" ! HOUSE OF REPRESENTATIVES 110TH CONGRESS

2d Session 

REPORT

110–627 

FOOD, CONSERVATION, AND ENERGY ACT 

OF 2008 

CONFERENCE REPORT 

TO ACCOMPANY

H.R. 2419 

MAY 13, 2008.—Ordered to be printed 


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FOOD, CONSERVATION, AND ENERGY ACT OF 2008 


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U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

1 

42–321 

" ! HOUSE OF REPRESENTATIVES 110TH CONGRESS

2d Session 

REPORT

2008

110–627 

FOOD, CONSERVATION, AND ENERGY ACT 

OF 2008 

CONFERENCE REPORT 

TO ACCOMPANY

H.R. 2419 

MAY 13, 2008.—Ordered to be printed 


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110TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 2d Session 110–627 

FOOD, CONSERVATION, AND ENERGY ACT OF 2008 

MAY 13, 2008.—Ordered to be printed 

Mr. PETERSON of Minnesota, from the committee of conference, 

submitted the following 

CONFERENCE REPORT 

[To accompany H.R. 2419] 

The committee of conference on the disagreeing votes of the 

two Houses on the amendment of the Senate to the bill (H. R. 

2419), to provide for the continuation of agricultural programs 

through fiscal year 2012, and for other purposes, having met, after 

full and free conference, have agreed to recommend and do recommend to their respective Houses as follows: 

That the House recede from its disagreement to the amendment of the Senate and agree to the same with an amendment as 

follows: 

In lieu of the matter proposed to be inserted by the Senate 

amendment, insert the following: 

SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

(a) SHORT TITLE.—This Act may be cited as the ‘‘Food, Conservation, and Energy Act of 2008’’. 

(b) TABLE OF CONTENTS.—The table of contents of this Act is 

as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Definition of Secretary. 

TITLE I—COMMODITY PROGRAMS 

Sec. 1001. Definitions. 

Subtitle A—Direct Payments and Counter-Cyclical Payments 

Sec. 1101. Base acres. 

Sec. 1102. Payment yields. 

Sec. 1103. Availability of direct payments. 

Sec. 1104. Availability of counter-cyclical payments. 

Sec. 1105. Average crop revenue election program. 

Sec. 1106. Producer agreement required as condition of provision of payments. 

Sec. 1107. Planting flexibility. 

Sec. 1108. Special rule for long grain and medium grain rice. 

Sec. 1109. Period of effectiveness. 


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Subtitle B—Marketing Assistance Loans and Loan Deficiency Payments 

Sec. 1201. Availability of nonrecourse marketing assistance loans for loan commodities. 

Sec. 1202. Loan rates for nonrecourse marketing assistance loans. 

Sec. 1203. Term of loans. 

Sec. 1204. Repayment of loans. 

Sec. 1205. Loan deficiency payments. 

Sec. 1206. Payments in lieu of loan deficiency payments for grazed acreage. 

Sec. 1207. Special marketing loan provisions for upland cotton. 

Sec. 1208. Special competitive provisions for extra long staple cotton. 

Sec. 1209. Availability of recourse loans for high moisture feed grains and seed cotton. 

Sec. 1210. Adjustments of loans. 

Subtitle C—Peanuts 

Sec. 1301. Definitions. 

Sec. 1302. Base acres for peanuts for a farm. 

Sec. 1303. Availability of direct payments for peanuts. 

Sec. 1304. Availability of counter-cyclical payments for peanuts. 

Sec. 1305. Producer agreement required as condition on provision of payments. 

Sec. 1306. Planting flexibility. 

Sec. 1307. Marketing assistance loans and loan deficiency payments for peanuts. 

Sec. 1308. Adjustments of loans. 

Subtitle D—Sugar 

Sec. 1401. Sugar program. 

Sec. 1402. United States membership in the International Sugar Organization. 

Sec. 1403. Flexible marketing allotments for sugar. 

Sec. 1404. Storage facility loans. 

Sec. 1405. Commodity Credit Corporation storage payments. 

Subtitle E—Dairy 

Sec. 1501. Dairy product price support program. 

Sec. 1502. Dairy forward pricing program. 

Sec. 1503. Dairy export incentive program. 

Sec. 1504. Revision of Federal marketing order amendment procedures. 

Sec. 1505. Dairy indemnity program. 

Sec. 1506. Milk income loss contract program. 

Sec. 1507. Dairy promotion and research program. 

Sec. 1508. Report on Department of Agriculture reporting procedures for nonfat dry 

milk. 

Sec. 1509. Federal Milk Marketing Order Review Commission. 

Sec. 1510. Mandatory reporting of dairy commodities. 

Subtitle F—Administration 

Sec. 1601. Administration generally. 

Sec. 1602. Suspension of permanent price support authority. 

Sec. 1603. Payment limitations. 

Sec. 1604. Adjusted gross income limitation. 

Sec. 1605. Availability of quality incentive payments for covered oilseed producers. 

Sec. 1606. Personal liability of producers for deficiencies. 

Sec. 1607. Extension of existing administrative authority regarding loans. 

Sec. 1608. Assignment of payments. 

Sec. 1609. Tracking of benefits. 

Sec. 1610. Government publication of cotton price forecasts. 

Sec. 1611. Prevention of deceased individuals receiving payments under farm commodity programs. 

Sec. 1612. Hard white wheat development program. 

Sec. 1613. Durum wheat quality program. 

Sec. 1614. Storage facility loans. 

Sec. 1615. State, county, and area committees. 

Sec. 1616. Prohibition on charging certain fees. 

Sec. 1617. Signature authority. 

Sec. 1618. Modernization of Farm Service Agency. 

Sec. 1619. Information gathering. 

Sec. 1620. Leasing of office space. 

Sec. 1621. Geographically disadvantaged farmers and ranchers. 


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Sec. 1622. Implementation. 

Sec. 1623. Repeals. 

TITLE II—CONSERVATION 

Subtitle A—Definitions and Highly Erodible Land and Wetland Conservation 

Sec. 2001. Definitions relating to conservation title of Food Security Act of 1985. 

Sec. 2002. Review of good faith determinations related to highly erodible land conservation. 

Sec. 2003. Review of good faith determinations related to wetland conservation. 

Subtitle B—Conservation Reserve Program 

Sec. 2101. Extension of conservation reserve program. 

Sec. 2102. Land eligible for enrollment in conservation reserve. 

Sec. 2103. Maximum enrollment of acreage in conservation reserve. 

Sec. 2104. Designation of conservation priority areas. 

Sec. 2105. Treatment of multi-year grasses and legumes. 

Sec. 2106. Revised pilot program for enrollment of wetland and buffer acreage in 

conservation reserve. 

Sec. 2107. Additional duty of participants under conservation reserve contracts. 

Sec. 2108. Managed haying, grazing, or other commercial use of forage on enrolled 

land and installation of wind turbines. 

Sec. 2109. Cost sharing payments relating to trees, windbreaks, shelterbelts, and 

wildlife corridors. 

Sec. 2110. Evaluation and acceptance of contract offers, annual rental payments, 

and payment limitations. 

Sec. 2111. Conservation reserve program transition incentives for beginning farmers 

or ranchers and socially disadvantaged farmers or ranchers. 

Subtitle C—Wetlands Reserve Program 

Sec. 2201. Establishment and purpose of wetlands reserve program. 

Sec. 2202. Maximum enrollment and enrollment methods. 

Sec. 2203. Duration of wetlands reserve program and lands eligible for enrollment. 

Sec. 2204. Terms of wetlands reserve program easements. 

Sec. 2205. Compensation for easements under wetlands reserve program. 

Sec. 2206. Wetlands reserve enhancement program and reserved rights pilot program. 

Sec. 2207. Duties of Secretary of Agriculture under wetlands reserve program. 

Sec. 2208. Payment limitations under wetlands reserve contracts and agreements. 

Sec. 2209. Repeal of payment limitations exception for State agreements for wetlands reserve enhancement. 

Sec. 2210. Report on implications of long-term nature of conservation easements. 

Subtitle D—Conservation Stewardship Program 

Sec. 2301. Conservation stewardship program. 

Subtitle E—Farmland Protection and Grassland Reserve 

Sec. 2401. Farmland protection program. 

Sec. 2402. Farm viability program. 

Sec. 2403. Grassland reserve program. 

Subtitle F—Environmental Quality Incentives Program 

Sec. 2501. Purposes of environmental quality incentives program. 

Sec. 2502. Definitions. 

Sec. 2503. Establishment and administration of environmental quality incentives 

program. 

Sec. 2504. Evaluation of applications. 

Sec. 2505. Duties of producers under environmental quality incentives program. 

Sec. 2506. Environmental quality incentives program plan. 

Sec. 2507. Duties of the Secretary. 

Sec. 2508. Limitation on environmental quality incentives program payments. 

Sec. 2509. Conservation innovation grants and payments. 

Sec. 2510. Agricultural water enhancement program. 

Subtitle G—Other Conservation Programs of the Food Security Act of 1985 

Sec. 2601. Conservation of private grazing land. 

Sec. 2602. Wildlife habitat incentive program. 

Sec. 2603. Grassroots source water protection program. 


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Sec. 2604. Great Lakes Basin Program for soil erosion and sediment control. 

Sec. 2605. Chesapeake Bay watershed program. 

Sec. 2606. Voluntary public access and habitat incentive program. 

Subtitle H—Funding and Administration of Conservation Programs 

Sec. 2701. Funding of conservation programs under Food Security Act of 1985. 

Sec. 2702. Authority to accept contributions to support conservation programs. 

Sec. 2703. Regional equity and flexibility. 

Sec. 2704. Assistance to certain farmers and ranchers to improve their access to conservation programs. 

Sec. 2705. Report regarding enrollments and assistance under conservation programs. 

Sec. 2706. Delivery of conservation technical assistance. 

Sec. 2707. Cooperative conservation partnership initiative. 

Sec. 2708. Administrative requirements for conservation programs. 

Sec. 2709. Environmental services markets. 

Sec. 2710. Agriculture conservation experienced services program. 

Sec. 2711. Establishment of State technical committees and their responsibilities. 

Subtitle I—Conservation Programs Under Other Laws 

Sec. 2801. Agricultural management assistance program. 

Sec. 2802. Technical assistance under Soil Conservation and Domestic Allotment 

Act. 

Sec. 2803. Small watershed rehabilitation program. 

Sec. 2804. Amendments to Soil and Water Resources Conservation Act of 1977. 

Sec. 2805. Resource Conservation and Development Program. 

Sec. 2806. Use of funds in Basin Funds for salinity control activities upstream of 

Imperial Dam. 

Sec. 2807. Desert terminal lakes. 

Subtitle J—Miscellaneous Conservation Provisions 

Sec. 2901. High Plains water study. 

Sec. 2902. Naming of National Plant Materials Center at Beltsville, Maryland, in 

honor of Norman A. Berg. 

Sec. 2903. Transition. 

Sec. 2904. Regulations. 

TITLE III—TRADE 

Subtitle A—Food for Peace Act 

Sec. 3001. Short title. 

Sec. 3002. United States policy. 

Sec. 3003. Food aid to developing countries. 

Sec. 3004. Trade and development assistance. 

Sec. 3005. Agreements regarding eligible countries and private entities. 

Sec. 3006. Use of local currency payments. 

Sec. 3007. General authority. 

Sec. 3008. Provision of agricultural commodities. 

Sec. 3009. Generation and use of currencies by private voluntary organizations and 

cooperatives. 

Sec. 3010. Levels of assistance. 

Sec. 3011. Food Aid Consultative Group. 

Sec. 3012. Administration. 

Sec. 3013. Assistance for stockpiling and rapid transportation, delivery, and distribution of shelf-stable prepackaged foods. 

Sec. 3014. General authorities and requirements. 

Sec. 3015. Definitions. 

Sec. 3016. Use of Commodity Credit Corporation. 

Sec. 3017. Administrative provisions. 

Sec. 3018. Consolidation and modification of annual reports regarding agricultural 

trade issues. 

Sec. 3019. Expiration of assistance. 

Sec. 3020. Authorization of appropriations. 

Sec. 3021. Minimum level of nonemergency food assistance. 

Sec. 3022. Coordination of foreign assistance programs. 

Sec. 3023. Micronutrient fortification programs. 

Sec. 3024. John Ogonowski and Doug Bereuter Farmer-to-Farmer Program. 


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Subtitle B—Agricultural Trade Act of 1978 and Related Statutes 

Sec. 3101. Export credit guarantee program. 

Sec. 3102. Market access program. 

Sec. 3103. Export enhancement program. 

Sec. 3104. Foreign market development cooperator program. 

Sec. 3105. Food for Progress Act of 1985. 

Sec. 3106. McGovern-Dole International Food for Education and Child Nutrition 

Program. 

Subtitle C—Miscellaneous 

Sec. 3201. Bill Emerson Humanitarian Trust. 

Sec. 3202. Global Crop Diversity Trust. 

Sec. 3203. Technical assistance for specialty crops. 

Sec. 3204. Emerging markets and facility guarantee loan program. 

Sec. 3205. Consultative Group to Eliminate the Use of Child Labor and Forced 

Labor in Imported Agricultural Products. 

Sec. 3206. Local and regional food aid procurement projects. 

Subtitle D—Softwood Lumber 

Sec. 3301. Softwood lumber. 

TITLE IV—NUTRITION 

Subtitle A—Food Stamp Program 

PART I—RENAMING OF FOOD STAMP ACT AND PROGRAM

Sec. 4001. Renaming of Food Stamp Act and program. 

Sec. 4002. Conforming amendments. 

PART II—BENEFIT IMPROVEMENTS

Sec. 4101. Exclusion of certain military payments from income. 

Sec. 4102. Strengthening the food purchasing power of low-income Americans. 

Sec. 4103. Supporting working families with child care expenses. 

Sec. 4104. Asset indexation, education, and retirement accounts. 

Sec. 4105. Facilitating simplified reporting. 

Sec. 4106. Transitional benefits option. 

Sec. 4107. Increasing the minimum benefit. 

Sec. 4108. Employment, training, and job retention. 

PART III—PROGRAM OPERATIONS

Sec. 4111. Nutrition education. 

Sec. 4112. Technical clarification regarding eligibility. 

Sec. 4113. Clarification of split issuance. 

Sec. 4114. Accrual of benefits. 

Sec. 4115. Issuance and use of program benefits. 

Sec. 4116. Review of major changes in program design. 

Sec. 4117. Civil rights compliance. 

Sec. 4118. Codification of access rules. 

Sec. 4119. State option for telephonic signature. 

Sec. 4120. Privacy protections. 

Sec. 4121. Preservation of access and payment accuracy. 

Sec. 4122. Funding of employment and training programs. 

PART IV—PROGRAM INTEGRITY

Sec. 4131. Eligibility disqualification. 

Sec. 4132. Civil penalties and disqualification of retail food stores and wholesale 

food concerns. 

Sec. 4133. Major systems failures. 

PART V—MISCELLANEOUS

Sec. 4141. Pilot projects to evaluate health and nutrition promotion in the supplemental nutrition assistance program. 

Sec. 4142. Study on comparable access to supplemental nutrition assistance for 

Puerto Rico. 


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Subtitle B—Food Distribution Programs 

PART I—EMERGENCY FOOD ASSISTANCE PROGRAM

Sec. 4201. Emergency food assistance. 

Sec. 4202. Emergency food program infrastructure grants. 

PART II—FOOD DISTRIBUTION PROGRAM ON INDIAN RESERVATIONS

Sec. 4211. Assessing the nutritional value of the FDPIR food package. 

PART III—COMMODITY SUPPLEMENTAL FOOD PROGRAM

Sec. 4221. Commodity supplemental food program. 

PART IV—SENIOR FARMERS’ MARKET NUTRITION PROGRAM

Sec. 4231. Senior farmers’ market nutrition program. 

Subtitle C—Child Nutrition and Related Programs 

Sec. 4301. State performance on enrolling children receiving program benefits for 

free school meals. 

Sec. 4302. Purchases of locally produced foods. 

Sec. 4303. Healthy food education and program replicability. 

Sec. 4304. Fresh fruit and vegetable program. 

Sec. 4305. Whole grain products. 

Sec. 4306. Buy American requirements. 

Sec. 4307. Survey of foods purchased by school food authorities. 

Subtitle D—Miscellaneous 

Sec. 4401. Bill Emerson National Hunger Fellows and Mickey Leland International 

Hunger Fellows. 

Sec. 4402. Assistance for community food projects. 

Sec. 4403. Joint nutrition monitoring and related research activities. 

Sec. 4404. Section 32 funds for purchase of fruits, vegetables, and nuts to support 

domestic nutrition assistance programs. 

Sec. 4405. Hunger-free communities. 

Sec. 4406. Reauthorization of Federal food assistance programs. 

Sec. 4407. Effective and implementation dates. 

TITLE V—CREDIT 

Subtitle A—Farm Ownership Loans 

Sec. 5001. Direct loans. 

Sec. 5002. Conservation loan and loan guarantee program. 

Sec. 5003. Limitations on amount of farm ownership loans. 

Sec. 5004. Down payment loan program. 

Sec. 5005. Beginning farmer or rancher and socially disadvantaged farmer or 

rancher contract land sales program. 

Subtitle B—Operating Loans 

Sec. 5101. Farming experience as eligibility requirement. 

Sec. 5102. Limitations on amount of operating loans. 

Sec. 5103. Suspension of limitation on period for which borrowers are eligible for 

guaranteed assistance. 

Subtitle C—Emergency Loans 

Sec. 5201. Eligibility of equine farmers and ranchers for emergency loans. 

Subtitle D—Administrative Provisions 

Sec. 5301. Beginning farmer and rancher individual development accounts pilot 

program. 

Sec. 5302. Inventory sales preferences; loan fund set-asides. 

Sec. 5303. Loan authorization levels. 

Sec. 5304. Transition to private commercial or other sources of credit. 

Sec. 5305. Extension of the right of first refusal to reacquire homestead property to 

immediate family members of borrower-owner. 

Sec. 5306. Rural development and farm loan program activities. 

Subtitle E—Farm Credit 

Sec. 5401. Farm Credit System Insurance Corporation. 


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Sec. 5402. Technical correction. 

Sec. 5403. Bank for cooperatives voting stock. 

Sec. 5404. Premiums. 

Sec. 5405. Certification of premiums. 

Sec. 5406. Rural utility loans. 

Sec. 5407. Equalization of loan-making powers of certain district associations. 

Subtitle F—Miscellaneous 

Sec. 5501. Loans to purchasers of highly fractioned land. 

TITLE VI—RURAL DEVELOPMENT 

Subtitle A—Consolidated Farm and Rural Development Act 

Sec. 6001. Water, waste disposal, and wastewater facility grants. 

Sec. 6002. SEARCH grants. 

Sec. 6003. Rural business opportunity grants. 

Sec. 6004. Child day care facility grants, loans, and loan guarantees. 

Sec. 6005. Community facility grants to advance broadband. 

Sec. 6006. Rural water and wastewater circuit rider program. 

Sec. 6007. Tribal College and University essential community facilities. 

Sec. 6008. Emergency and imminent community water assistance grant program. 

Sec. 6009. Water systems for rural and native villages in Alaska. 

Sec. 6010. Grants to nonprofit organizations to finance the construction, refurbishing, and servicing of individually-owned household water well systems in rural areas for individuals with low or moderate incomes. 

Sec. 6011. Interest rates for water and waste disposal facilities loans. 

Sec. 6012. Cooperative equity security guarantee. 

Sec. 6013. Rural cooperative development grants. 

Sec. 6014. Grants to broadcasting systems. 

Sec. 6015. Locally or regionally produced agricultural food products. 

Sec. 6016. Appropriate technology transfer for rural areas. 

Sec. 6017. Rural economic area partnership zones. 

Sec. 6018. Definitions. 

Sec. 6019. National rural development partnership. 

Sec. 6020. Historic barn preservation. 

Sec. 6021. Grants for NOAA weather radio transmitters. 

Sec. 6022. Rural microentrepreneur assistance program. 

Sec. 6023. Grants for expansion of employment opportunities for individuals with 

disabilities in rural areas. 

Sec. 6024. Health care services. 

Sec. 6025. Delta Regional Authority. 

Sec. 6026. Northern Great Plains Regional Authority. 

Sec. 6027. Rural Business Investment Program. 

Sec. 6028. Rural Collaborative Investment Program. 

Sec. 6029. Funding of pending rural development loan and grant applications. 

Subtitle B—Rural Electrification Act of 1936 

Sec. 6101. Energy efficiency programs. 

Sec. 6102. Reinstatement of Rural Utility Services direct lending. 

Sec. 6103. Deferment of payments to allow loans for improved energy efficiency and 

demand reduction and for energy efficiency and use audits. 

Sec. 6104. Rural electrification assistance. 

Sec. 6105. Substantially underserved trust areas. 

Sec. 6106. Guarantees for bonds and notes issued for electrification or telephone 

purposes. 

Sec. 6107. Expansion of 911 access. 

Sec. 6108. Electric loans for renewable energy. 

Sec. 6109. Bonding requirements. 

Sec. 6110. Access to broadband telecommunications services in rural areas. 

Sec. 6111. National Center for Rural Telecommunications Assessment. 

Sec. 6112. Comprehensive rural broadband strategy. 

Sec. 6113. Study on rural electric power generation. 

Subtitle C—Miscellaneous 

Sec. 6201. Distance learning and telemedicine. 

Sec. 6202. Value-added agricultural market development program grants. 

Sec. 6203. Agriculture innovation center demonstration program. 

Sec. 6204. Rural firefighters and emergency medical service assistance program. 


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Sec. 6205. Insurance of loans for housing and related facilities for domestic farm 

labor. 

Sec. 6206. Study of rural transportation issues. 

Subtitle D—Housing Assistance Council 

Sec. 6301. Short title. 

Sec. 6302. Assistance to Housing Assistance Council. 

Sec. 6303. Audits and reports. 

Sec. 6304. Persons not lawfully present in the United States. 

Sec. 6305. Limitation on use of authorized amounts. 

TITLE VII—RESEARCH AND RELATED MATTERS 

Subtitle A—National Agricultural Research, Extension, and Teaching Policy Act of 

1977 

Sec. 7101. Definitions. 

Sec. 7102. National Agricultural Research, Extension, Education, and Economics 

Advisory Board. 

Sec. 7103. Specialty crop committee report. 

Sec. 7104. Renewable energy committee. 

Sec. 7105. Veterinary medicine loan repayment. 

Sec. 7106. Eligibility of University of the District of Columbia for grants and fellowships for food and agricultural sciences education. 

Sec. 7107. Grants to 1890 schools to expand extension capacity. 

Sec. 7108. Expansion of food and agricultural sciences awards. 

Sec. 7109. Grants and fellowships for food and agricultural sciences education. 

Sec. 7110. Grants for research on production and marketing of alcohols and industrial hydrocarbons from agricultural commodities and forest products. 

Sec. 7111. Policy research centers. 

Sec. 7112. Education grants to Alaska Native-serving institutions and Native Hawaiian-serving institutions. 

Sec. 7113. Emphasis of human nutrition initiative. 

Sec. 7114. Human nutrition intervention and health promotion research program. 

Sec. 7115. Pilot research program to combine medical and agricultural research. 

Sec. 7116. Nutrition education program. 

Sec. 7117. Continuing animal health and disease research programs. 

Sec. 7118. Cooperation among eligible institutions. 

Sec. 7119. Appropriations for research on national or regional problems. 

Sec. 7120. Animal health and disease research program. 

Sec. 7121. Authorization level for extension at 1890 land-grant colleges. 

Sec. 7122. Authorization level for agricultural research at 1890 land-grant colleges. 

Sec. 7123. Grants to upgrade agricultural and food sciences facilities at 1890 landgrant colleges, including Tuskegee University. 

Sec. 7124. Grants to upgrade agriculture and food sciences facilities at the District 

of Columbia land-grant university. 

Sec. 7125. Grants to upgrade agriculture and food sciences facilities and equipment 

at insular area land-grant institutions. 

Sec. 7126. National research and training virtual centers. 

Sec. 7127. Matching funds requirement for research and extension activities of 1890 

institutions. 

Sec. 7128. Hispanic-serving institutions. 

Sec. 7129. Hispanic-serving agricultural colleges and universities. 

Sec. 7130. International agricultural research, extension, and education. 

Sec. 7131. Competitive grants for international agricultural science and education 

programs. 

Sec. 7132. Administration. 

Sec. 7133. Research equipment grants. 

Sec. 7134. University research. 

Sec. 7135. Extension Service. 

Sec. 7136. Supplemental and alternative crops. 

Sec. 7137. New Era Rural Technology Program. 

Sec. 7138. Capacity building grants for NLGCA Institutions. 

Sec. 7139. Borlaug international agricultural science and technology fellowship program. 

Sec. 7140. Aquaculture assistance programs. 

Sec. 7141. Rangeland research grants. 

Sec. 7142. Special authorization for biosecurity planning and response. 

Sec. 7143. Resident instruction and distance education grants program for insular 

area institutions of higher education. 


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Subtitle B—Food, Agriculture, Conservation, and Trade Act of 1990 

Sec. 7201. National genetics resources program. 

Sec. 7202. National Agricultural Weather Information System. 

Sec. 7203. Partnerships. 

Sec. 7204. High-priority research and extension areas. 

Sec. 7205. Nutrient management research and extension initiative. 

Sec. 7206. Organic Agriculture Research and Extension Initiative. 

Sec. 7207. Agricultural bioenergy feedstock and energy efficiency research and extension initiative. 

Sec. 7208. Farm business management and benchmarking. 

Sec. 7209. Agricultural telecommunications program. 

Sec. 7210. Assistive technology program for farmers with disabilities. 

Sec. 7211. Research on honey bee diseases. 

Sec. 7212. National Rural Information Center Clearinghouse. 

Subtitle C—Agricultural Research, Extension, and Education Reform Act of 1998 

Sec. 7301. Peer and merit review. 

Sec. 7302. Partnerships for high-value agricultural product quality research. 

Sec. 7303. Precision agriculture. 

Sec. 7304. Biobased products. 

Sec. 7305. Thomas Jefferson Initiative for Crop Diversification. 

Sec. 7306. Integrated research, education, and extension competitive grants program. 

Sec. 7307. Fusarium graminearum grants. 

Sec. 7308. Bovine Johne’s disease control program. 

Sec. 7309. Grants for youth organizations. 

Sec. 7310. Agricultural biotechnology research and development for developing countries. 

Sec. 7311. Specialty crop research initiative. 

Sec. 7312. Food animal residue avoidance database program. 

Sec. 7313. Office of pest management policy. 

Subtitle D—Other Laws 

Sec. 7401. Critical Agricultural Materials Act. 

Sec. 7402. Equity in Educational Land-Grant Status Act of 1994. 

Sec. 7403. Smith-Lever Act. 

Sec. 7404. Hatch Act of 1887. 

Sec. 7405. Agricultural Experiment Station Research Facilities Act. 

Sec. 7406. Agriculture and food research initiative. 

Sec. 7407. Agricultural Risk Protection Act of 2000. 

Sec. 7408. Exchange or sale authority. 

Sec. 7409. Enhanced use lease authority pilot program. 

Sec. 7410. Beginning farmer and rancher development program. 

Sec. 7411. Public education regarding use of biotechnology in producing food for 

human consumption. 

Sec. 7412. McIntire-Stennis Cooperative Forestry Act. 

Sec. 7413. Renewable Resources Extension Act of 1978. 

Sec. 7414. National Aquaculture Act of 1980. 

Sec. 7415. Construction of Chinese Garden at the National Arboretum. 

Sec. 7416. National Agricultural Research, Extension, and Teaching Policy Act 

Amendments of 1985. 

Sec. 7417. Eligibility of University of the District of Columbia for certain land-grant 

university assistance. 

Subtitle E—Miscellaneous 

PART I—GENERAL PROVISIONS

Sec. 7501. Definitions. 

Sec. 7502. Grazinglands research laboratory. 

Sec. 7503. Fort Reno Science Park Research Facility. 

Sec. 7504. Roadmap. 

Sec. 7505. Review of plan of work requirements. 

Sec. 7506. Budget submission and funding. 

PART II—RESEARCH, EDUCATION, AND ECONOMICS

Sec. 7511. Research, education, and economics. 


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PART III—NEW GRANT AND RESEARCH PROGRAMS

Sec. 7521. Research and education grants for the study of antibiotic-resistant bacteria. 

Sec. 7522. Farm and ranch stress assistance network. 

Sec. 7523. Seed distribution. 

Sec. 7524. Live virus foot and mouth disease research. 

Sec. 7525. Natural products research program. 

Sec. 7526. Sun grant program. 

Sec. 7527. Study and report on food deserts. 

Sec. 7528. Demonstration project authority for temporary positions. 

Sec. 7529. Agricultural and rural transportation research and education. 

TITLE VIII—FORESTRY 

Subtitle A—Amendments to Cooperative Forestry Assistance Act of 1978 

Sec. 8001. National priorities for private forest conservation. 

Sec. 8002. Long-term State-wide assessments and strategies for forest resources. 

Sec. 8003. Community forest and open space conservation program. 

Sec. 8004. Assistance to the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic of Palau. 

Sec. 8005. Changes to Forest Resource Coordinating Committee. 

Sec. 8006. Changes to State Forest Stewardship Coordinating Committees. 

Sec. 8007. Competition in programs under Cooperative Forestry Assistance Act of 

1978. 

Sec. 8008. Competitive allocation of funds for cooperative forest innovation partnership projects. 

Subtitle B—Cultural and Heritage Cooperation Authority 

Sec. 8101. Purposes. 

Sec. 8102. Definitions. 

Sec. 8103. Reburial of human remains and cultural items. 

Sec. 8104. Temporary closure for traditional and cultural purposes. 

Sec. 8105. Forest products for traditional and cultural purposes. 

Sec. 8106. Prohibition on disclosure. 

Sec. 8107. Severability and savings provisions. 

Subtitle C—Amendments to Other Forestry-Related Laws 

Sec. 8201. Rural revitalization technologies. 

Sec. 8202. Office of International Forestry. 

Sec. 8203. Emergency forest restoration program. 

Sec. 8204. Prevention of illegal logging practices. 

Sec. 8205. Healthy forests reserve program. 

Subtitle D—Boundary Adjustments and Land Conveyance Provisions 

Sec. 8301. Green Mountain National Forest boundary adjustment. 

Sec. 8302. Land conveyances, Chihuahuan Desert Nature Park, New Mexico, and 

George Washington National Forest, Virginia. 

Sec. 8303. Sale and exchange of National Forest System land, Vermont. 

Subtitle E—Miscellaneous Provisions 

Sec. 8401. Qualifying timber contract options. 

Sec. 8402. Hispanic-serving institution agricultural land national resources leadership program. 

TITLE IX—ENERGY 

Sec. 9001. Energy. 

Sec. 9002. Biofuels infrastructure study. 

Sec. 9003. Renewable fertilizer study. 

TITLE X—HORTICULTURE AND ORGANIC AGRICULTURE 

Sec. 10001. Definitions. 

Subtitle A—Horticulture Marketing and Information 

Sec. 10101. Independent evaluation of Department of Agriculture commodity purchase process. 

Sec. 10102. Quality requirements for clementines. 

Sec. 10103. Inclusion of specialty crops in census of agriculture. 


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Sec. 10104. Mushroom promotion, research, and consumer information. 

Sec. 10105. Food safety education initiatives. 

Sec. 10106. Farmers’ market promotion program. 

Sec. 10107. Specialty crops market news allocation. 

Sec. 10108. Expedited marketing order for Hass avocados for grades and standards 

and other purposes. 

Sec. 10109. Specialty crop block grants. 

Subtitle B—Pest and Disease Management 

Sec. 10201. Plant pest and disease management and disaster prevention. 

Sec. 10202. National Clean Plant Network. 

Sec. 10203. Plant protection. 

Sec. 10204. Regulations to improve management and oversight of certain regulated 

articles. 

Sec. 10205. Pest and Disease Revolving Loan Fund. 

Sec. 10206. Cooperative agreements relating to plant pest and disease prevention activities. 

Subtitle C—Organic Agriculture 

Sec. 10301. National organic certification cost-share program. 

Sec. 10302. Organic production and market data initiatives. 

Sec. 10303. National Organic Program. 

Subtitle D—Miscellaneous 

Sec. 10401. National Honey Board. 

Sec. 10402. Identification of honey. 

Sec. 10403. Grant program to improve movement of specialty crops. 

Sec. 10404. Market loss assistance for asparagus producers. 

TITLE XI—LIVESTOCK 

Sec. 11001. Livestock mandatory reporting. 

Sec. 11002. Country of origin labeling. 

Sec. 11003. Agricultural Fair Practices Act of 1967 definitions. 

Sec. 11004. Annual report. 

Sec. 11005. Production contracts. 

Sec. 11006. Regulations. 

Sec. 11007. Sense of Congress regarding pseudorabies eradication program. 

Sec. 11008. Sense of Congress regarding the cattle fever tick eradication program. 

Sec. 11009. National Sheep Industry Improvement Center. 

Sec. 11010. Trichinae certification program. 

Sec. 11011. Low pathogenic diseases. 

Sec. 11012. Animal protection. 

Sec. 11013. National Aquatic Animal Health Plan. 

Sec. 11014. Study on bioenergy operations. 

Sec. 11015. Interstate shipment of meat and poultry inspected by Federal and State 

agencies for certain small establishments. 

Sec. 11016. Inspection and grading. 

Sec. 11017. Food safety improvement. 

TITLE XII—CROP INSURANCE AND DISASTER ASSISTANCE PROGRAMS 

Subtitle A—Crop Insurance and Disaster Assistance 

Sec. 12001. Definition of organic crop. 

Sec. 12002. General powers. 

Sec. 12003. Reduction in loss ratio. 

Sec. 12004. Premiums adjustments. 

Sec. 12005. Controlled business insurance. 

Sec. 12006. Administrative fee. 

Sec. 12007. Time for payment. 

Sec. 12008. Catastrophic coverage reimbursement rate. 

Sec. 12009. Grain sorghum price election. 

Sec. 12010. Premium reduction authority. 

Sec. 12011. Enterprise and whole farm units. 

Sec. 12012. Payment of portion of premium for area revenue plans. 

Sec. 12013. Denial of claims. 

Sec. 12014. Settlement of crop insurance claims on farm-stored production. 

Sec. 12015. Time for reimbursement. 

Sec. 12016. Reimbursement rate. 


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Sec. 12017. Renegotiation of Standard Reinsurance Agreement. 

Sec. 12018. Change in due date for Corporation payments for underwriting gains. 

Sec. 12019. Malting barley. 

Sec. 12020. Crop production on native sod. 

Sec. 12021. Information management. 

Sec. 12022. Research and development. 

Sec. 12023. Contracts for additional policies and studies. 

Sec. 12024. Funding from insurance fund. 

Sec. 12025. Pilot programs. 

Sec. 12026. Risk management education for beginning farmers or ranchers. 

Sec. 12027. Coverage for aquaculture under noninsured crop assistance program. 

Sec. 12028. Increase in service fees for noninsured crop assistance program. 

Sec. 12029. Determination of certain sweet potato production. 

Sec. 12030. Declining yield report. 

Sec. 12031. Definition of basic unit. 

Sec. 12032. Crop insurance mediation. 

Sec. 12033. Supplemental agricultural disaster assistance. 

Sec. 12034. Fisheries disaster assistance. 

Subtitle B—Small Business Disaster Loan Program 

Sec. 12051. Short title. 

Sec. 12052. Definitions. 

PART I—DISASTER PLANNING AND RESPONSE

Sec. 12061. Economic injury disaster loans to nonprofits. 

Sec. 12062. Coordination of disaster assistance programs with FEMA. 

Sec. 12063. Public awareness of disaster declaration and application periods. 

Sec. 12064. Consistency between administration regulations and standard operating 

procedures. 

Sec. 12065. Increasing collateral requirements. 

Sec. 12066. Processing disaster loans. 

Sec. 12067. Information tracking and follow-up system. 

Sec. 12068. Increased deferment period. 

Sec. 12069. Disaster processing redundancy. 

Sec. 12070. Net earnings clauses prohibited. 

Sec. 12071. Economic injury disaster loans in cases of ice storms and blizzards. 

Sec. 12072. Development and implementation of major disaster response plan. 

Sec. 12073. Disaster planning responsibilities. 

Sec. 12074. Assignment of employees of the office of disaster assistance and disaster 

cadre. 

Sec. 12075. Comprehensive disaster response plan. 

Sec. 12076. Plans to secure sufficient office space. 

Sec. 12077. Applicants that have become a major source of employment due to 

changed economic circumstances. 

Sec. 12078. Disaster loan amounts. 

Sec. 12079. Small business bonding threshold. 

PART II—DISASTER LENDING

Sec. 12081. Eligibility for additional disaster assistance. 

Sec. 12082. Additional economic injury disaster loan assistance. 

Sec. 12083. Private disaster loans. 

Sec. 12084. Immediate Disaster Assistance program. 

Sec. 12085. Expedited disaster assistance loan program. 

Sec. 12086. Gulf Coast Disaster Loan Refinancing Program. 

PART III—MISCELLANEOUS

Sec. 12091. Reports on disaster assistance. 

TITLE XIII—COMMODITY FUTURES 

Sec. 13001. Short title. 

Subtitle A—General Provisions 

Sec. 13101. Commission authority over agreements, contracts or transactions in foreign currency. 

Sec. 13102. Anti-fraud authority over principal-to-principal transactions. 

Sec. 13103. Criminal and civil penalties. 

Sec. 13104. Authorization of appropriations. 


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Sec. 13105. Technical and conforming amendments. 

Sec. 13106. Portfolio margining and security index issues. 

Subtitle B—Significant Price Discovery Contracts on Exempt Commercial Markets 

Sec. 13201. Significant price discovery contracts. 

Sec. 13202. Large trader reporting. 

Sec. 13203. Conforming amendments. 

Sec. 13204. Effective date. 

TITLE XIV—MISCELLANEOUS 

Subtitle A—Socially Disadvantaged Producers and Limited Resource Producers 

Sec. 14001. Improved program delivery by Department of Agriculture on Indian reservations. 

Sec. 14002. Foreclosure. 

Sec. 14003. Receipt for service or denial of service from certain Department of Agriculture agencies. 

Sec. 14004. Outreach and technical assistance for socially disadvantaged farmers or 

ranchers. 

Sec. 14005. Accurate documentation in the Census of Agriculture and certain studies. 

Sec. 14006. Transparency and accountability for socially disadvantaged farmers or 

ranchers. 

Sec. 14007. Oversight and compliance. 

Sec. 14008. Minority Farmer Advisory Committee. 

Sec. 14009. National Appeals Division. 

Sec. 14010. Report of civil rights complaints, resolutions, and actions. 

Sec. 14011. Sense of Congress relating to claims brought by socially disadvantaged 

farmers or ranchers. 

Sec. 14012. Determination on merits of Pigford claims. 

Sec. 14013. Office of Advocacy and Outreach. 

Subtitle B—Agricultural Security 

Sec. 14101. Short title. 

Sec. 14102. Definitions. 

CHAPTER 1—AGRICULTURAL SECURITY

Sec. 14111. Office of Homeland Security. 

Sec. 14112. Agricultural biosecurity communication center. 

Sec. 14113. Assistance to build local capacity in agricultural biosecurity planning, 

preparedness, and response. 

CHAPTER 2—OTHER PROVISIONS

Sec. 14121. Research and development of agricultural countermeasures. 

Sec. 14122. Agricultural biosecurity grant program. 

Subtitle C—Other Miscellaneous Provisions 

Sec. 14201. Cotton classification services. 

Sec. 14202. Designation of States for cotton research and promotion. 

Sec. 14203. Grants to reduce production of methamphetamines from anhydrous ammonia. 

Sec. 14204. Grants to improve supply, stability, safety, and training of agricultural 

labor force. 

Sec. 14205. Amendment to the Right to Financial Privacy Act of 1978. 

Sec. 14206. Report on stored quantities of propane. 

Sec. 14207. Prohibitions on dog fighting ventures. 

Sec. 14208. Department of Agriculture conference transparency. 

Sec. 14209. Federal Insecticide, Fungicide, and Rodenticide Act amendments. 

Sec. 14210. Importation of live dogs. 

Sec. 14211. Permanent debarment from participation in Department of Agriculture 

programs for fraud. 

Sec. 14212. Prohibition on closure or relocation of county offices for the Farm Service Agency. 

Sec. 14213. USDA Graduate School. 

Sec. 14214. Fines for violations of the Animal Welfare Act. 

Sec. 14215. Definition of central filing system. 

Sec. 14216. Consideration of proposed recommendations of study on use of cats and 

dogs in Federal research. 


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Sec. 14217. Regional economic and infrastructure development. 

Sec. 14218. Coordinator for chronically underserved rural areas. 

Sec. 14219. Elimination of statute of limitations applicable to collection of debt by 

administrative offset. 

Sec. 14220. Availability of excess and surplus computers in rural areas. 

Sec. 14221. Repeal of section 3068 of the Water Resources Development Act of 2007. 

Sec. 14222. Domestic food assistance programs. 

Sec. 14223. Technical correction. 

TITLE XV—TRADE AND TAX PROVISIONS 

Sec. 15001. Short title; etc. 

Subtitle A—Supplemental Agricultural Disaster Assistance From the Agricultural 

Disaster Relief Trust Fund 

Sec. 15101. Supplemental agricultural disaster assistance. 

Subtitle B—Revenue Provisions for Agriculture Programs 

Sec. 15201. Customs User Fees. 

Sec. 15202. Time for payment of corporate estimated taxes. 

Subtitle C—Tax Provisions 

PART I—CONSERVATION

SUBPART A—LAND AND SPECIES PRESERVATION PROVISIONS

Sec. 15301. Exclusion of conservation reserve program payments from SECA tax for 

certain individuals. 

Sec. 15302. Two-year extension of special rule encouraging contributions of capital 

gain real property for conservation purposes. 

Sec. 15303. Deduction for endangered species recovery expenditures. 

SUBPART B—TIMBER PROVISIONS

Sec. 15311. Temporary reduction in rate of tax on qualified timber gain of corporations. 

Sec. 15312. Timber REIT modernization. 

Sec. 15313. Mineral royalty income qualifying income for timber REITs. 

Sec. 15314. Modification of taxable REIT subsidiary asset test for timber REITs. 

Sec. 15315. Safe harbor for timber property. 

Sec. 15316. Qualified forestry conservation bonds. 

PART II—ENERGY PROVISIONS

SUBPART A—CELLULOSIC BIOFUEL

Sec. 15321. Credit for production of cellulosic biofuel. 

Sec. 15322. Comprehensive study of biofuels. 

SUBPART B—REVENUE PROVISIONS

Sec. 15331. Modification of alcohol credit. 

Sec. 15332. Calculation of volume of alcohol for fuel credits. 

Sec. 15333. Ethanol tariff extension. 

Sec. 15334. Limitations on duty drawback on certain imported ethanol. 

PART III—AGRICULTURAL PROVISIONS

Sec. 15341. Increase in loan limits on agricultural bonds. 

Sec. 15342. Allowance of section 1031 treatment for exchanges involving certain mutual ditch, reservoir, or irrigation company stock. 

Sec. 15343. Agricultural chemicals security credit. 

Sec. 15344. 3-year depreciation for race horses that are 2 years old or younger. 

Sec. 15345. Temporary tax relief for Kiowa County, Kansas and surrounding area. 

Sec. 15346. Competitive certification awards modification authority. 

PART IV—OTHER REVENUE PROVISIONS

Sec. 15351. Limitation on excess farm losses of certain taxpayers. 

Sec. 15352. Modification to optional method of computing net earnings from self-employment. 

Sec. 15353. Information reporting for Commodity Credit Corporation transactions. 


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PART V—PROTECTION OF SOCIAL SECURITY

Sec. 15361. Protection of social security. 

Subtitle D—Trade Provisions 

PART I—EXTENSION OF CERTAIN TRADE BENEFITS

Sec. 15401. Short title. 

Sec. 15402. Benefits for apparel and other textile articles. 

Sec. 15403. Labor Ombudsman and technical assistance improvement and compliance needs assessment and remediation program. 

Sec. 15404. Petition process. 

Sec. 15405. Conditions regarding enforcement of circumvention. 

Sec. 15406. Presidential proclamation authority. 

Sec. 15407. Regulations and procedures. 

Sec. 15408. Extension of CBTPA. 

Sec. 15409. Sense of Congress on interpretation of textile and apparel provisions for 

Haiti. 

Sec. 15410. Sense of Congress on trade mission to Haiti. 

Sec. 15411. Sense of Congress on visa systems. 

Sec. 15412. Effective date. 

PART II—MISCELLANEOUS TRADE PROVISIONS

Sec. 15421. Unused merchandise drawback. 

Sec. 15422. Requirements relating to determination of transaction value of imported 

merchandise. 

SEC. 2. DEFINITION OF SECRETARY. 

In this Act, the term ‘‘Secretary’’ means the Secretary of Agriculture. 

TITLE I—COMMODITY PROGRAMS 

SEC. 1001. DEFINITIONS. 

In this title (other than subtitle C): 

(1) AVERAGE CROP REVENUE ELECTION PAYMENT.—The term ‘‘average crop revenue election payment’’ means a payment 

made to producers on a farm under section 1105. 

(2) BASE ACRES.— (A) IN GENERAL.—The term ‘‘base acres’’, with respect 

to a covered commodity on a farm, means the number of 

acres established under section 1101 of the Farm Security 

and Rural Investment Act of 2002 (7 U.S.C. 7911) as in effect on September 30, 2007, subject to any adjustment 

under section 1101 of this Act. 

(B) PEANUTS.—The term ‘‘base acres for peanuts’’ has 

the meaning given the term in section 1301. 

(3) COUNTER-CYCLICAL PAYMENT.—The term ‘‘counter-cyclical payment’’ means a payment made to producers on a farm 

under section 1104. 

(4) COVERED COMMODITY.—The term ‘‘covered commodity’’

means wheat, corn, grain sorghum, barley, oats, upland cotton, 

long grain rice, medium grain rice, pulse crops, soybeans, and 

other oilseeds. 

(5) DIRECT PAYMENT.—The term ‘‘direct payment’’ means a 

payment made to producers on a farm under section 1103. 

(6) EFFECTIVE PRICE.—The term ‘‘effective price’’, with respect to a covered commodity for a crop year, means the price 

calculated by the Secretary under section 1104 to determine 

whether counter-cyclical payments are required to be made for 

that crop year. 


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(7) EXTRA LONG STAPLE COTTON.—The term ‘‘extra long staple cotton’’ means cotton that—

(A) is produced from pure strain varieties of the 

Barbadense species or any hybrid of the species, or other 

similar types of extra long staple cotton, designated by the 

Secretary, having characteristics needed for various end 

uses for which United States upland cotton is not suitable 

and grown in irrigated cotton-growing regions of the 

United States designated by the Secretary or other areas 

designated by the Secretary as suitable for the production 

of the varieties or types; and 

(B) is ginned on a roller-type gin or, if authorized by 

the Secretary, ginned on another type gin for experimental 

purposes. 

(8) LOAN COMMODITY.—The term ‘‘loan commodity’’ means 

wheat, corn, grain sorghum, barley, oats, upland cotton, extra 

long staple cotton, long grain rice, medium grain rice, soybeans, 

other oilseeds, graded wool, nongraded wool, mohair, honey, 

dry peas, lentils, small chickpeas, and large chickpeas. 

(9) MEDIUM GRAIN RICE.—The term ‘‘medium grain rice’’ includes short grain rice. 

(10) OTHER OILSEED.—The term ‘‘other oilseed’’ means a 

crop of sunflower seed, rapeseed, canola, safflower, flaxseed, 

mustard seed, crambe, sesame seed, or any oilseed designated 

by the Secretary. 

(11) PAYMENT ACRES.—The term ‘‘payment acres’’ means, in 

the case of direct payments and counter-cyclical payments—

(A) except as provided in subparagraph (B), 85 percent 

of the base acres of a covered commodity on a farm on 

which direct payments or counter-cyclical payments are 

made; and 

(B) in the case of direct payments for each of the 2009 

through 2011 crop years, 83.3 percent of the base acres for 

the covered commodity on a farm on which direct payments 

are made. 

(12) PAYMENT YIELD.—The term ‘‘payment yield’’ means the 

yield established for direct payments and the yield established 

for counter-cyclical payments under section 1102 of the Farm 

Security and Rural Investment Act of 2002 (7 U.S.C. 7912) as 

in effect on September 30, 2007, or under section 1102 of this 

Act, for a farm for a covered commodity. 

(13) PRODUCER.—

(A) IN GENERAL.—The term ‘‘producer’’ means an 

owner, operator, landlord, tenant, or sharecropper that 

shares in the risk of producing a crop and is entitled to 

share in the crop available for marketing from the farm, or 

would have shared had the crop been produced. 

(B) HYBRID SEED.—In determining whether a grower of 

hybrid seed is a producer, the Secretary shall—

(i) not take into consideration the existence of a hybrid seed contract; and 

(ii) ensure that program requirements do not adversely affect the ability of the grower to receive a payment under this title. 


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(14) PULSE CROP.—The term ‘‘pulse crop’’ means dry peas, 

lentils, small chickpeas, and large chickpeas. 

(15) STATE.—The term ‘‘State’’ means—

(A) a State; 

(B) the District of Columbia; 

(C) the Commonwealth of Puerto Rico; and 

(D) any other territory or possession of the United 

States. 

(16) TARGET PRICE.—The term ‘‘target price’’ means the 

price per bushel, pound, or hundredweight (or other appropriate 

unit) of a covered commodity used to determine the payment 

rate for counter-cyclical payments. 

(17) UNITED STATES.—The term ‘‘United States’’, when used 

in a geographical sense, means all of the States. 

(18) UNITED STATES PREMIUM FACTOR.—The term ‘‘United 

States Premium Factor’’ means the percentage by which the difference in the United States loan schedule premiums for Strict 

Middling (SM) 11⁄8-inch upland cotton and for Middling (M) 

13⁄32-inch upland cotton exceeds the difference in the applicable 

premiums for comparable international qualities. 

Subtitle A—Direct Payments and Counter-Cyclical Payments 

SEC. 1101. BASE ACRES. 

(a) ADJUSTMENT OF BASE ACRES.— 

(1) IN GENERAL.—The Secretary shall provide for an adjustment, as appropriate, in the base acres for covered commodities 

for a farm whenever any of the following circumstances occurs: 

(A) A conservation reserve contract entered into under 

section 1231 of the Food Security Act of 1985 (16 U.S.C. 

3831) with respect to the farm expires or is voluntarily terminated, or was terminated or expired during the period 

beginning on October 1, 2007, and ending on the date of 

enactment of this Act. 

(B) Cropland is released from coverage under a conservation reserve contract by the Secretary, or was released 

during the period beginning on October 1, 2007, and ending on the date of enactment of this Act. 

(C) The producer has eligible pulse crop acreage, which 

shall be determined in the same manner as eligible oilseed 

acreage under section 1101(a)(2) of the Farm Security and 

Rural Investment Act of 2002 (7 U.S.C. 7911(a)(2)). 

(D) The producer has eligible oilseed acreage as the result of the Secretary designating additional oilseeds, which 

shall be determined in the same manner as eligible oilseed 

acreage under section 1101(a)(2) of the Farm Security and 

Rural Investment Act of 2002 (7 U.S.C. 7911(a)(2)). 

(2) SPECIAL CONSERVATION RESERVE ACREAGE PAYMENT

RULES.—For the crop year in which a base acres adjustment 

under subparagraph (A) or (B) of paragraph (1) is first made, 

the owner of the farm shall elect to receive either direct payments and counter-cyclical payments with respect to the acreage 

added to the farm under this subsection or a prorated payment 

under the conservation reserve contract, but not both. 

(b) PREVENTION OF EXCESS BASE ACRES.— 


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(1) REQUIRED REDUCTION.—If the sum of the base acres for 

a farm, together with the acreage described in paragraph (2) exceeds the actual cropland acreage of the farm, the Secretary 

shall reduce the base acres for 1 or more covered commodities 

for the farm or the base acres for peanuts for the farm so that 

the sum of the base acres and acreage described in paragraph 

(2) does not exceed the actual cropland acreage of the farm. 

(2) OTHER ACREAGE.—For purposes of paragraph (1), the 

Secretary shall include the following: 

(A) Any base acres for peanuts for the farm. 

(B) Any acreage on the farm enrolled in the conservation reserve program or wetlands reserve program under 

chapter 1 of subtitle D of title XII of the Food Security Act 

of 1985 (16 U.S.C. 3830 et seq.). 

(C) Any other acreage on the farm enrolled in a Federal conservation program for which payments are made in 

exchange for not producing an agricultural commodity on 

the acreage. 

(D) Any eligible pulse crop acreage, which shall be determined in the same manner as eligible oilseed acreage 

under section 1101(a)(2) of the Farm Security and Rural 

Investment Act of 2002 (7 U.S.C. 7911(a)(2)). 

(E) If the Secretary designates additional oilseeds, any 

eligible oilseed acreage, which shall be determined in the 

same manner as eligible oilseed acreage under section 

1101(a)(2) of the Farm Security and Rural Investment Act 

of 2002 (7 U.S.C. 7911(a)(2)). 

(3) SELECTION OF ACRES.—The Secretary shall give the 

owner of the farm the opportunity to select the base acres for 

a covered commodity or the base acres for peanuts for the farm 

against which the reduction required by paragraph (1) will be 

made. 

(4) EXCEPTION FOR DOUBLE-CROPPED ACREAGE.—In applying paragraph (1), the Secretary shall make an exception in the 

case of double cropping, as determined by the Secretary. 

(5) COORDINATED APPLICATION OF REQUIREMENTS.—The 

Secretary shall take into account section 1302(b) when applying 

the requirements of this subsection. 

(c) REDUCTION IN BASE ACRES.— (1) REDUCTION AT OPTION OF OWNER.—

(A) IN GENERAL.—The owner of a farm may reduce, at 

any time, the base acres for any covered commodity for the 

farm. 

(B) EFFECT OF REDUCTION.—A reduction under subparagraph (A) shall be permanent and made in a manner 

prescribed by the Secretary. 

(2) REQUIRED ACTION BY SECRETARY.—

(A) IN GENERAL.—The Secretary shall proportionately 

reduce base acres on a farm for covered commodities for 

land that has been subdivided and developed for multiple 

residential units or other nonfarming uses if the size of the 

tracts and the density of the subdivision is such that the 

land is unlikely to return to the previous agricultural use, 

unless the producers on the farm demonstrate that the 

land—


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(i) remains devoted to commercial agricultural production; or 

(ii) is likely to be returned to the previous agricultural use. 

(B) REQUIREMENT.—The Secretary shall establish procedures to identify land described in subparagraph (A). 

(3) REVIEW AND REPORT.—Each year, to ensure, to the maximum extent practicable, that payments are received only by 

producers, the Secretary shall submit to Congress a report that 

describes the results of the actions taken under paragraph (2). 

(d) TREATMENT OF FARMS WITH LIMITED BASE ACRES.—

(1) PROHIBITION ON PAYMENTS.—Except as provided in 

paragraph (2) and notwithstanding any other provision of this 

title, a producer on a farm may not receive direct payments, 

counter-cyclical payments, or average crop revenue election payments if the sum of the base acres of the farm is 10 acres or 

less, as determined by the Secretary. 

(2) EXCEPTIONS.—Paragraph (1) shall not apply to a farm 

owned by—

(A) a socially disadvantaged farmer or rancher (as defined in section 355(e) of the Consolidated Farm and Rural 

Development Act (7 U.S.C. 2003(e)); or 

(B) a limited resource farmer or rancher, as defined by 

the Secretary. 

(3) DATA COLLECTION AND PUBLICATION.—The Secretary 

shall—

(A) collect and publish segregated data and survey information about the farm profiles, utilization of land, and 

crop production; and 

(B) perform an evaluation on the supply and price of 

fruits and vegetables based on the effects of suspension of 

base acres under this section. 

SEC. 1102. PAYMENT YIELDS. 

(a) ESTABLISHMENT AND PURPOSE.—For the purpose of making 

direct payments and counter-cyclical payments under this subtitle, 

the Secretary shall provide for the establishment of a yield for each 

farm for any designated oilseed or eligible pulse crop for which a 

payment yield was not established under section 1102 of the Farm 

Security and Rural Investment Act of 2002 (7 U.S.C. 7912) in accordance with this section. 

(b) PAYMENT YIELDS FOR DESIGNATED OILSEEDS AND ELIGIBLE

PULSE CROPS.—

(1) DETERMINATION OF AVERAGE YIELD.—In the case of designated oilseeds and eligible pulse crops, the Secretary shall determine the average yield per planted acre for the designated 

oilseed or pulse crop on a farm for the 1998 through 2001 crop 

years, excluding any crop year in which the acreage planted to 

the designated oilseed or pulse crop was zero. 

(2) ADJUSTMENT FOR PAYMENT YIELD.—

(A) IN GENERAL.—The payment yield for a farm for a 

designated oilseed or eligible pulse crop shall be equal to 

the product of the following: 

(i) The average yield for the designated oilseed or 

pulse crop determined under paragraph (1). 


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(ii) The ratio resulting from dividing the national 

average yield for the designated oilseed or pulse crop 

for the 1981 through 1985 crops by the national average yield for the designated oilseed or pulse crop for 

the 1998 through 2001 crops. 

(B) NO NATIONAL AVERAGE YIELD INFORMATION AVAIL- ABLE.—To the extent that national average yield information for a designated oilseed or pulse crop is not available, 

the Secretary shall use such information as the Secretary 

determines to be fair and equitable to establish a national 

average yield under this section. 

(3) USE OF PARTIAL COUNTY AVERAGE YIELD.—If the yield 

per planted acre for a crop of a designated oilseed or pulse crop 

for a farm for any of the 1998 through 2001 crop years was less 

than 75 percent of the county yield for that designated oilseed 

or pulse crop, the Secretary shall assign a yield for that crop 

year equal to 75 percent of the county yield for the purpose of 

determining the average under paragraph (1). 

(4) NO HISTORIC YIELD DATA AVAILABLE.—In the case of establishing yields for designated oilseeds and eligible pulse 

crops, if historic yield data is not available, the Secretary shall 

use the ratio for dry peas calculated under paragraph (2)(A)(ii) 

in determining the yields for designated oilseeds and eligible 

pulse crops, as determined to be fair and equitable by the Secretary. 

SEC. 1103. AVAILABILITY OF DIRECT PAYMENTS. 

(a) PAYMENT REQUIRED.—For each of the 2008 through 2012 

crop years of each covered commodity (other than pulse crops), the 

Secretary shall make direct payments to producers on farms for 

which base acres and payment yields are established. 

(b) PAYMENT RATE.—Except as provided in section 1105, the 

payment rates used to make direct payments with respect to covered 

commodities for a crop year shall be as follows: (1) Wheat, $0.52 per bushel. 

(2) Corn, $0.28 per bushel. 

(3) Grain sorghum, $0.35 per bushel. 

(4) Barley, $0.24 per bushel. 

(5) Oats, $0.024 per bushel. 

(6) Upland cotton, $0.0667 per pound. 

(7) Long grain rice, $2.35 per hundredweight. 

(8) Medium grain rice, $2.35 per hundredweight. 

(9) Soybeans, $0.44 per bushel. 

(10) Other oilseeds, $0.80 per hundredweight. 

(c) PAYMENT AMOUNT.—The amount of the direct payment to be 

paid to the producers on a farm for a covered commodity for a crop 

year shall be equal to the product of the following: 

(1) The payment rate specified in subsection (b). 

(2) The payment acres of the covered commodity on the 

farm. 

(3) The payment yield for the covered commodity for the 

farm. 

(d) TIME FOR PAYMENT.—

(1) IN GENERAL.—Except as provided in paragraph (2), in 

the case of each of the 2008 through 2012 crop years, the Secretary may not make direct payments before October 1 of the 


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calendar year in which the crop of the covered commodity is 

harvested. 

(2) ADVANCE PAYMENTS.— (A) OPTION.— (i) IN GENERAL.—At the option of the producers on 

a farm, the Secretary shall pay in advance up to 22 

percent of the direct payment for a covered commodity 

for any of the 2008 through 2011 crop years to the producers on a farm. 

(ii) 2008 CROP YEAR.—If the producers on a farm 

elect to receive advance direct payments under clause 

(i) for a covered commodity for the 2008 crop year, as 

soon as practicable after the election, the Secretary 

shall make the advance direct payment to the producers on the farm. 

(B) MONTH.— (i) SELECTION.—Subject to clauses (ii) and (iii), the 

producers on a farm shall select the month during 

which the advance payment for a crop year will be 

made. 

(ii) OPTIONS.—The month selected may be any 

month during the period— (I) beginning on December 1 of the calendar 

year before the calendar year in which the crop of 

the covered commodity is harvested; and 

(II) ending during the month within which the 

direct payment would otherwise be made. 

(iii) CHANGE.—The producers on a farm may 

change the selected month for a subsequent advance 

payment by providing advance notice to the Secretary. 

(3) REPAYMENT OF ADVANCE PAYMENTS.—If a producer on 

a farm that receives an advance direct payment for a crop year 

ceases to be a producer on that farm, or the extent to which the 

producer shares in the risk of producing a crop changes, before 

the date the remainder of the direct payment is made, the producer shall be responsible for repaying the Secretary the applicable amount of the advance payment, as determined by the 

Secretary. 

SEC. 1104. AVAILABILITY OF COUNTER-CYCLICAL PAYMENTS. 

(a) PAYMENT REQUIRED.—Except as provided in section 1105, 

for each of the 2008 through 2012 crop years for each covered commodity, the Secretary shall make counter-cyclical payments to producers on farms for which payment yields and base acres are established with respect to the covered commodity if the Secretary determines that the effective price for the covered commodity is less than 

the target price for the covered commodity. 

(b) EFFECTIVE PRICE.—

(1) COVERED COMMODITIES OTHER THAN RICE.—Except as 

provided in paragraph (2), for purposes of subsection (a), the effective price for a covered commodity is equal to the sum of the 

following: 

(A) The higher of the following: 

(i) The national average market price received by 

producers during the 12-month marketing year for the 

covered commodity, as determined by the Secretary. 


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(ii) The national average loan rate for a marketing 

assistance loan for the covered commodity in effect for 

the applicable period under subtitle B. 

(B) The payment rate in effect for the covered commodity under section 1103 for the purpose of making direct 

payments with respect to the covered commodity. 

(2) RICE.—In the case of long grain rice and medium grain 

rice, for purposes of subsection (a), the effective price for each 

type or class of rice is equal to the sum of the following: 

(A) The higher of the following: 

(i) The national average market price received by 

producers during the 12-month marketing year for the 

type or class of rice, as determined by the Secretary. 

(ii) The national average loan rate for a marketing 

assistance loan for the type or class of rice in effect for 

the applicable period under subtitle B. 

(B) The payment rate in effect for the type or class of 

rice under section 1103 for the purpose of making direct 

payments with respect to the type or class of rice. 

(c) TARGET PRICE.—

(1) 2008 CROP YEAR.—For purposes of the 2008 crop year, 

the target prices for covered commodities shall be as follows: (A) Wheat, $3.92 per bushel. 

(B) Corn, $2.63 per bushel. 

(C) Grain sorghum, $2.57 per bushel. 

(D) Barley, $2.24 per bushel. 

(E) Oats, $1.44 per bushel. 

(F) Upland cotton, $0.7125 per pound. 

(G) Long grain rice, $10.50 per hundredweight. 

(H) Medium grain rice, $10.50 per hundredweight. 

(I) Soybeans, $5.80 per bushel. 

(J) Other oilseeds, $10.10 per hundredweight. 

(2) 2009 CROP YEAR.—For purposes of the 2009 crop year, 

the target prices for covered commodities shall be as follows: (A) Wheat, $3.92 per bushel. 

(B) Corn, $2.63 per bushel. 

(C) Grain sorghum, $2.57 per bushel. 

(D) Barley, $2.24 per bushel. 

(E) Oats, $1.44 per bushel. 

(F) Upland cotton, $0.7125 per pound. 

(G) Long grain rice, $10.50 per hundredweight. 

(H) Medium grain rice, $10.50 per hundredweight. 

(I) Soybeans, $5.80 per bushel. 

(J) Other oilseeds, $10.10 per hundredweight. 

(K) Dry peas, $8.32 per hundredweight. 

(L) Lentils, $12.81 per hundredweight. 

(M) Small chickpeas, $10.36 per hundredweight. 

(N) Large chickpeas, $12.81 per hundredweight. 

(3) SUBSEQUENT CROP YEARS.—For purposes of each of the 

2010 through 2012 crop years, the target prices for covered commodities shall be as follows: (A) Wheat, $4.17 per bushel. 

(B) Corn, $2.63 per bushel. 

(C) Grain sorghum, $2.63 per bushel. 

(D) Barley, $2.63 per bushel. 


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(E) Oats, $1.79 per bushel. 

(F) Upland cotton, $0.7125 per pound. 

(G) Long grain rice, $10.50 per hundredweight. 

(H) Medium grain rice, $10.50 per hundredweight. 

(I) Soybeans, $6.00 per bushel. 

(J) Other oilseeds, $12.68 per hundredweight. 

(K) Dry peas, $8.32 per hundredweight. 

(L) Lentils, $12.81 per hundredweight. 

(M) Small chickpeas, $10.36 per hundredweight. 

(N) Large chickpeas, $12.81 per hundredweight. 

(d) PAYMENT RATE.—The payment rate used to make countercyclical payments with respect to a covered commodity for a crop 

year shall be equal to the difference between—

(1) the target price for the covered commodity; and 

(2) the effective price determined under subsection (b) for 

the covered commodity. 

(e) PAYMENT AMOUNT.—If counter-cyclical payments are required to be paid under this section for any of the 2008 through 

2012 crop years of a covered commodity, the amount of the countercyclical payment to be paid to the producers on a farm for that crop 

year shall be equal to the product of the following: 

(1) The payment rate specified in subsection (d). 

(2) The payment acres of the covered commodity on the 

farm. 

(3) The payment yield for the covered commodity for the 

farm. 

(f) TIME FOR PAYMENTS.—

(1) GENERAL RULE.—Except as provided in paragraph (2), 

if the Secretary determines under subsection (a) that counter-cyclical payments are required to be made under this section for 

the crop of a covered commodity, beginning October 1, or as 

soon as practicable thereafter, after the end of the marketing 

year for the covered commodity, the Secretary shall make the 

counter-cyclical payments for the crop. 

(2) AVAILABILITY OF PARTIAL PAYMENTS.—

(A) IN GENERAL.—If, before the end of the 12-month 

marketing year for a covered commodity, the Secretary estimates that counter-cyclical payments will be required for 

the crop of the covered commodity, the Secretary shall give 

producers on a farm the option to receive partial payments 

of the counter-cyclical payment projected to be made for 

that crop of the covered commodity. 

(B) ELECTION.—

(i) IN GENERAL.—The Secretary shall allow producers on a farm to make an election to receive partial 

payments for a covered commodity under subparagraph (A) at any time but not later than 60 days prior 

to the end of the marketing year for that covered commodity. 

(ii) DATE OF ISSUANCE.—The Secretary shall issue 

the partial payment after the date of an announcement 

by the Secretary but not later than 30 days prior to the 

end of the marketing year. 


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(3) TIME FOR PARTIAL PAYMENTS.—When the Secretary 

makes partial payments for a covered commodity for any of the 

2008 through 2010 crop years— (A) the first partial payment shall be made after completion of the first 180 days of the marketing year for the 

covered commodity; and 

(B) the final partial payment shall be made beginning 

October 1, or as soon as practicable thereafter, after the end 

of the applicable marketing year for the covered commodity. 

(4) AMOUNT OF PARTIAL PAYMENT.— (A) FIRST PARTIAL PAYMENT.—For each of the 2008 

through 2010 crops of a covered commodity, the first partial payment under paragraph (3) to the producers on a 

farm may not exceed 40 percent of the projected counter-cyclical payment for the covered commodity for the crop year, 

as determined by the Secretary. 

(B) FINAL PAYMENT.—The final payment for a covered 

commodity for a crop year shall be equal to the difference 

between—

(i) the actual counter-cyclical payment to be made 

to the producers for the covered commodity for that 

crop year; and 

(ii) the amount of the partial payment made to the 

producers under subparagraph (A). 

(5) REPAYMENT.—The producers on a farm that receive a 

partial payment under this subsection for a crop year shall 

repay to the Secretary the amount, if any, by which the total of 

the partial payments exceed the actual counter-cyclical payment 

to be made for the covered commodity for that crop year. 

SEC. 1105. AVERAGE CROP REVENUE ELECTION PROGRAM. 

(a) AVAILABILITY AND ELECTION OF ALTERNATIVE APPROACH.— (1) AVAILABILITY OF AVERAGE CROP REVENUE ELECTION PAY- MENTS.—As an alternative to receiving counter-cyclical payments under section 1104 or 1304 and in exchange for a 20-percent reduction in direct payments under section 1103 or 1303 

and a 30-percent reduction in marketing assistance loan rates 

under section 1202 or 1307, with respect to all covered commodities and peanuts on a farm, during each of the 2009, 2010, 

2011, and 2012 crop years, the Secretary shall give the producers on the farm an opportunity to make an irrevocable election to instead receive average crop revenue election (referred to 

in this section as ‘‘ACRE’’) payments under this section for the 

initial crop year for which the election is made through the 

2012 crop year. 

(2) LIMITATION.—

(A) IN GENERAL.—The total number of planted acres 

for which the producers on a farm may receive ACRE payments under this section may not exceed the total base acreage for all covered commodities and peanuts on the farm. 

(B) ELECTION.—If the total number of planted acres to 

all covered commodities and peanuts of the producers on a 

farm exceeds the total base acreage of the farm, the producers on the farm may choose which planted acres to enroll in the program under this section. 

(3) ELECTION; TIME FOR ELECTION.—


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(A) IN GENERAL.—The Secretary shall provide notice to 

producers regarding the opportunity to make each of the 

elections described in paragraph (1). 

(B) NOTICE REQUIREMENTS.—The notice shall include— (i) notice of the opportunity of the producers on a 

farm to make the election; and 

(ii) information regarding the manner in which the 

election must be made and the time periods and manner in which notice of the election must be submitted 

to the Secretary. 

(4) ELECTION DEADLINE.—Within the time period and in 

the manner prescribed pursuant to paragraph (3), all of the 

producers on a farm shall submit to the Secretary notice of an 

election made under paragraph (1). 

(5) EFFECT OF FAILURE TO MAKE ELECTION.—If all of the 

producers on a farm fail to make an election under paragraph 

(1), make different elections under paragraph (1), or fail to 

timely notify the Secretary of the election made, as required by 

paragraph (4), all of the producers on the farm shall be deemed 

to have made the election to receive counter-cyclical payments 

under section 1104 or 1304 for all covered commodities and 

peanuts on the farm, and to otherwise not have made the election described in paragraph (1), for the applicable crop years. 

(b) PAYMENTS REQUIRED.— (1) IN GENERAL.—In the case of producers on a farm who 

make an election under subsection (a) to receive ACRE payments for any of the 2009 through 2012 crop years for all covered commodities and peanuts, the Secretary shall make ACRE 

payments available to the producers on a farm in accordance 

with this subsection. 

(2) ACRE PAYMENT.—

(A) IN GENERAL.—Subject to paragraph (3), in the case 

of producers on a farm described in paragraph (1), the Secretary shall make ACRE payments available to the producers on a farm for each crop year if— (i) the actual State revenue for the crop year for the 

covered commodity or peanuts in the State determined 

under subsection (c); is less than 

(ii) the ACRE program guarantee for the crop year 

for the covered commodity or peanuts in the State determined under subsection (d). 

(B) INDIVIDUAL LOSS.—The Secretary shall make 

ACRE payments available to the producers on a farm in a 

State for a crop year only if (as determined by the Secretary)—

(i) the actual farm revenue for the crop year for the 

covered commodity or peanuts, as determined under 

subsection (e); is less than 

(ii) the farm ACRE benchmark revenue for the crop 

year for the covered commodity or peanuts, as determined under subsection (f). 

(3) TIME FOR PAYMENTS.—In the case of each of the 2009 

through 2012 crop years, the Secretary shall make ACRE payments beginning October 1, or as soon as practicable thereafter, 


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after the end of the applicable marketing year for the covered 

commodity or peanuts. 

(c) ACTUAL STATE REVENUE.— (1) IN GENERAL.—For purposes of subsection (b)(2)(A), the 

amount of the actual State revenue for a crop year of a covered 

commodity or peanuts shall equal the product obtained by multiplying—

(A) the actual State yield for each planted acre for the 

crop year for the covered commodity or peanuts determined 

under paragraph (2); and 

(B) the national average market price for the crop year 

for the covered commodity or peanuts determined under 

paragraph (3). 

(2) ACTUAL STATE YIELD.—For purposes of paragraph 

(1)(A), the actual State yield for each planted acre for a crop 

year for a covered commodity or peanuts in a State shall equal 

(as determined by the Secretary)—

(A) the quantity of the covered commodity or peanuts 

that is produced in the State during the crop year; divided 

by 

(B) the number of acres that are planted to the covered 

commodity or peanuts in the State during the crop year. 

(3) NATIONAL AVERAGE MARKET PRICE.—For purposes of 

paragraph (1)(B), the national average market price for a crop 

year for a covered commodity or peanuts in a State shall equal 

the greater of— (A) the national average market price received by producers during the 12-month marketing year for the covered 

commodity or peanuts, as determined by the Secretary; or 

(B) the marketing assistance loan rate for the covered 

commodity or peanuts under section 1202 or 1307, as reduced under subsection (a)(1). 

(d) ACRE PROGRAM GUARANTEE.— (1) AMOUNT.—

(A) IN GENERAL.—For purposes of subsection (b)(2)(A) 

and subject to subparagraph (B), the ACRE program guarantee for a crop year for a covered commodity or peanuts 

in a State shall equal 90 percent of the product obtained 

by multiplying— (i) the benchmark State yield for each planted acre 

for the crop year for the covered commodity or peanuts 

in a State determined under paragraph (2); and 

(ii) the ACRE program guarantee price for the crop 

year for the covered commodity or peanuts determined 

under paragraph (3). 

(B) MINIMUM AND MAXIMUM GUARANTEE.—In the case 

of each of the 2010 through 2012 crop years, the ACRE program guarantee for a crop year for a covered commodity or 

peanuts under subparagraph (A) shall not decrease or increase more than 10 percent from the guarantee for the preceding crop year. 

(2) BENCHMARK STATE YIELD.— (A) IN GENERAL.—For purposes of paragraph (1)(A)(i), 

subject to subparagraph (B), the benchmark State yield for 

each planted acre for a crop year for a covered commodity 


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or peanuts in a State shall equal the average yield per 

planted acre for the covered commodity or peanuts in the 

State for the most recent 5 crop year yields, excluding each 

of the crop years with the highest and lowest yields, using 

National Agricultural Statistics Service data. 

(B) ASSIGNED YIELD.—If the Secretary cannot establish 

the benchmark State yield for each planted acre for a crop 

year for a covered commodity or peanuts in a State in accordance with subparagraph (A) or if the yield determined 

under subparagraph (A) is an unrepresentative average 

yield for the State (as determined by the Secretary), the Secretary shall assign a benchmark State yield for each planted acre for the crop year for the covered commodity or peanuts in the State on the basis of— (i) previous average yields for a period of 5 crop 

years, excluding each of the crop years with the highest 

and lowest yields; or 

(ii) benchmark State yields for planted acres for 

the crop year for the covered commodity or peanuts in 

similar States. 

(3) ACRE PROGRAM GUARANTEE PRICE.—For purposes of 

paragraph (1)(A)(ii), the ACRE program guarantee price for a 

crop year for a covered commodity or peanuts in a State shall 

be the simple average of the national average market price received by producers of the covered commodity or peanuts for the 

most recent 2 crop years, as determined by the Secretary. 

(4) STATES WITH IRRIGATED AND NONIRRIGATED LAND.—In 

the case of a State in which at least 25 percent of the acreage 

planted to a covered commodity or peanuts in the State is irrigated and at least 25 percent of the acreage planted to the covered commodity or peanuts in the State is not irrigated, the Secretary shall calculate a separate ACRE program guarantee for 

the irrigated and nonirrigated areas of the State for the covered 

commodity or peanuts. 

(e) ACTUAL FARM REVENUE.—For purposes of subsection 

(b)(2)(B)(i), the amount of the actual farm revenue for a crop year 

for a covered commodity or peanuts shall equal the amount determined by multiplying— (1) the actual yield for the covered commodity or peanuts 

of the producers on the farm; and 

(2) the national average market price for the crop year for 

the covered commodity or peanuts determined under subsection 

(c)(3). 

(f) FARM ACRE BENCHMARK REVENUE.—For purposes of subsection (b)(2)(B)(ii), the farm ACRE benchmark revenue for the crop 

year for a covered commodity or peanuts shall equal the sum obtained by adding—

(1) the amount determined by multiplying—

(A) the average yield per planted acre for the covered 

commodity or peanuts of the producers on the farm for the 

most recent 5 crop years, excluding each of the crop years 

with the highest and lowest yields; and 

(B) the ACRE program guarantee price for the applicable crop year for the covered commodity or peanuts in a 

State determined under subsection (d)(3); and 


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(2) the amount of the per acre crop insurance premium required to be paid by the producers on the farm for the applicable crop year for the covered commodity or peanuts on the farm. 

(g) PAYMENT AMOUNT.—If ACRE payments are required to be 

paid for any of the 2009 through 2012 crop years of a covered commodity or peanuts under this section, the amount of the ACRE payment to be paid to the producers on the farm for the crop year under 

this section shall be equal to the product obtained by multiplying— (1) the lesser of— (A) the difference between— (i) the ACRE program guarantee for the crop year 

for the covered commodity or peanuts in the State determined under subsection (d); and 

(ii) the actual State revenue from the crop year for 

the covered commodity or peanuts in the State determined under subsection (c); and 

(B) 25 percent of the ACRE program guarantee for the 

crop year for the covered commodity or peanuts in the State 

determined under subsection (d); 

(2)(A) for each of the 2009 through 2011 crop years, 83.3 

percent of the acreage planted or considered planted to the covered commodity or peanuts for harvest on the farm in the crop 

year; and 

(B) for the 2012 crop year, 85 percent of the acreage planted 

or considered planted to the covered commodity or peanuts for 

harvest on the farm in the crop year; and 

(3) the quotient obtained by dividing—

(A) the average yield per planted acre for the covered 

commodity or peanuts of the producers on the farm for the 

most recent 5 crop years, excluding each of the crop years 

with the highest and lowest yields; by 

(B) the benchmark State yield for the crop year, as determined under subsection (d)(2). 

SEC. 1106. PRODUCER AGREEMENT REQUIRED AS CONDITION OF PROVISION OF PAYMENTS. 

(a) COMPLIANCE WITH CERTAIN REQUIREMENTS.—

(1) REQUIREMENTS.—Before the producers on a farm may 

receive direct payments, counter-cyclical payments, or average 

crop revenue election payments with respect to the farm, the 

producers shall agree, during the crop year for which the payments are made and in exchange for the payments—

(A) to comply with applicable conservation requirements under subtitle B of title XII of the Food Security Act 

of 1985 (16 U.S.C. 3811 et seq.); 

(B) to comply with applicable wetland protection requirements under subtitle C of title XII of that Act (16 

U.S.C. 3821 et seq.); 

(C) to comply with the planting flexibility requirements 

of section 1107; 

(D) to use the land on the farm, in a quantity equal to 

the attributable base acres for the farm and any base acres 

for peanuts for the farm under subtitle C, for an agricultural or conserving use, and not for a nonagricultural commercial, industrial, or residential use, as determined by the 

Secretary; and 


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(E) to effectively control noxious weeds and otherwise 

maintain the land in accordance with sound agricultural 

practices, as determined by the Secretary, if the agricultural or conserving use involves the noncultivation of any 

portion of the land referred to in subparagraph (D). 

(2) COMPLIANCE.—The Secretary may issue such rules as 

the Secretary considers necessary to ensure producer compliance 

with the requirements of paragraph (1). 

(3) MODIFICATION.—At the request of the transferee or 

owner, the Secretary may modify the requirements of this subsection if the modifications are consistent with the objectives of 

this subsection, as determined by the Secretary. 

(b) TRANSFER OR CHANGE OF INTEREST IN FARM.—

(1) TERMINATION.—

(A) IN GENERAL.—Except as provided in paragraph (2), 

a transfer of (or change in) the interest of the producers on 

a farm in base acres for which direct payments or countercyclical payments are made, or on which average crop revenue election payments are based, shall result in the termination of the direct payments, counter-cyclical payments, or 

average crop revenue election payments to the extent the 

payments are made or based on the base acres, unless the 

transferee or owner of the acreage agrees to assume all obligations under subsection (a). 

(B) EFFECTIVE DATE.—The termination shall take effect 

on the date determined by the Secretary. 

(2) EXCEPTION.—If a producer entitled to a direct payment, 

counter-cyclical payment, or average crop revenue election payment dies, becomes incompetent, or is otherwise unable to receive the payment, the Secretary shall make the payment, in accordance with rules issued by the Secretary. 

(c) REPORTS.—

(1) ACREAGE REPORTS.—As a condition on the receipt of any 

benefits under this subtitle or subtitle B, the Secretary shall require producers on a farm to submit to the Secretary annual 

acreage reports with respect to all cropland on the farm. 

(2) PRODUCTION REPORTS.—As a condition on the receipt of 

any benefits under this subtitle or subtitle B, the Secretary shall 

require producers on a farm that receive payments under section 1105 to submit to the Secretary annual production reports 

with respect to all covered commodities and peanuts produced 

on the farm. 

(3) PENALTIES.—No penalty with respect to benefits under 

this subtitle or subtitle B shall be assessed against the producers on a farm for an inaccurate acreage or production report 

unless the producers on the farm knowingly and willfully falsified the acreage or production report. 

(d) TENANTS AND SHARECROPPERS.—In carrying out this subtitle, the Secretary shall provide adequate safeguards to protect the 

interests of tenants and sharecroppers. 

(e) SHARING OF PAYMENTS.—The Secretary shall provide for the 

sharing of direct payments, counter-cyclical payments, or average 

crop revenue election payments among the producers on a farm on 

a fair and equitable basis. 


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SEC. 1107. PLANTING FLEXIBILITY. 

(a) PERMITTED CROPS.—Subject to subsection (b), any commodity or crop may be planted on base acres on a farm. 

(b) LIMITATIONS REGARDING CERTAIN COMMODITIES.—

(1) GENERAL LIMITATION.—The planting of an agricultural 

commodity specified in paragraph (3) shall be prohibited on 

base acres unless the commodity, if planted, is destroyed before 

harvest. 

(2) TREATMENT OF TREES AND OTHER PERENNIALS.—The 

planting of an agricultural commodity specified in paragraph 

(3) that is produced on a tree or other perennial plant shall be 

prohibited on base acres. 

(3) COVERED AGRICULTURAL COMMODITIES.—Paragraphs (1) 

and (2) apply to the following agricultural commodities: 

(A) Fruits. 

(B) Vegetables (other than mung beans and pulse 

crops). 

(C) Wild rice. 

(c) EXCEPTIONS.—Paragraphs (1) and (2) of subsection (b) shall 

not limit the planting of an agricultural commodity specified in 

paragraph (3) of that subsection—

(1) in any region in which there is a history of double-cropping of covered commodities with agricultural commodities 

specified in subsection (b)(3), as determined by the Secretary, in 

which case the double-cropping shall be permitted; 

(2) on a farm that the Secretary determines has a history 

of planting agricultural commodities specified in subsection 

(b)(3) on base acres, except that direct payments and countercyclical payments shall be reduced by an acre for each acre 

planted to such an agricultural commodity; or 

(3) by the producers on a farm that the Secretary determines has an established planting history of a specific agricultural commodity specified in subsection (b)(3), except that—

(A) the quantity planted may not exceed the average 

annual planting history of such agricultural commodity by 

the producers on the farm in the 1991 through 1995 or 

1998 through 2001 crop years (excluding any crop year in 

which no plantings were made), as determined by the Secretary; and 

(B) direct payments and counter-cyclical payments 

shall be reduced by an acre for each acre planted to such 

agricultural commodity. 

(d) PLANTING TRANSFERABILITY PILOT PROJECT.— (1) PILOT PROJECT AUTHORIZED.—Notwithstanding paragraphs (1) and (2) of subsection (b) and in addition to the exceptions provided in subsection (c), the Secretary shall carry out 

a pilot project to permit the planting of cucumbers, green peas, 

lima beans, pumpkins, snap beans, sweet corn, and tomatoes 

grown for processing on base acres during each of the 2009 

through 2012 crop years. 

(2) PILOT PROJECT STATES AND ACRES.—The number of 

base acres eligible during each crop year for the pilot project 

under paragraph (1) shall be—

(A) 9,000 acres in the State of Illinois; 

(B) 9,000 acres in the State of Indiana; 


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(C) 1,000 acres in the State of Iowa; 

(D) 9,000 acres in the State of Michigan; 

(E) 34,000 acres in the State of Minnesota; 

(F) 4,000 acres in the State of Ohio; and 

(G) 9,000 acres in the State of Wisconsin. 

(3) CONTRACT AND MANAGEMENT REQUIREMENTS.—To be eligible for selection to participate in the pilot project, the producers on a farm shall— (A) demonstrate to the Secretary that the producers on 

the farm have entered into a contract to produce a crop of 

a commodity specified in paragraph (1) for processing; 

(B) agree to produce the crop as part of a program of 

crop rotation on the farm to achieve agronomic and pest 

and disease management benefits; and 

(C) provide evidence of the disposition of the crop. 

(4) TEMPORARY REDUCTION IN BASE ACRES.—The base acres 

on a farm for a crop year shall be reduced by an acre for each 

acre planted under the pilot program. 

(5) DURATION OF REDUCTIONS.—The reduction in the base 

acres of a farm for a crop year under paragraph (4) shall expire 

at the end of the crop year. 

(6) RECALCULATION OF BASE ACRES.— (A) IN GENERAL.—If the Secretary recalculates base 

acres for a farm while the farm is included in the pilot 

project, the planting and production of a crop of a commodity specified in paragraph (1) on base acres for which 

a temporary reduction was made under this section shall 

be considered to be the same as the planting and production of a covered commodity. 

(B) PROHIBITION.—Nothing in this paragraph provides 

authority for the Secretary to recalculate base acres for a 

farm. 

(7) PILOT IMPACT EVALUATION.— (A) IN GENERAL.—The Secretary shall periodically 

evaluate the pilot project conducted under this subsection to 

determine the effects of the pilot project on the supply and 

price of—

(i) fresh fruits and vegetables; and 

(ii) fruits and vegetables for processing. 

(B) DETERMINATION.—An evaluation under subparagraph (A) shall include a determination as to whether—

(i) producers of fresh fruits and vegetables are 

being negatively impacted; and 

(ii) existing production capacities are being supplanted. 

(C) REPORT.—As soon as practicable after conducting 

an evaluation under subparagraph (A), the Secretary shall 

submit to the Committee on Agriculture of the House of 

Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes the 

results of the evaluation. 

SEC. 1108. SPECIAL RULE FOR LONG GRAIN AND MEDIUM GRAIN RICE. 

(a) CALCULATION METHOD.—Subject to subsections (b) and (c), 

for the purposes of determining the amount of the counter-cyclical 

payments to be paid to the producers on a farm for long grain rice 


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and medium grain rice under section 1104, the base acres of rice on 

the farm shall be apportioned using the 4-year average of the percentages of acreage planted in the applicable State to long grain rice 

and medium grain rice during the 2003 through 2006 crop years, 

as determined by the Secretary. 

(b) PRODUCER ELECTION.—As an alternative to the calculation 

method described in subsection (a), the Secretary shall provide producers on a farm the opportunity to elect to apportion rice base 

acres on the farm using the 4-year average of—

(1) the percentages of acreage planted on the farm to long 

grain rice and medium grain rice during the 2003 through 

2006 crop years; 

(2) the percentages of any acreage on the farm that the producers were prevented from planting to long grain rice and medium grain rice during the 2003 through 2006 crop years because of drought, flood, other natural disaster, or other condition beyond the control of the producers, as determined by the 

Secretary; and 

(3) in the case of a crop year for which a producer on a 

farm elected not to plant to long grain and medium grain rice 

during the 2003 through 2006 crop years, the percentages of 

acreage planted in the applicable State to long grain rice and 

medium grain rice, as determined by the Secretary. 

(c) LIMITATION.—In carrying out this section, the Secretary 

shall use the same total base acres, payment acres, and payment 

yields established with respect to rice under sections 1101 and 1102 

of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

7911, 7912), as in effect on September 30, 2007, subject to any adjustment under section 1101 of this Act. 

SEC. 1109. PERIOD OF EFFECTIVENESS. 

This subtitle shall be effective beginning with the 2008 crop 

year of each covered commodity through the 2012 crop year. 

Subtitle B—Marketing Assistance Loans and Loan Deficiency 

Payments 

SEC. 1201. AVAILABILITY OF NONRECOURSE MARKETING ASSISTANCE 

LOANS FOR LOAN COMMODITIES. 

(a) NONRECOURSE LOANS AVAILABLE.—

(1) AVAILABILITY.—For each of the 2008 through 2012 crops 

of each loan commodity, the Secretary shall make available to 

producers on a farm nonrecourse marketing assistance loans for 

loan commodities produced on the farm. 

(2) TERMS AND CONDITIONS.—The marketing assistance 

loans shall be made under terms and conditions that are prescribed by the Secretary and at the loan rate established under 

section 1202 for the loan commodity. 

(b) ELIGIBLE PRODUCTION.—The producers on a farm shall be 

eligible for a marketing assistance loan under subsection (a) for any 

quantity of a loan commodity produced on the farm. 

(c) COMPLIANCE WITH CONSERVATION AND WETLANDS REQUIRE- MENTS.—As a condition of the receipt of a marketing assistance loan 

under subsection (a), the producer shall comply with applicable conservation requirements under subtitle B of title XII of the Food Security Act of 1985 (16 U.S.C. 3811 et seq.) and applicable wetland 


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protection requirements under subtitle C of title XII of that Act (16 

U.S.C. 3821 et seq.) during the term of the loan. 

SEC. 1202. LOAN RATES FOR NONRECOURSE MARKETING ASSISTANCE 

LOANS. 

(a) 2008 CROP YEAR.—For purposes of the 2008 crop year, the 

loan rate for a marketing assistance loan under section 1201 for a 

loan commodity shall be equal to the following: (1) In the case of wheat, $2.75 per bushel. 

(2) In the case of corn, $1.95 per bushel. 

(3) In the case of grain sorghum, $1.95 per bushel. 

(4) In the case of barley, $1.85 per bushel. 

(5) In the case of oats, $1.33 per bushel. 

(6) In the case of base quality of upland cotton, $0.52 per 

pound. (7) In the case of extra long staple cotton, $0.7977 per 

pound. (8) In the case of long grain rice, $6.50 per hundredweight. 

(9) In the case of medium grain rice, $6.50 per hundredweight. (10) In the case of soybeans, $5.00 per bushel. 

(11) In the case of other oilseeds, $9.30 per hundredweight 

for each of the following kinds of oilseeds: 

(A) Sunflower seed. 

(B) Rapeseed. 

(C) Canola. 

(D) Safflower. 

(E) Flaxseed. 

(F) Mustard seed. 

(G) Crambe. 

(H) Sesame seed. 

(I) Other oilseeds designated by the Secretary. 

(12) In the case of dry peas, $6.22 per hundredweight. 

(13) In the case of lentils, $11.72 per hundredweight. 

(14) In the case of small chickpeas, $7.43 per hundredweight. (15) In the case of graded wool, $1.00 per pound. 

(16) In the case of nongraded wool, $0.40 per pound. 

(17) In the case of mohair, $4.20 per pound. 

(18) In the case of honey, $0.60 per pound. 

(b) 2009 CROP YEAR.—Except as provided in section 1105, for 

purposes of the 2009 crop year, the loan rate for a marketing assistance loan under section 1201 for a loan commodity shall be equal 

to the following: 

(1) In the case of wheat, $2.75 per bushel. 

(2) In the case of corn, $1.95 per bushel. 

(3) In the case of grain sorghum, $1.95 per bushel. 

(4) In the case of barley, $1.85 per bushel. 

(5) In the case of oats, $1.33 per bushel. 

(6) In the case of base quality of upland cotton, $0.52 per 

pound. 

(7) In the case of extra long staple cotton, $0.7977 per 

pound. 

(8) In the case of long grain rice, $6.50 per hundredweight. 

(9) In the case of medium grain rice, $6.50 per hundredweight. 


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(10) In the case of soybeans, $5.00 per bushel. 

(11) In the case of other oilseeds, $9.30 per hundredweight 

for each of the following kinds of oilseeds: 

(A) Sunflower seed. 

(B) Rapeseed. 

(C) Canola. 

(D) Safflower. 

(E) Flaxseed. 

(F) Mustard seed. 

(G) Crambe. 

(H) Sesame seed. 

(I) Other oilseeds designated by the Secretary. 

(12) In the case of dry peas, $5.40 per hundredweight. 

(13) In the case of lentils, $11.28 per hundredweight. 

(14) In the case of small chickpeas, $7.43 per hundredweight. 

(15) In the case of large chickpeas, $11.28 per hundredweight. 

(16) In the case of graded wool, $1.00 per pound. 

(17) In the case of nongraded wool, $0.40 per pound. 

(18) In the case of mohair, $4.20 per pound. 

(19) In the case of honey, $0.60 per pound. 

(c) 2010 THROUGH 2012 CROP YEARS.—Except as provided in 

section 1105, for purposes of each of the 2010 through 2012 crop 

years, the loan rate for a marketing assistance loan under section 

1201 for a loan commodity shall be equal to the following: 

(1) In the case of wheat, $2.94 per bushel. 

(2) In the case of corn, $1.95 per bushel. 

(3) In the case of grain sorghum, $1.95 per bushel. 

(4) In the case of barley, $1.95 per bushel. 

(5) In the case of oats, $1.39 per bushel. 

(6) In the case of base quality of upland cotton, $0.52 per 

pound. 

(7) In the case of extra long staple cotton, $0.7977 per 

pound. 

(8) In the case of long grain rice, $6.50 per hundredweight. 

(9) In the case of medium grain rice, $6.50 per hundredweight. 

(10) In the case of soybeans, $5.00 per bushel. 

(11) In the case of other oilseeds, $10.09 per hundredweight 

for each of the following kinds of oilseeds: 

(A) Sunflower seed. 

(B) Rapeseed. 

(C) Canola. 

(D) Safflower. 

(E) Flaxseed. 

(F) Mustard seed. 

(G) Crambe. 

(H) Sesame seed. 

(I) Other oilseeds designated by the Secretary. 

(12) In the case of dry peas, $5.40 per hundredweight. 

(13) In the case of lentils, $11.28 per hundredweight. 

(14) In the case of small chickpeas, $7.43 per hundredweight. 


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(15) In the case of large chickpeas, $11.28 per hundredweight. 

(16) In the case of graded wool, $1.15 per pound. 

(17) In the case of nongraded wool, $0.40 per pound. 

(18) In the case of mohair, $4.20 per pound. 

(19) In the case of honey, $0.69 per pound. 

(d) SINGLE COUNTY LOAN RATE FOR OTHER OILSEEDS.—The 

Secretary shall establish a single loan rate in each county for each 

kind of other oilseeds described in subsections (a)(11), (b)(11), and 

(c)(11). 

SEC. 1203. TERM OF LOANS. 

(a) TERM OF LOAN.—In the case of each loan commodity, a marketing assistance loan under section 1201 shall have a term of 9 

months beginning on the first day of the first month after the month 

in which the loan is made. 

(b) EXTENSIONS PROHIBITED.—The Secretary may not extend 

the term of a marketing assistance loan for any loan commodity. 

SEC. 1204. REPAYMENT OF LOANS. 

(a) GENERAL RULE.—The Secretary shall permit the producers 

on a farm to repay a marketing assistance loan under section 1201 

for a loan commodity (other than upland cotton, long grain rice, medium grain rice, extra long staple cotton, and confectionery and 

each other kind of sunflower seed (other than oil sunflower seed)) 

at a rate that is the lesser of—

(1) the loan rate established for the commodity under section 1202, plus interest (determined in accordance with section 

163 of the Federal Agriculture Improvement and Reform Act of 

1996 (7 U.S.C. 7283)); 

(2) a rate (as determined by the Secretary) that—

(A) is calculated based on average market prices for the 

loan commodity during the preceding 30-day period; and 

(B) will minimize discrepancies in marketing loan benefits across State boundaries and across county boundaries; 

or 

(3) a rate that the Secretary may develop using alternative 

methods for calculating a repayment rate for a loan commodity 

that the Secretary determines will—

(A) minimize potential loan forfeitures; 

(B) minimize the accumulation of stocks of the commodity by the Federal Government; 

(C) minimize the cost incurred by the Federal Government in storing the commodity; 

(D) allow the commodity produced in the United States 

to be marketed freely and competitively, both domestically 

and internationally; and 

(E) minimize discrepancies in marketing loan benefits 

across State boundaries and across county boundaries. 

(b) REPAYMENT RATES FOR UPLAND COTTON, LONG GRAIN RICE, 

AND MEDIUM GRAIN RICE.—The Secretary shall permit producers to 

repay a marketing assistance loan under section 1201 for upland 

cotton, long grain rice, and medium grain rice at a rate that is the 

lesser of—

(1) the loan rate established for the commodity under section 1202, plus interest (determined in accordance with section 


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163 of the Federal Agriculture Improvement and Reform Act of 

1996 (7 U.S.C. 7283)); or 

(2) the prevailing world market price for the commodity, as 

determined and adjusted by the Secretary in accordance with 

this section. 

(c) REPAYMENT RATES FOR EXTRA LONG STAPLE COTTON.—Repayment of a marketing assistance loan for extra long staple cotton 

shall be at the loan rate established for the commodity under section 

1202, plus interest (determined in accordance with section 163 of 

the Federal Agriculture Improvement and Reform Act of 1996 (7 

U.S.C. 7283)). 

(d) PREVAILING WORLD MARKET PRICE.—For purposes of this 

section and section 1207, the Secretary shall prescribe by regulation—

(1) a formula to determine the prevailing world market 

price for each of upland cotton, long grain rice, and medium 

grain rice; and 

(2) a mechanism by which the Secretary shall announce periodically those prevailing world market prices. 

(e) ADJUSTMENT OF PREVAILING WORLD MARKET PRICE FOR UP- LAND COTTON, LONG GRAIN RICE, AND MEDIUM GRAIN RICE.— (1) RICE.—The prevailing world market price for long grain 

rice and medium grain rice determined under subsection (d) 

shall be adjusted to United States quality and location. 

(2) COTTON.—The prevailing world market price for upland 

cotton determined under subsection (d)— (A) shall be adjusted to United States quality and location, with the adjustment to include— (i) a reduction equal to any United States Premium Factor for upland cotton of a quality higher 

than Middling (M) 13⁄32-inch; and 

(ii) the average costs to market the commodity, including average transportation costs, as determined by 

the Secretary; and 

(B) may be further adjusted, during the period beginning on the date of enactment of this Act and ending on 

July 31, 2013, if the Secretary determines the adjustment 

is necessary to—

(i) minimize potential loan forfeitures; 

(ii) minimize the accumulation of stocks of upland 

cotton by the Federal Government; 

(iii) ensure that upland cotton produced in the 

United States can be marketed freely and competitively, both domestically and internationally; and 

(iv) ensure an appropriate transition between current-crop and forward-crop price quotations, except 

that the Secretary may use forward-crop price 

quotations prior to July 31 of a marketing year only 

if—

(I) there are insufficient current-crop price 

quotations; and 

(II) the forward-crop price quotation is the 

lowest such quotation available. 

(3) GUIDELINES FOR ADDITIONAL ADJUSTMENTS.—In making adjustments under this subsection, the Secretary shall esVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00040 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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tablish a mechanism for determining and announcing the adjustments in order to avoid undue disruption in the United 

States market. 

(f) REPAYMENT RATES FOR CONFECTIONERY AND OTHER KINDS

OF SUNFLOWER SEEDS.—The Secretary shall permit the producers 

on a farm to repay a marketing assistance loan under section 1201 

for confectionery and each other kind of sunflower seed (other than 

oil sunflower seed) at a rate that is the lesser of—

(1) the loan rate established for the commodity under section 1202, plus interest (determined in accordance with section 

163 of the Federal Agriculture Improvement and Reform Act of 

1996 (7 U.S.C. 7283)); or 

(2) the repayment rate established for oil sunflower seed. 

(g) PAYMENT OF COTTON STORAGE COSTS.—

(1) 2008 THROUGH 2011 CROP YEARS.—Effective for each of 

the 2008 through 2011 crop years, the Secretary shall provide 

cotton storage payments in the same manner, and at the same 

rates as the Secretary provided storage payments for the 2006 

crop of cotton, except that the rates shall be reduced by 10 percent. 

(2) SUBSEQUENT CROP YEARS.—Beginning with the 2012 

crop year, the Secretary shall provide cotton storage payments 

in the same manner, and at the same rates as the Secretary 

provided storage payments for the 2006 crop of cotton, except 

that the rates shall be reduced by 20 percent. 

(h) AUTHORITY TO TEMPORARILY ADJUST REPAYMENT RATES.—

(1) ADJUSTMENT AUTHORITY.—In the event of a severe disruption to marketing, transportation, or related infrastructure, 

the Secretary may modify the repayment rate otherwise applicable under this section for marketing assistance loans under section 1201 for a loan commodity. 

(2) DURATION.—Any adjustment made under paragraph (1) 

in the repayment rate for marketing assistance loans for a loan 

commodity shall be in effect on a short-term and temporary 

basis, as determined by the Secretary. 

SEC. 1205. LOAN DEFICIENCY PAYMENTS. 

(a) AVAILABILITY OF LOAN DEFICIENCY PAYMENTS.—

(1) IN GENERAL.—Except as provided in subsection (d), the 

Secretary may make loan deficiency payments available to producers on a farm that, although eligible to obtain a marketing 

assistance loan under section 1201 with respect to a loan commodity, agree to forgo obtaining the loan for the commodity in 

return for loan deficiency payments under this section. 

(2) UNSHORN PELTS, HAY, AND SILAGE.—

(A) MARKETING ASSISTANCE LOANS.—Subject to subparagraph (B), nongraded wool in the form of unshorn 

pelts and hay and silage derived from a loan commodity 

are not eligible for a marketing assistance loan under section 1201. 

(B) LOAN DEFICIENCY PAYMENT.—Effective for the 2008 

through 2012 crop years, the Secretary may make loan deficiency payments available under this section to producers 

on a farm that produce unshorn pelts or hay and silage derived from a loan commodity. 


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(b) COMPUTATION.—A loan deficiency payment for a loan commodity or commodity referred to in subsection (a)(2) shall be computed by multiplying— (1) the payment rate determined under subsection (c) for the 

commodity; by 

(2) the quantity of the commodity produced by the eligible 

producers, excluding any quantity for which the producers obtain a marketing assistance loan under section 1201. 

(c) PAYMENT RATE.— (1) IN GENERAL.—In the case of a loan commodity, the payment rate shall be the amount by which— (A) the loan rate established under section 1202 for the 

loan commodity; exceeds 

(B) the rate at which a marketing assistance loan for 

the loan commodity may be repaid under section 1204. 

(2) UNSHORN PELTS.—In the case of unshorn pelts, the payment rate shall be the amount by which— (A) the loan rate established under section 1202 for 

ungraded wool; exceeds 

(B) the rate at which a marketing assistance loan for 

ungraded wool may be repaid under section 1204. 

(3) HAY AND SILAGE.—In the case of hay or silage derived 

from a loan commodity, the payment rate shall be the amount 

by which—

(A) the loan rate established under section 1202 for the 

loan commodity from which the hay or silage is derived; exceeds 

(B) the rate at which a marketing assistance loan for 

the loan commodity may be repaid under section 1204. 

(d) EXCEPTION FOR EXTRA LONG STAPLE COTTON.—This section 

shall not apply with respect to extra long staple cotton. 

(e) EFFECTIVE DATE FOR PAYMENT RATE DETERMINATION.—The 

Secretary shall determine the amount of the loan deficiency payment 

to be made under this section to the producers on a farm with respect to a quantity of a loan commodity or commodity referred to 

in subsection (a)(2) using the payment rate in effect under subsection (c) as of the date the producers request the payment. 

SEC. 1206. PAYMENTS IN LIEU OF LOAN DEFICIENCY PAYMENTS FOR 

GRAZED ACREAGE. 

(a) ELIGIBLE PRODUCERS.—

(1) IN GENERAL.—Effective for the 2008 through 2012 crop 

years, in the case of a producer that would be eligible for a loan 

deficiency payment under section 1205 for wheat, barley, or 

oats, but that elects to use acreage planted to the wheat, barley, 

or oats for the grazing of livestock, the Secretary shall make a 

payment to the producer under this section if the producer enters into an agreement with the Secretary to forgo any other 

harvesting of the wheat, barley, or oats on that acreage. 

(2) GRAZING OF TRITICALE ACREAGE.—Effective for the 2008 

through 2012 crop years, with respect to a producer on a farm 

that uses acreage planted to triticale for the grazing of livestock, 

the Secretary shall make a payment to the producer under this 

section if the producer enters into an agreement with the Secretary to forgo any other harvesting of triticale on that acreage. 

(b) PAYMENT AMOUNT.—


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(1) IN GENERAL.—The amount of a payment made under 

this section to a producer on a farm described in subsection 

(a)(1) shall be equal to the amount determined by multiplying— (A) the loan deficiency payment rate determined under 

section 1205(c) in effect, as of the date of the agreement, for 

the county in which the farm is located; by 

(B) the payment quantity determined by multiplying— (i) the quantity of the grazed acreage on the farm 

with respect to which the producer elects to forgo harvesting of wheat, barley, or oats; and 

(ii) the payment yield in effect for the calculation 

of direct payments under subtitle A with respect to that 

loan commodity on the farm or, in the case of a farm 

without a payment yield for that loan commodity, an 

appropriate yield established by the Secretary in a 

manner consistent with section 1102 of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 7912). 

(2) GRAZING OF TRITICALE ACREAGE.—The amount of a payment made under this section to a producer on a farm described 

in subsection (a)(2) shall be equal to the amount determined by 

multiplying— (A) the loan deficiency payment rate determined under 

section 1205(c) in effect for wheat, as of the date of the 

agreement, for the county in which the farm is located; by 

(B) the payment quantity determined by multiplying— (i) the quantity of the grazed acreage on the farm 

with respect to which the producer elects to forgo harvesting of triticale; and 

(ii) the payment yield in effect for the calculation 

of direct payments under subtitle A with respect to 

wheat on the farm or, in the case of a farm without a 

payment yield for wheat, an appropriate yield established by the Secretary in a manner consistent with 

section 1102 of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 7912). 

(c) TIME, MANNER, AND AVAILABILITY OF PAYMENT.— (1) TIME AND MANNER.—A payment under this section shall 

be made at the same time and in the same manner as loan deficiency payments are made under section 1205. 

(2) AVAILABILITY.—

(A) IN GENERAL.—The Secretary shall establish an 

availability period for the payments authorized by this section. 

(B) CERTAIN COMMODITIES.—In the case of wheat, barley, and oats, the availability period shall be consistent 

with the availability period for the commodity established 

by the Secretary for marketing assistance loans authorized 

by this subtitle. 

(d) PROHIBITION ON CROP INSURANCE INDEMNITY OR NON- INSURED CROP ASSISTANCE.—A 2008 through 2012 crop of wheat, 

barley, oats, or triticale planted on acreage that a producer elects, 

in the agreement required by subsection (a), to use for the grazing 

of livestock in lieu of any other harvesting of the crop shall not be 

eligible for an indemnity under a policy or plan of insurance authorized under the Federal Crop Insurance Act (7 U.S.C. 1501 et 


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seq.) or noninsured crop assistance under section 196 of the Federal 

Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7333). 

SEC. 1207. SPECIAL MARKETING LOAN PROVISIONS FOR UPLAND COTTON. 

(a) SPECIAL IMPORT QUOTA.— (1) DEFINITION OF SPECIAL IMPORT QUOTA.—In this subsection, the term ‘‘special import quota’’ means a quantity of imports that is not subject to the over-quota tariff rate of a tariffrate quota. 

(2) ESTABLISHMENT.— (A) IN GENERAL.—The President shall carry out an import quota program during the period beginning on the 

date of enactment of this Act through July 31, 2013, as provided in this subsection. 

(B) PROGRAM REQUIREMENTS.—Whenever the Secretary 

determines and announces that for any consecutive 4-week 

period, the Friday through Thursday average price 

quotation for the lowest-priced United States growth, as 

quoted for Middling (M) 13⁄32-inch cotton, delivered to a definable and significant international market, as determined 

by the Secretary, exceeds the prevailing world market price, 

there shall immediately be in effect a special import quota. 

(3) QUANTITY.—The quota shall be equal to 1 week’s consumption of cotton by domestic mills at the seasonally adjusted 

average rate of the most recent 3 months for which data are 

available. 

(4) APPLICATION.—The quota shall apply to upland cotton 

purchased not later than 90 days after the date of the Secretary’s announcement under paragraph (2) and entered into 

the United States not later than 180 days after that date. 

(5) OVERLAP.—A special quota period may be established 

that overlaps any existing quota period if required by paragraph (2), except that a special quota period may not be established under this subsection if a quota period has been established under subsection (b). 

(6) PREFERENTIAL TARIFF TREATMENT.—The quantity under 

a special import quota shall be considered to be an in-quota 

quantity for purposes of—

(A) section 213(d) of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(d)); 

(B) section 204 of the Andean Trade Preference Act (19 

U.S.C. 3203); 

(C) section 503(d) of the Trade Act of 1974 (19 U.S.C. 

2463(d)); and 

(D) General Note 3(a)(iv) to the Harmonized Tariff 

Schedule. 

(7) LIMITATION.—The quantity of cotton entered into the 

United States during any marketing year under the special import quota established under this subsection may not exceed the 

equivalent of 10 week’s consumption of upland cotton by domestic mills at the seasonally adjusted average rate of the 3 months 

immediately preceding the first special import quota established 

in any marketing year. 

(b) LIMITED GLOBAL IMPORT QUOTA FOR UPLAND COTTON.—

(1) DEFINITIONS.—In this subsection: 


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(A) SUPPLY.—The term ‘‘supply’’ means, using the latest official data of the Bureau of the Census, the Department of Agriculture, and the Department of the Treasury— (i) the carry-over of upland cotton at the beginning 

of the marketing year (adjusted to 480-pound bales) in 

which the quota is established; 

(ii) production of the current crop; and 

(iii) imports to the latest date available during the 

marketing year. 

(B) DEMAND.—The term ‘‘demand’’ means— (i) the average seasonally adjusted annual rate of 

domestic mill consumption of cotton during the most 

recent 3 months for which data are available; and 

(ii) the larger of— (I) average exports of upland cotton during the 

preceding 6 marketing years; or 

(II) cumulative exports of upland cotton plus 

outstanding export sales for the marketing year in 

which the quota is established. 

(C) LIMITED GLOBAL IMPORT QUOTA.—The term ‘‘limited global import quota’’ means a quantity of imports that 

is not subject to the over-quota tariff rate of a tariff-rate 

quota. 

(2) PROGRAM.—The President shall carry out an import 

quota program that provides that whenever the Secretary determines and announces that the average price of the base quality 

of upland cotton, as determined by the Secretary, in the designated spot markets for a month exceeded 130 percent of the 

average price of the quality of cotton in the markets for the preceding 36 months, notwithstanding any other provision of law, 

there shall immediately be in effect a limited global import 

quota subject to the following conditions: 

(A) QUANTITY.—The quantity of the quota shall be 

equal to 21 days of domestic mill consumption of upland 

cotton at the seasonally adjusted average rate of the most 

recent 3 months for which data are available or as estimated by the Secretary. 

(B) QUANTITY IF PRIOR QUOTA.—If a quota has been established under this subsection during the preceding 12 

months, the quantity of the quota next established under 

this subsection shall be the smaller of 21 days of domestic 

mill consumption calculated under subparagraph (A) or the 

quantity required to increase the supply to 130 percent of 

the demand. 

(C) PREFERENTIAL TARIFF TREATMENT.—The quantity 

under a limited global import quota shall be considered to 

be an in-quota quantity for purposes of—

(i) section 213(d) of the Caribbean Basin Economic 

Recovery Act (19 U.S.C. 2703(d)); 

(ii) section 204 of the Andean Trade Preference Act 

(19 U.S.C. 3203); 

(iii) section 503(d) of the Trade Act of 1974 (19 

U.S.C. 2463(d)); and 

(iv) General Note 3(a)(iv) to the Harmonized Tariff 

Schedule. 


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(D) QUOTA ENTRY PERIOD.—When a quota is established under this subsection, cotton may be entered under 

the quota during the 90-day period beginning on the date 

the quota is established by the Secretary. 

(3) NO OVERLAP.—Notwithstanding paragraph (2), a quota 

period may not be established that overlaps an existing quota 

period or a special quota period established under subsection 

(a). 

(c) ECONOMIC ADJUSTMENT ASSISTANCE TO USERS OF UPLAND

COTTON.—

(1) IN GENERAL.—Subject to paragraph (2), the Secretary 

shall, on a monthly basis, provide economic adjustment assistance to domestic users of upland cotton in the form of payments 

for all documented use of that upland cotton during the previous monthly period regardless of the origin of the upland cotton. 

(2) VALUE OF ASSISTANCE.—

(A) BEGINNING PERIOD.—During the period beginning 

on August 1, 2008, and ending on July 31, 2012, the value 

of the assistance provided under paragraph (1) shall be 4 

cents per pound. 

(B) SUBSEQUENT PERIOD.—Effective beginning on August 1, 2012, the value of the assistance provided under 

paragraph (1) shall be 3 cents per pound. 

(3) ALLOWABLE PURPOSES.—Economic adjustment assistance under this subsection shall be made available only to domestic users of upland cotton that certify that the assistance 

shall be used only to acquire, construct, install, modernize, develop, convert, or expand land, plant, buildings, equipment, facilities, or machinery. 

(4) REVIEW OR AUDIT.—The Secretary may conduct such review or audit of the records of a domestic user under this subsection as the Secretary determines necessary to carry out this 

subsection. 

(5) IMPROPER USE OF ASSISTANCE.—If the Secretary determines, after a review or audit of the records of the domestic 

user, that economic adjustment assistance under this subsection 

was not used for the purposes specified in paragraph (3), the 

domestic user shall be—

(A) liable to repay the assistance to the Secretary, plus 

interest, as determined by the Secretary; and 

(B) ineligible to receive assistance under this subsection 

for a period of 1 year following the determination of the 

Secretary. 

SEC. 1208. SPECIAL COMPETITIVE PROVISIONS FOR EXTRA LONG STAPLE COTTON. 

(a) COMPETITIVENESS PROGRAM.—Notwithstanding any other 

provision of law, during the period beginning on the date of enactment of this Act through July 31, 2013, the Secretary shall carry 

out a program—

(1) to maintain and expand the domestic use of extra long 

staple cotton produced in the United States; 

(2) to increase exports of extra long staple cotton produced 

in the United States; and 


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(3) to ensure that extra long staple cotton produced in the 

United States remains competitive in world markets. 

(b) PAYMENTS UNDER PROGRAM; TRIGGER.—Under the program, the Secretary shall make payments available under this section whenever—

(1) for a consecutive 4-week period, the world market price 

for the lowest priced competing growth of extra long staple cotton (adjusted to United States quality and location and for 

other factors affecting the competitiveness of such cotton), as determined by the Secretary, is below the prevailing United States 

price for a competing growth of extra long staple cotton; and 

(2) the lowest priced competing growth of extra long staple 

cotton (adjusted to United States quality and location and for 

other factors affecting the competitiveness of such cotton), as determined by the Secretary, is less than 134 percent of the loan 

rate for extra long staple cotton. 

(c) ELIGIBLE RECIPIENTS.—The Secretary shall make payments 

available under this section to domestic users of extra long staple 

cotton produced in the United States and exporters of extra long staple cotton produced in the United States that enter into an agreement with the Commodity Credit Corporation to participate in the 

program under this section. 

(d) PAYMENT AMOUNT.—Payments under this section shall be 

based on the amount of the difference in the prices referred to in 

subsection (b)(1) during the fourth week of the consecutive 4-week 

period multiplied by the amount of documented purchases by domestic users and sales for export by exporters made in the week following such a consecutive 4-week period. 

SEC. 1209. AVAILABILITY OF RECOURSE LOANS FOR HIGH MOISTURE 

FEED GRAINS AND SEED COTTON. 

(a) HIGH MOISTURE FEED GRAINS.—

(1) DEFINITION OF HIGH MOISTURE STATE.—In this subsection, the term ‘‘high moisture state’’ means corn or grain sorghum having a moisture content in excess of Commodity Credit 

Corporation standards for marketing assistance loans made by 

the Secretary under section 1201. 

(2) RECOURSE LOANS AVAILABLE.—For each of the 2008 

through 2012 crops of corn and grain sorghum, the Secretary 

shall make available recourse loans, as determined by the Secretary, to producers on a farm that—

(A) normally harvest all or a portion of their crop of 

corn or grain sorghum in a high moisture state; 

(B) present—

(i) certified scale tickets from an inspected, certified commercial scale, including a licensed warehouse, feedlot, feed mill, distillery, or other similar entity approved by the Secretary, pursuant to regulations 

issued by the Secretary; or 

(ii) field or other physical measurements of the 

standing or stored crop in regions of the United States, 

as determined by the Secretary, that do not have certified commercial scales from which certified scale tickets may be obtained within reasonable proximity of 

harvest operation; 


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(C) certify that they were the owners of the feed grain 

at the time of delivery to, and that the quantity to be placed 

under loan under this subsection was in fact harvested on 

the farm and delivered to, a feedlot, feed mill, or commercial or on-farm high-moisture storage facility, or to a facility maintained by the users of corn and grain sorghum in 

a high moisture state; and 

(D) comply with deadlines established by the Secretary 

for harvesting the corn or grain sorghum and submit applications for loans under this subsection within deadlines established by the Secretary. 

(3) ELIGIBILITY OF ACQUIRED FEED GRAINS.—A loan under 

this subsection shall be made on a quantity of corn or grain 

sorghum of the same crop acquired by the producer equivalent 

to a quantity determined by multiplying— (A) the acreage of the corn or grain sorghum in a high 

moisture state harvested on the producer’s farm; by 

(B) the lower of the farm program payment yield used 

to make counter-cyclical payments under subtitle A or the 

actual yield on a field, as determined by the Secretary, that 

is similar to the field from which the corn or grain sorghum was obtained. 

(b) RECOURSE LOANS AVAILABLE FOR SEED COTTON.—For each 

of the 2008 through 2012 crops of upland cotton and extra long staple cotton, the Secretary shall make available recourse seed cotton 

loans, as determined by the Secretary, on any production. 

(c) REPAYMENT RATES.—Repayment of a recourse loan made 

under this section shall be at the loan rate established for the commodity by the Secretary, plus interest (determined in accordance 

with section 163 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7283)). 

SEC. 1210. ADJUSTMENTS OF LOANS. 

(a) ADJUSTMENT AUTHORITY.—Subject to subsection (e), the Secretary may make appropriate adjustments in the loan rates for any 

loan commodity (other than cotton) for differences in grade, type, 

quality, location, and other factors. 

(b) MANNER OF ADJUSTMENT.—The adjustments under subsection (a) shall, to the maximum extent practicable, be made in 

such a manner that the average loan level for the commodity will, 

on the basis of the anticipated incidence of the factors, be equal to 

the level of support determined in accordance with this subtitle and 

subtitles B through E. 

(c) ADJUSTMENT ON COUNTY BASIS.—

(1) IN GENERAL.—The Secretary may establish loan rates 

for a crop for producers in individual counties in a manner that 

results in the lowest loan rate being 95 percent of the national 

average loan rate, if those loan rates do not result in an increase in outlays. 

(2) PROHIBITION.—Adjustments under this subsection shall 

not result in an increase in the national average loan rate for 

any year. 

(d) ADJUSTMENT IN LOAN RATE FOR COTTON.—

(1) IN GENERAL.—The Secretary may make appropriate adjustments in the loan rate for cotton for differences in quality 

factors. 


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(2) REVISIONS TO QUALITY ADJUSTMENTS FOR UPLAND COT- TON.— (A) IN GENERAL.—Not later than 180 days after the 

date of enactment of this Act, the Secretary shall implement 

revisions in the administration of the marketing assistance 

loan program for upland cotton to more accurately and efficiently reflect market values for upland cotton. 

(B) MANDATORY REVISIONS.—Revisions under subparagraph (A) shall include— (i) the elimination of warehouse location differentials; 

(ii) the establishment of differentials for the various quality factors and staple lengths of cotton based 

on a 3-year, weighted moving average of the weighted 

designated spot market regions, as determined by regional production; 

(iii) the elimination of any artificial split in the 

premium or discount between upland cotton with a 32 

or 33 staple length due to micronaire; and 

(iv) a mechanism to ensure that no premium or 

discount is established that exceeds the premium or 

discount associated with a leaf grade that is 1 better 

than the applicable color grade. 

(C) DISCRETIONARY REVISIONS.—Revisions under subparagraph (A) may include— (i) the use of non-spot market price data, in addition to spot market price data, that would enhance the 

accuracy of the price information used in determining 

quality adjustments under this subsection; 

(ii) adjustments in the premiums or discounts associated with upland cotton with a staple length of 33 

or above due to micronaire with the goal of eliminating 

any unnecessary artificial splits in the calculations of 

the premiums or discounts; and 

(iii) such other adjustments as the Secretary determines appropriate, after consultations conducted in accordance with paragraph (3). 

(3) CONSULTATION WITH PRIVATE SECTOR.— (A) PRIOR TO REVISION.—In making adjustments to the 

loan rate for cotton (including any review of the adjustments) as provided in this subsection, the Secretary shall 

consult with representatives of the United States cotton industry. 

(B) INAPPLICABILITY OF FEDERAL ADVISORY COMMITTEE

ACT.—The Federal Advisory Committee Act (5 U.S.C. App.) 

shall not apply to consultations under this subsection. 

(4) REVIEW OF ADJUSTMENTS.—The Secretary may review 

the operation of the upland cotton quality adjustments implemented pursuant to this subsection and may make further revisions to the administration of the loan program for upland cotton, by—

(A) revoking or revising any actions taken under paragraph (2)(B); or 

(B) revoking or revising any actions taken or authorized to be taken under paragraph (2)(C). 


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(e) RICE.—The Secretary shall not make adjustments in the 

loan rates for long grain rice and medium grain rice, except for differences in grade and quality (including milling yields). 

Subtitle C—Peanuts 

SEC. 1301. DEFINITIONS. 

In this subtitle: 

(1) BASE ACRES FOR PEANUTS.— (A) IN GENERAL.—The term ‘‘base acres for peanuts’’ means the number of acres assigned to a farm pursuant to 

section 1302 of the Farm Security and Rural Investment 

Act of 2002 (7 U.S.C. 7952), as in effect on September 30, 

2007, subject to any adjustment under section 1302 of this 

Act. 

(B) COVERED COMMODITIES.—The term ‘‘base acres’’, with respect to a covered commodity, has the meaning given 

the term in section 1101. 

(2) COUNTER-CYCLICAL PAYMENT.—The term ‘‘counter-cyclical payment’’ means a payment made to producers on a farm 

under section 1304. 

(3) DIRECT PAYMENT.—The term ‘‘direct payment’’ means a 

direct payment made to producers on a farm under section 

1303. 

(4) EFFECTIVE PRICE.—The term ‘‘effective price’’ means the 

price calculated by the Secretary under section 1304 for peanuts 

to determine whether counter-cyclical payments are required to 

be made under that section for a crop year. 

(5) PAYMENT ACRES.—The term ‘‘payment acres’’ means, in 

the case of direct payments and counter-cyclical payments— (A) except as provided in subparagraph (B), 85 percent 

of the base acres of peanuts on a farm on which direct payments or counter-cyclical payments are made; and 

(B) in the case of direct payments for each of the 2009 

through 2011 crop years, 83.3 percent of the base acres for 

peanuts on a farm on which direct payments are made. 

(6) PAYMENT YIELD.—The term ‘‘payment yield’’ means the 

yield established for direct payments and the yield established 

for counter-cyclical payments under section 1302 of the Farm 

Security and Rural Investment Act of 2002 (7 U.S.C. 7952), as 

in effect on September 30, 2007, for a farm for peanuts. 

(7) PRODUCER.— (A) IN GENERAL.—The term ‘‘producer’’ means an 

owner, operator, landlord, tenant, or sharecropper that 

shares in the risk of producing a crop on a farm and is entitled to share in the crop available for marketing from the 

farm, or would have shared had the crop been produced. 

(B) HYBRID SEED.—In determining whether a grower of 

hybrid seed is a producer, the Secretary shall— (i) not take into consideration the existence of a hybrid seed contract; and 

(ii) ensure that program requirements do not adversely affect the ability of the grower to receive a payment under this subtitle. 

(8) STATE.—The term ‘‘State’’ means—

(A) a State; 


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(B) the District of Columbia; 

(C) the Commonwealth of Puerto Rico; and 

(D) any other territory or possession of the United 

States. 

(9) TARGET PRICE.—The term ‘‘target price’’ means the price 

per ton of peanuts used to determine the payment rate for 

counter-cyclical payments. 

(10) UNITED STATES.—The term ‘‘United States’’, when used 

in a geographical sense, means all of the States. 

SEC. 1302. BASE ACRES FOR PEANUTS FOR A FARM. 

(a) ADJUSTMENT OF BASE ACREAGE FOR PEANUTS.— (1) IN GENERAL.—The Secretary shall provide for an adjustment, as appropriate, in the base acres for peanuts for a farm 

whenever any of the following circumstances occur: 

(A) A conservation reserve contract entered into under 

section 1231 of the Food Security Act of 1985 (16 U.S.C. 

3831) with respect to the farm expires or is voluntarily terminated, or was terminated or expired during the period 

beginning on October 1, 2007, and ending on the date of 

enactment of this Act. 

(B) Cropland is released from coverage under a conservation reserve contract by the Secretary, or was released 

during the period beginning on October 1, 2007, and ending on the date of enactment of this Act. 

(C) The producer has eligible pulse crop acreage, which 

shall be determined in the same manner as eligible oilseed 

acreage under section 1101(a)(2) of the Farm Security and 

Rural Investment Act of 2002 (7 U.S.C. 7911(a)(2)). 

(D) The producer has eligible oilseed acreage as the result of the Secretary designating additional oilseeds, which 

shall be determined in the same manner as eligible oilseed 

acreage under section 1101(a)(2) of the Farm Security and 

Rural Investment Act of 2002 (7 U.S.C. 7911(a)(2)). 

(2) SPECIAL CONSERVATION RESERVE ACREAGE PAYMENT

RULES.—For the crop year in which a base acres for peanuts 

adjustment under subparagraph (A) or (B) of paragraph (1) is 

first made, the owner of the farm shall elect to receive either direct payments and counter-cyclical payments with respect to the 

acreage added to the farm under this subsection or a prorated 

payment under the conservation reserve contract, but not both. 

(b) PREVENTION OF EXCESS BASE ACRES FOR PEANUTS.—

(1) REQUIRED REDUCTION.—If the sum of the base acres for 

peanuts for a farm, together with the acreage described in paragraph (2), exceeds the actual cropland acreage of the farm, the 

Secretary shall reduce the base acres for peanuts for the farm 

or the base acres for 1 or more covered commodities for the farm 

so that the sum of the base acres for peanuts and acreage described in paragraph (2) does not exceed the actual cropland 

acreage of the farm. 

(2) OTHER ACREAGE.—For purposes of paragraph (1), the 

Secretary shall include the following: 

(A) Any base acres for the farm for a covered commodity. 

(B) Any acreage on the farm enrolled in the conservation reserve program or wetlands reserve program under 


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chapter 1 of subtitle D of title XII of the Food Security Act 

of 1985 (16 U.S.C. 3830 et seq.). 

(C) Any other acreage on the farm enrolled in a Federal conservation program for which payments are made in 

exchange for not producing an agricultural commodity on 

the acreage. 

(D) Any eligible pulse crop acreage, which shall be determined in the same manner as eligible oilseed acreage 

under section 1101(a)(2) of the Farm Security and Rural 

Investment Act of 2002 (7 U.S.C. 7911(a)(2)). 

(E) If the Secretary designates additional oilseeds, any 

eligible oilseed acreage, which shall be determined in the 

same manner as eligible oilseed acreage under section 

1101(a)(2) of the Farm Security and Rural Investment Act 

of 2002 (7 U.S.C. 7911(a)(2)). 

(3) SELECTION OF ACRES.—The Secretary shall give the 

owner of the farm the opportunity to select the base acres for 

peanuts or the base acres for covered commodities against 

which the reduction required by paragraph (1) will be made. 

(4) EXCEPTION FOR DOUBLE-CROPPED ACREAGE.—In applying paragraph (1), the Secretary shall make an exception in the 

case of double cropping, as determined by the Secretary. 

(5) COORDINATED APPLICATION OF REQUIREMENTS.—The 

Secretary shall take into account section 1101(b) when applying 

the requirements of this subsection. 

(c) REDUCTION IN BASE ACRES.— (1) REDUCTION AT OPTION OF OWNER.— (A) IN GENERAL.—The owner of a farm may reduce, at 

any time, the base acres for peanuts for the farm. 

(B) EFFECT OF REDUCTION.—A reduction under subparagraph (A) shall be permanent and made in a manner 

prescribed by the Secretary. 

(2) REQUIRED ACTION BY SECRETARY.— (A) IN GENERAL.—The Secretary shall proportionately 

reduce base acres on a farm for peanuts for land that has 

been subdivided and developed for multiple residential 

units or other nonfarming uses if the size of the tracts and 

the density of the subdivision is such that the land is unlikely to return to the previous agricultural use, unless the 

producers on the farm demonstrate that the land—

(i) remains devoted to commercial agricultural production; or 

(ii) is likely to be returned to the previous agricultural use. 

(B) REQUIREMENT.—The Secretary shall establish procedures to identify land described in subparagraph (A). 

(3) REVIEW AND REPORT.—Each year, to ensure, to the maximum extent practicable, that payments are received only by 

producers, the Secretary shall submit to Congress a report that 

describes the results of the actions taken under paragraph (2). 

(d) TREATMENT OF FARMS WITH LIMITED BASE ACRES.— (1) PROHIBITION ON PAYMENTS.—Except as provided in 

paragraph (2) and notwithstanding any other provision of this 

title, a producer on a farm may not receive direct payments, 

counter-cyclical payments, or average crop revenue election payVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00052 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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ments if the sum of the base acres of the farm is 10 acres or 

less, as determined by the Secretary. 

(2) EXCEPTIONS.—Paragraph (1) shall not apply to a farm 

owned by—

(A) a socially disadvantaged farmer or rancher (as defined in section 355(e) of the Consolidated Farm and Rural 

Development Act (7 U.S.C. 2003(e)); or 

(B) a limited resource farmer or rancher, as defined by 

the Secretary. 

(3) DATA COLLECTION AND PUBLICATION.—The Secretary 

shall— (A) collect and publish segregated data and survey information about the farm profiles, utilization of land, and 

crop production; and 

(B) perform an evaluation on the supply and price of 

fruits and vegetables based on the effects of suspension of 

base acres under this section. 

SEC. 1303. AVAILABILITY OF DIRECT PAYMENTS FOR PEANUTS. 

(a) PAYMENT REQUIRED.—For each of the 2008 through 2012 

crop years for peanuts, the Secretary shall make direct payments to 

the producers on a farm for which a payment yield and base acres 

for peanuts are established. 

(b) PAYMENT RATE.—Except as provided in section 1105, the 

payment rate used to make direct payments with respect to peanuts 

for a crop year shall be equal to $36 per ton. 

(c) PAYMENT AMOUNT.—The amount of the direct payment to be 

paid to the producers on a farm for peanuts for a crop year shall 

be equal to the product of the following: 

(1) The payment rate specified in subsection (b). 

(2) The payment acres on the farm. 

(3) The payment yield for the farm. 

(d) TIME FOR PAYMENT.— (1) IN GENERAL.—Except as provided in paragraph (2), in 

the case of each of the 2008 through 2012 crop years, the Secretary may not make direct payments under this section before 

October 1 of the calendar year in which the crop is harvested. 

(2) ADVANCE PAYMENTS.— (A) OPTION.— (i) IN GENERAL.—At the option of the producers on 

a farm, the Secretary shall pay in advance up to 22 

percent of the direct payment for peanuts for any of the 

2008 through 2011 crop years to the producers on a 

farm. 

(ii) 2008 CROP YEAR.—If the producers on a farm 

elect to receive advance direct payments under clause 

(i) for peanuts for the 2008 crop year, as soon as practicable after the election, the Secretary shall make the 

advance direct payment to the producers on the farm. 

(B) MONTH.—

(i) SELECTION.—Subject to clauses (ii) and (iii), the 

producers on a farm shall select the month during 

which the advance payment for a crop year will be 

made. 

(ii) OPTIONS.—The month selected may be any 

month during the period—


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(I) beginning on December 1 of the calendar 

year before the calendar year in which the crop of 

peanuts is harvested; and 

(II) ending during the month within which the 

direct payment would otherwise be made. 

(iii) CHANGE.—The producers on a farm may 

change the selected month for a subsequent advance 

payment by providing advance notice to the Secretary. 

(3) REPAYMENT OF ADVANCE PAYMENTS.—If a producer on 

a farm that receives an advance direct payment for a crop year 

ceases to be a producer on that farm, or the extent to which the 

producer shares in the risk of producing a crop changes, before 

the date the remainder of the direct payment is made, the producer shall be responsible for repaying the Secretary the applicable amount of the advance payment, as determined by the 

Secretary. 

SEC. 1304. AVAILABILITY OF COUNTER-CYCLICAL PAYMENTS FOR PEANUTS. 

(a) PAYMENT REQUIRED.—Except as provided in section 1105, 

for each of the 2008 through 2012 crop years for peanuts, the Secretary shall make counter-cyclical payments to producers on farms 

for which payment yields and base acres for peanuts are established 

if the Secretary determines that the effective price for peanuts is less 

than the target price for peanuts. 

(b) EFFECTIVE PRICE.—For purposes of subsection (a), the effective price for peanuts is equal to the sum of the following: 

(1) The higher of the following: 

(A) The national average market price for peanuts received by producers during the 12-month marketing year 

for peanuts, as determined by the Secretary. 

(B) The national average loan rate for a marketing assistance loan for peanuts in effect for the applicable period 

under this subtitle. 

(2) The payment rate in effect for peanuts under section 

1303 for the purpose of making direct payments. 

(c) TARGET PRICE.—For purposes of subsection (a), the target 

price for peanuts shall be equal to $495 per ton. 

(d) PAYMENT RATE.—The payment rate used to make countercyclical payments for a crop year shall be equal to the difference between—

(1) the target price for peanuts; and 

(2) the effective price determined under subsection (b) for 

peanuts. 

(e) PAYMENT AMOUNT.—If counter-cyclical payments are required to be paid for any of the 2008 through 2012 crops of peanuts, 

the amount of the counter-cyclical payment to be paid to the producers on a farm for that crop year shall be equal to the product 

of the following: 

(1) The payment rate specified in subsection (d). 

(2) The payment acres on the farm. 

(3) The payment yield for the farm. 

(f) TIME FOR PAYMENTS.—

(1) GENERAL RULE.—Except as provided in paragraph (2), 

if the Secretary determines under subsection (a) that counter-cyclical payments are required to be made under this section for 


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a crop of peanuts, beginning October 1, or as soon as practicable after the end of the marketing year, the Secretary shall 

make the counter-cyclical payments for the crop. 

(2) AVAILABILITY OF PARTIAL PAYMENTS.— (A) IN GENERAL.—If, before the end of the 12-month 

marketing year, the Secretary estimates that counter-cyclical payments will be required under this section for a crop 

year, the Secretary shall give producers on a farm the option to receive partial payments of the counter-cyclical payment projected to be made for the crop. 

(B) ELECTION.— (i) IN GENERAL.—The Secretary shall allow producers on a farm to make an election to receive partial 

payments under subparagraph (A) at any time but not 

later than 60 days prior to the end of the marketing 

year for the crop. 

(ii) DATE OF ISSUANCE.—The Secretary shall issue 

the partial payment after the date of an announcement 

by the Secretary but not later than 30 days prior to the 

end of the marketing year. 

(3) TIME FOR PARTIAL PAYMENTS.—When the Secretary 

makes partial payments for any of the 2008 through 2010 crop 

years—

(A) the first partial payment shall be made after completion of the first 180 days of the marketing year for that 

crop; and 

(B) the final partial payment shall be made beginning 

October 1, or as soon as practicable thereafter, after the end 

of the applicable marketing year for that crop. 

(4) AMOUNT OF PARTIAL PAYMENTS.—

(A) FIRST PARTIAL PAYMENT.—For each of the 2008 

through 2010 crop years, the first partial payment under 

paragraph (3) to the producers on a farm may not exceed 

40 percent of the projected counter-cyclical payment for the 

crop year, as determined by the Secretary. 

(B) FINAL PAYMENT.—The final payment for a crop 

year shall be equal to the difference between— (i) the actual counter-cyclical payment to be made 

to the producers for that crop year; and 

(ii) the amount of the partial payment made to the 

producers under subparagraph (A). 

(5) REPAYMENT.—The producers on a farm that receive a 

partial payment under this subsection for a crop year shall 

repay to the Secretary the amount, if any, by which the total of 

the partial payments exceed the actual counter-cyclical payment 

to be made for that crop year. 

SEC. 1305. PRODUCER AGREEMENT REQUIRED AS CONDITION ON PROVISION OF PAYMENTS. 

(a) COMPLIANCE WITH CERTAIN REQUIREMENTS.—

(1) REQUIREMENTS.—Before the producers on a farm may 

receive direct payments or counter-cyclical payments under this 

subtitle, or average crop revenue election payments under section 1105, with respect to the farm, the producers shall agree, 

during the crop year for which the payments are made and in 

exchange for the payments—


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(A) to comply with applicable conservation requirements under subtitle B of title XII of the Food Security Act 

of 1985 (16 U.S.C. 3811 et seq.); 

(B) to comply with applicable wetland protection requirements under subtitle C of title XII of that Act (16 

U.S.C. 3821 et seq.); 

(C) to comply with the planting flexibility requirements 

of section 1306; 

(D) to use the land on the farm, in a quantity equal to 

the attributable base acres for peanuts and any base acres 

for the farm under subtitle A, for an agricultural or conserving use, and not for a nonagricultural commercial, industrial, or residential use, as determined by the Secretary; 

and 

(E) to effectively control noxious weeds and otherwise 

maintain the land in accordance with sound agricultural 

practices, as determined by the Secretary, if the agricultural or conserving use involves the noncultivation of any 

portion of the land referred to in subparagraph (D). 

(2) COMPLIANCE.—The Secretary may issue such rules as 

the Secretary considers necessary to ensure producer compliance 

with the requirements of paragraph (1). 

(3) MODIFICATION.—At the request of the transferee or 

owner, the Secretary may modify the requirements of this subsection if the modifications are consistent with the objectives of 

this subsection, as determined by the Secretary. 

(b) TRANSFER OR CHANGE OF INTEREST IN FARM.—

(1) TERMINATION.—

(A) IN GENERAL.—Except as provided in paragraph (2), 

a transfer of (or change in) the interest of the producers on 

a farm in the base acres for peanuts for which direct payments or counter-cyclical payments are made, or on which 

average crop revenue election payments are based, shall result in the termination of the direct payments, counter-cyclical payments, or average crop revenue election payments 

to the extent the payments are made or based on the base 

acres, unless the transferee or owner of the acreage agrees 

to assume all obligations under subsection (a). 

(B) EFFECTIVE DATE.—The termination shall take effect 

on the date determined by the Secretary. 

(2) EXCEPTION.—If a producer entitled to a direct payment, 

counter-cyclical payment, or average crop revenue election payment dies, becomes incompetent, or is otherwise unable to receive the payment, the Secretary shall make the payment, in accordance with rules issued by the Secretary. 

(c) ACREAGE REPORTS.—

(1) IN GENERAL.—As a condition on the receipt of any benefits under this subtitle, the Secretary shall require producers on 

a farm to submit to the Secretary annual acreage reports with 

respect to all cropland on the farm. 

(2) PENALTIES.—No penalty with respect to benefits under 

this subtitle shall be assessed against the producers on a farm 

for an inaccurate acreage report unless the producers on the 

farm knowingly and willfully falsified the acreage report. 


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(d) TENANTS AND SHARECROPPERS.—In carrying out this subtitle, the Secretary shall provide adequate safeguards to protect the 

interests of tenants and sharecroppers. 

(e) SHARING OF PAYMENTS.—The Secretary shall provide for the 

sharing of direct payments, counter-cyclical payments, or average 

crop revenue election payments under section 1105 among the producers on a farm on a fair and equitable basis. 

SEC. 1306. PLANTING FLEXIBILITY. 

(a) PERMITTED CROPS.—Subject to subsection (b), any commodity or crop may be planted on the base acres for peanuts on a 

farm. 

(b) LIMITATIONS REGARDING CERTAIN COMMODITIES.—

(1) GENERAL LIMITATION.—The planting of an agricultural 

commodity specified in paragraph (3) shall be prohibited on 

base acres for peanuts unless the commodity, if planted, is destroyed before harvest. 

(2) TREATMENT OF TREES AND OTHER PERENNIALS.—The 

planting of an agricultural commodity specified in paragraph 

(3) that is produced on a tree or other perennial plant shall be 

prohibited on base acres for peanuts. 

(3) COVERED AGRICULTURAL COMMODITIES.—Paragraphs (1) 

and (2) apply to the following agricultural commodities: 

(A) Fruits. 

(B) Vegetables (other than mung beans and pulse 

crops). 

(C) Wild rice. 

(c) EXCEPTIONS.—Paragraphs (1) and (2) of subsection (b) shall 

not limit the planting of an agricultural commodity specified in 

paragraph (3) of that subsection—

(1) in any region in which there is a history of double-cropping of peanuts with agricultural commodities specified in subsection (b)(3), as determined by the Secretary, in which case the 

double-cropping shall be permitted; 

(2) on a farm that the Secretary determines has a history 

of planting agricultural commodities specified in subsection 

(b)(3) on the base acres for peanuts, except that direct payments 

and counter-cyclical payments shall be reduced by an acre for 

each acre planted to such an agricultural commodity; or 

(3) by the producers on a farm that the Secretary determines has an established planting history of a specific agricultural commodity specified in subsection (b)(3), except that—

(A) the quantity planted may not exceed the average 

annual planting history of such agricultural commodity by 

the producers on the farm in the 1991 through 1995 or 

1998 through 2001 crop years (excluding any crop year in 

which no plantings were made), as determined by the Secretary; and 

(B) direct payments and counter-cyclical payments 

shall be reduced by an acre for each acre planted to such 

agricultural commodity. 

SEC. 1307. MARKETING ASSISTANCE LOANS AND LOAN DEFICIENCY 

PAYMENTS FOR PEANUTS. 

(a) NONRECOURSE LOANS AVAILABLE.—


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(1) AVAILABILITY.—For each of the 2008 through 2012 crops 

of peanuts, the Secretary shall make available to producers on 

a farm nonrecourse marketing assistance loans for peanuts produced on the farm. 

(2) TERMS AND CONDITIONS.—The loans shall be made 

under terms and conditions that are prescribed by the Secretary 

and at the loan rate established under subsection (b). 

(3) ELIGIBLE PRODUCTION.—The producers on a farm shall 

be eligible for a marketing assistance loan under this subsection 

for any quantity of peanuts produced on the farm. 

(4) OPTIONS FOR OBTAINING LOAN.—A marketing assistance 

loan under this subsection, and loan deficiency payments under 

subsection (e), may be obtained at the option of the producers 

on a farm through—

(A) a designated marketing association or marketing 

cooperative of producers that is approved by the Secretary; 

or 

(B) the Farm Service Agency. 

(5) STORAGE OF LOAN PEANUTS.—As a condition on the Secretary’s approval of an individual or entity to provide storage 

for peanuts for which a marketing assistance loan is made 

under this section, the individual or entity shall agree—

(A) to provide such storage on a nondiscriminatory 

basis; and 

(B) to comply with such additional requirements as the 

Secretary considers appropriate to accomplish the purposes 

of this section and promote fairness in the administration 

of the benefits of this section. 

(6) STORAGE, HANDLING, AND ASSOCIATED COSTS.—

(A) IN GENERAL.—Beginning with the 2008 crop of peanuts, to ensure proper storage of peanuts for which a loan 

is made under this section, the Secretary shall pay handling and other associated costs (other than storage costs) 

incurred at the time at which the peanuts are placed under 

loan, as determined by the Secretary. 

(B) REDEMPTION AND FORFEITURE.—The Secretary 

shall—

(i) require the repayment of handling and other associated costs paid under subparagraph (A) for all peanuts pledged as collateral for a loan that is redeemed 

under this section; and 

(ii) pay storage, handling, and other associated 

costs for all peanuts pledged as collateral that are forfeited under this section. 

(7) MARKETING.—A marketing association or cooperative 

may market peanuts for which a loan is made under this section in any manner that conforms to consumer needs, including 

the separation of peanuts by type and quality. 

(b) LOAN RATE.—Except as provided in section 1105, the loan 

rate for a marketing assistance loan for peanuts under subsection 

(a) shall be equal to $355 per ton. 

(c) TERM OF LOAN.—

(1) IN GENERAL.—A marketing assistance loan for peanuts 

under subsection (a) shall have a term of 9 months beginning 


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on the first day of the first month after the month in which the 

loan is made. 

(2) EXTENSIONS PROHIBITED.—The Secretary may not extend the term of a marketing assistance loan for peanuts under 

subsection (a). 

(d) REPAYMENT RATE.— (1) IN GENERAL.—The Secretary shall permit producers on 

a farm to repay a marketing assistance loan for peanuts under 

subsection (a) at a rate that is the lesser of— (A) the loan rate established for peanuts under subsection (b), plus interest (determined in accordance with 

section 163 of the Federal Agriculture Improvement and 

Reform Act of 1996 (7 U.S.C. 7283)); or 

(B) a rate that the Secretary determines will— (i) minimize potential loan forfeitures; 

(ii) minimize the accumulation of stocks of peanuts 

by the Federal Government; 

(iii) minimize the cost incurred by the Federal Government in storing peanuts; and 

(iv) allow peanuts produced in the United States to 

be marketed freely and competitively, both domestically 

and internationally. 

(2) AUTHORITY TO TEMPORARILY ADJUST REPAYMENT

RATES.—

(A) ADJUSTMENT AUTHORITY.—In the event of a severe 

disruption to marketing, transportation, or related infrastructure, the Secretary may modify the repayment rate otherwise applicable under this subsection for marketing assistance loans for peanuts under subsection (a). 

(B) DURATION.—An adjustment made under subparagraph (A) in the repayment rate for marketing assistance 

loans for peanuts shall be in effect on a short-term and 

temporary basis, as determined by the Secretary. 

(e) LOAN DEFICIENCY PAYMENTS.—

(1) AVAILABILITY.—The Secretary may make loan deficiency 

payments available to producers on a farm that, although eligible to obtain a marketing assistance loan for peanuts under 

subsection (a), agree to forgo obtaining the loan for the peanuts 

in return for loan deficiency payments under this subsection. 

(2) COMPUTATION.—A loan deficiency payment under this 

subsection shall be computed by multiplying—

(A) the payment rate determined under paragraph (3) 

for peanuts; by 

(B) the quantity of the peanuts produced by the producers, excluding any quantity for which the producers obtain a marketing assistance loan under subsection (a). 

(3) PAYMENT RATE.—For purposes of this subsection, the 

payment rate shall be the amount by which—

(A) the loan rate established under subsection (b); exceeds 

(B) the rate at which a loan may be repaid under subsection (d). 

(4) EFFECTIVE DATE FOR PAYMENT RATE DETERMINATION.—

The Secretary shall determine the amount of the loan deficiency 

payment to be made under this subsection to the producers on 


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a farm with respect to a quantity of peanuts using the payment 

rate in effect under paragraph (3) as of the date the producers 

request the payment. 

(f) COMPLIANCE WITH CONSERVATION AND WETLANDS REQUIREMENTS.—As a condition of the receipt of a marketing assistance loan 

under subsection (a), the producer shall comply with applicable conservation requirements under subtitle B of title XII of the Food Security Act of 1985 (16 U.S.C. 3811 et seq.) and applicable wetland 

protection requirements under subtitle C of title XII of that Act (16 

U.S.C. 3821 et seq.) during the term of the loan. 

(g) REIMBURSABLE AGREEMENTS AND PAYMENT OF ADMINISTRATIVE EXPENSES.—The Secretary may implement any reimbursable 

agreements or provide for the payment of administrative expenses 

under this subtitle only in a manner that is consistent with such activities in regard to other commodities. 

SEC. 1308. ADJUSTMENTS OF LOANS. 

(a) ADJUSTMENT AUTHORITY.—The Secretary may make appropriate adjustments in the loan rates for peanuts for differences in 

grade, type, quality, location, and other factors. 

(b) MANNER OF ADJUSTMENT.—The adjustments under subsection (a) shall, to the maximum extent practicable, be made in 

such a manner that the average loan level for peanuts will, on the 

basis of the anticipated incidence of the factors, be equal to the level 

of support determined in accordance with this subtitle and subtitles 

B, D, and E. 

(c) ADJUSTMENT ON COUNTY BASIS.—

(1) IN GENERAL.—Subject to paragraph (2), the Secretary 

may establish loan rates for a crop of peanuts for producers in 

individual counties in a manner that results in the lowest loan 

rate being 95 percent of the national average loan rate, if those 

loan rates do not result in an increase in outlays. 

(2) PROHIBITION.—Adjustments under this subsection shall 

not result in an increase in the national average loan rate for 

any year. 

Subtitle D—Sugar 

SEC. 1401. SUGAR PROGRAM. 

(a) IN GENERAL.—Section 156 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7272) is amended to 

read as follows: 

‘‘SEC. 156. SUGAR PROGRAM. 

‘‘(a) SUGARCANE.—The Secretary shall make loans available to 

processors of domestically grown sugarcane at a rate equal to—

‘‘(1) 18.00 cents per pound for raw cane sugar for the 2008 

crop year; 

‘‘(2) 18.25 cents per pound for raw cane sugar for the 2009 

crop year; 

‘‘(3) 18.50 cents per pound for raw cane sugar for the 2010 

crop year; 

‘‘(4) 18.75 cents per pound for raw cane sugar for the 2011 

crop year; and 

‘‘(5) 18.75 cents per pound for raw cane sugar for the 2012 

crop year. 


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‘‘(b) SUGAR BEETS.—The Secretary shall make loans available 

to processors of domestically grown sugar beets at a rate equal to—

‘‘(1) 22.9 cents per pound for refined beet sugar for the 2008 

crop year; and 

‘‘(2) a rate that is equal to 128.5 percent of the loan rate 

per pound of raw cane sugar for the applicable crop year under 

subsection (a) for each of the 2009 through 2012 crop years. 

‘‘(c) TERM OF LOANS.—

‘‘(1) IN GENERAL.—A loan under this section during any fiscal year shall be made available not earlier than the beginning 

of the fiscal year and shall mature at the earlier of—

‘‘(A) the end of the 9-month period beginning on the 

first day of the first month after the month in which the 

loan is made; or 

‘‘(B) the end of the fiscal year in which the loan is 

made. 

‘‘(2) SUPPLEMENTAL LOANS.—In the case of a loan made 

under this section in the last 3 months of a fiscal year, the processor may repledge the sugar as collateral for a second loan in 

the subsequent fiscal year, except that the second loan shall—

‘‘(A) be made at the loan rate in effect at the time the 

first loan was made; and 

‘‘(B) mature in 9 months less the quantity of time that 

the first loan was in effect. 

‘‘(d) LOAN TYPE; PROCESSOR ASSURANCES.—

‘‘(1) NONRECOURSE LOANS.—The Secretary shall carry out 

this section through the use of nonrecourse loans. 

‘‘(2) PROCESSOR ASSURANCES.—

‘‘(A) IN GENERAL.—The Secretary shall obtain from 

each processor that receives a loan under this section such 

assurances as the Secretary considers adequate to ensure 

that the processor will provide payments to producers that 

are proportional to the value of the loan received by the 

processor for the sugar beets and sugarcane delivered by 

producers to the processor. 

‘‘(B) MINIMUM PAYMENTS.—

‘‘(i) IN GENERAL.—Subject to clause (ii), the Secretary may establish appropriate minimum payments 

for purposes of this paragraph. 

‘‘(ii) LIMITATION.—In the case of sugar beets, the 

minimum payment established under clause (i) shall 

not exceed the rate of payment provided for under the 

applicable contract between a sugar beet producer and 

a sugar beet processor. 

‘‘(3) ADMINISTRATION.—The Secretary may not impose or 

enforce any prenotification requirement, or similar administrative requirement not otherwise in effect on May 13, 2002, that 

has the effect of preventing a processor from electing to forfeit 

the loan collateral (of an acceptable grade and quality) on the 

maturity of the loan. 

‘‘(e) LOANS FOR IN-PROCESS SUGAR.—

‘‘(1) DEFINITION OF IN-PROCESS SUGARS AND SYRUPS.—In 

this subsection, the term ‘in-process sugars and syrups’ does not 

include raw sugar, liquid sugar, invert sugar, invert syrup, or 


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other finished product that is otherwise eligible for a loan 

under subsection (a) or (b). ‘‘(2) AVAILABILITY.—The Secretary shall make nonrecourse 

loans available to processors of a crop of domestically grown 

sugarcane and sugar beets for in-process sugars and syrups derived from the crop. ‘‘(3) LOAN RATE.—The loan rate shall be equal to 80 percent 

of the loan rate applicable to raw cane sugar or refined beet 

sugar, as determined by the Secretary on the basis of the source 

material for the in-process sugars and syrups. ‘‘(4) FURTHER PROCESSING ON FORFEITURE.— ‘‘(A) IN GENERAL.—As a condition of the forfeiture of 

in-process sugars and syrups serving as collateral for a 

loan under paragraph (2), the processor shall, within such 

reasonable time period as the Secretary may prescribe and 

at no cost to the Commodity Credit Corporation, convert the 

in-process sugars and syrups into raw cane sugar or refined beet sugar of acceptable grade and quality for sugars 

eligible for loans under subsection (a) or (b). 

‘‘(B) TRANSFER TO CORPORATION.—Once the in-process 

sugars and syrups are fully processed into raw cane sugar 

or refined beet sugar, the processor shall transfer the sugar 

to the Commodity Credit Corporation. 

‘‘(C) PAYMENT TO PROCESSOR.—On transfer of the 

sugar, the Secretary shall make a payment to the processor 

in an amount equal to the amount obtained by multiplying—‘‘(i) the difference between— ‘‘(I) the loan rate for raw cane sugar or refined 

beet sugar, as appropriate; and ‘‘(II) the loan rate the processor received under 

paragraph (3); by 

‘‘(ii) the quantity of sugar transferred to the Secretary. 

‘‘(5) LOAN CONVERSION.—If the processor does not forfeit the 

collateral as described in paragraph (4), but instead further 

processes the in-process sugars and syrups into raw cane sugar 

or refined beet sugar and repays the loan on the in-process sugars and syrups, the processor may obtain a loan under subsection (a) or (b) for the raw cane sugar or refined beet sugar, 

as appropriate. ‘‘(6) TERM OF LOAN.—The term of a loan made under this 

subsection for a quantity of in-process sugars and syrups, when 

combined with the term of a loan made with respect to the raw 

cane sugar or refined beet sugar derived from the in-process 

sugars and syrups, may not exceed 9 months, consistent with 

subsection (c). 

‘‘(f) AVOIDING FORFEITURES; CORPORATION INVENTORY DISPOSITION.— ‘‘(1) IN GENERAL.—Subject to subsection (d)(3), to the maximum extent practicable, the Secretary shall operate the program established under this section at no cost to the Federal 

Government by avoiding the forfeiture of sugar to the Commodity Credit Corporation. ‘‘(2) INVENTORY DISPOSITION.—


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‘‘(A) IN GENERAL.—To carry out paragraph (1), the 

Commodity Credit Corporation may accept bids to obtain 

raw cane sugar or refined beet sugar in the inventory of the 

Commodity Credit Corporation from (or otherwise make 

available such commodities, on appropriate terms and conditions, to) processors of sugarcane and processors of sugar 

beets (acting in conjunction with the producers of the sugarcane or sugar beets processed by the processors) in return 

for the reduction of production of raw cane sugar or refined 

beet sugar, as appropriate. ‘‘(B) BIOENERGY FEEDSTOCK.—If a reduction in the 

quantity of production accepted under subparagraph (A) involves sugar beets or sugarcane that has already been 

planted, the sugar beets or sugarcane so planted may not 

be used for any commercial purpose other than as a bioenergy feedstock. ‘‘(C) ADDITIONAL AUTHORITY.—The authority provided 

under this paragraph is in addition to any authority of the 

Commodity Credit Corporation under any other law. 

‘‘(g) INFORMATION REPORTING.—

‘‘(1) DUTY OF PROCESSORS AND REFINERS TO REPORT.—A 

sugarcane processor, cane sugar refiner, and sugar beet processor shall furnish the Secretary, on a monthly basis, such information as the Secretary may require to administer sugar 

programs, including the quantity of purchases of sugarcane, 

sugar beets, and sugar, and production, importation, distribution, and stock levels of sugar. ‘‘(2) DUTY OF PRODUCERS TO REPORT.— ‘‘(A) PROPORTIONATE SHARE STATES.—As a condition of 

a loan made to a processor for the benefit of a producer, the 

Secretary shall require each producer of sugarcane located 

in a State (other than the Commonwealth of Puerto Rico) 

in which there are in excess of 250 producers of sugarcane 

to report, in the manner prescribed by the Secretary, the 

sugarcane yields and acres planted to sugarcane of the producer. ‘‘(B) OTHER STATES.—The Secretary may require each 

producer of sugarcane or sugar beets not covered by subparagraph (A) to report, in a manner prescribed by the Secretary, the yields of, and acres planted to, sugarcane or 

sugar beets, respectively, of the producer. 

‘‘(3) DUTY OF IMPORTERS TO REPORT.—

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

(B), the Secretary shall require an importer of sugars, syrups, or molasses to be used for human consumption or to 

be used for the extraction of sugar for human consumption 

to report, in the manner prescribed by the Secretary, the 

quantities of the products imported by the importer and the 

sugar content or equivalent of the products. ‘‘(B) TARIFF-RATE QUOTAS.—Subparagraph (A) shall 

not apply to sugars, syrups, or molasses that are within the 

quantities of tariff-rate quotas that are subject to the lower 

rate of duties. 

‘‘(4) COLLECTION OF INFORMATION ON MEXICO.—

‘‘(A) COLLECTION.—The Secretary shall collect—


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‘‘(i) information on the production, consumption, 

stocks, and trade of sugar in Mexico, including United 

States exports of sugar to Mexico; and 

‘‘(ii) publicly available information on Mexican 

production, consumption, and trade of high fructose 

corn syrups. 

‘‘(B) PUBLICATION.—The data collected under subparagraph (A) shall be published in each edition of the World 

Agricultural Supply and Demand Estimates. 

‘‘(5) PENALTY.—Any person willfully failing or refusing to 

furnish the information required to be reported by paragraph 

(1), (2), or (3), or furnishing willfully false information, shall be 

subject to a civil penalty of not more than $10,000 for each such 

violation. 

‘‘(6) MONTHLY REPORTS.—Taking into consideration the information received under this subsection, the Secretary shall 

publish on a monthly basis composite data on production, imports, distribution, and stock levels of sugar. 

‘‘(h) SUBSTITUTION OF REFINED SUGAR.—For purposes of Additional U.S. Note 6 to chapter 17 of the Harmonized Tariff Schedule 

of the United States and the reexport programs and polyhydric alcohol program administered by the Secretary, all refined sugars 

(whether derived from sugar beets or sugarcane) produced by cane 

sugar refineries and beet sugar processors shall be fully substitutable for the export of sugar and sugar-containing products under 

those programs. 

‘‘(i) EFFECTIVE PERIOD.—This section shall be effective only for 

the 2008 through 2012 crops of sugar beets and sugarcane.’’. 

(b) TRANSITION.—The Secretary shall make loans for raw cane 

sugar and refined beet sugar available for the 2007 crop year on the 

terms and conditions provided in section 156 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7272), as in 

effect on the day before the date of enactment of this Act. 

SEC. 1402. UNITED STATES MEMBERSHIP IN THE INTERNATIONAL 

SUGAR ORGANIZATION. 

The Secretary shall work with the Secretary of State to restore 

United States membership in the International Sugar Organization 

not later than 1 year after the date of enactment of this Act. 

SEC. 1403. FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR. 

(a) DEFINITIONS.—Section 359a of the Agricultural Adjustment 

Act of 1938 (7 U.S.C. 1359aa) is amended—

(1) by redesignating paragraphs (1), (2), (3), and (4) as 

paragraphs (2), (4), (5), and (6), respectively; 

(2) by inserting before paragraph (2) (as so redesignated) 

the following: 

‘‘(1) HUMAN CONSUMPTION.—The term ‘human consumption’, when used in the context of a reference to sugar (whether 

in the form of sugar, in-process sugar, syrup, molasses, or in 

some other form) for human consumption, includes sugar for 

use in human food, beverages, or similar products.’’; and 

(3) by inserting after paragraph (2) (as so redesignated) the 

following: 

‘‘(3) MARKET.—


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‘‘(A) IN GENERAL.—The term ‘market’ means to sell or 

otherwise dispose of in commerce in the United States. ‘‘(B) INCLUSIONS.—The term ‘market’ includes— ‘‘(i) the forfeiture of sugar under the loan program 

for sugar established under section 156 of the Federal 

Agriculture Improvement and Reform Act of 1996 (7 

U.S.C. 7272); ‘‘(ii) with respect to any integrated processor and 

refiner, the movement of raw cane sugar into the refining process; and ‘‘(iii) the sale of sugar for the production of ethanol 

or other bioenergy product, if the disposition of the 

sugar is administered by the Secretary under section 

9010 of the Farm Security and Rural Investment Act 

of 2002. 

‘‘(C) MARKETING YEAR.—Forfeited sugar described in 

subparagraph (B)(i) shall be considered to have been marketed during the crop year for which a loan is made under 

the loan program described in that subparagraph.’’. (b) FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR.—Section 

359b of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359bb) 

is amended to read as follows: 

‘‘SEC. 359b. FLEXIBLE MARKETING ALLOTMENTS FOR SUGAR. 

‘‘(a) SUGAR ESTIMATES.— ‘‘(1) IN GENERAL.—Not later than August 1 before the beginning of each of the 2008 through 2012 crop years for sugarcane 

and sugar beets, the Secretary shall estimate— ‘‘(A) the quantity of sugar that will be subject to human 

consumption in the United States during the crop year; ‘‘(B) the quantity of sugar that would provide for reasonable carryover stocks; ‘‘(C) the quantity of sugar that will be available from 

carry-in stocks for human consumption in the United 

States during the crop year; ‘‘(D) the quantity of sugar that will be available from 

the domestic processing of sugarcane, sugar beets, and inprocess beet sugar; and ‘‘(E) the quantity of sugars, syrups, and molasses that 

will be imported for human consumption or to be used for 

the extraction of sugar for human consumption in the 

United States during the crop year, whether the articles are 

under a tariff-rate quota or are in excess or outside of a tariff-rate quota. 

‘‘(2) EXCLUSION.—The estimates under this subsection shall 

not apply to sugar imported for the production of polyhydric alcohol or to any sugar refined and reexported in refined form or 

in products containing sugar. 

‘‘(3) REESTIMATES.—The Secretary shall make reestimates 

of sugar consumption, stocks, production, and imports for a 

crop year as necessary, but not later than the beginning of each 

of the second through fourth quarters of the crop year. 

‘‘(b) SUGAR ALLOTMENTS.—

‘‘(1) ESTABLISHMENT.—By the beginning of each crop year, 

the Secretary shall establish for that crop year appropriate allotments under section 359c for the marketing by processors of 


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sugar processed from sugar cane or sugar beets or in-process 

beet sugar (whether the sugar beets or in-process beet sugar was 

produced domestically or imported) at a level that is— ‘‘(A) sufficient to maintain raw and refined sugar 

prices above forfeiture levels so that there will be no forfeitures of sugar to the Commodity Credit Corporation under 

the loan program for sugar established under section 156 

of the Federal Agriculture Improvement and Reform Act of 

1996 (7 U.S.C. 7272); but ‘‘(B) not less than 85 percent of the estimated quantity 

of sugar for domestic human consumption for the crop year. 

‘‘(2) PRODUCTS.—The Secretary may include sugar products, the majority content of which is sucrose for human consumption, derived from sugar cane, sugar beets, molasses, or 

sugar in the allotments established under paragraph (1) if the 

Secretary determines it to be appropriate for purposes of this 

part. 

‘‘(c) COVERAGE OF ALLOTMENTS.— ‘‘(1) IN GENERAL.—The marketing allotments under this 

part shall apply to the marketing by processors of sugar intended for domestic human consumption that has been processed from sugar cane, sugar beets, or in-process beet sugar, 

whether such sugar beets or in-process beet sugar was produced 

domestically or imported. 

‘‘(2) EXCEPTIONS.—Consistent with the administration of 

marketing allotments for each of the 2002 through 2007 crop 

years, the marketing allotments shall not apply to sugar sold— ‘‘(A) to facilitate the exportation of the sugar to a foreign country, except that the exports of sugar shall not be 

eligible to receive credits under reexport programs for refined sugar or sugar containing products administered by 

the Secretary; ‘‘(B) to enable another processor to fulfill an allocation 

established for that processor; or 

‘‘(C) for uses other than domestic human consumption, 

except for the sale of sugar for the production of ethanol or 

other bioenergy if the disposition of the sugar is administered by the Secretary under section 9010 of the Farm Security and Rural Investment Act of 2002. 

‘‘(3) REQUIREMENT.—The sale of sugar described in paragraph (2)(B) shall be—

‘‘(A) made prior to May 1; and 

‘‘(B) reported to the Secretary. 

‘‘(d) PROHIBITIONS.—

‘‘(1) IN GENERAL.—During all or part of any crop year for 

which marketing allotments have been established, no processor 

of sugar beets or sugarcane shall market for domestic human 

consumption a quantity of sugar in excess of the allocation established for the processor, except— ‘‘(A) to enable another processor to fulfill an allocation 

established for that other processor; or ‘‘(B) to facilitate the exportation of the sugar. ‘‘(2) CIVIL PENALTY.—Any processor who knowingly violates 

paragraph (1) shall be liable to the Commodity Credit Corporation for a civil penalty in an amount equal to 3 times the 


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United States market value, at the time of the commission of 

the violation, of that quantity of sugar involved in the violation.’’. (c) ESTABLISHMENT OF FLEXIBLE MARKETING ALLOTMENTS.— Section 359c of the Agricultural Adjustment Act of 1938 (7 U.S.C. 

1359cc) is amended— (1) by striking subsection (b) and inserting the following: ‘‘(b) OVERALL ALLOTMENT QUANTITY.— ‘‘(1) IN GENERAL.—The Secretary shall establish the overall 

quantity of sugar to be allotted for the crop year (referred to in 

this part as the ‘overall allotment quantity’) at a level that is— ‘‘(A) sufficient to maintain raw and refined sugar 

prices above forfeiture levels to avoid forfeiture of sugar to 

the Commodity Credit Corporation; but ‘‘(B) not less than a quantity equal to 85 percent of the 

estimated quantity of sugar for domestic human consumption for the crop year. 

‘‘(2) ADJUSTMENT.—Subject to paragraph (1), the Secretary 

shall adjust the overall allotment quantity to maintain— ‘‘(A) raw and refined sugar prices above forfeiture levels to avoid the forfeiture of sugar to the Commodity Credit 

Corporation; and ‘‘(B) adequate supplies of raw and refined sugar in the 

domestic market.’’; 

(2) in subsection (d)(2), by inserting ‘‘or in-process beet 

sugar’’ before the period at the end; 

(3) in subsection (g)(1)— (A) by striking ‘‘(1) IN GENERAL.—The Secretary’’ and 

inserting the following: 

‘‘(1) ADJUSTMENTS.—

‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

Secretary’’; and 

(B) by adding at the end the following: 

‘‘(B) LIMITATION.—In carrying out subparagraph (A), 

the Secretary may not reduce the overall allotment quantity 

to a quantity of less than 85 percent of the estimated quantity of sugar for domestic human consumption for the crop 

year.’’; and 

(4) by striking subsection (h). 

(d) ALLOCATION OF MARKETING ALLOTMENTS.—Section 359d(b) 

of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359dd(b)) is 

amended—

(1) in paragraph (1)(F), by striking ‘‘Except as otherwise 

provided in section 359f(c)(8), if’’ and inserting ‘‘If’’; and 

(2) in paragraph (2), by striking subparagraphs (G), (H), 

and (I) and inserting the following: 

‘‘(G) SALE OF FACTORIES OF A PROCESSOR TO ANOTHER

PROCESSOR.—

‘‘(i) EFFECT OF SALE.—Subject to subparagraphs 

(E) and (F), if 1 or more factories of a processor of beet 

sugar (but not all of the assets of the processor) are 

sold to another processor of beet sugar during a crop 

year, the Secretary shall assign a pro rata portion of 

the allocation of the seller to the allocation of the buyer 

to reflect the historical contribution of the production of 


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the sold 1 or more factories to the total allocation of the 

seller, unless the buyer and the seller have agreed upon 

the transfer of a different portion of the allocation of 

the seller, in which case, the Secretary shall transfer 

that portion agreed upon by the buyer and seller. 

‘‘(ii) APPLICATION OF ALLOCATION.—The assignment of the allocation under clause (i) shall apply—

‘‘(I) during the remainder of the crop year for 

which the sale described in clause (i) occurs; and 

‘‘(II) during each subsequent crop year. 

‘‘(iii) USE OF OTHER FACTORIES TO FILL ALLOCATION.—If the assignment of the allocation under clause 

(i) to the buyer for the 1 or more purchased factories 

cannot be filled by the production of the 1 or more purchased factories, the remainder of the allocation may 

be filled by beet sugar produced by the buyer from 

other factories of the buyer. 

‘‘(H) NEW ENTRANTS STARTING PRODUCTION, REOPENING, OR ACQUIRING AN EXISTING FACTORY WITH PRODUCTION

HISTORY.—

‘‘(i) DEFINITION OF NEW ENTRANT.—

‘‘(I) IN GENERAL.—In this subparagraph, the 

term ‘new entrant’ means an individual, corporation, or other entity that—

‘‘(aa) does not have an allocation of the 

beet sugar allotment under this part; 

‘‘(bb) is not affiliated with any other individual, corporation, or entity that has an allocation of beet sugar under this part (referred 

to in this clause as a ‘third party’); and 

‘‘(cc) will process sugar beets produced by 

sugar beet growers under contract with the 

new entrant for the production of sugar at the 

new or re-opened factory that is the basis for 

the new entrant allocation. 

‘‘(II) AFFILIATION.—For purposes of subclause 

(I)(bb), a new entrant and a third party shall be 

considered to be affiliated if—

‘‘(aa) the third party has an ownership interest in the new entrant; 

‘‘(bb) the new entrant and the third party 

have owners in common; 

‘‘(cc) the third party has the ability to exercise control over the new entrant by organizational rights, contractual rights, or any 

other means; 

‘‘(dd) the third party has a contractual relationship with the new entrant by which the 

new entrant will make use of the facilities or 

assets of the third party; or 

‘‘(ee) there are any other similar circumstances by which the Secretary determines 

that the new entrant and the third party are 

affiliated. 


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‘‘(ii) ALLOCATION FOR A NEW ENTRANT THAT HAS

CONSTRUCTED A NEW FACTORY OR REOPENED A FAC- TORY THAT WAS NOT OPERATED SINCE BEFORE 1998.—If 

a new entrant constructs a new sugar beet processing 

factory, or acquires and reopens a sugar beet processing factory that last processed sugar beets prior to 

the 1998 crop year and there is no allocation currently 

associated with the factory, the Secretary shall— ‘‘(I) assign an allocation for beet sugar to the 

new entrant that provides a fair and equitable distribution of the allocations for beet sugar so as to 

enable the new entrant to achieve a factory utilization rate comparable to the factory utilization rates 

of other similarly-situated processors; and ‘‘(II) reduce the allocations for beet sugar of all 

other processors on a pro rata basis to reflect the 

allocation to the new entrant. 

‘‘(iii) ALLOCATION FOR A NEW ENTRANT THAT HAS

ACQUIRED AN EXISTING FACTORY WITH A PRODUCTION

HISTORY.—

‘‘(I) IN GENERAL.—If a new entrant acquires 

an existing factory that has processed sugar beets 

from the 1998 or subsequent crop year and has a 

production history, on the mutual agreement of the 

new entrant and the company currently holding 

the allocation associated with the factory, the Secretary shall transfer to the new entrant a portion 

of the allocation of the current allocation holder to 

reflect the historical contribution of the production 

of the 1 or more sold factories to the total allocation of the current allocation holder, unless the 

new entrant and current allocation holder have 

agreed upon the transfer of a different portion of 

the allocation of the current allocation holder, in 

which case, the Secretary shall transfer that portion agreed upon by the new entrant and the current allocation holder. 

‘‘(II) PROHIBITION.—In the absence of a mutual 

agreement described in subclause (I), the new entrant shall be ineligible for a beet sugar allocation. 

‘‘(iv) APPEALS.—Any decision made under this subsection may be appealed to the Secretary in accordance 

with section 359i.’’. 

(e) REASSIGNMENT OF DEFICITS.—Section 359e(b) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359ee(b)) is amended in 

paragraphs (1)(D) and (2)(C), by inserting ‘‘of raw cane sugar’’ after 

‘‘imports’’ each place it appears. 

(f) PROVISIONS APPLICABLE TO PRODUCERS.—Section 359f(c) of 

the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359ff(c)) is 

amended—

(1) by striking paragraph (8); 

(2) by redesignating paragraphs (1) through (7) as paragraphs (2) through (8), respectively; 

(3) by inserting before paragraph (2) (as so redesignated) 

the following: 


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‘‘(1) DEFINITION OF SEED.—

‘‘(A) IN GENERAL.—In this subsection, the term ‘seed’

means only those varieties of seed that are dedicated to the 

production of sugarcane from which is produced sugar for 

human consumption. 

‘‘(B) EXCLUSION.—The term ‘seed’ does not include seed 

of a high-fiber cane variety dedicated to other uses, as determined by the Secretary’’; 

(4) in paragraph (3) (as so redesignated)—

(A) in the first sentence—

(i) by striking ‘‘paragraph (1)’’ and inserting ‘‘paragraph (2)’’; and 

(ii) by inserting ‘‘sugar produced from’’ after 

‘‘quantity of’’; and 

(B) in the second sentence, by striking ‘‘paragraph (7)’’

and inserting ‘‘paragraph (8)’’; 

(5) in the first sentence of paragraph (6)(C) (as so redesignated), by inserting ‘‘for sugar’’ before ‘‘in excess of the farm’s 

proportionate share’’; and 

(6) in paragraph (8) (as so redesignated), by inserting 

‘‘sugar from’’ after ‘‘the amount of’’. 

(g) SPECIAL RULES.—Section 359g of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359gg) is amended—

(1) by striking subsection (a) and inserting the following: 

‘‘(a) TRANSFER OF ACREAGE BASE HISTORY.—

‘‘(1) TRANSFER AUTHORIZED.—For the purpose of establishing proportionate shares for sugarcane farms under section 

359f(c), the Secretary, on application of any producer, with the 

written consent of all owners of a farm, may transfer the acreage base history of the farm to any other parcels of land of the 

applicant. 

‘‘(2) CONVERTED ACREAGE BASE.—

‘‘(A) IN GENERAL.—Sugarcane acreage base established 

under section 359f(c) that has been or is converted to nonagricultural use on or after May 13, 2002, may be transferred to other land suitable for the production of sugarcane that can be delivered to a processor in a proportionate 

share State in accordance with this paragraph. 

‘‘(B) NOTIFICATION.—Not later than 90 days after the 

Secretary becomes aware of a conversion of any sugarcane 

acreage base to a nonagricultural use, the Secretary shall 

notify the 1 or more affected landowners of the transferability of the applicable sugarcane acreage base. 

‘‘(C) INITIAL TRANSFER PERIOD.—The owner of the base 

attributable to the acreage at the time of the conversion 

shall be afforded 90 days from the date of the receipt of the 

notification under subparagraph (B) to transfer the base to 

1 or more farms owned by the owner. 

‘‘(D) GROWER OF RECORD.—If a transfer under subparagraph (C) cannot be accomplished during the period 

specified in that subparagraph, the grower of record with 

regard to the acreage base on the date on which the acreage 

was converted to nonagricultural use shall—

‘‘(i) be notified; and 


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‘‘(ii) have 90 days from the date of the receipt of 

the notification to transfer the base to 1 or more farms 

operated by the grower. 

‘‘(E) POOL DISTRIBUTION.—

‘‘(i) IN GENERAL.—If transfers under subparagraphs (B) and (C) cannot be accomplished during the 

periods specified in those subparagraphs, the county 

committee of the Farm Service Agency for the applicable county shall place the acreage base in a pool for 

possible assignment to other farms. 

‘‘(ii) ACCEPTANCE OF REQUESTS.—After providing 

reasonable notice to farm owners, operators, and growers of record in the county, the county committee shall 

accept requests from owners, operators, and growers of 

record in the county. 

‘‘(iii) ASSIGNMENT.—The county committee shall 

assign the acreage base to other farms in the county 

that are eligible and capable of accepting the acreage 

base, based on a random drawing from among the requests received under clause (ii). 

‘‘(F) STATEWIDE REALLOCATION.—

‘‘(i) IN GENERAL.—Any acreage base remaining unassigned after the transfers and processes described in 

subparagraphs (A) through (E) shall be made available 

to the State committee of the Farm Service Agency for 

allocation among the remaining county committees in 

the State representing counties with farms eligible for 

assignment of the base, based on a random drawing. 

‘‘(ii) ALLOCATION.—Any county committee receiving 

acreage base under this subparagraph shall allocate 

the acreage base to eligible farms using the process described in subparagraph (E). 

‘‘(G) STATUS OF REASSIGNED BASE.—After acreage base 

has been reassigned in accordance with this subparagraph, 

the acreage base shall—

‘‘(i) remain on the farm; and 

‘‘(ii) be subject to the transfer provisions of paragraph (1).’’; and 

(2) in subsection (d)—

(A) in paragraph (1)—

(i) by inserting ‘‘affected’’ before ‘‘crop-share owners’’ each place it appears; and 

(ii) by striking ‘‘, and from the processing company 

holding the applicable allocation for such shares,’’; and 

(B) in paragraph (2), by striking ‘‘based on’’ and all 

that follows through the end of subparagraph (B) and inserting ‘‘based on—

‘‘(A) the number of acres of sugarcane base being transferred; and 

‘‘(B) the pro rata amount of allocation at the processing 

company holding the applicable allocation that equals the 

contribution of the grower to allocation of the processing 

company for the sugarcane acreage base being transferred.’’. 


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(h) APPEALS.—Section 359i of the Agricultural Adjustment Act 

of 1938 (7 U.S.C. 1359ii) is amended—

(1) in subsection (a), by inserting ‘‘or 359g(d)’’ after ‘‘359f’’; 

and 

(2) by striking subsection (c). 

(i) REALLOCATING SUGAR QUOTA IMPORT SHORTFALLS.—Section 

359k of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359kk) 

is repealed. 

(j) ADMINISTRATION OF TARIFF RATE QUOTAS.—Part VII of subtitle B of title III of the Agricultural Adjustment Act of 1938 (7 

U.S.C. 1359aa) (as amended by subsection (i)) is amended by adding at the end the following: 

‘‘SEC. 359k. ADMINISTRATION OF TARIFF RATE QUOTAS. 

‘‘(a) ESTABLISHMENT.—

‘‘(1) IN GENERAL.—Except as provided in paragraph (2) and 

notwithstanding any other provision of law, at the beginning of 

the quota year, the Secretary shall establish the tariff-rate 

quotas for raw cane sugar and refined sugars at the minimum 

level necessary to comply with obligations under international 

trade agreements that have been approved by Congress. 

‘‘(2) EXCEPTION.—Paragraph (1) shall not apply to specialty 

sugar. 

‘‘(b) ADJUSTMENT.—

‘‘(1) BEFORE APRIL 1.—Before April 1 of each fiscal year, if 

there is an emergency shortage of sugar in the United States 

market that is caused by a war, flood, hurricane, or other natural disaster, or other similar event as determined by the Secretary—

‘‘(A) the Secretary shall take action to increase the supply of sugar in accordance with sections 359c(b)(2) and 

359e(b), including an increase in the tariff-rate quota for 

raw cane sugar to accommodate the reassignment to imports; and 

‘‘(B) if there is still a shortage of sugar in the United 

States market, and marketing of domestic sugar has been 

maximized, and domestic raw cane sugar refining capacity 

has been maximized, the Secretary may increase the tariffrate quota for refined sugars sufficient to accommodate the 

supply increase, if the further increase will not threaten to 

result in the forfeiture of sugar pledged as collateral for a 

loan under section 156 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7272). 

‘‘(2) ON OR AFTER APRIL 1.—On or after April 1 of each fiscal year—

‘‘(A) the Secretary may take action to increase the supply of sugar in accordance with sections 359c(b)(2) and 

359e(b), including an increase in the tariff-rate quota for 

raw cane sugar to accommodate the reassignment to imports; and 

‘‘(B) if there is still a shortage of sugar in the United 

States market, and marketing of domestic sugar has been 

maximized, the Secretary may increase the tariff-rate quota 

for raw cane sugar if the further increase will not threaten 

to result in the forfeiture of sugar pledged as collateral for 


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a loan under section 156 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7272).’’. (k) PERIOD OF EFFECTIVENESS.—Part VII of subtitle B of title 

III of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359aa) (as 

amended by subsection (j)) is amended by adding at the end the following: 

‘‘SEC. 359l. PERIOD OF EFFECTIVENESS. 

‘‘(a) IN GENERAL.—This part shall be effective only for the 2008 

through 2012 crop years for sugar. ‘‘(b) TRANSITION.—The Secretary shall administer flexible marketing allotments for sugar for the 2007 crop year for sugar on the 

terms and conditions provided in this part as in effect on the day 

before the date of enactment of this section.’’. 

SEC. 1404. STORAGE FACILITY LOANS. 

Section 1402(c) of the Farm Security and Rural Investment Act 

of 2002 (7 U.S.C. 7971(c)) is amended—

(1) in paragraph (1), by striking ‘‘and’’ at the end; 

(2) by redesignating paragraph (2) as paragraph (3); 

(3) by inserting after paragraph (1) the following: 

‘‘(2) not include any penalty for prepayment; and’’; and 

(4) in paragraph (3) (as redesignated by paragraph (2)), by 

inserting ‘‘other’’ after ‘‘on such’’. 

SEC. 1405. COMMODITY CREDIT CORPORATION STORAGE PAYMENTS. 

Subtitle E of the Federal Agriculture Improvement and Reform 

Act of 1996 (7 U.S.C. 7281 et seq.) is amended by adding at the end 

the following: 

‘‘SEC. 167. COMMODITY CREDIT CORPORATION STORAGE PAYMENTS. 

‘‘(a) INITIAL CROP YEARS.—Notwithstanding any other provision 

of law, for each of the 2008 through 2011 crop years, the Commodity Credit Corporation shall establish rates for the storage of 

forfeited sugar in an amount that is not less than— ‘‘(1) in the case of refined sugar, 15 cents per hundredweight of refined sugar per month; and 

‘‘(2) in the case of raw cane sugar, 10 cents per hundredweight of raw cane sugar per month. 

‘‘(b) SUBSEQUENT CROP YEARS.—For each of the 2012 and subsequent crop years, the Commodity Credit Corporation shall establish rates for the storage of forfeited sugar in the same manner as 

was used on the day before the date of enactment of this section.’’. 

Subtitle E—Dairy 

SEC. 1501. DAIRY PRODUCT PRICE SUPPORT PROGRAM. 

(a) DEFINITION OF NET REMOVALS.—In this section, the term 

‘‘net removals’’ means—

(1) the sum of—

(A) the quantity of a product described in subsection 

(b) purchased by the Commodity Credit Corporation under 

this section; and 

(B) the quantity of the product exported under section 

153 of the Food Security Act of 1985 (15 U.S.C. 713a–14); 

less 

(2) the quantity of the product sold for unrestricted use by 

the Commodity Credit Corporation. 


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(b) SUPPORT ACTIVITIES.—During the period beginning on January 1, 2008, and ending December 31, 2012, the Secretary shall 

support the price of cheddar cheese, butter, and nonfat dry milk 

through the purchase of such products made from milk produced in 

the United States. 

(c) PURCHASE PRICE.—To carry out subsection (b) during the 

period specified in that subsection, the Secretary shall purchase—

(1) cheddar cheese in blocks at not less than $1.13 per 

pound; 

(2) cheddar cheese in barrels at not less than $1.10 per 

pound; 

(3) butter at not less than $1.05 per pound; and 

(4) nonfat dry milk at not less than $0.80 per pound. 

(d) TEMPORARY PRICE ADJUSTMENT TO AVOID EXCESS INVENTORIES.—

(1) ADJUSTMENTS AUTHORIZED.—The Secretary may adjust 

the minimum purchase prices established under subsection (c) 

only as permitted under this subsection. 

(2) CHEESE INVENTORIES IN EXCESS OF 200,000,000

POUNDS.—If net removals for a period of 12 consecutive months 

exceed 200,000,000 pounds of cheese, but do not exceed 

400,000,000 pounds, the Secretary may reduce the purchase 

prices under paragraphs (1) and (2) of subsection (c) during the 

immediately following month by not more than 10 cents per 

pound. 

(3) CHEESE INVENTORIES IN EXCESS OF 400,000,000

POUNDS.—If net removals for a period of 12 consecutive months 

exceed 400,000,000 pounds of cheese, the Secretary may reduce 

the purchase prices under paragraphs (1) and (2) of subsection 

(c) during the immediately following month by not more than 

20 cents per pound. 

(4) BUTTER INVENTORIES IN EXCESS OF 450,000,000

POUNDS.—If net removals for a period of 12 consecutive months 

exceed 450,000,000 pounds of butter, but do not exceed 

650,000,000 pounds, the Secretary may reduce the purchase 

price under subsection (c)(3) during the immediately following 

month by not more than 10 cents per pound. 

(5) BUTTER INVENTORIES IN EXCESS OF 650,000,000

POUNDS.—If net removals for a period of 12 consecutive months 

exceed 650,000,000 pounds of butter, the Secretary may reduce 

the purchase price under subsection (c)(3) during the immediately following month by not more than 20 cents per pound. 

(6) NONFAT DRY MILK INVENTORIES IN EXCESS OF 600,000,000

POUNDS.—If net removals for a period of 12 consecutive months 

exceed 600,000,000 pounds of nonfat dry milk, but do not exceed 800,000,000 pounds, the Secretary may reduce the purchase price under subsection (c)(4) during the immediately following month by not more than 5 cents per pound. 

(7) NONFAT DRY MILK INVENTORIES IN EXCESS OF 800,000,000

POUNDS.—If net removals for a period of 12 consecutive months 

exceed 800,000,000 pounds of nonfat dry milk, the Secretary 

may reduce the purchase price under subsection (c)(4) during 

the immediately following month by not more than 10 cents per 

pound. 


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(e) UNIFORM PURCHASE PRICE.—The prices that the Secretary 

pays for cheese, butter, or nonfat dry milk, respectively, under subsection (b) shall be uniform for all regions of the United States. 

(f) SALES FROM INVENTORIES.—In the case of each commodity 

specified in subsection (c) that is available for unrestricted use in 

the inventory of the Commodity Credit Corporation, the Secretary 

may sell the commodity at the market prices prevailing for that 

commodity at the time of sale, except that the sale price may not be 

less than 110 percent of the minimum purchase price specified in 

subsection (c) for that commodity. 

SEC. 1502. DAIRY FORWARD PRICING PROGRAM. 

(a) PROGRAM REQUIRED.—The Secretary shall establish a program under which milk producers and cooperative associations of 

producers are authorized to voluntarily enter into forward price contracts with milk handlers. 

(b) MINIMUM MILK PRICE REQUIREMENTS.—Payments made by 

milk handlers to milk producers and cooperative associations of producers, and prices received by milk producers and cooperative associations, in accordance with the terms of a forward price contract 

authorized by subsection (a), shall be treated as satisfying— (1) all uniform and minimum milk price requirements of 

subparagraphs (B) and (F) of paragraph (5) of section 8c of the 

Agricultural Adjustment Act (7 U.S.C. 608c), reenacted with 

amendments by the Agricultural Marketing Agreement Act of 

1937; and 

(2) the total payment requirement of subparagraph (C) of 

that paragraph. 

(c) MILK COVERED BY PROGRAM.— (1) COVERED MILK.—The program shall apply only with respect to the marketing of federally regulated milk that— (A) is not classified as Class I milk or otherwise intended for fluid use; and 

(B) is in the current of interstate or foreign commerce 

or directly burdens, obstructs, or affects interstate or foreign commerce in federally regulated milk. 

(2) RELATION TO CLASS I MILK.—To assist milk handlers in 

complying with paragraph (1)(A) without having to segregate or 

otherwise individually track the source and disposition of milk, 

a milk handler may allocate milk receipts from producers, cooperatives, and other sources that are not subject to a forward 

contract to satisfy the obligations of the handler with regard to 

Class I milk usage. 

(d) VOLUNTARY PROGRAM.—

(1) IN GENERAL.—A milk handler may not require participation in a forward pricing contract as a condition of the handler receiving milk from a producer or cooperative association 

of producers. 

(2) PRICING.—A producer or cooperative association described in paragraph (1) may continue to have their milk priced 

in accordance with the minimum payment provisions of the 

Federal milk marketing order. 

(3) COMPLAINTS.—

(A) IN GENERAL.—The Secretary shall investigate complaints made by producers or cooperative associations of coercion by handlers to enter into forward contracts. 


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(B) ACTION.—If the Secretary finds evidence of coercion, the Secretary shall take appropriate action. 

(e) DURATION.—

(1) NEW CONTRACTS.—No forward price contract may be entered into under the program established under this section 

after September 30, 2012. 

(2) APPLICATION.—No forward contract entered into under 

the program may extend beyond September 30, 2015. 

SEC. 1503. DAIRY EXPORT INCENTIVE PROGRAM. 

(a) EXTENSION.—Section 153(a) of the Food Security Act of 

1985 (15 U.S.C. 713a–14(a)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

(b) COMPLIANCE WITH TRADE AGREEMENTS.—Section 153 of the 

Food Security Act of 1985 (15 U.S.C. 713a–14) is amended—

(1) in subsection (c), by striking paragraph (3) and inserting the following: 

‘‘(3) the maximum volume of dairy product exports allowable consistent with the obligations of the United States under 

the Uruguay Round Agreements approved under section 101 of 

the Uruguay Round Agreements Act (19 U.S.C. 3511) is exported under the program each year (minus the volume sold 

under section 1163 of this Act during that year), except to the 

extent that the export of such a volume under the program 

would, in the judgment of the Secretary, exceed the limitations 

on the value permitted under subsection (f); and’’; and. 

(2) in subsection (f), by striking paragraph (1) and inserting the following: 

‘‘(1) FUNDS AND COMMODITIES.—Except as provided in 

paragraph (2), the Commodity Credit Corporation shall in each 

year use money and commodities for the program under this 

section in the maximum amount consistent with the obligations 

of the United States under the Uruguay Round Agreements approved under section 101 of the Uruguay Round Agreements Act 

(19 U.S.C. 3511), minus the amount expended under section 

1163 of this Act during that year.’’. 

SEC. 1504. REVISION OF FEDERAL MARKETING ORDER AMENDMENT 

PROCEDURES. 

Section 8c of the Agricultural Adjustment Act (7 U.S.C. 608c), 

reenacted with amendments by the Agricultural Marketing Agreement Act of 1937, is amended by striking subsection (17) and inserting the following: ‘‘(17) PROVISIONS APPLICABLE TO AMENDMENTS.—

‘‘(A) APPLICABILITY TO AMENDMENTS.—The provisions 

of this section and section 8d applicable to orders shall be 

applicable to amendments to orders. 

‘‘(B) SUPPLEMENTAL RULES OF PRACTICE.—

‘‘(i) IN GENERAL.—Not later than 60 days after the 

date of enactment of this subparagraph, the Secretary 

shall issue, using informal rulemaking, supplemental 

rules of practice to define guidelines and timeframes 

for the rulemaking process relating to amendments to 

orders. ‘‘(ii) ISSUES.—At a minimum, the supplemental 

rules of practice shall establish—


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‘‘(I) proposal submission requirements; 

‘‘(II) pre-hearing information session specifications; ‘‘(III) written testimony and data request requirements; ‘‘(IV) public participation timeframes; and 

‘‘(V) electronic document submission standards. 

‘‘(iii) EFFECTIVE DATE.—The supplemental rules of 

practice shall take effect not later than 120 days after 

the date of enactment of this subparagraph, as determined by the Secretary. 

‘‘(C) HEARING TIMEFRAMES.—

‘‘(i) IN GENERAL.—Not more than 30 days after the 

receipt of a proposal for an amendment hearing regarding a milk marketing order, the Secretary shall—

‘‘(I) issue a notice providing an action plan 

and expected timeframes for completion of the 

hearing not more than 120 days after the date of 

the issuance of the notice; 

‘‘(II)(aa) issue a request for additional information to be used by the Secretary in making a determination regarding the proposal; and 

‘‘(bb) if the additional information is not provided to the Secretary within the timeframe requested by the Secretary, issue a denial of the request; or 

‘‘(III) issue a denial of the request. 

‘‘(ii) REQUIREMENT.—A post-hearing brief may be 

filed under this paragraph not later than 60 days after 

the date of an amendment hearing regarding a milk 

marketing order. 

‘‘(iii) RECOMMENDED DECISIONS.—A recommended 

decision on a proposed amendment to an order shall be 

issued not later than 90 days after the deadline for the 

submission of post-hearing briefs. ‘‘(iv) FINAL DECISIONS.—A final decision on a proposed amendment to an order shall be issued not later 

than 60 days after the deadline for submission of comments and exceptions to the recommended decision 

issued under clause (iii). 

‘‘(D) INDUSTRY ASSESSMENTS.—If the Secretary determines it is necessary to improve or expedite rulemaking 

under this subsection, the Secretary may impose an assessment on the affected industry to supplement appropriated 

funds for the procurement of service providers, such as 

court reporters. 

‘‘(E) USE OF INFORMAL RULEMAKING.—The Secretary 

may use rulemaking under section 553 of title 5, United 

States Code, to amend orders, other than provisions of orders that directly affect milk prices. 

‘‘(F) AVOIDING DUPLICATION.—The Secretary shall not 

be required to hold a hearing on any amendment proposed 

to be made to a milk marketing order in response to an application for a hearing on the proposed amendment if—


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‘‘(i) the application requesting the hearing is received by the Secretary not later than 90 days after the 

date on which the Secretary has announced the decision on a previously proposed amendment to that 

order; and 

‘‘(ii) the 2 proposed amendments are essentially the 

same, as determined by the Secretary. 

‘‘(G) MONTHLY FEED AND FUEL COSTS FOR MAKE ALLOWANCES.—As part of any hearing to adjust make allowances under marketing orders commencing prior to September 30, 2012, the Secretary shall—

‘‘(i) determine the average monthly prices of feed 

and fuel incurred by dairy producers in the relevant 

marketing area; 

‘‘(ii) consider the most recent monthly feed and fuel 

price data available; and 

‘‘(iii) consider those prices in determining whether 

or not to adjust make allowances.’’. 

SEC. 1505. DAIRY INDEMNITY PROGRAM. 

Section 3 of Public Law 90–484 (7 U.S.C. 450l) is amended by 

striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 1506. MILK INCOME LOSS CONTRACT PROGRAM. 

(a) DEFINITIONS.—In this section: 

(1) CLASS I MILK.—The term ‘‘Class I milk’’ means milk (including milk components) classified as Class I milk under a 

Federal milk marketing order. 

(2) ELIGIBLE PRODUCTION.—The term ‘‘eligible production’’

means milk produced by a producer in a participating State. 

(3) FEDERAL MILK MARKETING ORDER.—The term ‘‘Federal 

milk marketing order’’ means an order issued under section 8c 

of the Agricultural Adjustment Act (7 U.S.C. 608c), reenacted 

with amendments by the Agricultural Marketing Agreement Act 

of 1937. 

(4) PARTICIPATING STATE.—The term ‘‘participating State’’

means each State. 

(5) PRODUCER.—The term ‘‘producer’’ means an individual 

or entity that directly or indirectly (as determined by the Secretary)—

(A) shares in the risk of producing milk; and 

(B) makes contributions (including land, labor, management, equipment, or capital) to the dairy farming operation of the individual or entity that are at least commensurate with the share of the individual or entity of the proceeds of the operation. 

(b) PAYMENTS.—The Secretary shall offer to enter into contracts 

with producers on a dairy farm located in a participating State 

under which the producers receive payments on eligible production. 

(c) AMOUNT.—Payments to a producer under this section shall 

be calculated by multiplying (as determined by the Secretary)—

(1) the payment quantity for the producer during the applicable month established under subsection (e); 

(2) the amount equal to—

(A) $16.94 per hundredweight, as adjusted under subsection (d); less 


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(B) the Class I milk price per hundredweight in Boston 

under the applicable Federal milk marketing order; by 

(3)(A) for the period beginning October 1, 2007, and ending 

September 30, 2008, 34 percent; 

(B) for the period beginning October 1, 2008, and ending 

August 31, 2012, 45 percent; and 

(C) for the period beginning September 1, 2012, and thereafter, 34 percent. 

(d) PAYMENT RATE ADJUSTMENT FOR FEED PRICES.— (1) INITIAL ADJUSTMENT AUTHORITY.—During the period beginning on January 1, 2008, and ending on August 31, 2012, 

if the National Average Dairy Feed Ration Cost for a month 

during that period is greater than $7.35 per hundredweight, the 

amount specified in subsection (c)(2)(A) used to determine the 

payment rate for that month shall be increased by 45 percent 

of the percentage by which the National Average Dairy Feed 

Ration Cost exceeds $7.35 per hundredweight. 

(2) SUBSEQUENT ADJUSTMENT AUTHORITY.—For any month 

beginning on or after September 1, 2012, if the National Average Dairy Feed Ration Cost for the month is greater than $9.50 

per hundredweight, the amount specified in subsection (c)(2)(A) 

used to determine the payment rate for that month shall be increased by 45 percent of the percentage by which the National 

Average Dairy Feed Ration Cost exceeds $9.50 per hundredweight. 

(3) NATIONAL AVERAGE DAIRY FEED RATION COST.—For each 

month, the Secretary shall calculate a National Average Dairy 

Feed Ration Cost per hundredweight using the same procedures 

(adjusted to a hundredweight basis) used to calculate the feed 

components of the estimated price of 16 percent Mixed Dairy 

Feed per pound noted on page 33 of the USDA March 2008 Agricultural Prices publication (including the data and factors 

noted in footnote 4). 

(e) PAYMENT QUANTITY.—

(1) IN GENERAL.—Subject to paragraph (2), the payment 

quantity for a producer during the applicable month under this 

section shall be equal to the quantity of eligible production marketed by the producer during the month. 

(2) LIMITATION.— (A) IN GENERAL.—The payment quantity for all producers on a single dairy operation for which the producers 

receive payments under subsection (b) shall not exceed—

(i) for the period beginning October 1, 2007, and 

ending September 30, 2008, 2,400,000 pounds; 

(ii) for the period beginning October 1, 2008, and 

ending August 31, 2012, 2,985,000 pounds for each fiscal year; and 

(iii) effective beginning September 1, 2012, 

2,400,000 pounds per fiscal year. 

(B) STANDARDS.—For purposes of determining whether 

producers are producers on separate dairy operations or a 

single dairy operation, the Secretary shall apply the same 

standards as were applied in implementing the dairy program under section 805 of the Agriculture, Rural Development, Food and Drug Administration, and Related AgenVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00079 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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cies Appropriations Act, 2001 (as enacted into law by Public Law 106–387; 114 Stat. 1549A–50). 

(3) RECONSTITUTION.—The Secretary shall ensure that a 

producer does not reconstitute a dairy operation for the sole 

purpose of receiving additional payments under this section. 

(f) PAYMENTS.—A payment under a contract under this section 

shall be made on a monthly basis not later than 60 days after the 

last day of the month for which the payment is made. 

(g) SIGNUP.—The Secretary shall offer to enter into contracts 

under this section during the period beginning on the date that is 

90 days after the date of enactment of this Act and ending on September 30, 2012. 

(h) DURATION OF CONTRACT.—

(1) IN GENERAL.—Except as provided in paragraph (2), any 

contract entered into by producers on a dairy farm under this 

section shall cover eligible production marketed by the producers on the dairy farm during the period starting with the 

first day of month the producers on the dairy farm enter into 

the contract and ending on September 30, 2012. 

(2) VIOLATIONS.—If a producer violates the contract, the 

Secretary may—

(A) terminate the contract and allow the producer to retain any payments received under the contract; or 

(B) allow the contract to remain in effect and require 

the producer to repay a portion of the payments received 

under the contract based on the severity of the violation. 

SEC. 1507. DAIRY PROMOTION AND RESEARCH PROGRAM. 

(a) EXTENSION OF DAIRY PROMOTION AND RESEARCH AUTHORITY.—Section 113(e)(2) of the Dairy Production Stabilization Act of 

1983 (7 U.S.C. 4504(e)(2)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

(b) DEFINITION OF UNITED STATES FOR PROMOTION PROGRAM.—Section 111 of the Dairy Production Stabilization Act of 

1983 (7 U.S.C. 4502) is amended—

(1) by striking subsection (l) and inserting the following: 

‘‘(l) the term ‘United States’, when used in a geographical sense, 

means all of the States, the District of Columbia, and the Commonwealth of Puerto Rico;’’; and 

(2) in subsection (m), by striking ‘‘(as defined in subsection 

(l))’’. 

(c) DEFINITION OF UNITED STATES FOR RESEARCH PROGRAM.—

Section 130 of the Dairy Production Stabilization Act of 1983 (7 

U.S.C. 4531)) is amended by striking paragraph (12) and inserting 

the following: 

‘‘(12) the term ‘United States’, when used in a geographical 

sense, means all of the States, the District of Columbia, and the 

Commonwealth of Puerto Rico.’’. 

(d) ASSESSMENT RATE FOR IMPORTED DAIRY PRODUCTS.—Section 113(g) of the Dairy Production Stabilization Act of 1983 (7 

U.S.C. 4504(g)) is amended by striking paragraph (3) and inserting 

the following: 

‘‘(3) RATE.—

‘‘(A) IN GENERAL.—The rate of assessment for milk produced in the United States prescribed by the order shall be 


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15 cents per hundredweight of milk for commercial use or 

the equivalent thereof, as determined by the Secretary. 

‘‘(B) IMPORTED DAIRY PRODUCTS.—The rate of assessment for imported dairy products prescribed by the order 

shall be 7.5 cents per hundredweight of milk for commercial use or the equivalent thereof, as determined by the Secretary.’’. 

(e) TIME AND METHOD OF IMPORTER PAYMENTS.—Section 

113(g)(6) of the Dairy Production Stabilization Act of 1983 (7 U.S.C. 

4504(g)(6)) is amended—

(1) by striking subparagraph (B); and 

(2) by redesignating subparagraph (C) as subparagraph 

(B). 

(f) REFUND OF ASSESSMENTS ON CERTAIN IMPORTED DAIRY

PRODUCTS.—Section 113(g) of the Dairy Production Stabilization 

Act of 1983 (7 U.S.C. 4504(g)) is amended by adding at the end the 

following: 

‘‘(7) REFUND OF ASSESSMENTS ON CERTAIN IMPORTED PRODUCTS.—

‘‘(A) IN GENERAL.—An importer shall be entitled to a 

refund of any assessment paid under this subsection on imported dairy products imported under a contract entered 

into prior to the date of enactment of the Food, Conservation, and Energy Act of 2008. 

‘‘(B) EXPIRATION.—Refunds under subparagraph (A) 

shall expire 1 year after the date of enactment of the Food, 

Conservation, and Energy Act of 2008.’’. 

SEC. 1508. REPORT ON DEPARTMENT OF AGRICULTURE REPORTING 

PROCEDURES FOR NONFAT DRY MILK. 

Not later than 90 days after the date of enactment of this Act, 

the Secretary shall submit to the Committee on Agriculture of the 

House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report regarding Department of 

Agriculture reporting procedures for nonfat dry milk and the impact 

of the procedures on Federal milk marketing order minimum prices 

during the period beginning on July 1, 2006, and ending on the 

date of enactment of this Act. 

SEC. 1509. FEDERAL MILK MARKETING ORDER REVIEW COMMISSION. 

(a) ESTABLISHMENT.—Subject to the availability of appropriations to carry out this section, the Secretary shall establish a commission to be known as the ‘‘Federal Milk Marketing Order Review 

Commission’’ (referred to in this section as the ‘‘commission’’), which 

shall conduct a comprehensive review and evaluation of— (1) the Federal milk marketing order system in effect on the 

date of establishment of the commission; and 

(2) non-Federal milk marketing order systems. 

(b) ELEMENTS OF REVIEW AND EVALUATION.—As part of the review and evaluation under subsection (a), the commission shall consider legislative and regulatory options for— (1) ensuring that the competitiveness of dairy products with 

other competing products in the marketplace is preserved and 

enhanced; 

(2) enhancing the competitiveness of American dairy producers in world markets; 


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(3) ensuring the competitiveness and transparency in dairy 

pricing; 

(4) streamlining and expediting the process by which 

amendments to Federal milk market orders are adopted; 

(5) simplifying the Federal milk marketing order system; 

(6) evaluating whether the Federal milk marketing order 

system serves the interests of dairy producers, consumers, and 

dairy processors; and 

(7) evaluating the nutritional composition of milk, including the potential benefits and costs of adjusting the milk content standards. 

(c) MEMBERSHIP.—

(1) COMPOSITION.—The commission shall consist of 14 

members. 

(2) MEMBERS.—As soon as practicable after the date on 

which funds are first made available to carry out this section, 

the Secretary shall appoint members to the commission according to the following requirements: 

(A) At least 1 member shall represent a national consumer organization. 

(B) At least 4 members shall represent land-grant universities or NLGCA Institutions (as defined in section 1404 

of the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3103)) with accredited dairy economic programs, with at least 2 of those members being experts in the field of economics. 

(C) At least 1 member shall represent the food and beverage retail sector. 

(D) 4 dairy producers and 4 dairy processors, appointed so as to balance geographical distribution of milk 

production and dairy processing, reflect all segments of 

dairy processing, and represent all regions of the United 

States equitably, including States that operate outside of a 

Federal milk marketing order. 

(3) CHAIR.—The commission shall elect 1 of the appointed 

members of the commission to serve as chairperson for the duration of the proceedings of the commission. 

(4) VACANCY.—Any vacancy occurring before the termination of the commission shall be filled in the same manner as 

the original appointment. 

(5) COMPENSATION.—Members of the commission shall 

serve without compensation, but shall be reimbursed by the Secretary from existing budget authority for necessary and reasonable expenses incurred in the performance of the duties of the 

commission. 

(d) REPORT.—

(1) IN GENERAL.—Not later than 2 years after the date of 

the first meeting of the commission, the commission shall submit to Congress and the Secretary a report describing the results of the review and evaluation conducted under this section, 

including such recommendations regarding the legislative and 

regulatory options considered under subsection (b) as the commission considers to be appropriate. 

(2) OPINIONS.—The report findings shall reflect, to the maximum extent practicable, a consensus opinion of the commission 


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members, but the report may include majority and minority 

findings regarding those matters for which consensus was not 

reached. 

(e) ADVISORY NATURE.—The commission is wholly advisory in 

nature, and the recommendations of the commission are nonbinding. 

(f) NO EFFECT ON EXISTING PROGRAMS.—The Secretary shall 

not allow the existence of the commission to impede, delay, or otherwise affect any decisionmaking process of the Department of Agriculture, including any rulemaking procedures planned, proposed, or 

near completion. 

(g) ADMINISTRATIVE ASSISTANCE.—The Secretary shall provide 

administrative support to the commission, and expend to carry out 

this section such funds as necessary from budget authority available 

to the Secretary. 

(h) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this section. 

(i) TERMINATION.—The commission shall terminate effective on 

the date of the submission of the report under subsection (d). 

SEC. 1510. MANDATORY REPORTING OF DAIRY COMMODITIES. 

(a) ELECTRONIC REPORTING.—Section 273 of the Agricultural 

Marketing Act of 1946 (7 U.S.C. 1637b) is amended—

(1) by redesignating subsection (d) as subsection (e); and 

(2) by inserting after subsection (c) the following: 

‘‘(d) ELECTRONIC REPORTING.—

‘‘(1) IN GENERAL.—Subject to the availability of funds 

under paragraph (3), the Secretary shall establish an electronic 

reporting system to carry out this section. 

‘‘(2) FREQUENCY OF REPORTS.—After the establishment of 

the electronic reporting system in accordance with paragraph 

(1), the Secretary shall increase the frequency of the reports required under this section. 

‘‘(3) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated such sums as are necessary to carry 

out this subsection.’’. 

(b) QUARTERLY AUDITS.—Section 273(c) of the Agricultural 

Marketing Act of 1946 (7 U.S.C. 1637b(c)) is amended by striking 

paragraph (3) and inserting the following: 

‘‘(3) VERIFICATION.—

‘‘(A) IN GENERAL.—The Secretary shall take such actions as the Secretary considers necessary to verify the accuracy of the information submitted or reported under this 

subtitle. 

‘‘(B) QUARTERLY AUDITS.—The Secretary shall quarterly conduct an audit of information submitted or reported 

under this subtitle and compare such information with 

other related dairy market statistics.’’. 

Subtitle F—Administration 

SEC. 1601. ADMINISTRATION GENERALLY. 

(a) USE OF COMMODITY CREDIT CORPORATION.—Except as otherwise provided in this title, the Secretary shall use the funds, faVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00083 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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cilities, and authorities of the Commodity Credit Corporation to 

carry out this title. 

(b) DETERMINATIONS BY SECRETARY.—A determination made by 

the Secretary under this title shall be final and conclusive. 

(c) REGULATIONS.— (1) IN GENERAL.—Except as otherwise provided in this subsection, not later than 90 days after the date of enactment of 

this Act, the Secretary and the Commodity Credit Corporation, 

as appropriate, shall promulgate such regulations as are necessary to implement this title and the amendments made by 

this title. 

(2) PROCEDURE.—The promulgation of the regulations and 

administration of this title and the amendments made by this 

title shall be made without regard to—

(A) chapter 35 of title 44, United States Code (commonly known as the ‘‘Paperwork Reduction Act’’); 

(B) 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 

(C) the notice and comment provisions of section 553 of 

title 5, United States Code. 

(3) CONGRESSIONAL REVIEW OF AGENCY RULEMAKING.—In 

carrying out this subsection, the Secretary shall use the authority provided under section 808 of title 5, United States Code. 

(4) INTERIM REGULATIONS.—Notwithstanding paragraphs 

(1) and (2), the Secretary shall implement the amendments 

made by sections 1603 and 1604 for the 2009 crop, fiscal, or 

program year, as appropriate, through the promulgation of an 

interim rule. 

(d) ADJUSTMENT AUTHORITY RELATED TO TRADE AGREEMENTS

COMPLIANCE.—

(1) REQUIRED DETERMINATION; ADJUSTMENT.—If the Secretary determines that expenditures under this title that are 

subject to the total allowable domestic support levels under the 

Uruguay Round Agreements (as defined in section 2 of the Uruguay Round Agreements Act (19 U.S.C. 3501)) will exceed such 

allowable levels for any applicable reporting period, the Secretary shall, to the maximum extent practicable, make adjustments in the amount of such expenditures during that period to 

ensure that such expenditures do not exceed such allowable levels. 

(2) CONGRESSIONAL NOTIFICATION.—Before making any adjustment under paragraph (1), the Secretary shall submit to the 

Committee on Agriculture of the House of Representatives or the 

Committee on Agriculture, Nutrition, and Forestry of the Senate 

a report describing the determination made under that paragraph and the extent of the adjustment to be made. 

(e) TREATMENT OF ADVANCE PAYMENT OPTION.—Section 

1601(d) of the Farm Security and Rural Investment Act of 2002 (7 

U.S.C. 7991(d)) is amended— (1) in paragraph (1), by striking ‘‘and’’ at the end; 

(2) in paragraph (2), by striking the period at the end and 

inserting ‘‘; and’’; and 

(3) by adding at the end the following: 


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‘‘(3) the advance payment of direct payments and countercyclical payments under title I of the Food, Conservation, and 

Energy Act of 2008.’’. 

SEC. 1602. SUSPENSION OF PERMANENT PRICE SUPPORT AUTHORITY. 

(a) AGRICULTURAL ADJUSTMENT ACT OF 1938.—The following 

provisions of the Agricultural Adjustment Act of 1938 shall not be 

applicable to the 2008 through 2012 crops of covered commodities, 

peanuts, and sugar and shall not be applicable to milk during the 

period beginning on the date of enactment of this Act through December 31, 2012: 

(1) Parts II through V of subtitle B of title III (7 U.S.C. 

1326 et seq.). 

(2) In the case of upland cotton, section 377 (7 U.S.C. 

1377). 

(3) Subtitle D of title III (7 U.S.C. 1379a et seq.). 

(4) Title IV (7 U.S.C. 1401 et seq.). 

(b) AGRICULTURAL ACT OF 1949.—The following provisions of 

the Agricultural Act of 1949 shall not be applicable to the 2008 

through 2012 crops of covered commodities, peanuts, and sugar and 

shall not be applicable to milk during the period beginning on the 

date of enactment of this Act and through December 31, 2012: 

(1) Section 101 (7 U.S.C. 1441). 

(2) Section 103(a) (7 U.S.C. 1444(a)). 

(3) Section 105 (7 U.S.C. 1444b). 

(4) Section 107 (7 U.S.C. 1445a). 

(5) Section 110 (7 U.S.C. 1445e). 

(6) Section 112 (7 U.S.C. 1445g). 

(7) Section 115 (7 U.S.C. 1445k). 

(8) Section 201 (7 U.S.C. 1446). 

(9) Title III (7 U.S.C. 1447 et seq.). 

(10) Title IV (7 U.S.C. 1421 et seq.), other than sections 

404, 412, and 416 (7 U.S.C. 1424, 1429, and 1431). 

(11) Title V (7 U.S.C. 1461 et seq.). 

(12) Title VI (7 U.S.C. 1471 et seq.). 

(c) SUSPENSION OF CERTAIN QUOTA PROVISIONS.—The joint resolution entitled ‘‘A joint resolution relating to corn and wheat marketing quotas under the Agricultural Adjustment Act of 1938, as 

amended’’, approved May 26, 1941 (7 U.S.C. 1330 and 1340), shall 

not be applicable to the crops of wheat planted for harvest in the 

calendar years 2008 through 2012. 

SEC. 1603. PAYMENT LIMITATIONS. 

(a) EXTENSION OF LIMITATIONS.—Sections 1001 and 1001C(a) 

of the Food Security Act of 1985 (7 U.S.C. 1308, 1308–3(a)) are 

amended by striking ‘‘Farm Security and Rural Investment Act of 

2002’’ each place it appears and inserting ‘‘Food, Conservation, and 

Energy Act of 2008’’. 

(b) REVISION OF LIMITATIONS.—

(1) DEFINITIONS.—Section 1001(a) of the Food Security Act 

of 1985 (7 U.S.C. 1308(a)) is amended— (A) in the matter preceding paragraph (1), by inserting ‘‘through section 1001F’’after ‘‘section’’; 

(B) by striking paragraph (2) and redesignating paragraph (3) as paragraph (5); and 

(C) by inserting after paragraph (1) the following: 


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‘‘(2) FAMILY MEMBER.—The term ‘family member’ means a 

person to whom a member in the farming operation is related 

as lineal ancestor, lineal descendant, sibling, spouse, or otherwise by marriage. 

‘‘(3) LEGAL ENTITY.—The term ‘legal entity’ means an entity 

that is created under Federal or State law and that—

‘‘(A) owns land or an agricultural commodity; or 

‘‘(B) produces an agricultural commodity. 

‘‘(4) PERSON.—The term ‘person’ means a natural person, 

and does not include a legal entity.’’. 

(2) LIMITATION ON DIRECT PAYMENTS AND COUNTER-CYCLICAL PAYMENTS.—Section 1001 of the Food Security Act of 1985 

(7 U.S.C. 1308) is amended by striking subsections (b), (c), and 

(d) and inserting the following: 

‘‘(b) LIMITATION ON DIRECT PAYMENTS, COUNTER-CYCLICAL

PAYMENTS, AND ACRE PAYMENTS FOR COVERED COMMODITIES

(OTHER THAN PEANUTS).—

‘‘(1) DIRECT PAYMENTS.—The total amount of direct payments received, directly or indirectly, by a person or legal entity 

(except a joint venture or a general partnership) for any crop 

year under subtitle A of title I of the Food, Conservation, and 

Energy Act of 2008 for 1 or more covered commodities (except 

for peanuts) may not exceed—

‘‘(A) in the case of a person or legal entity that does not 

participate in the average crop revenue election program 

under section 1105 of that Act, $40,000; or 

‘‘(B) in the case of a person or legal entity that participates in the average crop revenue election program under 

section 1105 of that Act, an amount equal to—

‘‘(i) the payment limit specified in subparagraph 

(A); less 

‘‘(ii) the amount of the reduction in direct payments under section 1105(a)(1) of that Act. 

‘‘(2) COUNTER-CYCLICAL PAYMENTS.—In the case of a person 

or legal entity (except a joint venture or a general partnership) 

that does not participate in the average crop revenue election 

program under section 1105 of the Food, Conservation, and Energy Act of 2008, the total amount of counter-cyclical payments 

received, directly or indirectly, by the person or legal entity for 

any crop year under subtitle A of title I of that Act for 1 or more 

covered commodities (except for peanuts) may not exceed 

$65,000. 

‘‘(3) ACRE AND COUNTER-CYCLICAL PAYMENTS.—In the case 

of a person or legal entity (except a joint venture or a general 

partnership) that participates in the average crop revenue election program under section 1105 of the Food, Conservation, and 

Energy Act of 2008, the total amount of average crop revenue 

election payments and counter-cyclical payments received, directly or indirectly, by the person or legal entity for any crop 

year for 1 or more covered commodities (except for peanuts) may 

not exceed the sum of—

‘‘(A) $65,000; and 

‘‘(B) the amount by which the direct payment limitation 

is reduced under paragraph (1)(B). 


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‘‘(c) LIMITATION ON DIRECT PAYMENTS, COUNTER-CYCLICAL

PAYMENTS, AND ACRE PAYMENTS FOR PEANUTS.— ‘‘(1) DIRECT PAYMENTS.—The total amount of direct payments received, directly or indirectly, by a person or legal entity 

(except a joint venture or a general partnership) for any crop 

year under subtitle C of title I of the Food, Conservation, and 

Energy Act of 2008 for peanuts may not exceed— ‘‘(A) in the case of a person or legal entity that does not 

participate in the average crop revenue election program 

under section 1105 of that Act, $40,000; or ‘‘(B) in the case of a person or legal entity that participates in the average crop revenue election program under 

section 1105 of that Act, an amount equal to— ‘‘(i) the payment limit specified in subparagraph 

(A); less ‘‘(ii) the amount of the reduction in direct payments under section 1105(a)(1) of that Act. ‘‘(2) COUNTER-CYCLICAL PAYMENTS.—In the case of a person 

or legal entity (except a joint venture or a general partnership) 

that does not participate in the average crop revenue election 

program under section 1105 of the Food, Conservation, and Energy Act of 2008, the total amount of counter-cyclical payments 

received, directly or indirectly, by the person or legal entity for 

any crop year under subtitle C of title I of that Act for peanuts 

may not exceed $65,000. ‘‘(3) ACRE AND COUNTER-CYCLICAL PAYMENTS.—In the case 

of a person or legal entity (except a joint venture or a general 

partnership) that participates in the average crop revenue election program under section 1105 of the Food, Conservation, and 

Energy Act of 2008, the total amount of average crop revenue 

election payments received, directly or indirectly, by the person 

or legal entity for any crop year for peanuts may not exceed the 

sum of—

‘‘(A) $65,000; and 

‘‘(B) the amount by which the direct payment limitation 

is reduced under paragraph (1)(B). 

‘‘(d) LIMITATION ON APPLICABILITY.—Nothing in this section authorizes any limitation on any benefit associated with the marketing 

assistance loan program or the loan deficiency payment program 

under title I of the Food, Conservation, and Energy Act of 2008.’’. (3) DIRECT ATTRIBUTION.—Section 1001 of the Food Security Act of 1985 (7 U.S.C. 1308) is amended—

(A) by striking subsections (e) and (f) and redesignating subsection (g) as subsection (h); and 

(B) by inserting after subsection (d) the following: 

‘‘(e) ATTRIBUTION OF PAYMENTS.—

‘‘(1) IN GENERAL.—In implementing subsections (b) and (c) 

and a program described in paragraphs (1)(C) and (2)(B) of section 1001D(b), the Secretary shall issue such regulations as are 

necessary to ensure that the total amount of payments are attributed to a person by taking into account the direct and indirect ownership interests of the person in a legal entity that is 

eligible to receive the payments. ‘‘(2) PAYMENTS TO A PERSON.—Each payment made directly 

to a person shall be combined with the pro rata interest of the 


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person in payments received by a legal entity in which the person has a direct or indirect ownership interest unless the payments of the legal entity have been reduced by the pro rata 

share of the person. 

‘‘(3) PAYMENTS TO A LEGAL ENTITY.—

‘‘(A) IN GENERAL.—Each payment made to a legal entity shall be attributed to those persons who have a direct or 

indirect ownership interest in the legal entity unless the 

payment to the legal entity has been reduced by the pro 

rata share of the person. 

‘‘(B) ATTRIBUTION OF PAYMENTS.—

‘‘(i) PAYMENT LIMITS.—Except as provided in 

clause (ii), payments made to a legal entity shall not 

exceed the amounts specified in subsections (b) and (c). 

‘‘(ii) EXCEPTION FOR JOINT VENTURES AND GENERAL PARTNERSHIPS.—Payments made to a joint venture or a general partnership shall not exceed, for each 

payment specified in subsections (b) and (c), the 

amount determined by multiplying the maximum payment amount specified in subsections (b) and (c) by the 

number of persons and legal entities (other than joint 

ventures and general partnerships) that comprise the 

ownership of the joint venture or general partnership. 

‘‘(iii) REDUCTION.—Payments made to a legal entity shall be reduced proportionately by an amount that 

represents the direct or indirect ownership in the legal 

entity by any person or legal entity that has otherwise 

exceeded the applicable maximum payment limitation. 

‘‘(4) FOUR LEVELS OF ATTRIBUTION FOR EMBEDDED LEGAL

ENTITIES.—

‘‘(A) IN GENERAL.—Attribution of payments made to 

legal entities shall be traced through 4 levels of ownership 

in legal entities. 

‘‘(B) FIRST LEVEL.—Any payments made to a legal entity (a first-tier legal entity) that is owned in whole or in part 

by a person shall be attributed to the person in an amount 

that represents the direct ownership in the first-tier legal 

entity by the person. 

‘‘(C) SECOND LEVEL.—

‘‘(i) IN GENERAL.—Any payments made to a firsttier legal entity that is owned (in whole or in part) by 

another legal entity (a second-tier legal entity) shall be 

attributed to the second-tier legal entity in proportion 

to the ownership of the second-tier legal entity in the 

first-tier legal entity. 

‘‘(ii) OWNERSHIP BY A PERSON.—If the second-tier 

legal entity is owned (in whole or in part) by a person, 

the amount of the payment made to the first-tier legal 

entity shall be attributed to the person in the amount 

that represents the indirect ownership in the first-tier 

legal entity by the person. 

‘‘(D) THIRD AND FOURTH LEVELS.—

‘‘(i) IN GENERAL.—Except as provided in clause (ii), 

the Secretary shall attribute payments at the third and 


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fourth tiers of ownership in the same manner as specified in subparagraph (C). ‘‘(ii) FOURTH-TIER OWNERSHIP.—If the fourth-tier of 

ownership is that of a fourth-tier legal entity and not 

that of a person, the Secretary shall reduce the amount 

of the payment to be made to the first-tier legal entity 

in the amount that represents the indirect ownership in 

the first-tier legal entity by the fourth-tier legal entity. ‘‘(f) SPECIAL RULES.— ‘‘(1) MINOR CHILDREN.— ‘‘(A) IN GENERAL.—Except as provided in subparagraph 

(B), payments received by a child under the age of 18 shall 

be attributed to the parents of the child. ‘‘(B) REGULATIONS.—The Secretary shall issue regulations specifying the conditions under which payments received by a child under the age of 18 will not be attributed 

to the parents of the child. 

‘‘(2) MARKETING COOPERATIVES.—Subsections (b) and (c) 

shall not apply to a cooperative association of producers with 

respect to commodities produced by the members of the association that are marketed by the association on behalf of the members of the association but shall apply to the producers as persons. ‘‘(3) TRUSTS AND ESTATES.— ‘‘(A) IN GENERAL.—With respect to irrevocable trusts 

and estates, the Secretary shall administer this section 

through section 1001F in such manner as the Secretary determines will ensure the fair and equitable treatment of the 

beneficiaries of the trusts and estates. ‘‘(B) IRREVOCABLE TRUST.—

‘‘(i) IN GENERAL.—In order for a trust to be considered an irrevocable trust, the terms of the trust agreement shall not— ‘‘(I) allow for modification or termination of 

the trust by the grantor; 

‘‘(II) allow for the grantor to have any future, 

contingent, or remainder interest in the corpus of 

the trust; or 

‘‘(III) except as provided in clause (ii), provide 

for the transfer of the corpus of the trust to the remainder beneficiary in less than 20 years beginning on the date the trust is established. 

‘‘(ii) EXCEPTION.—Clause (i)(III) shall not apply in 

a case in which the transfer is—

‘‘(I) contingent on the remainder beneficiary 

achieving at least the age of majority; or 

‘‘(II) contingent on the death of the grantor or 

income beneficiary. 

‘‘(C) REVOCABLE TRUST.—For the purposes of this section through section 1001F, a revocable trust shall be considered to be the same person as the grantor of the trust. 

‘‘(4) CASH RENT TENANTS.— ‘‘(A) DEFINITION.—In this paragraph, the term ‘cash 

rent tenant’ means a person or legal entity that rents 

land—


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‘‘(i) for cash; or 

‘‘(ii) for a crop share guaranteed as to the amount 

of the commodity to be paid in rent. 

‘‘(B) RESTRICTION.—A cash rent tenant who makes a 

significant contribution of active personal management, but 

not of personal labor, with respect to a farming operation 

shall be eligible to receive a payment described in subsection (b) or (c) only if the tenant makes a significant contribution of equipment to the farming operation. 

‘‘(5) FEDERAL AGENCIES.— ‘‘(A) IN GENERAL.—Notwithstanding subsection (d), a 

Federal agency shall not be eligible to receive any payment, 

benefit, or loan under title I of the Food, Conservation, and 

Energy Act of 2008 or title XII of this Act. ‘‘(B) LAND RENTAL.—A lessee of land owned by a Federal agency may receive a payment described in subsection 

(b), (c), or (d) if the lessee otherwise meets all applicable 

criteria. 

‘‘(6) STATE AND LOCAL GOVERNMENTS.—

‘‘(A) IN GENERAL.—Notwithstanding subsection (d), except as provided in subsection (g), a State or local government, or political subdivision or agency of the government, 

shall not be eligible to receive any payment, benefit, or loan 

under title I of the Food, Conservation, and Energy Act of 

2008 or title XII of this Act. 

‘‘(B) TENANTS.—A lessee of land owned by a State or 

local government, or political subdivision or agency of the 

government, may receive payments described in subsections 

(b), (c), and (d) if the lessee otherwise meets all applicable 

criteria. 

‘‘(7) CHANGES IN FARMING OPERATIONS.— ‘‘(A) IN GENERAL.—In the administration of this section 

through section 1001F, the Secretary may not approve any 

change in a farming operation that otherwise will increase 

the number of persons to which the limitations under this 

section are applied unless the Secretary determines that the 

change is bona fide and substantive. ‘‘(B) FAMILY MEMBERS.—The addition of a family member to a farming operation under the criteria set out in section 1001A shall be considered a bona fide and substantive 

change in the farming operation. 

‘‘(8) DEATH OF OWNER.—

‘‘(A) IN GENERAL.—If any ownership interest in land or 

a commodity is transferred as the result of the death of a 

program participant, the new owner of the land or commodity may, if the person is otherwise eligible to participate 

in the applicable program, succeed to the contract of the 

prior owner and receive payments subject to this section 

without regard to the amount of payments received by the 

new owner. ‘‘(B) LIMITATIONS ON PRIOR OWNER.—Payments made 

under this paragraph shall not exceed the amount to which 

the previous owner was entitled to receive under the terms 

of the contract at the time of the death of the prior owner. ‘‘(g) PUBLIC SCHOOLS.—


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‘‘(1) IN GENERAL.—Notwithstanding subsection (f)(6)(A), a 

State or local government, or political subdivision or agency of 

the government, shall be eligible, subject to the limitation in 

paragraph (2), to receive a payment described in subsection (b) 

or (c) for land owned by the State or local government, or political subdivision or agency of the government, that is used to 

maintain a public school. ‘‘(2) LIMITATION.— ‘‘(A) IN GENERAL.—For each State, the total amount of 

payments described in subsections (b) and (c) that are received collectively by the State and local government and 

all political subdivisions or agencies of those governments 

shall not exceed $500,000. ‘‘(B) EXCEPTION.—The limitation in subparagraph (A) 

shall not apply to States with a population of less than 

1,500,000.’’. 

(c) REPEAL OF 3-ENTITY RULE.—Section 1001A of the Food Security Act of 1985 (7 U.S.C. 1308–1) is amended—

(1) in the section heading, by striking ‘‘PREVENTION OF

CREATION OF ENTITIES TO QUALIFY AS SEPARATE PERSONS’’

and inserting ‘‘NOTIFICATION OF INTERESTS’’; and 

(2) by striking subsection (a) and inserting the following: ‘‘(a) NOTIFICATION OF INTERESTS.—To facilitate administration 

of section 1001 and this section, each person or legal entity receiving 

payments described in subsections (b) and (c) of section 1001 as a 

separate person or legal entity shall separately provide to the Secretary, at such times and in such manner as prescribed by the Secretary— ‘‘(1) the name and social security number of each person, or 

the name and taxpayer identification number of each legal entity, that holds or acquires an ownership interest in the separate 

person or legal entity; and ‘‘(2) the name and taxpayer identification number of each 

legal entity in which the person or legal entity holds an ownership interest.’’. 

(d) AMENDMENT FOR CONSISTENCY.—Section 1001A of the Food 

Security Act of 1985 (7 U.S.C. 1308–1) is amended by striking subsection (b) and inserting the following: ‘‘(b) ACTIVELY ENGAGED.— ‘‘(1) IN GENERAL.—To be eligible to receive a payment described in subsection (b) or (c) of section 1001, a person or legal 

entity shall be actively engaged in farming with respect to a 

farming operation as provided in this subsection or subsection 

(c). 

‘‘(2) CLASSES ACTIVELY ENGAGED.—Except as provided in 

subsections (c) and (d)—

‘‘(A) a person (including a person participating in a 

farming operation as a partner in a general partnership, a 

participant in a joint venture, a grantor of a revocable 

trust, or a participant in a similar entity, as determined by 

the Secretary) shall be considered to be actively engaged in 

farming with respect to a farming operation if— ‘‘(i) the person makes a significant contribution 

(based on the total value of the farming operation) to 

the farming operation of—


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‘‘(I) capital, equipment, or land; and 

‘‘(II) personal labor or active personal management; 

‘‘(ii) the person’s share of the profits or losses from 

the farming operation is commensurate with the contributions of the person to the farming operation; and ‘‘(iii) the contributions of the person are at risk; ‘‘(B) a legal entity that is a corporation, joint stock 

company, association, limited partnership, charitable organization, or other similar entity determined by the Secretary (including any such legal entity participating in the 

farming operation as a partner in a general partnership, a 

participant in a joint venture, a grantor of a revocable 

trust, or as a participant in a similar legal entity as determined by the Secretary) shall be considered as actively engaged in farming with respect to a farming operation if— ‘‘(i) the legal entity separately makes a significant 

contribution (based on the total value of the farming 

operation) of capital, equipment, or land; ‘‘(ii) the stockholders or members collectively make 

a significant contribution of personal labor or active 

personal management to the operation; and ‘‘(iii) the standards provided in clauses (ii) and 

(iii) of subparagraph (A), as applied to the legal entity, 

are met by the legal entity; 

‘‘(C) if a legal entity that is a general partnership, joint 

venture, or similar entity, as determined by the Secretary, 

separately makes a significant contribution (based on the 

total value of the farming operation involved) of capital, 

equipment, or land, and the standards provided in clauses 

(ii) and (iii) of subparagraph (A), as applied to the legal entity, are met by the legal entity, the partners or members 

making a significant contribution of personal labor or active personal management shall be considered to be actively 

engaged in farming with respect to the farming operation 

involved; and 

‘‘(D) in making determinations under this subsection 

regarding equipment and personal labor, the Secretary 

shall take into consideration the equipment and personal 

labor normally and customarily provided by farm operators 

in the area involved to produce program crops. 

‘‘(c) SPECIAL CLASSES ACTIVELY ENGAGED.—

‘‘(1) LANDOWNER.—A person or legal entity that is a landowner contributing the owned land to a farming operation shall 

be considered to be actively engaged in farming with respect to 

the farming operation if—

‘‘(A) the landowner receives rent or income for the use 

of the land based on the production on the land or the operating results of the operation; and ‘‘(B) the person or legal entity meets the standards provided in clauses (ii) and (iii) of subsection (b)(2)(A). 

‘‘(2) ADULT FAMILY MEMBER.—If a majority of the participants in a farming operation are family members, an adult 

family member shall be considered to be actively engaged in 

farming with respect to the farming operation if the person—


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‘‘(A) makes a significant contribution, based on the 

total value of the farming operation, of active personal 

management or personal labor; and ‘‘(B) with respect to such contribution, meets the standards provided in clauses (ii) and (iii) of subsection (b)(2)(A). 

‘‘(3) SHARECROPPER.—A sharecropper who makes a significant contribution of personal labor to a farming operation shall 

be considered to be actively engaged in farming with respect to 

the farming operation if the contribution meets the standards 

provided in clauses (ii) and (iii) of subsection (b)(2)(A). ‘‘(4) GROWERS OF HYBRID SEED.—In determining whether a 

person or legal entity growing hybrid seed under contract shall 

be considered to be actively engaged in farming, the Secretary 

shall not take into consideration the existence of a hybrid seed 

contract. ‘‘(5) CUSTOM FARMING SERVICES.— ‘‘(A) IN GENERAL.—A person or legal entity receiving 

custom farming services shall be considered separately eligible for payment limitation purposes if the person or legal 

entity is actively engaged in farming based on subsection 

(b)(2) or paragraphs (1) through (4) of this subsection. ‘‘(B) PROHIBITION.—No other rules with respect to custom farming shall apply. 

‘‘(6) SPOUSE.—If 1 spouse (or estate of a deceased spouse) 

is determined to be actively engaged, the other spouse shall be 

determined to have met the requirements of subsection 

(b)(2)(A)(i)(II). 

‘‘(d) CLASSES NOT ACTIVELY ENGAGED.— ‘‘(1) CASH RENT LANDLORD.—A landlord contributing land 

to a farming operation shall not be considered to be actively engaged in farming with respect to the farming operation if the 

landlord receives cash rent, or a crop share guaranteed as to 

the amount of the commodity to be paid in rent, for the use of 

the land. ‘‘(2) OTHER PERSONS AND LEGAL ENTITIES.—Any other person or legal entity that the Secretary determines does not meet 

the standards described in subsections (b)(2) and (c) shall not 

be considered to be actively engaged in farming with respect to 

a farming operation.’’. (e) DENIAL OF PROGRAM BENEFITS.—Section 1001B of the Food 

Security Act of 1985 (7 U.S.C. 1308–2) is amended to read as follows: 

‘‘SEC. 1001B. DENIAL OF PROGRAM BENEFITS. 

‘‘(a) 2-YEAR DENIAL OF PROGRAM BENEFITS.—A person or legal 

entity shall be ineligible to receive payments specified in subsections 

(b) and (c) of section 1001 for the crop year, and the succeeding crop 

year, in which the Secretary determines that the person or legal entity—

‘‘(1) failed to comply with section 1001A(b) and adopted or 

participated in adopting a scheme or device to evade the application of section 1001, 1001A, or 1001C; or 

‘‘(2) intentionally concealed the interest of the person or 

legal entity in any farm or legal entity engaged in farming. 

‘‘(b) EXTENDED INELIGIBILITY.—If the Secretary determines that 

a person or legal entity, for the benefit of the person or legal entity 


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or the benefit of any other person or legal entity, has knowingly engaged in, or aided in the creation of a fraudulent document, failed 

to disclose material information relevant to the administration of 

sections 1001 through 1001F, or committed other equally serious actions (as identified in regulations issued by the Secretary), the Secretary may for a period not to exceed 5 crop years deny the issuance 

of payments to the person or legal entity. ‘‘(c) PRO RATA DENIAL.— ‘‘(1) IN GENERAL.—Payments otherwise owed to a person or 

legal entity described in subsections (a) or (b) shall be denied 

in a pro rata manner based on the ownership interest of the 

person or legal entity in a farm. ‘‘(2) CASH RENT TENANT.—Payments otherwise payable to a 

person or legal entity shall be denied in a pro rata manner if 

the person or legal entity is a cash rent tenant on a farm owned 

or under the control of a person or legal entity with respect to 

which a determination has been made under subsection (a) or 

(b). 

‘‘(d) JOINT AND SEVERAL LIABILITY.—Any legal entity (including 

partnerships and joint ventures) and any member of any legal entity 

determined to have knowingly participated in a scheme or device to 

evade, or that has the purpose of evading, sections 1001, 1001A, or 

1001C shall be jointly and severally liable for any amounts that are 

payable to the Secretary as the result of the scheme or device (including amounts necessary to recover those amounts). 

‘‘(e) RELEASE.—The Secretary may partially or fully release 

from liability any person or legal entity who cooperates with the 

Secretary in enforcing sections 1001, 1001A, and 1001C, and this 

section.’’ (f) CONFORMING AMENDMENT TO APPLY DIRECT ATTRIBUTION

TO NAP.—

(1) IN GENERAL.—Section 196(i) of the Federal Agriculture 

Improvement and Reform Act of 1996 (7 U.S.C. 7333(i)) is 

amended—

(A) by striking paragraphs (1) and (2) and inserting 

the following: 

‘‘(1) DEFINITIONS.—In this subsection, the terms ‘legal entity’ and ‘person’ have the meanings given those terms in section 

1001(a) of the Food Security Act of 1985 (7 U.S.C. 1308(a)). ‘‘(2) PAYMENT LIMITATION.—The total amount of payments 

received, directly or indirectly, by a person or legal entity (excluding a joint venture or general partnership) for any crop 

year may not exceed $100,000.’’; 

(B) by striking paragraph (4) and inserting the following: 

‘‘(4) ADJUSTED GROSS INCOME LIMITATION.—A person or 

legal entity that has an average adjusted gross income in excess 

of the average adjusted gross income limitation applicable 

under section 1001D(b)(1)(A) of the Food Security Act of 1985 

(7 U.S.C. 1308–3a(b)(1)(A)), or a successor provision, shall not 

be eligible to receive noninsured crop disaster assistance under 

this section.’’; and 

(C) in paragraph (5)— (i) by striking ‘‘necessary to ensure’’ and inserting ‘‘necessary—


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‘‘(A) to ensure’’; and 

(ii) by striking ‘‘this subsection.’’ and inserting the 

following: ‘‘this subsection; and 

‘‘(B) to ensure that payments under this section are attributed to a person or legal entity (excluding a joint venture or general partnership) in accordance with the terms 

and conditions of sections 1001 through 1001D of the Food 

Security Act of 1985 (7 U.S.C. 1308 et seq.), as determined 

by the Secretary.’’. 

(2) TRANSITION.—Section 196(i) of the Federal Agriculture 

Improvement and Reform Act of 1996 (7 U.S.C. 7333(i)), as in 

effect on September 30, 2007, shall apply with respect to the 

2007 and 2008 crops of any eligible crop. 

(g) CONFORMING AMENDMENTS.—

(1) Section 1009(e) of the Food Security Act of 1985 (7 

U.S.C. 1308a(e)) is amended in the second sentence by striking 

‘‘of $50,000’’. 

(2) Section 609(b)(1) of the Emergency Livestock Feed Assistance Act of 1988 (7 U.S.C. 1471g(b)(1)) is amended by inserting ‘‘(before the amendment made by section 1703(a) of the 

Food, Conservation, and Energy Act of 2008)’’ after ‘‘1985’’. 

(3) Section 524(b)(3) of the Federal Crop Insurance Act (7 

U.S.C. 1524(b)(3)) is amended by inserting ‘‘(before the amendment made by section 1703(a) of the Food, Conservation, and 

Energy Act of 2008)’’ after ‘‘1308(5)))’’. 

(4) Section 10204(c)(1) of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 8204(c)(1)) is amended by inserting ‘‘(before the amendment made by section 1703(a) of the 

Food, Conservation, and Energy Act of 2008)’’ after ‘‘1308)’’. (5) Section 1271(c)(3)(A) of the Food, Agriculture, Conservation, and Trade Act of 1990 (16 U.S.C. 2106a(c)(3)(A)) is 

amended by inserting ‘‘(before the amendment made by section 

1703(a) of the Food, Conservation, and Energy Act of 2008)’’

after ‘‘1308)’’. 

(6) Section 291(2) of the Trade Act of 1974 (19 U.S.C. 

2401(2)) is amended by inserting ‘‘(before the amendment made 

by section 1703(a) of the Food, Conservation, and Energy Act of 

2008)’’ before the period at the end. 

(h) TRANSITION.—Section 1001, 1001A, and 1001B of the Food 

Security Act of 1985 (7 U.S.C. 1308, 1308–1, 1308–2), as in effect 

on September 30, 2007, shall continue to apply with respect to the 

2007 and 2008 crops of any covered commodity or peanuts. 

SEC. 1604. ADJUSTED GROSS INCOME LIMITATION. 

(a) IN GENERAL.—Section 1001D of the Food Security Act of 

1985 (7 U.S.C. 1308–3a(e)) is amended to read as follows: 

‘‘SEC. 1001D. ADJUSTED GROSS INCOME LIMITATION. 

‘‘(a) DEFINITIONS.—

‘‘(1) IN GENERAL.—In this section: 

‘‘(A) AVERAGE ADJUSTED GROSS INCOME.—The term ‘average adjusted gross income’, with respect to a person or 

legal entity, means the average of the adjusted gross income 

or comparable measure of the person or legal entity over the 

3 taxable years preceding the most immediately preceding 

complete taxable year, as determined by the Secretary. 


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‘‘(B) AVERAGE ADJUSTED GROSS FARM INCOME.—The 

term ‘average adjusted gross farm income’, with respect to 

a person or legal entity, means the average of the portion 

of adjusted gross income of the person or legal entity that 

is attributable to activities related to farming, ranching, or 

forestry for the 3 taxable years described in subparagraph 

(A), as determined by the Secretary in accordance with subsection (c). 

‘‘(C) AVERAGE ADJUSTED GROSS NONFARM INCOME.—

The term ‘average adjusted gross nonfarm income’, with respect to a person or legal entity, means the difference between—

‘‘(i) the average adjusted gross income of the person 

or legal entity; and 

‘‘(ii) the average adjusted gross farm income of the 

person or legal entity. 

‘‘(2) SPECIAL RULES FOR CERTAIN PERSONS AND LEGAL ENTITIES.—In the case of a legal entity that is not required to file 

a Federal income tax return or a person or legal entity that did 

not have taxable income in 1 or more of the taxable years used 

to determine the average under subparagraph (A) or (B) of 

paragraph (1), the Secretary shall provide, by regulation, a 

method for determining the average adjusted gross income, the 

average adjusted gross farm income, and the average adjusted 

gross nonfarm income of the person or legal entity for purposes 

of this section. 

‘‘(3) ALLOCATION OF INCOME.—On the request of any person 

filing a joint tax return, the Secretary shall provide for the allocation of average adjusted gross income, average adjusted gross 

farm income, and average adjusted gross nonfarm income 

among the persons filing the return if—

‘‘(A) the person provides a certified statement by a certified public accountant or attorney that specifies the method by which the average adjusted gross income, average adjusted gross farm income, and average adjusted gross nonfarm income would have been declared and reported had 

the persons filed 2 separate returns; and 

‘‘(B) the Secretary determines that the method described in the statement is consistent with the information 

supporting the filed joint tax return. 

‘‘(b) LIMITATIONS.—

‘‘(1) COMMODITY PROGRAMS.—

‘‘(A) NONFARM LIMITATION.—Notwithstanding any 

other provision of law, a person or legal entity shall not be 

eligible to receive any benefit described in subparagraph 

(C) during a crop, fiscal, or program year, as appropriate, 

if the average adjusted gross nonfarm income of the person 

or legal entity exceeds $500,000. 

‘‘(B) FARM LIMITATION.—Notwithstanding any other 

provision of law, a person or legal entity shall not be eligible to receive a direct payment under subtitle A or C of title 

I of the Food, Conservation, and Energy Act of 2008 during 

a crop year, if the average adjusted gross farm income of 

the person or legal entity exceeds $750,000. 


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‘‘(C) COVERED BENEFITS.—Subparagraph (A) applies 

with respect to the following: 

‘‘(i) A direct payment or counter-cyclical payment 

under subtitle A or C of title I of the Food, Conservation, and Energy Act of 2008 or an average crop revenue election payment under subtitle A of title I of that 

Act. 

‘‘(ii) A marketing loan gain or loan deficiency payment under subtitle B or C of title I of the Food, Conservation, and Energy Act of 2008. 

‘‘(iii) A payment or benefit under section 196 of the 

Federal Agriculture Improvement and Reform Act of 

1996 (7 U.S.C. 7333). 

‘‘(iv) A payment or benefit under section 1506 of 

the Food, Conservation, and Energy Act of 2008. 

‘‘(v) A payment or benefit under title IX of the 

Trade Act of 1974 or subtitle B of the Federal Crop Insurance Act. 

‘‘(2) CONSERVATION PROGRAMS.—

‘‘(A) LIMITS.—

‘‘(i) IN GENERAL.—Notwithstanding any other provision of law, except as provided in clause (ii), a person 

or legal entity shall not be eligible to receive any benefit described in subparagraph (B) during a crop, fiscal, or program year, as appropriate, if the average adjusted gross nonfarm income of the person or legal entity exceeds $1,000,000, unless not less than 66.66 percent of the average adjusted gross income of the person 

or legal entity is average adjusted gross farm income. 

‘‘(ii) EXCEPTION.—The Secretary may waive the 

limitation established under clause (i) on a case-bycase basis if the Secretary determines that environmentally sensitive land of special significance would be 

protected. 

‘‘(B) COVERED BENEFITS.—Subparagraph (A) applies 

with respect to the following: 

‘‘(i) A payment or benefit under title XII of this Act. 

‘‘(ii) A payment or benefit under title II of the 

Farm Security and Rural Investment Act of 2002 (Public Law 107–171; 116 Stat. 223) or title II of the Food, 

Conservation, and Energy Act of 2008. 

‘‘(iii) A payment or benefit under section 524(b) of 

the Federal Crop Insurance Act (7 U.S.C. 1524(b)). 

‘‘(c) INCOME DETERMINATION.—

‘‘(1) IN GENERAL.—In determining the average adjusted 

gross farm income of a person or legal entity, the Secretary 

shall include income or benefits derived from or related to—

‘‘(A) the production of crops, including specialty crops 

(as defined in section 3 of the Specialty Crops Competitiveness Act of 2004 (7 U.S.C. 1621 note; Public Law 108–465)) 

and unfinished raw forestry products; 

‘‘(B) the production of livestock (including cattle, elk, 

reindeer, bison, horses, deer, sheep, goats, swine, poultry, 

fish, and other aquacultural products used for food, honeyVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00097 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

wwoods2 on PRODPC60 with HEARING
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bees, and other animals designated by the Secretary) and 

products produced by, or derived from, livestock; 

‘‘(C) the production of farm-based renewable energy (as 

defined in section 9001 of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 8101)); 

‘‘(D) the sale, including the sale of easements and development rights, of farm, ranch, or forestry land, water or 

hunting rights, or environmental benefits; 

‘‘(E) the rental or lease of land or equipment used for 

farming, ranching, or forestry operations, including water 

or hunting rights; 

‘‘(F) the processing (including packing), storing (including shedding), and transporting of farm, ranch, and forestry commodities, including renewable energy; 

‘‘(G) the feeding, rearing, or finishing of livestock; 

‘‘(H) the sale of land that has been used for agriculture; 

‘‘(I) payments or other benefits received under any program authorized under title I of the Farm Security and 

Rural Investment Act of 2002 (7 U.S.C. 7901 et seq.) or title 

I of the Food, Conservation, and Energy Act of 2008; 

‘‘(J) payments or other benefits received under any program authorized under title XII of this Act, title II of the 

Farm Security and Rural Investment Act of 2002 (Public 

Law 107–171; 116 Stat. 223), or title II of the Food, Conservation, and Energy Act of 2008; 

‘‘(K) payments or other benefits received under section 

196 of the Federal Agriculture Improvement and Reform 

Act of 1996 (7 U.S.C. 7333); 

‘‘(L) payments or other benefits received under title IX 

of the Trade Act of 1974 or subtitle B of the Federal Crop 

Insurance Act; 

‘‘(M) risk management practices, including benefits received under a program authorized under the Federal Crop 

Insurance Act (7 U.S.C. 1501 et seq.) (including a catastrophic risk protection plan offered under section 508(b) of 

that Act (7 U.S.C. 1508(b))); and 

‘‘(N) any other activity related to farming, ranching, or 

forestry, as determined by the Secretary. 

‘‘(2) INCOME DERIVED FROM FARMING, RANCHING, OR FORESTRY.—In determining the average adjusted gross farm income 

of a person or legal entity, in addition to the inclusions described in paragraph (1), the Secretary shall include any income reported on the Schedule F or other schedule used by the 

person or legal entity to report income from farming, ranching, 

or forestry operations to the Internal Revenue Service, to the extent such income is not already included under paragraph (1). 

‘‘(3) SPECIAL RULE.—If not less than 66.66 percent of the 

average adjusted gross income of a person or legal entity is derived from farming, ranching, or forestry operations described 

in paragraphs (1) and (2), in determining the average adjusted 

gross farm income of the person or legal entity, the Secretary 

shall also include—

‘‘(A) the sale of equipment to conduct farm, ranch, or 

forestry operations; and 


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‘‘(B) the provision of production inputs and services to 

farmers, ranchers, foresters, and farm operations. ‘‘(d) ENFORCEMENT.— ‘‘(1) IN GENERAL.—To comply with subsection (b), at least 

once every 3 years a person or legal entity shall provide to the 

Secretary—

‘‘(A) a certification by a certified public accountant or 

another third party that is acceptable to the Secretary that 

the average adjusted gross income, average adjusted gross 

farm income, and average adjusted gross nonfarm income 

of the person or legal entity does not exceed the applicable 

limitation specified in that subsection; or ‘‘(B) information and documentation regarding the average adjusted gross income, average adjusted gross farm 

income, and average adjusted gross nonfarm income of the 

person or legal entity through other procedures established 

by the Secretary. 

‘‘(2) DENIAL OF PROGRAM BENEFITS.—If the Secretary determines that a person or legal entity has failed to comply with 

this section, the Secretary shall deny the issuance of applicable 

payments and benefits specified in paragraphs (1)(C) and (2)(B) 

of subsection (b) to the person or legal entity, under similar 

terms and conditions as described in section 1001B. 

‘‘(3) AUDIT.—The Secretary shall establish statistically 

valid procedures under which the Secretary shall conduct targeted audits of such persons or legal entities as the Secretary 

determines are most likely to exceed the limitations under subsection (b). 

‘‘(e) COMMENSURATE REDUCTION.—In the case of a payment or 

benefit described in paragraphs (1)(C) and (2)(B) of subsection (b) 

made in a crop, program, or fiscal year, as appropriate, to an entity, 

general partnership, or joint venture, the amount of the payment or 

benefit shall be reduced by an amount that is commensurate with 

the direct and indirect ownership interest in the entity, general partnership, or joint venture of each person who has an average adjusted gross income, average adjusted gross farm income, or average 

adjusted gross nonfarm income in excess of the applicable limitation 

specified in subsection (b). ‘‘(f) EFFECTIVE PERIOD.—This section shall apply only during 

the 2009 through 2012 crop, program, or fiscal years, as appropriate.’’. (b) TRANSITION.—Section 1001D of the Food Security Act of 

1985 (7 U.S.C. 1308–3a), as in effect on September 30, 2007, shall 

apply with respect to the 2007 and 2008 crop, fiscal, or program 

year, as appropriate, for each program described in paragraphs 

(1)(C) and (2)(B) of subsection (b) of that section (as amended by 

subsection (a)). 

SEC. 1605. AVAILABILITY OF QUALITY INCENTIVE PAYMENTS FOR COVERED OILSEED PRODUCERS. 

(a) INCENTIVE PAYMENTS REQUIRED.—Subject to subsection (b) 

and the availability of appropriations under subsection (h), the Secretary shall use funds made available under subsection (h) to provide quality incentive payments for the production of oilseeds with 

specialized traits that enhance human health, as determined by the 

Secretary. 


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(b) COVERED OILSEEDS.—The Secretary shall make payments 

under this section only for the production of an oilseed variety that 

has, as determined by the Secretary— (1) been demonstrated to improve the health profile of the 

oilseed for use in human consumption by— (A) reducing or eliminating the need to partially hydrogenate the oil derived from the oilseed for use in human 

consumption; or 

(B) adopting new technology traits; and 

(2) 1 or more impediments to commercialization. 

(c) REQUEST FOR PROPOSALS.— (1) ISSUANCE.—If funds are made available to carry out 

this section for a crop year, the Secretary shall issue a request 

for proposals for payments under this section. 

(2) MULTIYEAR PROPOSALS.—A proponent may submit a 

multiyear proposal for payments under this section. 

(3) CONTENT OF PROPOSALS.—A proposal for payments 

under this section shall include a description of—

(A) how use of the oilseed enhances human health; 

(B) the impediments to commercial use of the oilseed; 

(C) each oilseed variety described in subsection (b) and 

the value of the oilseed variety as a matter of public policy; 

(D) a range for the base price and premiums per bushel 

or hundredweight to be paid to producers; 

(E) a per bushel or hundredweight amount of incentive 

payments requested for each year under this section that 

does not exceed 1⁄3 of the total premium offered for any 

year; 

(F) the period of time, not to exceed 4 years, during 

which incentive payments are to be provided to producers; 

and 

(G) the targeted total quantity of production and estimated acres needed to produce the targeted quantity for 

each year under this section. 

(d) CONTRACTS FOR PRODUCTION.— (1) IN GENERAL.—The Secretary shall approve successful 

proposals submitted under subsection (c) on a timely basis. 

(2) TIMING OF PAYMENTS.—The Secretary shall make payments to producers under this section after the Secretary receives documentation that the premium required under a contract has been paid to covered producers. 

(e) ADMINISTRATION.—

(1) IN GENERAL.—If funding provided for a crop year is not 

fully allocated under the initial request for proposals under 

subsection (c), the Secretary shall issue additional requests for 

proposals for subsequent crop years under this section. 

(2) PRORATED PAYMENTS.—If funding provided for a crop 

year is less than the amount otherwise approved by the Secretary or for which approval is sought, the Secretary shall prorate the payments or approvals in a manner determined by the 

Secretary so that the total payments do not exceed the funding 

level. 

(f) PROPRIETARY INFORMATION.—The Secretary shall protect 

proprietary information provided to the Secretary for the purpose of 

administering this section. 


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(g) PROGRAM COMPLIANCE AND PENALTIES.—

(1) GUARANTEE.—The proponent, if approved, shall be required to guarantee that the oilseed on which a payment is 

made by the Secretary under this section is used for human 

consumption as described in the proposal, as approved by the 

Secretary. 

(2) NONCOMPLIANCE.—If oilseeds on which a payment is 

made by the Secretary under this section are not actually used 

for the purpose the payment is made, the proponent shall be required to pay to the Secretary an amount equal to, as determined by the Secretary—

(A) in the case of an inadvertent failure, twice the 

amount of the payment made by the Secretary under this 

section to the producer of the oilseeds; and 

(B) in any other case, up to twice the full value of the 

oilseeds involved. 

(3) DOCUMENTATION.—The Secretary may require such assurances and documentation as may be needed to enforce the 

guarantee. 

(4) ADDITIONAL PENALTIES.—

(A) IN GENERAL.—In addition to payments required 

under paragraph (2), the Secretary may impose penalties 

on additional persons that use oilseeds the use of which is 

restricted under this section for a purpose other than the 

intended use. 

(B) AMOUNT.—The amount of a penalty under this 

paragraph shall—

(i) be in an amount determined appropriated by 

the Secretary; but 

(ii) not to exceed twice the full value of the oilseeds. 

(h) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this section for each of fiscal years 2009 through 2012. 

SEC. 1606. PERSONAL LIABILITY OF PRODUCERS FOR DEFICIENCIES. 

Section 164 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7284) is amended by striking ‘‘and title 

I of the Farm Security and Rural Investment Act of 2002’’ each 

place it appears and inserting ‘‘title I of the Farm Security and 

Rural Investment Act of 2002, and title I of the Food, Conservation, 

and Energy Act of 2008’’. 

SEC. 1607. EXTENSION OF EXISTING ADMINISTRATIVE AUTHORITY REGARDING LOANS. 

Section 166 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7286) is amended—

(1) by striking ‘‘and subtitle B and C of title I of the Farm 

Security and Rural Investment Act of 2002’’ each place it appears and inserting ‘‘, title I of the Farm Security and Rural 

Investment Act of 2002, and title I of the Food, Conservation, 

and Energy Act of 2008’’; and 

(2) in subsection (c), by adding at the end the following: 

‘‘(3) TERMINATION OF AUTHORITY.—The authority to carry 

out paragraph (1) terminates effective ending with the 2009 

crop year.’’. 


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SEC. 1608. ASSIGNMENT OF PAYMENTS. 

(a) IN GENERAL.—The provisions of section 8(g) of the Soil Conservation and Domestic Allotment Act (16 U.S.C. 590h(g)), relating 

to assignment of payments, shall apply to payments made under 

this title. 

(b) NOTICE.—The producer making the assignment, or the assignee, shall provide the Secretary with notice, in such manner as 

the Secretary may require, of any assignment made under this section. 

SEC. 1609. TRACKING OF BENEFITS. 

As soon as practicable after the date of enactment of this Act, 

the Secretary may track the benefits provided, directly or indirectly, 

to individuals and entities under titles I and II and the amendments made by those titles. 

SEC. 1610. GOVERNMENT PUBLICATION OF COTTON PRICE FORECASTS. 

Section 15 of the Agricultural Marketing Act (12 U.S.C. 1141j) 

is amended—

(1) by striking subsection (d); and 

(2) by redesignating subsections (e) through (g) as subsections (d) through (f), respectively. 

SEC. 1611. PREVENTION OF DECEASED INDIVIDUALS RECEIVING PAYMENTS UNDER FARM COMMODITY PROGRAMS. 

(a) REGULATIONS.—Not later than 180 days after the date of enactment of this Act, the Secretary shall promulgate regulations 

that—

(1) describe the circumstances under which, in order to 

allow for the settlement of estates and for related purposes, payments may be issued in the name of a deceased individual; and 

(2) preclude the issuance of payments to, and on behalf of, 

deceased individuals that were not eligible for the payments. 

(b) COORDINATION.—At least twice each year, the Secretary 

shall reconcile the social security numbers of all individuals who receive payments under this title, whether directly or indirectly, with 

the Social Security Administration to determine if the individuals 

are alive. 

SEC. 1612. HARD WHITE WHEAT DEVELOPMENT PROGRAM. 

(a) DEFINITIONS.—In this section: 

(1) ELIGIBLE HARD WHITE WHEAT SEED.—The term ‘‘eligible 

hard white wheat seed’’ means hard white wheat seed that, as 

determined by the Secretary, is— (A) certified; 

(B) of a variety that is suitable for the State in which 

the seed will be planted; 

(C) rated at least superior with respect to quality; and 

(D) specifically approved under a seed establishment 

program established by the State Department of Agriculture and the State Wheat Commission of the 1 or more 

States in which the seed will be planted. 

(2) PROGRAM.—The term ‘‘program’’ means the hard white 

wheat development program established under subsection (b)(1). 

(3) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of Agriculture, in consultation with the State Departments of 

Agriculture and the State Wheat Commissions of the States in 


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regions in which hard white wheat is produced, as determined 

by the Secretary. 

(b) ESTABLISHMENT.—

(1) IN GENERAL.—Subject to the availability of appropriations, the Secretary shall establish a hard white wheat development program in accordance with paragraph (2) to promote the 

establishment of hard white wheat as a viable market class of 

wheat in the United States by encouraging production of at 

least 240,000,000 bushels of hard white wheat by 2012. 

(2) PAYMENTS.—

(A) IN GENERAL.—Subject to subparagraphs (B) and 

(C) and subsection (c), if funds are made available for any 

of the 2009 through 2012 crops of hard white wheat, the 

Secretary shall make available incentive payments to producers of those crops. 

(B) ACREAGE LIMITATION.—The Secretary shall carry 

out subparagraph (A) subject to a regional limitation determined by the Secretary on the number of acres for which 

payments may be received that takes into account planting 

history and potential planting, but does not exceed a total 

of 2,900,000 acres or the equivalent volume of production 

based on a yield of 50 bushels per acre. 

(C) PAYMENT LIMITATIONS.—Payments to producers on 

a farm described in subparagraph (A) shall be—

(i) in an amount that is not less than $0.20 per 

bushel; and 

(ii) in an amount that is not less than $2.00 per 

acre for planting eligible hard white wheat seed. 

(c) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section $35,000,000 for the period of fiscal years 2009 through 2012. 

SEC. 1613. DURUM WHEAT QUALITY PROGRAM. 

(a) IN GENERAL.—Subject to the availability of funds under 

subsection (c), the Secretary shall provide compensation to producers of durum wheat in an amount not to exceed 50 percent of 

the actual cost of fungicides applied to a crop of durum wheat of 

the producers to control Fusarium head blight (wheat scab) on acres 

certified to have been planted to Durum wheat in a crop year. 

(b) INSUFFICIENT FUNDS.—If the total amount of funds appropriated for a fiscal year under subsection (c) are insufficient to fulfill all eligible requests for compensation under this section, the Secretary shall prorate the compensation payments in a manner determined by the Secretary to be equitable. 

(c) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to 

be appropriated to carry out this section $10,000,000 for each of fiscal years 2009 through 2012. 

SEC. 1614. STORAGE FACILITY LOANS. 

(a) IN GENERAL.—As soon as practicable after the date of enactment of this Act, the Secretary shall establish a storage facility loan 

program to provide funds for producers of grains, oilseeds, pulse 

crops, hay, renewable biomass, and other storable commodities 

(other than sugar), as determined by the Secretary, to construct or 

upgrade storage and handling facilities for the commodities. 


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(b) ELIGIBLE PRODUCERS.—A storage facility loan under this 

section shall be made available to any producer described in subsection (a) that, as determined by the Secretary— (1) has a satisfactory credit history; 

(2) has a need for increased storage capacity; and 

(3) demonstrates an ability to repay the loan. 

(c) TERM OF LOANS.—A storage facility loan under this section 

shall have a maximum term of 12 years. 

(d) LOAN AMOUNT.—The maximum principal amount of a stor- age facility loan under this section shall be $500,000. 

(e) LOAN DISBURSEMENTS.—The Secretary shall provide for 1 

partial disbursement of loan principal and 1 final disbursement of 

loan principal, as determined to be appropriate and subject to acceptable documentation, to facilitate the purchase and construction 

of eligible facilities. 

(f) LOAN SECURITY.—Approval of a storage facility loan under 

this section shall— (1) require the borrower to provide loan security to the Secretary, in the form of— (A) a lien on the real estate parcel on which the storage 

facility is located; or 

(B) such other security as is acceptable to the Secretary; 

(2) under such rules and regulations as the Secretary may 

prescribe, not require a severance agreement from the holder of 

any prior lien on the real estate parcel on which the storage facility is located, if the borrower— (A) agrees to increase the down payment on the storage 

facility by an amount determined appropriate by the Secretary; or 

(B) provides other security acceptable to the Secretary; 

and 

(3) allow a borrower, upon the approval of the Secretary, to 

define a subparcel of real estate as security for the storage facility loan if the subparcel is— (A) of adequate size and value to adequately secure the 

loan; and 

(B) not subject to any other liens or mortgages that are 

superior to the lien interest of the Commodity Credit Corporation. 

SEC. 1615. STATE, COUNTY, AND AREA COMMITTEES. 

Section 8(b)(5)(B)(ii) of the Soil Conservation and Domestic Allotment Act (16 U.S.C. 590h(b)(5)(B)(ii)) is amended—

(1) by redesignating subclauses (I) and (II) as items (aa) 

and (bb), respectively, and indenting appropriately; 

(2) in the matter preceding item (aa) (as redesignated by 

paragraph (1)), by striking ‘‘A committee established’’ and inserting the following: 

‘‘(I) IN GENERAL.—Except as provided in subclause (II), a committee established’’; and 

(3) by adding at the end the following: 

‘‘(II) COMBINATION OR CONSOLIDATION OF

AREAS.—A committee established by combining or 

consolidating 2 or more county or area committees 

shall consist of not fewer than 3 nor more than 11 

members that—


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‘‘(aa) are fairly representative of the agricultural producers within the area covered by 

the county, area, or local committee; and 

‘‘(bb) are elected by the agricultural producers that participate or cooperate in programs administered within the area under the 

jurisdiction of the county, area, or local committee. 

‘‘(III) REPRESENTATION OF SOCIALLY DISADVANTAGED FARMERS AND RANCHERS.—The Secretary shall develop procedures to maintain representation of socially disadvantaged farmers and 

ranchers on combined or consolidated committees. 

‘‘(IV) ELIGIBILITY FOR MEMBERSHIP.—Notwithstanding any other producer eligibility requirements for service on county or area committees, if 

a county or area is consolidated or combined, a 

producer shall be eligible to serve only as a member of the county or area committee that the producer elects to administer the farm records of the 

producer.’’. 

SEC. 1616. PROHIBITION ON CHARGING CERTAIN FEES. 

Public Law 108–470 (7 U.S.C. 7416a) is amended—

(1) in subsection (a), by striking ‘‘may’’ and inserting 

‘‘shall’’; and 

(2) by adding at the end the following: 

‘‘(c) PROHIBITION ON CHARGING CERTAIN FEES.—The Secretary 

may not charge any fees or related costs for the collection of commodity assessments pursuant to this Act.’’. 

SEC. 1617. SIGNATURE AUTHORITY. 

(a) IN GENERAL.—In carrying out this title and title II and 

amendments made by those titles, if the Secretary approves a document, the Secretary shall not subsequently determine the document 

is inadequate or invalid because of the lack of authority of any person signing the document on behalf of the applicant or any other 

individual, entity, general partnership, or joint venture, or the documents relied upon were determined inadequate or invalid, unless 

the person signing the program document knowingly and willfully 

falsified the evidence of signature authority or a signature. 

(b) AFFIRMATION.—

(1) IN GENERAL.—Nothing in this section prohibits the Secretary from asking a proper party to affirm any document that 

otherwise would be considered approved under subsection (a). 

(2) NO RETROACTIVE EFFECT.—A denial of benefits based on 

a lack of affirmation under paragraph (1) shall not be retroactive with respect to third-party producers who were not the 

subject of the erroneous representation of authority, if the thirdparty producers—

(A) relied on the prior approval by the Secretary of the 

documents in good faith; and 

(B) substantively complied with all program requirements. 


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SEC. 1618. MODERNIZATION OF FARM SERVICE AGENCY. 

Not later than 180 days after the date of enactment of this Act, 

the Secretary shall transmit to the Committee on Agriculture and 

the Committee on Appropriations of the House of Representatives 

and the Committee on Agriculture, Nutrition, and Forestry and the 

Committee on Appropriations of the Senate a report prepared by a 

third party that describes—

(1) the data processing and information technology challenges experienced in local offices of the Farm Service Agency; 

(2) the impact of those challenges on service to producers, 

on efficiency of personnel, and on implementation of this Act; 

(3) the need for information technology system upgrades of 

the Farm Service Agency relative to other agencies of the Department of Agriculture; 

(4) the detailed plan needed to fulfill the needs of the Department that are identified in paragraph (3), including hardware, software, and infrastructure requirements; 

(5) the estimated cost and timeframe for long-term modernization and stabilization of Farm Service Agency information technology systems; 

(6) the benefits associated with such modernization and 

stabilization; and 

(7) an evaluation of the existence of appropriate oversight 

within the Department to ensure that funds needed for systems 

upgrades can be appropriately managed. 

SEC. 1619. INFORMATION GATHERING. 

(a) GEOSPATIAL SYSTEMS.—The Secretary shall ensure that all 

the geospatial data of the agencies of the Department of Agriculture 

are portable and standardized. 

(b) LIMITATION ON DISCLOSURES.—

(1) DEFINITION OF AGRICULTURAL OPERATION.—In this subsection, the term ‘‘agricultural operation’’ includes the production and marketing of agricultural commodities and livestock. 

(2) PROHIBITION.—Except as provided in paragraphs (3) 

and (4), the Secretary, any officer or employee of the Department of Agriculture, or any contractor or cooperator of the Department, shall not disclose—

(A) information provided by an agricultural producer 

or owner of agricultural land concerning the agricultural 

operation, farming or conservation practices, or the land 

itself, in order to participate in programs of the Department; or 

(B) geospatial information otherwise maintained by the 

Secretary about agricultural land or operations for which 

information described in subparagraph (A) is provided. 

(3) AUTHORIZED DISCLOSURES.—

(A) LIMITED RELEASE OF INFORMATION.—If the Secretary determines that the information described in paragraph (2) will not be subsequently disclosed except in accordance with paragraph (4), the Secretary may release or 

disclose the information to a person or Federal, State, local, 

or tribal agency working in cooperation with the Secretary 

in any Department program—


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(i) when providing technical or financial assistance 

with respect to the agricultural operation, agricultural 

land, or farming or conservation practices; or 

(ii) when responding to a disease or pest threat to 

agricultural operations, if the Secretary determines 

that a threat to agricultural operations exists and the 

disclosure of information to a person or cooperating 

government entity is necessary to assist the Secretary 

in responding to the disease or pest threat as authorized by law. 

(4) EXCEPTIONS.—Nothing in this subsection affects—

(A) the disclosure of payment information (including 

payment information and the names and addresses of recipients of payments) under any Department program that 

is otherwise authorized by law; 

(B) the disclosure of information described in paragraph (2) if the information has been transformed into a 

statistical or aggregate form without naming any—

(i) individual owner, operator, or producer; or 

(ii) specific data gathering site; or 

(C) the disclosure of information described in paragraph (2) pursuant to the consent of the agricultural producer or owner of agricultural land. 

(5) CONDITION OF OTHER PROGRAMS.—The participation of 

the agricultural producer or owner of agricultural land in, or 

receipt of any benefit under, any program administered by the 

Secretary may not be conditioned on the consent of the agricultural producer or owner of agricultural land under paragraph 

(4)(C). 

(6) WAIVER OF PRIVILEGE OR PROTECTION.—The disclosure 

of information under paragraph (2) shall not constitute a waiver of any applicable privilege or protection under Federal law, 

including trade secret protection. 

SEC. 1620. LEASING OF OFFICE SPACE. 

Not later than 1 year after the date of enactment of this Act, 

the Secretary shall submit to the Committee on Agriculture and the 

Committee on Appropriations of the House of Representatives and 

the Committee on Agriculture, Nutrition, and Forestry and the 

Committee on Appropriations of the Senate a report that describes—

(1) the costs and time associated with complying with leasing procedures of the General Services Administration relative 

to the previous independent leasing procedures of the Department of Agriculture; 

(2) the additional staffing needs associated with complying 

with those procedures; and 

(3) the value added to the leasing process and the ability 

of the Department to secure best-value leases by complying with 

the General Services Administration leasing procedures. 

SEC. 1621. GEOGRAPHICALLY DISADVANTAGED FARMERS AND RANCHERS. 

(a) DEFINITIONS.—In this section: 

(1) AGRICULTURAL COMMODITY.—The term ‘‘agricultural 

commodity’’ has the meaning given the term in section 102 of 

the Agricultural Trade Act of 1978 (7 U.S.C. 5602). 


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(2) GEOGRAPHICALLY DISADVANTAGED FARMER OR RANCHER.—The term ‘‘geographically disadvantaged farmer or rancher’’ has the meaning given the term in section 10906(a) of the 

Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

2204 note; Public Law 107–171). 

(b) AUTHORIZATION.—Subject to the availability of funds under 

subsection (d), the Secretary may provide geographically disadvantaged farmers or ranchers direct reimbursement payments for activities described in subsection (c). 

(c) TRANSPORTATION.—

(1) IN GENERAL.—Subject to paragraphs (2) and (3), the 

Secretary may provide direct reimbursement payments to a geographically disadvantaged farmer or rancher to transport an 

agricultural commodity, or inputs used to produce an agricultural commodity, during a fiscal year. 

(2) PROOF OF ELIGIBILITY.—To be eligible to receive assistance under paragraph (1), a geographically disadvantaged 

farmer or rancher shall demonstrate to the Secretary that transportation of the agricultural commodity or inputs occurred over 

a distance of more than 30 miles, as determined by the Secretary. 

(3) AMOUNT.—

(A) IN GENERAL.—Subject to paragraph (2), the amount 

of direct reimbursement payments made to a geographically 

disadvantaged farmer or rancher under this section for a 

fiscal year shall equal the product obtained by multiplying—

(i) the amount of costs incurred by the geographically disadvantaged farmer or rancher for transportation of the agricultural commodity or inputs during 

the fiscal year; and 

(ii)(I) the percentage of the allowance for that fiscal 

year under section 5941 of title 5, United States Code, 

for Federal employees stationed in Alaska and Hawaii; 

or 

(II) in the case of an insular area (as defined in 

section 1404 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

3103)), a comparable percentage of the allowance for 

the fiscal year, as determined by the Secretary. 

(B) LIMITATION.—The total amount of direct reimbursement payments provided by the Secretary under this section 

shall not exceed $15,000,000 for a fiscal year. 

(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this section for each of fiscal years 2009 through 2012. 

SEC. 1622. IMPLEMENTATION. 

The Secretary shall make available to the Farm Service Agency 

to carry out this title $50,000,000. 

SEC. 1623. REPEALS. 

(a) COMMISSION ON APPLICATION OF PAYMENT LIMITATIONS.—

Section 1605 of the Farm Security and Rural Investment Act of 

2002 (7 U.S.C. 7993) is repealed. 


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(b) RENEWED AVAILABILITY OF MARKET LOSS ASSISTANCE AND

CERTAIN EMERGENCY ASSISTANCE TO PERSONS THAT FAILED TO

RECEIVE ASSISTANCE UNDER EARLIER AUTHORITIES.—Section 1617 

of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

8000) is repealed. 

TITLE II—CONSERVATION 

Subtitle A—Definitions and Highly Erodible Land and 

Wetland Conservation 

SEC. 2001. DEFINITIONS RELATING TO CONSERVATION TITLE OF FOOD 

SECURITY ACT OF 1985. 

(a) BEGINNING FARMER OR RANCHER.—Section 1201(a) of the 

Food Security Act of 1985 (16 U.S.C. 3801(a)) is amended—

(1) by redesignating paragraphs (2) through (6), (7) 

through (11), (12), (13) through (15), (16), (17), and (18) as 

paragraphs (3) through (7), (9) through (13), (15), (20) through 

(22), (24), (26), and (27), respectively; and 

(2) by inserting after paragraph (1) the following new paragraph: 

‘‘(2) BEGINNING FARMER OR RANCHER.—The term ‘beginning 

farmer or rancher’ has the meaning given the term in section 

343(a)(8) of the Consolidated Farm and Rural Development Act 

(7 U.S.C. 1991(a)(8)).’’. 

(b) FARM.—Section 1201(a) of the Food Security Act of 1985 (16 

U.S.C. 3801(a)) is amended by inserting after paragraph (7), as redesignated by subsection (a)(1), the following new paragraph: 

‘‘(8) FARM.—The term ‘farm’ means a farm that—

‘‘(A) is under the general control of one operator; 

‘‘(B) has one or more owners; 

‘‘(C) consists of one or more tracts of land, whether or 

not contiguous; 

‘‘(D) is located within a county or region, as determined 

by the Secretary; and 

‘‘(E) may contain lands that are incidental to the production of perennial crops, including conserving uses, forestry, and livestock, as determined by the Secretary.’’. 

(c) INDIAN TRIBE.—Section 1201(a) of the Food Security Act of 

1985 (16 U.S.C. 3801(a)) is amended by inserting after paragraph 

(13), as redesignated by subsection (a)(1), the following new paragraph: 

‘‘(14) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning given the term in section 4(e) of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b(e)).’’. 

(d) INTEGRATED PEST MANAGEMENT; LIVESTOCK; NONINDUSTRIAL PRIVATE FOREST LAND; PERSON AND LEGAL ENTITY.—Section 

1201(a) of the Food Security Act of 1985 (16 U.S.C. 3801(a)) is 

amended by inserting after paragraph (15), as redesignated by subsection (a)(1), the following new paragraphs: 

‘‘(16) INTEGRATED PEST MANAGEMENT.—The term ‘integrated pest management’ means a sustainable approach to 

managing pests by combining biological, cultural, physical, and 

chemical tools in a way that minimizes economic, health, and 

environmental risks. 


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‘‘(17) LIVESTOCK.—The term ‘livestock’ means all animals 

raised on farms, as determined by the Secretary. 

‘‘(18) NONINDUSTRIAL PRIVATE FOREST LAND.—The term 

‘nonindustrial private forest land’ means rural land, as determined by the Secretary, that—

‘‘(A) has existing tree cover or is suitable for growing 

trees; and 

‘‘(B) is owned by any nonindustrial private individual, 

group, association, corporation, Indian tribe, or other private legal entity that has definitive decisionmaking authority over the land. 

‘‘(19) PERSON AND LEGAL ENTITY.—For purposes of applying 

payment limitations under subtitle D, the terms ‘person’ and 

‘legal entity’ have the meanings given those terms in section 

1001(a) of this Act (7 U.S.C. 1308(a)).’’. 

(e) SOCIALLY DISADVANTAGED FARMER OR RANCHER.—Section 

1201(a) of the Food Security Act of 1985 (16 U.S.C. 3801(a)) is 

amended by inserting after paragraph (22), as redesignated by subsection (a)(1), the following new paragraph: 

‘‘(23) SOCIALLY DISADVANTAGED FARMER OR RANCHER.—The 

term ‘socially disadvantaged farmer or rancher’ has the meaning given the term in section 2501(e)(2) of the Food, Agriculture, 

Conservation, and Trade Act of 1990 (7 U.S.C. 2279(e)(2)).’’. 

(f) TECHNICAL ASSISTANCE.—Section 1201(a) of the Food Security Act of 1985 (16 U.S.C. 3801(a)) is amended by inserting after 

paragraph (24), as redesignated by subsection (a)(1), the following 

new paragraph: 

‘‘(25) TECHNICAL ASSISTANCE.—The term ‘technical assistance’ means technical expertise, information, and tools necessary for the conservation of natural resources on land active 

in agricultural, forestry, or related uses. The term includes the 

following: 

‘‘(A) Technical services provided directly to farmers, 

ranchers, and other eligible entities, such as conservation 

planning, technical consultation, and assistance with design and implementation of conservation practices. 

‘‘(B) Technical infrastructure, including activities, processes, tools, and agency functions needed to support delivery of technical services, such as technical standards, resource inventories, training, data, technology, monitoring, 

and effects analyses.’’. 

SEC. 2002. REVIEW OF GOOD FAITH DETERMINATIONS RELATED TO 

HIGHLY ERODIBLE LAND CONSERVATION. 

Section 1212 of the Food Security Act of 1985 (16 U.S.C. 3812) 

is amended by striking subsection (f) and inserting the following 

new subsection: 

‘‘(f) GRADUATED PENALTIES.—

‘‘(1) INELIGIBILITY.—No person shall become ineligible 

under section 1211 for program loans, payments, and benefits 

as a result of the failure of the person to actively apply a conservation plan, if the Secretary determines that the person has 

acted in good faith and without an intent to violate this subtitle. 


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‘‘(2) ELIGIBLE REVIEWERS.—A determination of the Secretary, or a designee of the Secretary, under paragraph (1) shall 

be reviewed by the applicable— ‘‘(A) State Executive Director, with the technical concurrence of the State Conservationist; or ‘‘(B) district director, with the technical concurrence of 

the area conservationist. 

‘‘(3) PERIOD FOR IMPLEMENTATION.—A person who meets 

the requirements of paragraph (1) shall be allowed a reasonable 

period of time, as determined by the Secretary, but not to exceed 

1 year, during which to implement the measures and practices 

necessary to be considered to be actively applying the conservation plan of the person. ‘‘(4) PENALTIES.— ‘‘(A) APPLICATION.—This paragraph applies if the Secretary determines that— ‘‘(i) a person has failed to comply with section 1211 

with respect to highly erodible cropland, and has acted 

in good faith and without an intent to violate section 

1211; or ‘‘(ii) the violation—

‘‘(I) is technical and minor in nature; and 

‘‘(II) has a minimal effect on the erosion control purposes of the conservation plan applicable to 

the land on which the violation has occurred. 

‘‘(B) REDUCTION.—If this paragraph applies under subparagraph (A), the Secretary shall, in lieu of applying the 

ineligibility provisions of section 1211, reduce program benefits described in section 1211 that the producer would otherwise be eligible to receive in a crop year by an amount 

commensurate with the seriousness of the violation, as determined by the Secretary. 

‘‘(5) SUBSEQUENT CROP YEARS.—Any person whose benefits 

are reduced for any crop year under this subsection shall continue to be eligible for all of the benefits described in section 

1211 for any subsequent crop year if, prior to the beginning of 

the subsequent crop year, the Secretary determines that the person is actively applying a conservation plan according to the 

schedule specified in the plan.’’. 

SEC. 2003. REVIEW OF GOOD FAITH DETERMINATIONS RELATED TO 

WETLAND CONSERVATION. 

Section 1222(h) of the Food Security Act of 1985 (16 U.S.C. 

3822(h)) is amended—

(1) by redesignating paragraph (2) as paragraph (3); 

(2) by inserting after paragraph (1) the following new paragraph: 

‘‘(2) ELIGIBLE REVIEWERS.—A determination of the Secretary, or a designee of the Secretary, under paragraph (1) shall 

be reviewed by the applicable—

‘‘(A) State Executive Director, with the technical concurrence of the State Conservationist; or 

‘‘(B) district director, with the technical concurrence of 

the area conservationist.’’; and 

(3) in paragraph (3) (as redesignated by paragraph (1)), by 

inserting ‘‘be’’ before ‘‘actively’’. 


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Subtitle B—Conservation Reserve Program 

SEC. 2101. EXTENSION OF CONSERVATION RESERVE PROGRAM. 

Section 1231(a) of the Food Security Act of 1985 (16 U.S.C. 

3831(a)) is amended—

(1) by striking ‘‘2007 calendar year’’ and inserting ‘‘2012 

fiscal year’’; and 

(2) by inserting before the period the following: ‘‘and to address issues raised by State, regional, and national conservation initiatives’’; and 

SEC. 2102. LAND ELIGIBLE FOR ENROLLMENT IN CONSERVATION RESERVE. 

Section 1231(b) of the Food Security Act of 1985 (16 U.S.C. 

3831(b)) is amended— (1) in paragraph (1)(B)— (A) by striking ‘‘Farm Security and Rural Investment 

Act of 2002’’ and inserting ‘‘Food, Conservation, and Energy Act of 2008’’; and 

(B) by striking the period at the end and inserting a 

semicolon; and 

(2) in paragraph (4)— (A) in subparagraph (C), by striking ‘‘; or’’ and inserting a semicolon; 

(B) in subparagraph (D), by striking ‘‘and’’ at the end 

and inserting ‘‘or’’; and 

(C) in subparagraph (E), by inserting ‘‘or’’ after the 

semicolon at the end. 

SEC. 2103. MAXIMUM ENROLLMENT OF ACREAGE IN CONSERVATION 

RESERVE. 

Section 1231(d) of the Food Security Act of 1985 (16 U.S.C. 

3831(d)) is amended—

(1) by striking ‘‘2007 calendar years’’ and inserting ‘‘2009 

fiscal years’’; 

(2) by striking ‘‘( 16 U.S.C.’’ and inserting ‘‘(16 U.S.C.’’; and 

(3) by adding at the end the following new sentence: ‘‘During fiscal years 2010, 2011, and 2012, the Secretary may maintain up to 32,000,000 acres in the conservation reserve at any 

1 time.’’. 

SEC. 2104. DESIGNATION OF CONSERVATION PRIORITY AREAS. 

Section 1231(f) of the Food Security Act of 1985 (16 U.S.C. 

3831(f)) is amended by striking ‘‘the Chesapeake Bay Region (Pennsylvania, Maryland, and Virginia)’’ and inserting ‘‘the Chesapeake 

Bay Region’’. 

SEC. 2105. TREATMENT OF MULTI-YEAR GRASSES AND LEGUMES. 

Subsection (g) of section 1231 of the Food Security Act of 1985 

(16 U.S.C. 3831) is amended to read as follows: 

‘‘(g) MULTI-YEAR GRASSES AND LEGUMES.—

‘‘(1) IN GENERAL.—For purposes of this subchapter, alfalfa 

and other multi-year grasses and legumes in a rotation practice, approved by the Secretary, shall be considered agricultural 

commodities. 

‘‘(2) CROPPING HISTORY.—Alfalfa, when grown as part of a 

rotation practice, as determined by the Secretary, is an agricultural commodity subject to the cropping history criteria under 


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subsection (b)(1)(B) for the purpose of determining whether 

highly erodible cropland has been planted or considered planted for 4 of the 6 years referred to in such subsection.’’. 

SEC. 2106. REVISED PILOT PROGRAM FOR ENROLLMENT OF WETLAND 

AND BUFFER ACREAGE IN CONSERVATION RESERVE. 

(a) REVISED PROGRAM.— (1) IN GENERAL.—Title XII of the Food Security Act of 1985 

is amended by inserting after section 1231 (16 U.S.C. 3831) the 

following new section: 

‘‘SEC. 1231B. PILOT PROGRAM FOR ENROLLMENT OF WETLAND AND 

BUFFER ACREAGE IN CONSERVATION RESERVE. 

‘‘(a) PROGRAM REQUIRED.— ‘‘(1) IN GENERAL.—During the 2008 through 2012 fiscal 

years, the Secretary shall carry out a program in each State 

under which the Secretary shall enroll eligible acreage described in subsection (b). ‘‘(2) PARTICIPATION AMONG STATES.—The Secretary shall 

ensure, to the maximum extent practicable, that owners and operators in each State have an equitable opportunity to participate in the program established under this section. 

‘‘(b) ELIGIBLE ACREAGE.— ‘‘(1) WETLAND AND RELATED LAND.—Subject to subsections 

(c) and (d), an owner or operator may enroll in the conservation 

reserve, pursuant to the program established under this section, 

land— ‘‘(A) that is wetland (including a converted wetland described in section 1222(b)(1)(A)) that had a cropping history during at least 3 of the immediately preceding 10 crop 

years; ‘‘(B) on which a constructed wetland is to be developed 

that will receive flow from a row crop agriculture drainage 

system and is designed to provide nitrogen removal in addition to other wetland functions; ‘‘(C) that was devoted to commercial pond-raised aquaculture in any year during the period of calendar years 

2002 through 2007; or ‘‘(D) that, after January 1, 1990, and before December 

31, 2002, was— ‘‘(i) cropped during at least 3 of 10 crop years; and 

‘‘(ii) subject to the natural overflow of a prairie 

wetland. ‘‘(2) BUFFER ACREAGE.—Subject to subsections (c) and (d), 

an owner or operator may enroll in the conservation reserve, 

pursuant to the program established under this section, buffer 

acreage that—

‘‘(A) with respect to land described in subparagraph 

(A), (B), or (C) of paragraph (1)—

‘‘(i) is contiguous to such land; 

‘‘(ii) is used to protect such land; and 

‘‘(iii) is of such width as the Secretary determines 

is necessary to protect such land, taking into consideration and accommodating the farming practices (including the straightening of boundaries to accommodate machinery) used with respect to the cropland that 

surrounds such land; and 


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‘‘(B) with respect to land described in subparagraph 

(D) of paragraph (1), enhances a wildlife benefit to the extent practicable in terms of upland to wetland ratios, as determined by the Secretary. 

‘‘(c) PROGRAM LIMITATIONS.—

‘‘(1) ACREAGE LIMITATION.—The Secretary may enroll in the 

conservation reserve, pursuant to the program established 

under this section, not more than—

‘‘(A) 100,000 acres in any State; and 

‘‘(B) a total of 1,000,000 acres. 

‘‘(2) RELATIONSHIP TO MAXIMUM ENROLLMENT.—Subject to 

paragraph (3), any acreage enrolled in the conservation reserve 

under this section shall be considered acres maintained in the 

conservation reserve. 

‘‘(3) RELATIONSHIP TO OTHER ENROLLED ACREAGE.—Acreage 

enrolled in the conservation reserve under this section shall not 

affect for any fiscal year the quantity of—

‘‘(A) acreage enrolled to establish conservation buffers 

as part of the program announced on March 24, 1998 (63 

Fed. Reg. 14109); or 

‘‘(B) acreage enrolled into the conservation reserve enhancement program announced on May 27, 1998 (63 Fed. 

Reg. 28965). 

‘‘(4) REVIEW; POTENTIAL INCREASE IN ENROLLMENT ACREAGE.—The Secretary shall conduct a review of the program established under this section with respect to each State that has 

enrolled land in the conservation reserve pursuant to the program. As a result of the review, the Secretary may increase the 

number of acres that may be enrolled in a State under the program to not more than 200,000 acres, notwithstanding paragraph (1)(A). 

‘‘(d) OWNER OR OPERATOR ENROLLMENT LIMITATIONS.—

‘‘(1) WETLAND AND RELATED LAND.—

‘‘(A) WETLANDS AND CONSTRUCTED WETLANDS.—The 

maximum size of any land described in subparagraph (A) 

or (B) of subsection (b)(1) that an owner or operator may 

enroll in the conservation reserve, pursuant to the program 

established under this section, shall be 40 contiguous acres. 

‘‘(B) FLOODED FARMLAND.—The maximum size of any 

land described in subparagraph (D) of subsection (b)(1) 

that an owner or operator may enroll in the conservation 

reserve, pursuant to the program established under this 

section, shall be 20 contiguous acres. 

‘‘(C) COVERAGE.—All acres described in subparagraph 

(A) or (B), including acres that are ineligible for payment, 

shall be covered by the conservation contract. 

‘‘(2) BUFFER ACREAGE.—The maximum size of any buffer 

acreage described in subsection (b)(2) that an owner or operator 

may enroll in the conservation reserve under this section shall 

be determined by the Secretary in consultation with the State 

Technical Committee. 

‘‘(3) TRACTS.—Except for land described in subsection 

(b)(1)(C) and buffer acreage related to such land, the maximum 

size of any eligible acreage described in subsection (b)(1) in a 


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tract of an owner or operator enrolled in the conservation reserve under this section shall be 40 acres. 

‘‘(e) DUTIES OF OWNERS AND OPERATORS.—During the term of 

a contract entered into under the program established under this 

section, an owner or operator shall agree—

‘‘(1) to restore the hydrology of the wetland within the eligible acreage to the maximum extent practicable, as determined 

by the Secretary; 

‘‘(2) to establish vegetative cover (which may include emerging vegetation in water and bottomland hardwoods, cypress, 

and other appropriate tree species) on the eligible acreage, as 

determined by the Secretary; 

‘‘(3) to a general prohibition of commercial use of the enrolled land; and 

‘‘(4) to carry out other duties described in section 1232. 

‘‘(f) DUTIES OF THE SECRETARY.—

‘‘(1) IN GENERAL.—Except as provided in paragraphs (2) 

and (3), in return for a contract entered into under this section, 

the Secretary shall—

‘‘(A) make payments to the owner or operator based on 

rental rates for cropland; and 

‘‘(B) provide assistance to the owner or operator in accordance with sections 1233 and 1234. 

‘‘(2) CONTRACT OFFERS AND PAYMENTS.—The Secretary 

shall use the method of determination described in section 

1234(c)(2)(B) to determine the acceptability of contract offers 

and the amount of rental payments under this section. 

‘‘(3) INCENTIVES.—The amounts payable to owners and operators in the form of rental payments under contracts entered 

into under this section shall reflect incentives that are provided 

to owners and operators to enroll filterstrips in the conservation 

reserve under section 1234.’’. 

(2) REPEAL OF SUPERSEDED PROGRAM.—Section 1231 of the 

Food Security Act of 1985 (16 U.S.C. 3831) is amended—

(A) by striking subsection (h); and 

(B) by redesignating subsections (i) and (j) as subsections (h) and (i), respectively. 

(b) CONFORMING CHANGES TO EMERGENCY FORESTRY CONSERVATION RESERVE PROGRAM.—Subsection (k) of section 1231 of 

the Food Security Act of 1985 (16 U.S.C. 3831) is amended—

(1) by striking ‘‘(k) EMERGENCY FORESTRY CONSERVATION

RESERVE PROGRAM.—’’ and inserting the following: 

‘‘SEC. 1231A. EMERGENCY FORESTRY CONSERVATION RESERVE PROGRAM.’’; 

(2) by striking ‘‘subsection’’ each place it appears (other 

than paragraph (3)(C)(ii)) and inserting ‘‘section’’; 

(3) by redesignating paragraphs (1), (2), and (3) as subsections (a), (b), and (c), respectively; 

(4) in subsection (a), as so redesignated, by redesignating 

subparagraphs (A) and (B) as paragraphs (1) and (2), respectively; and 

(5) in subsection (c), as so redesignated—

(A) by redesignating subparagraphs (A) through (I) as 

paragraphs (1) through (9), respectively; 


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(B) in paragraph (1), as so redesignated, by striking ‘‘subparagraph (B)’’ and ‘‘subparagraph (G)’’ and inserting ‘‘paragraph (2)’’ and ‘‘paragraph (7)’’, respectively; 

(C) in paragraph (3), as so redesignated— (i) by redesignating clauses (i) and (ii) as subparagraphs (A) and (B), respectively; and 

(ii) by striking ‘‘subsection (d)’’ and inserting ‘‘section 1231(d)’’; 

(D) in paragraph (4), as so redesignated, by redesignating clauses (i) and (ii) as subparagraphs (A) and (B), respectively; 

(E) in paragraph (5), as so redesignated— (i) by redesignating clauses (i) through (v) as subparagraphs (A) through (E), respectively, and subclauses (I) and (II) as clauses (i) and (ii), respectively; 

(ii) in subparagraph (B), as so redesignated, by 

striking ‘‘clause (i)(I)’’ and inserting ‘‘subparagraph 

(A)(i)’’; and 

(iii) in subparagraph (C), as so redesignated, by 

striking ‘‘clause (i)(II)’’ and inserting ‘‘subparagraph 

(A)(ii)’’; and 

(F) in paragraph (9), as so redesignated, by redesignating clauses (i) through (iii) as subparagraphs (A) 

through (C), respectively, and subclauses (I) through (III) 

as clauses (i) through (iii), respectively. 

SEC. 2107. ADDITIONAL DUTY OF PARTICIPANTS UNDER CONSERVATION RESERVE CONTRACTS. 

Section 1232(a) of the Food Security Act of 1985 (16 U.S.C. 

3832(a)) is amended— (1) by redesignating paragraphs (5) through (10) as paragraphs (6) through (11), respectively; and 

(2) by inserting after paragraph (4) the following new paragraph: ‘‘(5) to undertake management on the land as needed 

throughout the term of the contract to implement the conservation plan;’’. 

SEC. 2108. MANAGED HAYING, GRAZING, OR OTHER COMMERCIAL USE 

OF FORAGE ON ENROLLED LAND AND INSTALLATION OF 

WIND TURBINES. 

(a) GENERAL PROHIBITION; EXCEPTIONS.—Section 1232(a) of the 

Food Security Act of 1985 (16 U.S.C. 3832(a)) is amended by striking paragraph (8), as redesignated by section 2107, and inserting 

the following new paragraph: 

‘‘(8) not to conduct any harvesting or grazing, nor otherwise 

make commercial use of the forage, on land that is subject to 

the contract, nor adopt any similar practice specified in the contract by the Secretary as a practice that would tend to defeat 

the purposes of the contract, except that the Secretary may permit, consistent with the conservation of soil, water quality, and 

wildlife habitat (including habitat during nesting seasons for 

birds in the area)—

‘‘(A) managed harvesting (including the managed harvesting of biomass), except that in permitting managed harvesting, the Secretary, in coordination with the State technical committee—


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‘‘(i) shall develop appropriate vegetation management requirements; and ‘‘(ii) shall identify periods during which managed 

harvesting may be conducted; 

‘‘(B) harvesting and grazing or other commercial use of 

the forage on the land that is subject to the contract in response to a drought or other emergency; ‘‘(C) routine grazing or prescribed grazing for the control of invasive species, except that in permitting such routine grazing or prescribed grazing, the Secretary, in coordination with the State technical committee— ‘‘(i) shall develop appropriate vegetation management requirements and stocking rates for the land that 

are suitable for continued routine grazing; and ‘‘(ii) shall establish the frequency during which 

routine grazing may be conducted, taking into consideration regional differences such as— ‘‘(I) climate, soil type, and natural resources; 

‘‘(II) the number of years that should be required between routine grazing activities; and ‘‘(III) how often during a year in which routine 

grazing is permitted that routine grazing should 

be allowed to occur; and ‘‘(D) the installation of wind turbines, except that in 

permitting the installation of wind turbines, the Secretary 

shall determine the number and location of wind turbines 

that may be installed, taking into account— ‘‘(i) the location, size, and other physical characteristics of the land; ‘‘(ii) the extent to which the land contains wildlife 

and wildlife habitat; and ‘‘(iii) the purposes of the conservation reserve program under this subchapter;’’. (b) RENTAL PAYMENT REDUCTION.—Section 1232 of the Food 

Security Act of 1985 (16 U.S.C. 3832) is amended by adding at the 

end the following new subsection: 

‘‘(d) RENTAL PAYMENT REDUCTION FOR CERTAIN AUTHORIZED

USES OF ENROLLED LAND.—In the case of an authorized activity 

under subsection (a)(8) on land that is subject to a contract under 

this subchapter, the Secretary shall reduce the rental payment otherwise payable under the contract by an amount commensurate with 

the economic value of the authorized activity.’’. 

SEC. 2109. COST SHARING PAYMENTS RELATING TO TREES, 

WINDBREAKS, SHELTERBELTS, AND WILDLIFE CORRIDORS. 

Section 1234(b) of the Food Security Act of 1985 (16 U.S.C. 

3834(b)) is amended by striking paragraph (3) and inserting the following new paragraph: 

‘‘(3) TREES, WINDBREAKS, SHELTERBELTS, AND WILDLIFE

CORRIDORS.— ‘‘(A) APPLICABILITY.—This paragraph applies to— ‘‘(i) land devoted to the production of hardwood 

trees, windbreaks, shelterbelts, or wildlife corridors 

under a contract entered into under this subchapter 

after November 28, 1990; 


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‘‘(ii) land converted to such production under section 1235A; and ‘‘(iii) land on which an owner or operator agrees to 

conduct thinning authorized by section 1232(a)(9), if 

the thinning is necessary to improve the condition of 

resources on the land. 

‘‘(B) PAYMENTS.— ‘‘(i) PERCENTAGE.—In making cost share payments 

to an owner or operator of land described in subparagraph (A), the Secretary shall pay 50 percent of the 

reasonable and necessary costs incurred by the owner 

or operator for maintaining trees or shrubs, including 

the cost of replanting (if the trees or shrubs were lost 

due to conditions beyond the control of the owner or operator) or thinning. ‘‘(ii) DURATION.—The Secretary shall make payments as described in clause (i) for a period of not less 

than 2 years, but not more than 4 years, beginning on 

the date of—

‘‘(I) the planting of the trees or shrubs; or 

‘‘(II) the thinning of existing stands to improve 

the condition of resources on the land.’’. 

SEC. 2110. EVALUATION AND ACCEPTANCE OF CONTRACT OFFERS, ANNUAL RENTAL PAYMENTS, AND PAYMENT LIMITATIONS. 

(a) EVALUATION AND ACCEPTANCE OF CONTRACT OFFERS.—Section 1234(c) of the Food Security Act of 1985 (16 U.S.C. 3834(c)) is 

amended by striking paragraph (3) and inserting the following new 

paragraph: ‘‘(3) ACCEPTANCE OF CONTRACT OFFERS.— ‘‘(A) EVALUATION OF OFFERS.—In determining the acceptability of contract offers, the Secretary may take into 

consideration the extent to which enrollment of the land 

that is the subject of the contract offer would improve soil 

resources, water quality, or wildlife habitat or provide other 

environmental benefits. 

‘‘(B) ESTABLISHMENT OF DIFFERENT CRITERIA IN VARIOUS STATES AND REGIONS.—The Secretary may establish 

different criteria for determining the acceptability of contract offers in various States and regions of the United 

States based on the extent to which water quality or wildlife habitat may be improved or erosion may be abated. 

‘‘(C) LOCAL PREFERENCE.—In determining the acceptability of contract offers for new enrollments, the Secretary 

shall accept, to the maximum extent practicable, an offer 

from an owner or operator that is a resident of the county 

in which the land is located or of a contiguous county if, 

as determined by the Secretary, the land would provide at 

least equivalent conservation benefits to land under competing offers.’’. 

(b) ANNUAL SURVEY OF DRYLAND AND IRRIGATED CASH RENTAL

RATES.—

(1) ANNUAL ESTIMATES REQUIRED.—Section 1234(c) of the 

Food Security Act of 1985 (16 U.S.C. 3834(c)) is amended by 

adding at the end the following new paragraph: 

‘‘(5) RENTAL RATES.—


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‘‘(A) ANNUAL ESTIMATES.—The Secretary (acting 

through the National Agricultural Statistics Service) shall 

conduct an annual survey of per acre estimates of county 

average market dryland and irrigated cash rental rates for 

cropland and pastureland in all counties or equivalent subdivisions within each State that have 20,000 acres or more 

of cropland and pastureland. 

‘‘(B) PUBLIC AVAILABILITY OF ESTIMATES.—The estimates derived from the annual survey conducted under 

subparagraph (A) shall be maintained on a website of the 

Department of Agriculture for use by the general public.’’. 

(2) FIRST SURVEY.—The first survey required by paragraph 

(5) of section 1234(c) of the Food Security Act of 1985 (16 

U.S.C. 3834(c)), as added by subsection (a), shall be conducted 

not later than 1 year after the date of enactment of this Act. 

(c) PAYMENT LIMITATIONS.—Section 1234(f) of the Food Security 

Act of 1985 (16 U.S.C. 3834(f)) is amended—

(1) in paragraph (1), by striking ‘‘made to a person’’ and inserting ‘‘received by a person or legal entity, directly or indirectly,’’; 

(2) by striking paragraph (2); and 

(3) in paragraph (4), by striking ‘‘any person’’ and inserting 

‘‘any person or legal entity’’. 

SEC. 2111. CONSERVATION RESERVE PROGRAM TRANSITION INCENTIVES FOR BEGINNING FARMERS OR RANCHERS AND SOCIALLY DISADVANTAGED FARMERS OR RANCHERS. 

(a) CONTRACT MODIFICATION AUTHORITY.—Section 

1235(c)(1)(B) of the Food Security Act of 1985 (16 U.S.C. 

3835(c)(1)(B)) is amended—

(1) in clause (ii), by striking ‘‘or’’ at the end; 

(2) by redesignating clause (iii) as clause (iv); and 

(3) by inserting after clause (ii) the following new clause: 

‘‘(iii) to facilitate a transition of land subject to the 

contract from a retired or retiring owner or operator to 

a beginning farmer or rancher or socially disadvantaged farmer or rancher for the purpose of returning 

some or all of the land into production using sustainable grazing or crop production methods; or’’. 

(b) TRANSITION OPTION.—Section 1235 of the Food Security Act 

of 1985 (16 U.S.C. 3835) is amended by adding at the end the following new subsection: 

‘‘(f) TRANSITION OPTION FOR CERTAIN FARMERS OR RANCHERS.—

‘‘(1) DUTIES OF THE SECRETARY.—In the case of a contract 

modification approved in order to facilitate the transfer, as described in subsection (c)(1)(B)(iii), of land to a beginning farmer 

or rancher or socially disadvantaged farmer or rancher (in this 

subsection referred to as a ‘covered farmer or rancher’), the Secretary shall—

‘‘(A) beginning on the date that is 1 year before the date 

of termination of the contract—

‘‘(i) allow the covered farmer or rancher, in conjunction with the retired or retiring owner or operator, 

to make conservation and land improvements; and 


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‘‘(ii) allow the covered farmer or rancher to begin 

the certification process under the Organic Foods Production Act of 1990 (7 U.S.C. 6501 et seq.); 

‘‘(B) beginning on the date of termination of the contract, require the retired or retiring owner or operator to 

sell or lease (under a long-term lease or a lease with an option to purchase) to the covered farmer or rancher the land 

subject to the contract for production purposes; 

‘‘(C) require the covered farmer or rancher to develop 

and implement a conservation plan; 

‘‘(D) provide to the covered farmer or rancher an opportunity to enroll in the conservation stewardship program or 

the environmental quality incentives program by not later 

than the date on which the farmer or rancher takes possession of the land through ownership or lease; and 

‘‘(E) continue to make annual payments to the retired 

or retiring owner or operator for not more than an additional 2 years after the date of termination of the contract, 

if the retired or retiring owner or operator is not a family 

member (as defined in section 1001A(b)(3)(B) of this Act) of 

the covered farmer or rancher. 

‘‘(2) REENROLLMENT.—The Secretary shall provide a covered farmer or rancher with the option to reenroll any applicable partial field conservation practice that—

‘‘(A) is eligible for enrollment under the continuous 

signup requirement of section 1231(h)(4)(B); and 

‘‘(B) is part of an approved conservation plan.’’. 

Subtitle C—Wetlands Reserve Program 

SEC. 2201. ESTABLISHMENT AND PURPOSE OF WETLANDS RESERVE 

PROGRAM. 

Subsection (a) of section 1237 of the Food Security Act of 1985 

(16 U.S.C. 3837) is amended to read as follows: 

‘‘(a) ESTABLISHMENT AND PURPOSES.—

‘‘(1) ESTABLISHMENT.—The Secretary shall establish a wetlands reserve program to assist owners of eligible lands in restoring and protecting wetlands. 

‘‘(2) PURPOSES.—The purposes of the wetlands reserve program are to restore, protect, or enhance wetlands on private or 

tribal lands that are eligible under subsections (c) and (d).’’. 

SEC. 2202. MAXIMUM ENROLLMENT AND ENROLLMENT METHODS. 

Section 1237(b) of the Food Security Act of 1985 (16 U.S.C. 

3837(b)) is amended—

(1) by striking paragraph (1) and inserting the following 

new paragraph: 

‘‘(1) MAXIMUM ENROLLMENT.—The total number of acres enrolled in the wetlands reserve program shall not exceed 

3,041,200 acres.’’; 

(2) in paragraph (2), by striking ‘‘The Secretary’’ and inserting ‘‘Subject to paragraph (3), the Secretary’’; and 

(3) by adding at the end the following new paragraph: 

‘‘(3) ACREAGE OWNED BY INDIAN TRIBES.—In the case of 

acreage owned by an Indian tribe, the Secretary shall enroll 

acreage into the wetlands reserve program through the use of—


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‘‘(A) a 30-year contract (the value of which shall be 

equivalent to the value of a 30-year easement); 

‘‘(B) restoration cost-share agreements; or 

‘‘(C) any combination of the options described in subparagraphs (A) and (B).’’. 

SEC. 2203. DURATION OF WETLANDS RESERVE PROGRAM AND LANDS 

ELIGIBLE FOR ENROLLMENT. 

(a) IN GENERAL.—Section 1237(c) of the Food Security Act of 

1985 (16 U.S.C. 3837(c)) is amended—

(1) in the matter preceding paragraph (1)—

(A) by striking ‘‘2007 calendar’’ and inserting ‘‘2012 fiscal’’; and 

(B) by inserting ‘‘private or tribal’’ before ‘‘land’’ the 

second place it appears; 

(2) by striking paragraph (2) and inserting the following 

new paragraph: 

‘‘(2) such land is—

‘‘(A) farmed wetland or converted wetland, together 

with the adjacent land that is functionally dependent on 

the wetlands, except that converted wetland with respect to 

which the conversion was not commenced prior to December 

23, 1985, shall not be eligible to be enrolled in the program 

under this section; or 

‘‘(B) cropland or grassland that was used for agricultural production prior to flooding from the natural overflow 

of a closed basin lake or pothole, as determined by the Secretary, together (where practicable) with the adjacent land 

that is functionally dependent on the cropland or grassland; and’’. 

(b) CHANGE OF OWNERSHIP.—Section 1237E(a) of the Food Security Act of 1985 (16 U.S.C. 3837e(a)) is amended by striking ‘‘in 

the preceding 12 months’’ and inserting ‘‘during the preceding 7- 

year period’’. 

(c) ANNUAL SURVEY AND REALLOCATION.—Section 1237F of the 

Food Security Act of 1985 (16 U.S.C. 3837f) is amended by adding 

at the end the following new subsection: 

‘‘(c) PRAIRIE POTHOLE REGION SURVEY AND REALLOCATION.—

‘‘(1) SURVEY.—The Secretary shall conduct a survey during 

fiscal year 2008 and each subsequent fiscal year for the purpose 

of determining interest and allocations for the Prairie Pothole 

Region to enroll eligible land described in section 1237(c)(2)(B). ‘‘(2) ANNUAL ADJUSTMENT.—The Secretary shall make an 

adjustment to the allocation for an interested State for a fiscal 

year, based on the results of the survey conducted under paragraph (1) for the State during the previous fiscal year.’’. 

SEC. 2204. TERMS OF WETLANDS RESERVE PROGRAM EASEMENTS. 

Section 1237A(b)(2)(B) of the Food Security Act of 1985 (16 

U.S.C. 3837a(b)(2)(B)) is amended— (1) in clause (i), by striking ‘‘or’’ at the end; 

(2) in clause (ii), by striking ‘‘; and’’ and inserting ‘‘; or’’; 

and 

(3) by adding at the end the following new clause: ‘‘(iii) to meet habitat needs of specific wildlife species; and’’. 


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SEC. 2205. COMPENSATION FOR EASEMENTS UNDER WETLANDS RESERVE PROGRAM. 

Subsection (f) of section 1237A of the Food Security Act of 1985 

(16 U.S.C. 3837a) is amended to read as follows: 

‘‘(f) COMPENSATION.—

‘‘(1) DETERMINATION.—Effective on the date of the enactment of the Food, Conservation, and Energy Act of 2008, the 

Secretary shall pay as compensation for a conservation easement acquired under this subchapter the lowest of—

‘‘(A) the fair market value of the land, as determined 

by the Secretary, using the Uniform Standards of Professional Appraisal Practices or an area-wide market analysis 

or survey; 

‘‘(B) the amount corresponding to a geographical cap, 

as determined by the Secretary in regulations; or 

‘‘(C) the offer made by the landowner. 

‘‘(2) FORM OF PAYMENT.—Compensation for an easement 

shall be provided by the Secretary in the form of a cash payment, in an amount determined under paragraph (1) and specified in the easement agreement. 

‘‘(3) PAYMENT SCHEDULE FOR EASEMENTS.—

‘‘(A) EASEMENTS VALUED AT $500,000 OR LESS.—For 

easements valued at $500,000 or less, the Secretary may 

provide easement payments in not more than 30 annual 

payments. 

‘‘(B) EASEMENTS IN EXCESS OF $500,000.—For easements 

valued at more than $500,000, the Secretary may provide 

easement payments in at least 5, but not more than 30 annual payments, except that, if the Secretary determines it 

would further the purposes of the program, the Secretary 

may make a lump sum payment for such an easement. 

‘‘(4) RESTORATION AGREEMENT PAYMENT LIMITATION.—Payments made to a person or legal entity, directly or indirectly, 

pursuant to a restoration cost-share agreement under this subchapter may not exceed, in the aggregate, $50,000 per year. 

‘‘(5) ENROLLMENT PROCEDURE.—Lands may be enrolled 

under this subchapter through the submission of bids under a 

procedure established by the Secretary.’’. 

SEC. 2206. WETLANDS RESERVE ENHANCEMENT PROGRAM AND RESERVED RIGHTS PILOT PROGRAM. 

Section 1237A of the Food Security Act of 1985 (16 U.S.C. 

3837a) is amended by adding at the end the following new subsection: 

‘‘(h) WETLANDS RESERVE ENHANCEMENT PROGRAM.—

‘‘(1) PROGRAM AUTHORIZED.—The Secretary may enter into 

1 or more agreements with a State (including a political subdivision or agency of a State), nongovernmental organization, 

or Indian tribe to carry out a special wetlands reserve enhancement program that the Secretary determines would advance the 

purposes of this subchapter. 

‘‘(2) RESERVED RIGHTS PILOT PROGRAM.—

‘‘(A) RESERVATION OF GRAZING RIGHTS.—As part of the 

wetlands reserve enhancement program, the Secretary shall 

carry out a pilot program for land in which a landowner 

may reserve grazing rights in the warranty easement deed 


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restriction if the Secretary determines that the reservation 

and use of the grazing rights—

‘‘(i) is compatible with the land subject to the easement; 

‘‘(ii) is consistent with the long-term wetland protection and enhancement goals for which the easement 

was established; and 

‘‘(iii) complies with a conservation plan. 

‘‘(B) DURATION.—The pilot program established under 

this paragraph shall terminate on September 30, 2012.’’. 

SEC. 2207. DUTIES OF SECRETARY OF AGRICULTURE UNDER WETLANDS RESERVE PROGRAM. 

Section 1237C of the Food Security Act of 1985 (16 U.S.C. 

3837c) is amended—

(1) in subsection (a)(1), by inserting ‘‘including necessary 

maintenance activities,’’ after ‘‘values,’’; and 

(2) by striking subsection (c) and inserting the following 

new subsection: 

‘‘(c) RANKING OF OFFERS.—

‘‘(1) CONSERVATION BENEFITS AND FUNDING CONSIDERATIONS.—When evaluating offers from landowners, the Secretary may consider—

‘‘(A) the conservation benefits of obtaining an easement 

or other interest in the land; 

‘‘(B) the cost-effectiveness of each easement or other interest in eligible land, so as to maximize the environmental 

benefits per dollar expended; and 

‘‘(C) whether the landowner or another person is offering to contribute financially to the cost of the easement or 

other interest in the land to leverage Federal funds. 

‘‘(2) ADDITIONAL CONSIDERATIONS.—In determining the acceptability of easement offers, the Secretary may take into consideration—

‘‘(A) the extent to which the purposes of the easement 

program would be achieved on the land; 

‘‘(B) the productivity of the land; and 

‘‘(C) the on-farm and off-farm environmental threats if 

the land is used for the production of agricultural commodities.’’. 

SEC. 2208. PAYMENT LIMITATIONS UNDER WETLANDS RESERVE CONTRACTS AND AGREEMENTS. 

Section 1237D(c)(1) of the Food Security Act of 1985 (16 U.S.C. 

3837d(c)(1)) is amended—

(1) by striking ‘‘The total amount of easement payments 

made to a person’’ and inserting ‘‘The total amount of payments 

that a person or legal entity may receive, directly or indirectly,’’; 

and 

(2) by inserting ‘‘or under 30-year contracts’’ before the period at the end. 

SEC. 2209. REPEAL OF PAYMENT LIMITATIONS EXCEPTION FOR STATE 

AGREEMENTS FOR WETLANDS RESERVE ENHANCEMENT. 

Section 1237D(c) of the Food Security Act of 1985 (16 U.S.C. 

3837d(c)) is amended by striking paragraph (4). 


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SEC. 2210. REPORT ON IMPLICATIONS OF LONG-TERM NATURE OF 

CONSERVATION EASEMENTS. 

(a) REPORT REQUIRED.—Not later than January 1, 2010, the 

Secretary of Agriculture shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that evaluates the implications of the long-term nature of conservation easements granted under section 1237A of the Food Security Act of 1985 

(16 U.S.C. 3837a) on resources of the Department of Agriculture. 

(b) INCLUSIONS.—The report required by subsection (a) shall include the following: 

(1) Data relating to the number and location of conservation easements granted under that section that the Secretary 

holds or has a significant role in monitoring or managing. 

(2) An assessment of the extent to which the oversight of the 

conservation easement agreements impacts the availability of 

resources, including technical assistance. 

(3) An assessment of the uses and value of agreements with 

partner organizations. 

(4) Any other relevant information relating to costs or other 

effects that would be helpful to the Committees referred to in 

subsection (a). 

Subtitle D—Conservation Stewardship Program 

SEC. 2301. CONSERVATION STEWARDSHIP PROGRAM. 

(a) ESTABLISHMENT OF PROGRAM.—Chapter 2 of subtitle D of 

title XII of the Food Security Act of 1985 is amended—

(1) by redesignating subchapters B (farmland protection 

program) and C (grassland reserve program) as subchapters C 

and D, respectively; and 

(2) by inserting after subchapter A the following new subchapter: 

‘‘Subchapter B—Conservation Stewardship Program 

‘‘SEC. 1238D. DEFINITIONS. 

‘‘In this subchapter: 

‘‘(1) CONSERVATION ACTIVITIES.—

‘‘(A) IN GENERAL.—The term ‘conservation activities’

means conservation systems, practices, or management 

measures that are designed to address a resource concern. 

‘‘(B) INCLUSIONS.—The term ‘conservation activities’ includes—

‘‘(i) structural measures, vegetative measures, and 

land management measures, including agriculture 

drainage management systems, as determined by the 

Secretary; and 

‘‘(ii) planning needed to address a resource concern. 

‘‘(2) CONSERVATION MEASUREMENT TOOLS.—The term ‘conservation measurement tools’ means procedures to estimate the 

level of environmental benefit to be achieved by a producer in 

implementing conservation activities, including indices or other 

measures developed by the Secretary. 


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‘‘(3) CONSERVATION STEWARDSHIP PLAN.—The term ‘conservation stewardship plan’ means a plan that— ‘‘(A) identifies and inventories resource concerns; 

‘‘(B) establishes benchmark data and conservation objectives; ‘‘(C) describes conservation activities to be implemented, managed, or improved; and ‘‘(D) includes a schedule and evaluation plan for the 

planning, installation, and management of the new and existing conservation activities. 

‘‘(4) PRIORITY RESOURCE CONCERN.—The term ‘priority resource concern’ means a resource concern that is identified at 

the State level, in consultation with the State Technical Committee, as a priority for a particular watershed or area of the 

State. ‘‘(5) PROGRAM.—The term ‘program’ means the conservation 

stewardship program established by this subchapter. ‘‘(6) RESOURCE CONCERN.—The term ‘resource concern’ means a specific natural resource impairment or problem, as 

determined by the Secretary, that— ‘‘(A) represents a significant concern in a State or region; and ‘‘(B) is likely to be addressed successfully through the 

implementation of conservation activities by producers on 

land eligible for enrollment in the program. 

‘‘(7) STEWARDSHIP THRESHOLD.—The term ‘stewardship 

threshold’ means the level of natural resource conservation and 

environmental management required, as determined by the Secretary using conservation measurement tools, to improve and 

conserve the quality and condition of a resource concern. 

‘‘SEC. 1238E. CONSERVATION STEWARDSHIP PROGRAM. 

‘‘(a) ESTABLISHMENT AND PURPOSE.—During each of fiscal 

years 2009 through 2012, the Secretary shall carry out a conservation stewardship program to encourage producers to address resource concerns in a comprehensive manner— ‘‘(1) by undertaking additional conservation activities; and 

‘‘(2) by improving, maintaining and managing existing conservation activities. 

‘‘(b) ELIGIBLE LAND.— ‘‘(1) IN GENERAL.—Except as provided in subsection (c), the 

following land is eligible for enrollment in the program: 

‘‘(A) Private agricultural land (including cropland, 

grassland, prairie land, improved pastureland, rangeland, 

and land used for agro-forestry). 

‘‘(B) Agricultural land under the jurisdiction of an Indian tribe. 

‘‘(C) Forested land that is an incidental part of an agricultural operation. 

‘‘(D) Other private agricultural land (including cropped 

woodland, marshes, and agricultural land used for the production of livestock) on which resource concerns related to 

agricultural production could be addressed by enrolling the 

land in the program, as determined by the Secretary. 

‘‘(2) SPECIAL RULE FOR NONINDUSTRIAL PRIVATE FOREST

LAND.—Nonindustrial private forest land is eligible for enrollVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00125 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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ment in the program, except that not more than 10 percent of 

the annual acres enrolled nationally in any fiscal year may be 

nonindustrial private forest land. 

‘‘(3) AGRICULTURAL OPERATION.—Eligible land shall include all acres of an agricultural operation of a producer, 

whether or not contiguous, that are under the effective control 

of the producer at the time the producer enters into a stewardship contract, and is operated by the producer with equipment, 

labor, management, and production or cultivation practices 

that are substantially separate from other agricultural operations, as determined by the Secretary. 

‘‘(c) EXCLUSIONS.—

‘‘(1) LAND ENROLLED IN OTHER CONSERVATION PROGRAMS.—

Subject to paragraph (2), the following land is not eligible for 

enrollment in the program: 

‘‘(A) Land enrolled in the conservation reserve program. 

‘‘(B) Land enrolled in the wetlands reserve program. 

‘‘(C) Land enrolled in the grassland reserve program. 

‘‘(2) CONVERSION TO CROPLAND.—Land used for crop production after the date of enactment of the Food, Conservation, 

and Energy Act of 2008 that had not been planted, considered 

to be planted, or devoted to crop production for at least 4 of the 

6 years preceding that date shall not be the basis for any payment under the program, unless the land does not meet the requirement because—

‘‘(A) the land had previously been enrolled in the conservation reserve program; 

‘‘(B) the land has been maintained using long-term 

crop rotation practices, as determined by the Secretary; or 

‘‘(C) the land is incidental land needed for efficient operation of the farm or ranch, as determined by the Secretary. 

‘‘SEC. 1238F. STEWARDSHIP CONTRACTS. 

‘‘(a) SUBMISSION OF CONTRACT OFFERS.—To be eligible to participate in the conservation stewardship program, a producer shall 

submit to the Secretary for approval a contract offer that—

‘‘(1) demonstrates to the satisfaction of the Secretary that 

the producer, at the time of the contract offer, is meeting the 

stewardship threshold for at least one resource concern; and 

‘‘(2) would, at a minimum, meet or exceed the stewardship 

threshold for at least 1 priority resource concern by the end of 

the stewardship contract by—

‘‘(A) installing and adopting additional conservation 

activities; and 

‘‘(B) improving, maintaining, and managing conservation activities in place at the operation of the producer at 

the time the contract offer is accepted by the Secretary. 

‘‘(b) EVALUATION OF CONTRACT OFFERS.—

‘‘(1) RANKING OF APPLICATIONS.—In evaluating contract offers made by producers to enter into contracts under the program, the Secretary shall rank applications based on—

‘‘(A) the level of conservation treatment on all applicable priority resource concerns at the time of application, 


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based to the maximum extent practicable on conservation 

measurement tools; ‘‘(B) the degree to which the proposed conservation 

treatment on applicable priority resource concerns effectively increases conservation performance, based to the 

maximum extent possible on conservation measurement 

tools; ‘‘(C) the number of applicable priority resource concerns proposed to be treated to meet or exceed the stewardship threshold by the end of the contract; ‘‘(D) the extent to which other resource concerns, in addition to priority resource concerns, will be addressed to 

meet or exceed the stewardship threshold by the end of the 

contract period; and ‘‘(E) the extent to which the actual and anticipated environmental benefits from the contract are provided at the 

least cost relative to other similarly beneficial contract offers. 

‘‘(2) PROHIBITION.—The Secretary may not assign a higher 

priority to any application because the applicant is willing to 

accept a lower payment than the applicant would otherwise be 

eligible to receive. 

‘‘(3) ADDITIONAL CRITERIA.—The Secretary may develop and 

use such additional criteria for evaluating applications to enroll 

in the program that the Secretary determines are necessary to 

ensure that national, State, and local conservation priorities are 

effectively addressed. 

‘‘(c) ENTERING INTO CONTRACTS.—After a determination that a 

producer is eligible for the program under subsection (a), and a determination that the contract offer ranks sufficiently high under the 

evaluation criteria under subsection (b), the Secretary shall enter 

into a conservation stewardship contract with the producer to enroll 

the land to be covered by the contract. ‘‘(d) CONTRACT PROVISIONS.—

‘‘(1) TERM.—A conservation stewardship contract shall be 

for a term of 5 years. ‘‘(2) PROVISIONS.—The conservation stewardship contract of 

a producer shall— ‘‘(A) state the amount of the payment the Secretary 

agrees to make to the producer for each year of the conservation stewardship contract under section 1238G(e); ‘‘(B) require the producer— ‘‘(i) to implement during the term of the conservation stewardship contract the conservation stewardship 

plan approved by the Secretary; ‘‘(ii) to maintain, and make available to the Secretary at such times as the Secretary may request, appropriate records showing the effective and timely implementation of the conservation stewardship contract; 

and 

‘‘(iii) not to engage in any activity during the term 

of the conservation stewardship contract on the eligible 

land covered by the contract that would interfere with 

the purposes of the conservation stewardship contract; 

‘‘(C) permit all economic uses of the land that—


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‘‘(i) maintain the agricultural nature of the land; 

and 

‘‘(ii) are consistent with the conservation purposes 

of the conservation stewardship contract; 

‘‘(D) include a provision to ensure that a producer shall 

not be considered in violation of the contract for failure to 

comply with the contract due to circumstances beyond the 

control of the producer, including a disaster or related condition, as determined by the Secretary; and 

‘‘(E) include such other provisions as the Secretary determines necessary to ensure the purposes of the program 

are achieved. 

‘‘(e) CONTRACT RENEWAL.—At the end of an initial conservation 

stewardship contract of a producer, the Secretary may allow the 

producer to renew the contract for one additional five-year period if 

the producer—

‘‘(1) demonstrates compliance with the terms of the existing 

contract; and 

‘‘(2) agrees to adopt new conservation activities, as determined by the Secretary. 

‘‘(f) MODIFICATION.—The Secretary may allow a producer to 

modify a stewardship contract if the Secretary determines that the 

modification is consistent with achieving the purposes of the program. 

‘‘(g) CONTRACT TERMINATION.—

‘‘(1) VOLUNTARY TERMINATION.—A producer may terminate 

a conservation stewardship contract if the Secretary determines 

that termination would not defeat the purposes of the program. 

‘‘(2) INVOLUNTARY TERMINATION.—The Secretary may terminate a contract under this subchapter if the Secretary determines that the producer violated the contract. 

‘‘(3) REPAYMENT.—If a contract is terminated, the Secretary 

may, consistent with the purposes of the program—

‘‘(A) allow the producer to retain payments already received under the contract; or 

‘‘(B) require repayment, in whole or in part, of payments already received and assess liquidated damages. 

‘‘(4) CHANGE OF INTEREST IN LAND SUBJECT TO A CONTRACT.—

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

(B), a change in the interest of a producer in land covered 

by a contract under this chapter shall result in the termination of the contract with regard to that land. 

‘‘(B) TRANSFER OF DUTIES AND RIGHTS.—Subparagraph 

(A) shall not apply if—

‘‘(i) within a reasonable period of time (as determined by the Secretary) after the date of the change in 

the interest in land covered by a contract under the 

program, the transferee of the land provides written 

notice to the Secretary that all duties and rights under 

the contract have been transferred to, and assumed by, 

the transferee; and 

‘‘(ii) the transferee meets the eligibility requirements of the program. 


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‘‘(h) COORDINATION WITH ORGANIC CERTIFICATION.—The Secretary shall establish a transparent means by which producers may 

initiate organic certification under the Organic Foods Production 

Act of 1990 (7 U.S.C. 6501 et seq.) while participating in a contract 

under this subchapter. 

‘‘(i) ON-FARM RESEARCH AND DEMONSTRATION OR PILOT TESTING.—The Secretary may approve a contract offer under this subchapter that includes—

‘‘(1) on-farm conservation research and demonstration activities; and 

‘‘(2) pilot testing of new technologies or innovative conservation practices. 

‘‘SEC. 1238G. DUTIES OF THE SECRETARY. 

‘‘(a) IN GENERAL.—To achieve the conservation goals of a contract under the conservation stewardship program, the Secretary 

shall—

‘‘(1) make the program available to eligible producers on a 

continuous enrollment basis with 1 or more ranking periods, 

one of which shall occur in the first quarter of each fiscal year; 

‘‘(2) identify not less than 3 nor more than 5 priority resource concerns in a particular watershed or other appropriate 

region or area within a State; and 

‘‘(3) develop reliable conservation measurement tools for 

purposes of carrying out the program. 

‘‘(b) ALLOCATION TO STATES.—The Secretary shall allocate acres 

to States for enrollment, based—

‘‘(1) primarily on each State’s proportion of eligible acres 

under section 1238E(b)(1) to the total number of eligible acres 

in all States; and 

‘‘(2) also on consideration of—

‘‘(A) the extent and magnitude of the conservation 

needs associated with agricultural production in each 

State; 

‘‘(B) the degree to which implementation of the program in the State is, or will be, effective in helping producers address those needs; and 

‘‘(C) other considerations to achieve equitable geographic distribution of funds, as determined by the Secretary. 

‘‘(c) SPECIALTY CROP AND ORGANIC PRODUCERS.—The Secretary 

shall ensure that outreach and technical assistance are available, 

and program specifications are appropriate to enable specialty crop 

and organic producers to participate in the program. 

‘‘(d) ACREAGE ENROLLMENT LIMITATION.—During the period beginning on October 1, 2008, and ending on September 30, 2017, the 

Secretary shall, to the maximum extent practicable—

‘‘(1) enroll in the program an additional 12,769,000 acres 

for each fiscal year; and 

‘‘(2) manage the program to achieve a national average rate 

of $18 per acre, which shall include the costs of all financial 

assistance, technical assistance, and any other expenses associated with enrollment or participation in the program. 

‘‘(e) CONSERVATION STEWARDSHIP PAYMENTS.—


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‘‘(1) AVAILABILITY OF PAYMENTS.—The Secretary shall provide a payment under the program to compensate the producer 

for—

‘‘(A) installing and adopting additional conservation 

activities; and 

‘‘(B) improving, maintaining, and managing conservation activities in place at the operation of the producer at 

the time the contract offer is accepted by the Secretary. 

‘‘(2) PAYMENT AMOUNT.—The amount of the conservation 

stewardship payment shall be determined by the Secretary and 

based, to the maximum extent practicable, on the following factors: 

‘‘(A) Costs incurred by the producer associated with 

planning, design, materials, installation, labor, management, maintenance, or training. 

‘‘(B) Income forgone by the producer. 

‘‘(C) Expected environmental benefits as determined by 

conservation measurement tools. 

‘‘(3) EXCLUSIONS.—A payment to a producer under this 

subsection shall not be provided for—

‘‘(A) the design, construction, or maintenance of animal 

waste storage or treatment facilities or associated waste 

transport or transfer devices for animal feeding operations; 

or 

‘‘(B) conservation activities for which there is no cost 

incurred or income forgone to the producer. 

‘‘(4) TIMING OF PAYMENTS.—

‘‘(A) IN GENERAL.—The Secretary shall make payments 

as soon as practicable after October 1 of each fiscal year for 

activities carried out in the previous fiscal year. 

‘‘(B) ADDITIONAL ACTIVITIES.—The Secretary shall 

make payments to compensate producers for installation of 

additional practices at the time at which the practices are 

installed and adopted. 

‘‘(f) SUPPLEMENTAL PAYMENTS FOR RESOURCE-CONSERVING

CROP ROTATIONS.—

‘‘(1) AVAILABILITY OF PAYMENTS.—The Secretary shall provide additional payments to producers that, in participating in 

the program, agree to adopt resource-conserving crop rotations 

to achieve beneficial crop rotations as appropriate for the land 

of the producers. 

‘‘(2) BENEFICIAL CROP ROTATIONS.—The Secretary shall determine whether a resource-conserving crop rotation is a beneficial crop rotation eligible for additional payments under paragraph (1), based on whether the resource-conserving crop rotation is designed to provide natural resource conservation and 

production benefits. 

‘‘(3) ELIGIBILITY.—To be eligible to receive a payment described in paragraph (1), a producer shall agree to adopt and 

maintain beneficial resource-conserving crop rotations for the 

term of the contract. 

‘‘(4) RESOURCE-CONSERVING CROP ROTATION.—In this subsection, the term ‘resource-conserving crop rotation’ means a 

crop rotation that—


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‘‘(A) includes at least 1 resource conserving crop (as defined by the Secretary); 

‘‘(B) reduces erosion; 

‘‘(C) improves soil fertility and tilth; 

‘‘(D) interrupts pest cycles; and 

‘‘(E) in applicable areas, reduces depletion of soil moisture or otherwise reduces the need for irrigation. 

‘‘(g) PAYMENT LIMITATIONS.—A person or legal entity may not 

receive, directly or indirectly, payments under this subchapter that, 

in the aggregate, exceed $200,000 for all contracts entered into during any 5-year period, excluding funding arrangements with federally recognized Indian tribes or Alaska Native corporations, regardless of the number of contracts entered into under the program by 

the person or entity. 

‘‘(h) REGULATIONS.—The Secretary shall promulgate regulations 

that—

‘‘(1) prescribe such other rules as the Secretary determines 

to be necessary to ensure a fair and reasonable application of 

the limitations established under subsection (g); and 

‘‘(2) otherwise enable the Secretary to carry out the program. 

‘‘(i) DATA.—The Secretary shall maintain detailed and segmented data on contracts and payments under the program to allow 

for quantification of the amount of payments made for—

‘‘(1) the installation and adoption of additional conservation activities and improvements to conservation activities in 

place on the operation of a producer at the time the conservation stewardship offer is accepted by the Secretary; 

‘‘(2) participation in research, demonstration, and pilot 

projects; and 

‘‘(3) the development and periodic assessment and evaluation of conservation plans developed under this subchapter.’’. 

(b) TERMINATION OF CONSERVATION SECURITY PROGRAM AUTHORITY; EFFECT ON EXISTING CONTRACTS.—Section 1238A of the 

Food Security Act of 1985 (16 U.S.C. 3838a) is amended by adding 

at the end the following new subsection: 

‘‘(g) PROHIBITION ON CONSERVATION SECURITY PROGRAM CONTRACTS; EFFECT ON EXISTING CONTRACTS.—

‘‘(1) PROHIBITION.—A conservation security contract may 

not be entered into or renewed under this subchapter after September 30, 2008. 

‘‘(2) EXCEPTION.—This subchapter, and the terms and conditions of the conservation security program, shall continue to 

apply to—

‘‘(A) conservation security contracts entered into on or 

before September 30, 2008; and 

‘‘(B) any conservation security contract entered into 

after that date, but for which the application for the contract was received during the 2008 sign-up period. 

‘‘(3) EFFECT ON PAYMENTS.—The Secretary shall make payments under this subchapter with respect to conservation security contracts described in paragraph (2) during the remaining 

term of the contracts. 


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‘‘(4) REGULATIONS.—A contract described in paragraph (2) 

may not be administered under the regulations issued to carry 

out the conservation stewardship program.’’. (c) REFERENCE TO REDESIGNATED SUBCHAPTER.—Section 

1238A(b)(3)(C) of title XII of the Food Security Act of 1985 (16 

U.S.C. 3838a(b)(3)(C)) is amended by striking ‘‘subchapter C’’ and 

inserting ‘‘subchapter D’’. 

Subtitle E—Farmland Protection and Grassland Reserve 

SEC. 2401. FARMLAND PROTECTION PROGRAM. 

(a) DEFINITIONS.—Section 1238H of the Food Security Act of 

1985 (16 U.S.C. 3838h) is amended— (1) by striking paragraph (1) and inserting the following 

new paragraph: ‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible entity’ means— ‘‘(A) any agency of any State or local government or an 

Indian tribe (including a farmland protection board or 

land resource council established under State law); or ‘‘(B) any organization that— ‘‘(i) is organized for, and at all times since the formation of the organization has been operated principally for, 1 or more of the conservation purposes specified in clause (i), (ii), (iii), or (iv) of section 

170(h)(4)(A) of the Internal Revenue Code of 1986; ‘‘(ii) is an organization described in section 

501(c)(3) of that Code that is exempt from taxation 

under section 501(a) of that Code; and ‘‘(iii) is— ‘‘(I) described in paragraph (1) or (2) of section 

509(a) of that Code; or ‘‘(II) described in section 509(a)(3), and is controlled by an organization described in section 

509(a)(2), of that Code.’’; and 

(2) in paragraph (2)— (A) in subparagraph (A)— (i) by striking ‘‘that—’’ and inserting ‘‘that is subject to a pending offer for purchase from an eligible entity and—’’; and 

(ii) by striking clauses (i) and (ii) and inserting the 

following new clauses: ‘‘(i) has prime, unique, or other productive soil; 

‘‘(ii) contains historical or archaeological resources; 

or ‘‘(iii) the protection of which will further a State or 

local policy consistent with the purposes of the program.’’; and 

(B) in subparagraph (B)— (i) in clause (iv), by striking ‘‘and’’ at the end; and 

(ii) by striking clause (v) and inserting the following new clauses: ‘‘(v) forest land that— ‘‘(I) contributes to the economic viability of an 

agricultural operation; or 

‘‘(II) serves as a buffer to protect an agricultural operation from development; and 


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‘‘(vi) land that is incidental to land described in 

clauses (i) through (v), if such land is necessary for the 

efficient administration of a conservation easement, as 

determined by the Secretary.’’. (b) FARMLAND PROTECTION.—Section 1238I of the Food Security 

Act of 1985 (16 U.S.C. 3838i) is amended to read as follows: 

‘‘SEC. 1238I. FARMLAND PROTECTION PROGRAM. 

‘‘(a) ESTABLISHMENT.—The Secretary shall establish and carry 

out a farmland protection program under which the Secretary shall 

facilitate and provide funding for the purchase of conservation easements or other interests in eligible land. ‘‘(b) PURPOSE.—The purpose of the program is to protect the agricultural use and related conservation values of eligible land by 

limiting nonagricultural uses of that land. ‘‘(c) COST-SHARE ASSISTANCE.— ‘‘(1) PROVISION OF ASSISTANCE.—The Secretary shall provide cost-share assistance to eligible entities for purchasing a 

conservation easement or other interest in eligible land. ‘‘(2) FEDERAL SHARE.—The share of the cost provided by the 

Secretary for purchasing a conservation easement or other interest in eligible land shall not exceed 50 percent of the appraised 

fair market value of the conservation easement or other interest 

in eligible land. ‘‘(3) NON-FEDERAL SHARE.— ‘‘(A) SHARE PROVIDED BY ELIGIBLE ENTITY.—The eligible entity shall provide a share of the cost of purchasing a 

conservation easement or other interest in eligible land in 

an amount that is not less than 25 percent of the acquisition purchase price. ‘‘(B) LANDOWNER CONTRIBUTION.—As part of the nonFederal share of the cost of purchasing a conservation easement or other interest in eligible land, an eligible entity 

may include a charitable donation or qualified conservation contribution (as defined by section 170(h) of the Internal Revenue Code of 1986) from the private landowner 

from which the conservation easement or other interest in 

land will be purchased. ‘‘(d) DETERMINATION OF FAIR MARKET VALUE.—Effective on the 

date of enactment of the Food, Conservation, and Energy Act of 

2008, the fair market value of the conservation easement or other interest in eligible land shall be determined on the basis of an appraisal using an industry approved method, selected by the eligible 

entity and approved by the Secretary. 

‘‘(e) BIDDING DOWN PROHIBITED.—If the Secretary determines 

that 2 or more applications for cost-share assistance are comparable 

in achieving the purpose of the program, the Secretary shall not assign a higher priority to any 1 of those applications solely on the 

basis of lesser cost to the program. 

‘‘(f) CONDITION ON ASSISTANCE.—

‘‘(1) CONSERVATION PLAN.—Any highly erodible cropland 

for which a conservation easement or other interest is purchased using cost-share assistance provided under the program 

shall be subject to a conservation plan that requires, at the option of the Secretary, the conversion of the cropland to less intensive uses. 


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‘‘(2) CONTINGENT RIGHT OF ENFORCEMENT.—The Secretary 

shall require the inclusion of a contingent right of enforcement 

for the Secretary in the terms of a conservation easement or 

other interest in eligible land that is purchased using cost-share 

assistance provided under the program. 

‘‘(g) AGREEMENTS WITH ELIGIBLE ENTITIES.—

‘‘(1) IN GENERAL.—The Secretary shall enter into agreements with eligible entities to stipulate the terms and conditions 

under which the eligible entity is permitted to use cost-share assistance provided under subsection (c). 

‘‘(2) LENGTH OF AGREEMENTS.—An agreement under this 

subsection shall be for a term that is—

‘‘(A) in the case of an eligible entity certified under the 

process described in subsection (h), a minimum of five 

years; and 

‘‘(B) for all other eligible entities, at least three, but not 

more than five years. 

‘‘(3) SUBSTITUTION OF QUALIFIED PROJECTS.—An agreement 

shall allow, upon mutual agreement of the parties, substitution 

of qualified projects that are identified at the time of the proposed substitution. 

‘‘(4) MINIMUM REQUIREMENTS.—An eligible entity shall be 

authorized to use its own terms and conditions, as approved by 

the Secretary, for conservation easements and other purchases 

of interests in land, so long as such terms and conditions—

‘‘(A) are consistent with the purposes of the program; 

‘‘(B) permit effective enforcement of the conservation 

purposes of such easements or other interests; and 

‘‘(C) include a limit on the impervious surfaces to be allowed that is consistent with the agricultural activities to 

be conducted. 

‘‘(5) EFFECT OF VIOLATION.—If a violation occurs of a term 

or condition of an agreement entered into under this subsection—

‘‘(A) the agreement shall remain in force; and 

‘‘(B) the Secretary may require the eligible entity to refund all or part of any payments received by the entity 

under the program, with interest on the payments as determined appropriate by the Secretary. 

‘‘(h) CERTIFICATION OF ELIGIBLE ENTITIES.—

‘‘(1) CERTIFICATION PROCESS.—The Secretary shall establish a process under which the Secretary may—

‘‘(A) directly certify eligible entities that meet established criteria; 

‘‘(B) enter into long-term agreements with certified entities, as authorized by subsection (g)(2)(A); and 

‘‘(C) accept proposals for cost-share assistance to certified entities for the purchase of conservation easements or 

other interests in eligible land throughout the duration of 

such agreements. 

‘‘(2) CERTIFICATION CRITERIA.—In order to be certified, an 

eligible entity shall demonstrate to the Secretary that the entity 

will maintain, at a minimum, for the duration of the agreement—


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‘‘(A) a plan for administering easements that is consistent with the purpose of this subchapter; 

‘‘(B) the capacity and resources to monitor and enforce 

conservation easements or other interests in land; and 

‘‘(C) policies and procedures to ensure—

‘‘(i) the long-term integrity of conservation easements or other interests in eligible land; 

‘‘(ii) timely completion of acquisitions of easements 

or other interests in eligible land; and 

‘‘(iii) timely and complete evaluation and reporting 

to the Secretary on the use of funds provided by the 

Secretary under the program. 

‘‘(3) REVIEW AND REVISION.—

‘‘(A) REVIEW.—The Secretary shall conduct a review of 

eligible entities certified under paragraph (1) every three 

years to ensure that such entities are meeting the criteria 

established under paragraph (2). 

‘‘(B) REVOCATION.—If the Secretary finds that the certified entity no longer meets the criteria established under 

paragraph (2), the Secretary may—

‘‘(i) allow the certified entity a specified period of 

time, at a minimum 180 days, in which to take such 

actions as may be necessary to meet the criteria; and 

‘‘(ii) revoke the certification of the entity, if after 

the specified period of time, the certified entity does not 

meet the criteria established in paragraph (2).’’. 

SEC. 2402. FARM VIABILITY PROGRAM. 

Section 1238J(b) of the Food Security Act of 1985 (16 U.S.C. 

3838j(b)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 2403. GRASSLAND RESERVE PROGRAM. 

Subchapter D of chapter 2 of subtitle D of title XII of the Food 

Security Act of 1985 (16 U.S.C. 3838n et seq.), as redesignated by 

section 2301(a)(1), is amended to read as follows: 

‘‘Subchapter D—Grassland Reserve Program 

‘‘SEC. 1238N. GRASSLAND RESERVE PROGRAM. 

‘‘(a) ESTABLISHMENT AND PURPOSE.—The Secretary shall establish a grassland reserve program (referred to in this subchapter as 

the ‘program’) for the purpose of assisting owners and operators in 

protecting grazing uses and related conservation values by restoring 

and conserving eligible land through rental contracts, easements, 

and restoration agreements. 

‘‘(b) ENROLLMENT OF ACREAGE.—

‘‘(1) ACREAGE ENROLLED.—The Secretary shall enroll an 

additional 1,220,000 acres of eligible land in the program during fiscal years 2009 through 2012. 

‘‘(2) METHODS OF ENROLLMENT.—The Secretary shall enroll 

eligible land in the program through the use of; 

‘‘(A) a 10-year, 15-year, or 20-year rental contract; 

‘‘(B) a permanent easement; or 

‘‘(C) in a State that imposes a maximum duration for 

easements, an easement for the maximum duration allowed 

under the law of that State. 


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‘‘(3) LIMITATION.—Of the total amount of funds expended 

under the program to acquire rental contracts and easements 

described in paragraph (2), the Secretary shall use, to the extent 

practicable—‘‘(A) 40 percent for rental contacts; and 

‘‘(B) 60 percent for easements. ‘‘(4) ENROLLMENT OF CONSERVATION RESERVE LAND.— ‘‘(A) PRIORITY.—Upon expiration of a contract under 

subchapter B of chapter 1 of this subtitle, the Secretary 

shall give priority for enrollment in the program to land 

previously enrolled in the conservation reserve program if— ‘‘(i) the land is eligible land, as defined in subsection (c); and ‘‘(ii) the Secretary determines that the land is of 

high ecological value and under significant threat of 

conversion to uses other than grazing. 

‘‘(B) MAXIMUM ENROLLMENT.—The number of acres of 

land enrolled under the priority described in subparagraph 

(A) in a calendar year shall not exceed 10 percent of the 

total number of acres enrolled in the program in that calendar year. ‘‘(c) ELIGIBLE LAND DEFINED.—For purposes of the program, the 

term ‘eligible land’ means private or tribal land that— ‘‘(1) is grassland, land that contains forbs, or shrubland 

(including improved rangeland and pastureland) for which 

grazing is the predominant use; ‘‘(2) is located in an area that has been historically dominated by grassland, forbs, or shrubland, and the land— ‘‘(A) could provide habitat for animal or plant populations of significant ecological value if the land— ‘‘(i) is retained in its current use; or 

‘‘(ii) is restored to a natural condition; ‘‘(B) contains historical or archaeological resources; or 

‘‘(C) would address issues raised by State, regional, 

and national conservation priorities; or 

‘‘(3) is incidental to land described in paragraph (1) or (2), 

if the incidental land is determined by the Secretary to be necessary for the efficient administration of a rental contract or 

easement under the program. 

‘‘SEC. 1238O. DUTIES OF OWNERS AND OPERATORS. 

‘‘(a) RENTAL CONTRACTS.—To be eligible to enroll eligible land 

in the program under a rental contract, the owner or operator of the 

land shall agree—

‘‘(1) to comply with the terms of the contract and, when applicable, a restoration agreement; 

‘‘(2) to suspend any existing cropland base and allotment 

history for the land under another program administered by the 

Secretary; and 

‘‘(3) to implement a grazing management plan, as approved 

by the Secretary, which may be modified upon mutual agreement of the parties. 

‘‘(b) EASEMENTS.—To be eligible to enroll eligible land in the 

program through an easement, the owner of the land shall agree—

‘‘(1) to grant an easement to the Secretary or to an eligible 

entity described in section 1238Q; 


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‘‘(2) to create and record an appropriate deed restriction in 

accordance with applicable State law to reflect the easement; ‘‘(3) to provide a written statement of consent to the easement signed by persons holding a security interest or any vested 

interest in the land; ‘‘(4) to provide proof of unencumbered title to the underlying fee interest in the land that is the subject of the easement; ‘‘(5) to comply with the terms of the easement and, when 

applicable, a restoration agreement; ‘‘(6) to implement a grazing management plan, as approved 

by the Secretary, which may be modified upon mutual agreement of the parties; and ‘‘(7) to eliminate any existing cropland base and allotment 

history for the land under another program administered by the 

Secretary. 

‘‘(c) RESTORATION AGREEMENTS.—

‘‘(1) WHEN APPLICABLE.—To be eligible for cost-share assistance to restore eligible land subject to a rental contract or an 

easement under the program, the owner or operator of the land 

shall agree to comply with the terms of a restoration agreement. 

‘‘(2) TERMS AND CONDITIONS.—The Secretary shall prescribe the terms and conditions of a restoration agreement by 

which eligible land that is subject to a rental contract or easement under the program shall be restored. ‘‘(3) DUTIES.—The restoration agreement shall describe the 

respective duties of the owner or operator and the Secretary, including the Federal share of restoration payments and technical 

assistance. 

‘‘(d) TERMS AND CONDITIONS APPLICABLE TO RENTAL CONTRACTS AND EASEMENTS.—

‘‘(1) PERMISSIBLE ACTIVITIES.—The terms and conditions of 

a rental contract or easement under the program shall permit— ‘‘(A) common grazing practices, including maintenance 

and necessary cultural practices, on the land in a manner 

that is consistent with maintaining the viability of grassland, forb, and shrub species appropriate to that locality; 

‘‘(B) haying, mowing, or harvesting for seed production, 

subject to appropriate restrictions during the nesting season 

for birds in the local area that are in significant decline or 

are conserved in accordance with Federal or State law, as 

determined by the State Conservationist; 

‘‘(C) fire presuppression, rehabilitation, and construction of fire breaks; and 

‘‘(D) grazing related activities, such as fencing and livestock watering. 

‘‘(2) PROHIBITIONS.—The terms and conditions of a rental 

contract or easement under the program shall prohibit—

‘‘(A) the production of crops (other than hay), fruit 

trees, vineyards, or any other agricultural commodity that 

is inconsistent with maintaining grazing land; and ‘‘(B) except as permitted under a restoration plan, the 

conduct of any other activity that would be inconsistent 

with maintaining grazing land enrolled in the program. 

‘‘(3) ADDITIONAL TERMS AND CONDITIONS.—A rental contract or easement under the program shall include such addiVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00137 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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tional provisions as the Secretary determines are appropriate to 

carry out or facilitate the purposes and administration of the 

program. 

‘‘(e) VIOLATIONS.—On a violation of the terms or conditions of 

a rental contract, easement, or restoration agreement entered into 

under this section—

‘‘(1) the contract or easement shall remain in force; and 

‘‘(2) the Secretary may require the owner or operator to refund all or part of any payments received under the program, 

with interest on the payments as determined appropriate by the 

Secretary. 

‘‘SEC. 1238P. DUTIES OF SECRETARY. 

‘‘(a) EVALUATION AND RANKING OF APPLICATIONS.—

‘‘(1) CRITERIA.—The Secretary shall establish criteria to 

evaluate and rank applications for rental contracts and easements under the program. 

‘‘(2) CONSIDERATIONS.—In establishing the criteria, the Secretary shall emphasize support for—

‘‘(A) grazing operations; 

‘‘(B) plant and animal biodiversity; and 

‘‘(C) grassland, land that contains forbs, and 

shrubland under the greatest threat of conversion to uses 

other than grazing. 

‘‘(b) PAYMENTS.—

‘‘(1) IN GENERAL.—In return for the execution of a rental 

contract or the granting of an easement by an owner or operator 

under the program, the Secretary shall—

‘‘(A) make rental contract or easement payments to the 

owner or operator in accordance with paragraphs (2) and 

(3); and 

‘‘(B) make payments to the owner or operator under a 

restoration agreement for the Federal share of the cost of 

restoration in accordance with paragraph (4). 

‘‘(2) RENTAL CONTRACT PAYMENTS.—

‘‘(A) PERCENTAGE OF GRAZING VALUE OF LAND.—In return for the execution of a rental contract by an owner or 

operator under the program, the Secretary shall make annual payments during the term of the contract in an 

amount, subject to subparagraph (B), that is not more than 

75 percent of the grazing value of the land covered by the 

contract. 

‘‘(B) PAYMENT LIMITATION.—Payments made under 1 or 

more rental contracts to a person or legal entity, directly or 

indirectly, may not exceed, in the aggregate, $50,000 per 

year. 

‘‘(3) EASEMENT PAYMENTS.—

‘‘(A) IN GENERAL.—Subject to subparagraph (B), in return for the granting of an easement by an owner under the 

program, the Secretary shall make easement payments in 

an amount not to exceed the fair market value of the land 

less the grazing value of the land encumbered by the easement. 

‘‘(B) METHOD FOR DETERMINATION OF COMPENSATION.—In making a determination under subparagraph 


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(A), the Secretary shall pay as compensation for an easement acquired under the program the lowest of— ‘‘(i) the fair market value of the land encumbered 

by the easement, as determined by the Secretary, 

using— ‘‘(I) the Uniform Standards of Professional Appraisal Practices; or ‘‘(II) an area-wide market analysis or survey; ‘‘(ii) the amount corresponding to a geographical 

cap, as determined by the Secretary in regulations; or ‘‘(iii) the offer made by the landowner. ‘‘(C) SCHEDULE.—Easement payments may be provided 

in up to 10 annual payments of equal or unequal amount, 

as agreed to by the Secretary and the owner. 

‘‘(4) RESTORATION AGREEMENT PAYMENTS.— ‘‘(A) FEDERAL SHARE OF RESTORATION.—The Secretary 

shall make payments to an owner or operator under a restoration agreement of not more than 50 percent of the costs 

of carrying out measures and practices necessary to restore 

functions and values of that land. ‘‘(B) PAYMENT LIMITATION.—Payments made under 1 or 

more restoration agreements to a person or legal entity, directly or indirectly, may not exceed, in the aggregate, 

$50,000 per year. 

‘‘(5) PAYMENTS TO OTHERS.—If an owner or operator who is 

entitled to a payment under the program dies, becomes incompetent, is otherwise unable to receive the payment, or is succeeded by another person who renders or completes the required 

performance, the Secretary shall make the payment, in accordance with regulations promulgated by the Secretary and without regard to any other provision of law, in such manner as the 

Secretary determines is fair and reasonable in light of all the 

circumstances. 

‘‘SEC. 1238Q. DELEGATION OF DUTY. 

‘‘(a) AUTHORITY TO DELEGATE.—The Secretary may delegate a 

duty under the program— ‘‘(1) by transferring title of ownership to an easement to an 

eligible entity to hold and enforce; or ‘‘(2) by entering into a cooperative agreement with an eligible entity for the eligible entity to own, write, and enforce an 

easement. 

‘‘(b) ELIGIBLE ENTITY DEFINED.—In this section, the term ‘eligible entity’ means—

‘‘(1) an agency of State or local government or an Indian 

tribe; or 

‘‘(2) an organization that—

‘‘(A) is organized for, and at all times since the formation of the organization has been operated principally for, 

one or more of the conservation purposes specified in clause 

(i), (ii), (iii), or (iv) of section 170(h)(4)(A) of the Internal 

Revenue Code of 1986; 

‘‘(B) is an organization described in section 501(c)(3) of 

that Code that is exempt from taxation under section 501(a) 

of that Code; and 

‘‘(C) is described in—


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‘‘(i) paragraph (1) or (2) of section 509(a) of that 

Code; or 

‘‘(ii) in section 509(a)(3) of that Code, and is controlled by an organization described in section 

509(a)(2) of that Code. 

‘‘(c) TRANSFER OF TITLE OF OWNERSHIP.—

‘‘(1) TRANSFER.—The Secretary may transfer title of ownership to an easement to an eligible entity to hold and enforce, in 

lieu of the Secretary, subject to the right of the Secretary to conduct periodic inspections and enforce the easement, if—

‘‘(A) the Secretary determines that the transfer will promote protection of grassland, land that contains forbs, or 

shrubland; 

‘‘(B) the owner authorizes the eligible entity to hold or 

enforce the easement; and 

‘‘(C) the eligible entity agrees to assume the costs incurred in administering and enforcing the easement, including the costs of restoration or rehabilitation of the land 

as specified by the owner and the eligible entity. 

‘‘(2) APPLICATION.—An eligible entity that seeks to hold and 

enforce an easement shall apply to the Secretary for approval. 

‘‘(3) APPROVAL BY SECRETARY.—The Secretary may approve 

an application described in paragraph (2) if the eligible entity—

‘‘(A) has the relevant experience necessary, as appropriate for the application, to administer an easement on 

grassland, land that contains forbs, or shrubland; 

‘‘(B) has a charter that describes a commitment to conserving ranchland, agricultural land, or grassland for 

grazing and conservation purposes; and 

‘‘(C) has the resources necessary to effectuate the purposes of the charter. 

‘‘(d) COOPERATIVE AGREEMENTS.—

‘‘(1) AUTHORIZED; TERMS AND CONDITIONS.—The Secretary 

shall establish the terms and conditions of a cooperative agreement under which an eligible entity shall use funds provided by 

the Secretary to own, write, and enforce an easement, in lieu of 

the Secretary. 

‘‘(2) MINIMUM REQUIREMENTS.—At a minimum, the cooperative agreement shall—

‘‘(A) specify the qualification of the eligible entity to 

carry out the entity’s responsibilities under the program, including acquisition, monitoring, enforcement, and implementation of management policies and procedures that ensure the long-term integrity of the easement protections; 

‘‘(B) require the eligible entity to assume the costs incurred in administering and enforcing the easement, including the costs of restoration or rehabilitation of the land 

as specified by the owner and the eligible entity; 

‘‘(C) specify the right of the Secretary to conduct periodic inspections to verify the eligible entity’s enforcement of 

the easement; 

‘‘(D) subject to subparagraph (E), identify a specific 

project or a range of projects to be funded under the agreement; 


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‘‘(E) allow, upon mutual agreement of the parties, substitution of qualified projects that are identified at the time 

of substitution; 

‘‘(F) specify the manner in which the eligible entity will 

evaluate and report the use of funds to the Secretary; 

‘‘(G) allow the eligible entity flexibility to develop and 

use terms and conditions for easements, if the Secretary 

finds the terms and conditions consistent with the purposes 

of the program and adequate to enable effective enforcement 

of the easements; 

‘‘(H) if applicable, allow an eligible entity to include a 

charitable donation or qualified conservation contribution 

(as defined by section 170(h) of the Internal Revenue Code 

of 1986) from the landowner from which the easement will 

be purchased as part of the entity’s share of the cost to purchase an easement; and 

‘‘(I) provide for a schedule of payments to an eligible 

entity, as agreed to by the Secretary and the eligible entity. 

‘‘(3) COST SHARING.—

‘‘(A) IN GENERAL.—As part of a cooperative agreement 

with an eligible entity under this subsection, the Secretary 

may provide a share of the purchase price of an easement 

under the program. 

‘‘(B) MINIMUM SHARE BY ELIGIBLE ENTITY.—The eligible entity shall be required to provide a share of the purchase price at least equivalent to that provided by the Secretary. 

‘‘(C) PRIORITY.—The Secretary may accord a higher 

priority to proposals from eligible entities that leverage a 

greater share of the purchase price of the easement. 

‘‘(4) VIOLATION.—If an eligible entity violates the terms or 

conditions of a cooperative agreement entered into under this 

subsection—

‘‘(A) the cooperative agreement shall remain in force; 

and 

‘‘(B) the Secretary may require the eligible entity to refund all or part of any payments received by the eligible entity under the program, with interest on the payments as 

determined appropriate by the Secretary. 

‘‘(e) PROTECTION OF FEDERAL INVESTMENT.—When delegating a 

duty under this section, the Secretary shall ensure that the terms of 

an easement include a contingent right of enforcement for the Department.’’. 

Subtitle F—Environmental Quality Incentives Program 

SEC. 2501. PURPOSES OF ENVIRONMENTAL QUALITY INCENTIVES PROGRAM. 

(a) REVISED PURPOSES.—Section 1240 of the Food Security Act 

of 1985 (16 U.S.C. 3839aa) is amended—

(1) in the matter preceding paragraph (1), by inserting ‘‘, 

forest management,’’ after ‘‘agricultural production’’; and 

(2) by striking paragraphs (3) and (4) and inserting the following new paragraphs: 


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‘‘(3) providing flexible assistance to producers to install and 

maintain conservation practices that sustain food and fiber production while—

‘‘(A) enhancing soil, water, and related natural resources, including grazing land, forestland, wetland, and 

wildlife; and 

‘‘(B) conserving energy; 

‘‘(4) assisting producers to make beneficial, cost effective 

changes to production systems (including conservation practices 

related to organic production), grazing management, fuels management, forest management, nutrient management associated 

with livestock, pest or irrigation management, or other practices 

on agricultural and forested land; and’’. 

(b) TECHNICAL CORRECTION.—The Food Security Act of 1985 is 

amended by inserting immediately before section 1240 (16 U.S.C. 

3839aa) the following: 

‘‘CHAPTER 4—ENVIRONMENTAL QUALITY INCENTIVES 

PROGRAM’’. 

SEC. 2502. DEFINITIONS. 

Section 1240A of the Food Security Act of 1985 (16 U.S.C. 

3839aa–1) is amended to read as follows: 

‘‘SEC. 1240A. DEFINITIONS. 

‘‘In this chapter: 

‘‘(1) ELIGIBLE LAND.—

‘‘(A) IN GENERAL.—The term ‘eligible land’ means land 

on which agricultural commodities, livestock, or forest-related products are produced. 

‘‘(B) INCLUSIONS.—The term ‘eligible land’ includes the 

following: 

‘‘(i) Cropland. 

‘‘(ii) Grassland. 

‘‘(iii) Rangeland. 

‘‘(iv) Pasture land. 

‘‘(v) Nonindustrial private forest land. 

‘‘(vi) Other agricultural land (including cropped 

woodland, marshes, and agricultural land used for the 

production of livestock) on which resource concerns related to agricultural production could be addressed 

through a contract under the program, as determined 

by the Secretary. 

‘‘(2) NATIONAL ORGANIC PROGRAM.—The term ‘national organic program’ means the national organic program established 

under the Organic Foods Production Act of 1990 (7 U.S.C. 6501 

et seq.). 

‘‘(3) ORGANIC SYSTEM PLAN.—The term ‘organic system 

plan’ means an organic plan approved under the national organic program. 

‘‘(4) PAYMENT.—The term ‘payment’ means financial assistance provided to a producer for performing practices under this 

chapter, including compensation for—

‘‘(A) incurred costs associated with planning, design, 

materials, equipment, installation, labor, management, 

maintenance, or training; and 


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‘‘(B) income forgone by the producer. 

‘‘(5) PRACTICE.—The term ‘practice’ means 1 or more improvements and conservation activities that are consistent with 

the purposes of the program under this chapter, as determined 

by the Secretary, including—

‘‘(A) improvements to eligible land of the producer, including—

‘‘(i) structural practices; 

‘‘(ii) land management practices; 

‘‘(iii) vegetative practices; 

‘‘(iv) forest management; and 

‘‘(v) other practices that the Secretary determines 

would further the purposes of the program; and 

‘‘(B) conservation activities involving the development 

of plans appropriate for the eligible land of the producer, 

including—

‘‘(i) comprehensive nutrient management planning; 

and 

‘‘(ii) other plans that the Secretary determines 

would further the purposes of the program under this 

chapter. 

‘‘(6) PROGRAM.—The term ‘program’ means the environmental quality incentives program established by this chapter.’’. 

SEC. 2503. ESTABLISHMENT AND ADMINISTRATION OF ENVIRONMENTAL QUALITY INCENTIVES PROGRAM. 

Section 1240B of the Food Security Act of 1985 (16 U.S.C. 

3839aa–2) is amended to read as follows: 

‘‘SEC. 1240B. ESTABLISHMENT AND ADMINISTRATION. 

‘‘(a) ESTABLISHMENT.—During each of the 2002 through 2012 

fiscal years, the Secretary shall provide payments to producers that 

enter into contracts with the Secretary under the program. 

‘‘(b) PRACTICES AND TERM.—

‘‘(1) PRACTICES.—A contract under the program may apply 

to the performance of one or more practices. 

‘‘(2) TERM.—A contract under the program shall have a 

term that—

‘‘(A) at a minimum, is equal to the period beginning on 

the date on which the contract is entered into and ending 

on the date that is one year after the date on which all 

practices under the contract have been implemented; but 

‘‘(B) not to exceed 10 years. 

‘‘(c) BIDDING DOWN.—If the Secretary determines that the environmental values of two or more applications for payments are comparable, the Secretary shall not assign a higher priority to the application only because it would present the least cost to the program. 

‘‘(d) PAYMENTS.—

‘‘(1) AVAILABILITY OF PAYMENTS.—Payments are provided to 

a producer to implement one or more practices under the program. 

‘‘(2) LIMITATION ON PAYMENT AMOUNTS.—A payment to a 

producer for performing a practice may not exceed, as determined by the Secretary—


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‘‘(A) 75 percent of the costs associated with planning, 

design, materials, equipment, installation, labor, management, maintenance, or training; ‘‘(B) 100 percent of income foregone by the producer; or 

‘‘(C) in the case of a practice consisting of elements covered under subparagraphs (A) and (B)— ‘‘(i) 75 percent of the costs incurred for those elements covered under subparagraph (A); and ‘‘(ii) 100 percent of income foregone for those elements covered under subparagraph (B). ‘‘(3) SPECIAL RULE INVOLVING PAYMENTS FOR FOREGONE INCOME.—In determining the amount and rate of payments under 

paragraph (2)(B), the Secretary may accord great significance to 

a practice that, as determined by the Secretary, promotes—

‘‘(A) residue management; 

‘‘(B) nutrient management; 

‘‘(C) air quality management; 

‘‘(D) invasive species management; 

‘‘(E) pollinator habitat; 

‘‘(F) animal carcass management technology; or 

‘‘(G) pest management. 

‘‘(4) INCREASED PAYMENTS FOR CERTAIN PRODUCERS.— ‘‘(A) IN GENERAL.—Notwithstanding paragraph (2), in 

the case of a producer that is a limited resource, socially 

disadvantaged farmer or rancher or a beginning farmer or 

rancher, the Secretary shall increase the amount that 

would otherwise be provided to a producer under this subsection—

‘‘(i) to not more than 90 percent of the costs associated with planning, design, materials, equipment, installation, labor, management, maintenance, or training; and ‘‘(ii) to not less than 25 percent above the otherwise 

applicable rate. 

‘‘(B) ADVANCE PAYMENTS.—Not more than 30 percent of 

the amount determined under subparagraph (A) may be 

provided in advance for the purpose of purchasing materials or contracting. 

‘‘(5) FINANCIAL ASSISTANCE FROM OTHER SOURCES.—Except 

as provided in paragraph (6), any payments received by a producer from a State or private organization or person for the implementation of one or more practices on eligible land of the 

producer shall be in addition to the payments provided to the 

producer under this subsection. ‘‘(6) OTHER PAYMENTS.—A producer shall not be eligible for 

payments for practices on eligible land under the program if the 

producer receives payments or other benefits for the same practice on the same land under another program under this subtitle. 

‘‘(e) MODIFICATION OR TERMINATION OF CONTRACTS.— ‘‘(1) VOLUNTARY MODIFICATION OR TERMINATION.—The Secretary may modify or terminate a contract entered into with a 

producer under the program if— ‘‘(A) the producer agrees to the modification or termination; and 


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‘‘(B) the Secretary determines that the modification or 

termination is in the public interest. 

‘‘(2) INVOLUNTARY TERMINATION.—The Secretary may terminate a contract under the program if the Secretary determines that the producer violated the contract. 

‘‘(f) ALLOCATION OF FUNDING.—For each of fiscal years 2002 

through 2012, 60 percent of the funds made available for payments 

under the program shall be targeted at practices relating to livestock production. ‘‘(g) FUNDING FOR FEDERALLY RECOGNIZED NATIVE AMERICAN

INDIAN TRIBES AND ALASKA NATIVE CORPORATIONS.—The Secretary 

may enter into alternative funding arrangements with federally recognized Native American Indian Tribes and Alaska Native Corporations (including their affiliated membership organizations) if the 

Secretary determines that the goals and objectives of the program 

will be met by such arrangements, and that statutory limitations regarding contracts with individual producers will not be exceeded by 

any Tribal or Native Corporation member. ‘‘(h) WATER CONSERVATION OR IRRIGATION EFFICIENCY PRACTICE.—

‘‘(1) AVAILABILITY OF PAYMENTS.—The Secretary may provide payments under this subsection to a producer for a water 

conservation or irrigation practice. ‘‘(2) PRIORITY.—In providing payments to a producer for a 

water conservation or irrigation practice, the Secretary shall 

give priority to applications in which— ‘‘(A) consistent with the law of the State in which the 

eligible land of the producer is located, there is a reduction 

in water use in the operation of the producer; or ‘‘(B) the producer agrees not to use any associated 

water savings to bring new land, other than incidental 

land needed for efficient operations, under irrigated production, unless the producer is participating in a watershed-wide project that will effectively conserve water, as determined by the Secretary. 

‘‘(i) PAYMENTS FOR CONSERVATION PRACTICES RELATED TO OR- GANIC PRODUCTION.— ‘‘(1) PAYMENTS AUTHORIZED.—The Secretary shall provide 

payments under this subsection for conservation practices, on 

some or all of the operations of a producer, related— ‘‘(A) to organic production; and 

‘‘(B) to the transition to organic production. ‘‘(2) ELIGIBILITY REQUIREMENTS.—As a condition for receiving payments under this subsection, a producer shall agree—

‘‘(A) to develop and carry out an organic system plan; 

or 

‘‘(B) to develop and implement conservation practices 

for certified organic production that are consistent with an 

organic system plan and the purposes of this chapter. 

‘‘(3) PAYMENT LIMITATIONS.—Payments under this subsection to a person or legal entity, directly or indirectly, may not 

exceed, in the aggregate, $20,000 per year or $80,000 during 

any 6-year period. In applying these limitations, the Secretary 

shall not take into account payments received for technical assistance. 


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‘‘(4) EXCLUSION OF CERTAIN ORGANIC CERTIFICATION

COSTS.—Payments may not be made under this subsection to 

cover the costs associated with organic certification that are eligible for cost-share payments under section 10606 of the Farm 

Security and Rural Investment Act of 2002 (7 U.S.C. 6523). 

‘‘(5) TERMINATION OF CONTRACTS.—The Secretary may cancel or otherwise nullify a contract to provide payments under 

this subsection if the Secretary determines that the producer—

‘‘(A) is not pursuing organic certification; or 

‘‘(B) is not in compliance with the Organic Foods Production Act of 1990 (7 U.S.C. 6501 et seq.).’’. 

SEC. 2504. EVALUATION OF APPLICATIONS. 

Section 1240C of the Food Security Act of 1985 (16 U.S.C. 

3839aa–3) is amended to read as follows: 

‘‘SEC. 1240C. EVALUATION OF APPLICATIONS. 

‘‘(a) EVALUATION CRITERIA.—The Secretary shall develop criteria for evaluating applications that will ensure that national, 

State, and local conservation priorities are effectively addressed. 

‘‘(b) PRIORITIZATION OF APPLICATIONS.—In evaluating applications under this chapter, the Secretary shall prioritize applications—

‘‘(1) based on their overall level of cost-effectiveness to ensure that the conservation practices and approaches proposed 

are the most efficient means of achieving the anticipated environmental benefits of the project; 

‘‘(2) based on how effectively and comprehensively the 

project addresses the designated resource concern or resource 

concerns; 

‘‘(3) that best fulfill the purpose of the environmental quality incentives program specified in section 1240(1); and 

‘‘(4) that improve conservation practices or systems in place 

on the operation at the time the contract offer is accepted or 

that will complete a conservation system. 

‘‘(c) GROUPING OF APPLICATIONS.—To the greatest extent practicable, the Secretary shall group applications of similar crop or 

livestock operations for evaluation purposes or otherwise evaluate 

applications relative to other applications for similar farming operations.’’. 

SEC. 2505. DUTIES OF PRODUCERS UNDER ENVIRONMENTAL QUALITY 

INCENTIVES PROGRAM. 

Section 1240D of the Food Security Act of 1985 (16 U.S.C. 

3839aa–4) is amended—

(1) in the matter preceding paragraph (1), by striking ‘‘technical assistance, cost-share payments, or incentive’’; 

(2) in paragraph (2), by striking ‘‘farm or ranch’’ and inserting ‘‘farm, ranch, or forest land’’; and 

(3) in paragraph (4), by striking ‘‘cost-share payments and 

incentive’’. 

SEC. 2506. ENVIRONMENTAL QUALITY INCENTIVES PROGRAM PLAN. 

(a) PLAN OF OPERATIONS.—Section 1240E(a) of the Food Security Act of 1985 (16 U.S.C. 3839aa–5(a)) is amended—

(1) in the subsection heading, by striking ‘‘IN GENERAL’’

and inserting ‘‘PLAN OF OPERATIONS’’; 


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(2) in matter preceding paragraph (1), by striking ‘‘costshare payments or incentive’’; 

(3) in paragraph (2), by striking ‘‘and’’ after the semicolon 

at the end; 

(4) in paragraph (3), by striking the period at the end and 

inserting ‘‘; and’’; and 

(5) by adding at the end the following new paragraph: 

‘‘(4) in the case of forest land, is consistent with the provisions of a forest management plan that is approved by the Secretary, which may include—

‘‘(A) a forest stewardship plan described in section 5 of 

the Cooperative Forestry Assistance Act of 1978 (16 U.S.C. 

2103a); 

‘‘(B) another practice plan approved by the State forester; or 

‘‘(C) another plan determined appropriate by the Secretary.’’. 

(b) AVOIDANCE OF DUPLICATION.—Subsection (b) of section 

1240E of the Food Security Act of 1985 (16 U.S.C. 3839aa–5) is 

amended to read as follows: 

‘‘(b) AVOIDANCE OF DUPLICATION.—The Secretary shall—

‘‘(1) consider a plan developed in order to acquire a permit 

under a water or air quality regulatory program as the equivalent of a plan of operations under subsection (a), if the plan 

contains elements equivalent to those elements required by a 

plan of operations; and 

‘‘(2) to the maximum extent practicable, eliminate duplication of planning activities under the program under this chapter and comparable conservation programs.’’. 

SEC. 2507. DUTIES OF THE SECRETARY. 

Section 1240F(1) of the Food Security Act of 1985 (16 U.S.C. 

3839aa–6(1)) is amended by striking ‘‘cost-share payments or incentive’’. 

SEC. 2508. LIMITATION ON ENVIRONMENTAL QUALITY INCENTIVES 

PROGRAM PAYMENTS. 

Section 1240G of the Food Security Act of 1985 (16 U.S.C. 

3839aa–7) is amended—

(1) by striking ‘‘An individual or entity’’ and inserting ‘‘(a) 

LIMITATION.—Subject to subsection (b), a person or legal entity’’; 

(2) by striking ‘‘$450,000’’ and inserting ‘‘$300,000’’; 

(3) by striking ‘‘the individual’’ both places it appears and 

inserting ‘‘the person’’; and 

(4) by adding at the end the following new subsection: 

‘‘(b) WAIVER AUTHORITY.—In the case of contracts under this 

chapter for projects of special environmental significance (including 

projects involving methane digesters), as determined by the Secretary, the Secretary may—

‘‘(1) waive the limitation otherwise applicable under subsection (a); and 

‘‘(2) raise the limitation to not more than $450,000 during 

any six-year period.’’. 


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SEC. 2509. CONSERVATION INNOVATION GRANTS AND PAYMENTS. 

Section 1240H of the Food Security Act of 1985 (16 U.S.C. 

3839aa–8) is amended to read as follows: 

‘‘SEC. 1240H. CONSERVATION INNOVATION GRANTS AND PAYMENTS. 

‘‘(a) COMPETITIVE GRANTS FOR INNOVATIVE CONSERVATION APPROACHES.—

‘‘(1) GRANTS.—Out of the funds made available to carry out 

this chapter, the Secretary may pay the cost of competitive 

grants that are intended to stimulate innovative approaches to 

leveraging the Federal investment in environmental enhancement and protection, in conjunction with agricultural production or forest resource management, through the program. 

‘‘(2) USE.—The Secretary may provide grants under this 

subsection to governmental and non-governmental organizations and persons, on a competitive basis, to carry out projects 

that—

‘‘(A) involve producers who are eligible for payments or 

technical assistance under the program; 

‘‘(B) leverage Federal funds made available to carry out 

the program under this chapter with matching funds provided by State and local governments and private organizations to promote environmental enhancement and protection in conjunction with agricultural production; 

‘‘(C) ensure efficient and effective transfer of innovative 

technologies and approaches demonstrated through projects 

that receive funding under this section, such as market systems for pollution reduction and practices for the storage of 

carbon in soil; and 

‘‘(D) provide environmental and resource conservation 

benefits through increased participation by producers of 

specialty crops. 

‘‘(b) AIR QUALITY CONCERNS FROM AGRICULTURAL OPERATIONS.—

‘‘(1) IMPLEMENTATION ASSISTANCE.—The Secretary shall 

provide payments under this subsection to producers to implement practices to address air quality concerns from agricultural 

operations and to meet Federal, State, and local regulatory requirements. The funds shall be made available on the basis of 

air quality concerns in a State and shall be used to provide 

payments to producers that are cost effective and reflect innovative technologies. 

‘‘(2) FUNDING.—Of the funds made available to carry out 

this chapter, the Secretary shall carry out this subsection using 

$37,500,000 for each of fiscal years 2009 through 2012.’’. 

SEC. 2510. AGRICULTURAL WATER ENHANCEMENT PROGRAM. 

Section 1240I of the Food Security Act of 1985 (16 U.S.C. 

3839aa–9) is amended to read as follows: 

‘‘SEC. 1240I. AGRICULTURAL WATER ENHANCEMENT PROGRAM. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) AGRICULTURAL WATER ENHANCEMENT ACTIVITY.—The 

term ‘agricultural water enhancement activity’ includes the following activities carried out with respect to agricultural land: 


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‘‘(A) Water quality or water conservation plan development, including resource condition assessment and modeling. 

‘‘(B) Water conservation restoration or enhancement 

projects, including conversion to the production of less 

water-intensive agricultural commodities or dryland farming. 

‘‘(C) Water quality or quantity restoration or enhancement projects. 

‘‘(D) Irrigation system improvement and irrigation efficiency enhancement. 

‘‘(E) Activities designed to mitigate the effects of 

drought. 

‘‘(F) Related activities that the Secretary determines 

will help achieve water quality or water conservation benefits on agricultural land. 

‘‘(2) PARTNER.—The term ‘partner’ means an entity that enters into a partnership agreement with the Secretary to carry 

out agricultural water enhancement activities on a regional 

basis, including—

‘‘(A) an agricultural or silvicultural producer association or other group of such producers; 

‘‘(B) a State or unit of local government; or 

‘‘(C) a federally recognized Indian tribe. 

‘‘(3) PARTNERSHIP AGREEMENT.—The term ‘partnership 

agreement’ means an agreement between the Secretary and a 

partner. 

‘‘(4) PROGRAM.—The term ‘program’ means the agricultural 

water enhancement program established under subsection (b). 

‘‘(b) ESTABLISHMENT OF PROGRAM.—Beginning in fiscal year 

2009, the Secretary shall carry out, in accordance with this section 

and using such procedures as the Secretary determines to be appropriate, an agricultural water enhancement program as part of the 

environmental quality incentives program to promote ground and 

surface water conservation and improve water quality on agricultural lands—

‘‘(1) by entering into contracts with, and making payments 

to, producers to carry out agricultural water enhancement activities; or 

‘‘(2) by entering into partnership agreements with partners, 

in accordance with subsection (c), on a regional level to benefit 

working agricultural land. 

‘‘(c) PARTNERSHIP AGREEMENTS.—

‘‘(1) AGREEMENTS AUTHORIZED.—The Secretary may enter 

into partnership agreements to meet the objectives of the program described in subsection (b). 

‘‘(2) APPLICATIONS.—An application to the Secretary to 

enter into a partnership agreement under paragraph (1) shall 

include the following: 

‘‘(A) A description of the geographical area to be covered by the partnership agreement. 

‘‘(B) A description of the agricultural water quality or 

water conservation issues to be addressed by the partnership agreement. 


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‘‘(C) A description of the agricultural water enhancement objectives to be achieved through the partnership. 

‘‘(D) A description of the partners collaborating to 

achieve the project objectives and the roles, responsibilities, 

and capabilities of each partner. 

‘‘(E) A description of the program resources, including 

payments the Secretary is requested to make. 

‘‘(F) Such other elements as the Secretary considers 

necessary to adequately evaluate and competitively select 

applications for partnership agreements. 

‘‘(3) DUTIES OF PARTNERS.—A partner under a partnership 

agreement shall—

‘‘(A) identify producers participating in the project and 

act on their behalf in applying for the program; 

‘‘(B) leverage funds provided by the Secretary with additional funds to help achieve project objectives; 

‘‘(C) conduct monitoring and evaluation of project effects; and 

‘‘(D) at the conclusion of the project, report to the Secretary on project results. 

‘‘(d) AGRICULTURAL WATER ENHANCEMENT ACTIVITIES BY PRODUCERS.—The Secretary shall select agricultural water enhancement activities proposed by producers according to applicable requirements under the environmental quality incentives program. 

‘‘(e) AGRICULTURAL WATER ENHANCEMENT ACTIVITIES BY PARTNERS.—

‘‘(1) COMPETITIVE PROCESS.—The Secretary shall conduct a 

competitive process to select partners. In carrying out the process, the Secretary shall make public the criteria used in evaluating applications. 

‘‘(2) AUTHORITY TO GIVE PRIORITY TO CERTAIN PROPOSALS.—The Secretary may give a higher priority to proposals 

from partners that—

‘‘(A) include high percentages of agricultural land and 

producers in a region or other appropriate area; 

‘‘(B) result in high levels of applied agricultural water 

quality and water conservation activities; 

‘‘(C) significantly enhance agricultural activity; 

‘‘(D) allow for monitoring and evaluation; and 

‘‘(E) assist producers in meeting a regulatory requirement that reduces the economic scope of the producer’s operation. 

‘‘(3) PRIORITY TO PROPOSALS FROM STATES WITH WATER

QUANTITY CONCERNS.—The Secretary shall give a higher priority to proposals from partners that—

‘‘(A) include the conversion of agricultural land from 

irrigated farming to dryland farming; 

‘‘(B) leverage Federal funds provided under the program with funds provided by partners; and 

‘‘(C) assist producers in States with water quantity concerns, as determined by the Secretary. 

‘‘(4) ADMINISTRATION.—In carrying out this subsection, the 

Secretary shall—

‘‘(A) accept qualified applications—


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‘‘(i) directly from partners applying on behalf of 

producers; or 

‘‘(ii) from producers applying through a partner as 

part of a regional agricultural water enhancement 

project; and 

‘‘(B) ensure that resources made available for regional 

agricultural water enhancement activities are delivered in 

accordance with applicable program rules. 

‘‘(f) AREAS EXPERIENCING EXCEPTIONAL DROUGHT.—Notwithstanding the purposes described in section 1240, the Secretary shall 

consider as an eligible agricultural water enhancement activity the 

use of a water impoundment to capture surface water runoff on agricultural land if the agricultural water enhancement activity—

‘‘(1) is located in an area that is experiencing or has experienced exceptional drought conditions during the previous two 

calendar years; and 

‘‘(2) will capture surface water runoff through the construction, improvement, or maintenance of irrigation ponds or small, 

on-farm reservoirs. 

‘‘(g) WAIVER AUTHORITY.—To assist in the implementation of 

agricultural water enhancement activities under the program, the 

Secretary shall waive the applicability of the limitation in section 

1001D(b)(2)(B) of this Act for participating producers if the Secretary determines that the waiver is necessary to fulfill the objectives 

of the program. 

‘‘(h) PAYMENTS UNDER PROGRAM.—

‘‘(1) IN GENERAL.—The Secretary shall provide appropriate 

payments to producers participating in agricultural water enhancement activities in an amount determined by the secretary 

to be necessary to achieve the purposes of the program described 

in subsection (b). 

‘‘(2) PAYMENTS TO PRODUCERS IN STATES WITH WATER

QUANTITY CONCERNS.—The Secretary shall provide payments 

for a period of five years to producers participating in agricultural water enhancement activities under proposals described in 

subsection (e)(3) in an amount sufficient to encourage producers 

to convert from irrigated farming to dryland farming. 

‘‘(i) CONSISTENCY WITH STATE LAW.—Any agricultural water 

enhancement activity conducted under the program shall be conducted in a manner consistent with State water law. 

‘‘(j) FUNDING.—

‘‘(1) AVAILABILITY OF FUNDS.—In addition to funds made 

available to carry out this chapter under section 1241(a), the 

Secretary shall carry out the program using, of the funds of the 

Commodity Credit Corporation—

‘‘(A) $73,000,000 for each of fiscal years 2009 and 

2010; 

‘‘(B) $74,000,000 for fiscal year 2011; and 

‘‘(C) $60,000,000 for fiscal year 2012 and each fiscal 

year thereafter. 

‘‘(2) LIMITATION ON ADMINISTRATIVE EXPENSES.—None of 

the funds made available for regional agricultural water conservation activities under the program may be used to pay for 

the administrative expenses of partners.’’. 


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Subtitle G—Other Conservation Programs of the Food 

Security Act of 1985 

SEC. 2601. CONSERVATION OF PRIVATE GRAZING LAND. 

Section 1240M(e) of the Food Security Act of 1985 (16 U.S.C. 

3839bb(e)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 2602. WILDLIFE HABITAT INCENTIVE PROGRAM. 

(a) ELIGIBILITY.—Section 1240N of the Food Security Act of 

1985 (16 U.S.C. 3839bb–1) is amended—

(1) in subsection (a), by inserting before the period at the 

end the following: ‘‘for the development of wildlife habitat on 

private agricultural land, nonindustrial private forest land, 

and tribal lands’’. (2) in subsection (b)(1), by striking ‘‘landowners’’ and inserting ‘‘owners of lands referred to in subsection (a)’’. 

(b) INCLUSION OF PIVOT CORNERS AND IRREGULAR AREAS.—Section 1240N(b)(1)(E) of the Food Security Act of 1985 (16 U.S.C. 

3839bb–1(b)(1)(E)) is amended by inserting before the period at the 

end the following: ‘‘, including habitat developed on pivot corners 

and irregular areas’’. 

(c) COST SHARE FOR LONG-TERM AGREEMENTS.—Section 

1240N(b)(2)(B) of the Food Security Act of 1985 (16 U.S.C. 3839bb–

1(b)(2)(B)) is amended by striking ‘‘15 percent’’ and inserting ‘‘25 

percent’’. 

(d) PRIORITY FOR CERTAIN CONSERVATION INITIATIVES; PAYMENT LIMITATION.—Section 1240N of the Food Security Act of 1985 

(16 U.S.C. 3839bb–1) is amended by adding at the end the following 

new subsections: 

‘‘(d) PRIORITY FOR CERTAIN CONSERVATION INITIATIVES.—In 

carrying out this section, the Secretary may give priority to projects 

that would address issues raised by State, regional, and national 

conservation initiatives. 

‘‘(e) PAYMENT LIMITATION.—Payments made to a person or legal 

entity, directly or indirectly, under the program may not exceed, in 

the aggregate, $50,000 per year.’’. 

SEC. 2603. GRASSROOTS SOURCE WATER PROTECTION PROGRAM. 

Section 1240O(b) of the Food Security Act of 1985 (16 U.S.C. 

3839bb–2(b)) is amended by striking ‘‘$5,000,000 for each of fiscal 

years 2002 through 2007’’ and inserting ‘‘$20,000,000 for each of fiscal years 2008 through 2012’’. 

SEC. 2604. GREAT LAKES BASIN PROGRAM FOR SOIL EROSION AND 

SEDIMENT CONTROL. 

Section 1240P of the Food Security Act of 1985 (16 U.S.C. 

3839bb–3) is amended to read as follows: 

‘‘SEC. 1240P. GREAT LAKES BASIN PROGRAM FOR SOIL EROSION AND 

SEDIMENT CONTROL. 

‘‘(a) PROGRAM AUTHORIZED.—The Secretary may carry out the 

Great Lakes basin program for soil erosion and sediment control 

(referred to in this section as the ‘program’), including providing assistance to implement the recommendations of the Great Lakes Regional Collaboration Strategy to Restore and Protect the Great 

Lakes. 

‘‘(b) CONSULTATION AND COOPERATION.—The Secretary shall 

carry out the program in consultation with the Great Lakes ComVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00152 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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mission created by Article IV of the Great Lakes Basin Compact (82 

Stat. 415) and in cooperation with the Administrator of the Environmental Protection Agency and the Secretary of the Army. 

‘‘(c) ASSISTANCE.—In carrying out the program, the Secretary 

may—

‘‘(1) provide project demonstration grants, provide technical 

assistance, and carry out information and educational programs to improve water quality in the Great Lakes basin by reducing soil erosion and improving sediment control; and 

‘‘(2) establish a priority for projects and activities that—

‘‘(A) directly reduce soil erosion or improve sediment 

control; 

‘‘(B) reduce soil loss in degraded rural watersheds; or 

‘‘(C) improve water quality for downstream watersheds. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to the Secretary to carry out the program 

$5,000,000 for each of fiscal years 2008 through 2012.’’. 

SEC. 2605. CHESAPEAKE BAY WATERSHED PROGRAM. 

Chapter 5 of subtitle D of title XII of the Food Security Act of 

1985 is amended by inserting after section 1240P (16 U.S.C. 

3839bb–3) the following new section: 

‘‘SEC. 1240Q. CHESAPEAKE BAY WATERSHED. 

‘‘(a) CHESAPEAKE BAY WATERSHED DEFINED.—In this section, 

the term ‘Chesapeake Bay watershed’ means all tributaries, backwaters, and side channels, including their watersheds, draining 

into the Chesapeake Bay. 

‘‘(b) ESTABLISHMENT AND PURPOSE.—The Secretary shall assist 

producers in implementing conservation activities on agricultural 

lands in the Chesapeake Bay watershed for the purposes of—

‘‘(1) improving water quality and quantity in the Chesapeake Bay watershed; and 

‘‘(2) restoring, enhancing, and preserving soil, air, and related resources in the Chesapeake Bay watershed. 

‘‘(c) CONSERVATION ACTIVITIES.—The Secretary shall deliver the 

funds made available to carry out this section through applicable 

programs under this subtitle to assist producers in enhancing land 

and water resources—

‘‘(1) by controlling erosion and reducing sediment and nutrient levels in ground and surface water; and 

‘‘(2) by planning, designing, implementing, and evaluating 

habitat conservation, restoration, and enhancement measures 

where there is significant ecological value if the lands are—

‘‘(A) retained in their current use; or 

‘‘(B) restored to their natural condition. 

‘‘(d) AGREEMENTS.—

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

‘‘(A) enter into agreements with producers to carry out 

the purposes of this section; and 

‘‘(B) use the funds made available to carry out this section to cover the costs of the program involved with each 

agreement. 

‘‘(2) SPECIAL CONSIDERATIONS.—In entering into agreements under this subsection, the Secretary shall give special 


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consideration to, and begin evaluating, applications with producers in the following river basins: ‘‘(A) The Susquehanna River. 

‘‘(B) The Shenandoah River. 

‘‘(C) The Potomac River (including North and South 

Potomac). ‘‘(D) The Patuxent River. ‘‘(e) DUTIES OF THE SECRETARY.—In carrying out the purposes 

in this section, the Secretary shall— ‘‘(1) where available, use existing plans, models, and assessments to assist producers in implementing conservation activities; and ‘‘(2) proceed expeditiously with the implementation of any 

agreement with a producer that is consistent with State strategies for the restoration of the Chesapeake Bay watershed. 

‘‘(f) CONSULTATION.—The Secretary, in consultation with appropriate Federal agencies, shall ensure conservation activities carried 

out under this section complement Federal and State programs, including programs that address water quality, in the Chesapeake 

Bay watershed. ‘‘(g) SENSE OF CONGRESS REGARDING CHESAPEAKE BAY EXECU- TIVE COUNCIL.—It is the sense of Congress that the Secretary should 

be a member of the Chesapeake Bay Executive Council, and is authorized to do so under section 1(3) of the Soil Conservation and Domestic Allotment Act (16 U.S.C. 590a(3)). ‘‘(h) FUNDING.— ‘‘(1) AVAILABILITY.—Of the funds of the Commodity Credit 

Corporation, the Secretary shall use, to the maximum extent 

practicable—‘‘(A) $23,000,000 for fiscal year 2009; 

‘‘(B) $43,000,000 for fiscal year 2010; 

‘‘(C) $72,000,000 for fiscal year 2011; and 

‘‘(D) $50,000,000 for fiscal year 2012. ‘‘(2) DURATION OF AVAILABILITY.—Funds made available 

under paragraph (1) shall remain available until expended.’’

SEC. 2606. VOLUNTARY PUBLIC ACCESS AND HABITAT INCENTIVE PROGRAM. 

Chapter 5 of subtitle D of title XII of the Food Security Act of 

1985 (16 U.S.C. 3839bb et seq.) is amended by inserting after section 1240Q, as added by section 2605, the following new section: 

‘‘SEC. 1240R. VOLUNTARY PUBLIC ACCESS AND HABITAT INCENTIVE 

PROGRAM. 

‘‘(a) ESTABLISHMENT.—The Secretary shall establish a voluntary public access program under which States and tribal governments may apply for grants to encourage owners and operators of 

privately-held farm, ranch, and forest land to voluntarily make that 

land available for access by the public for wildlife-dependent recreation, including hunting or fishing under programs administered by 

the States and tribal governments. 

‘‘(b) APPLICATIONS.—In submitting applications for a grant 

under the program, a State or tribal government shall describe—

‘‘(1) the benefits that the State or tribal government intends 

to achieve by encouraging public access to private farm and 

ranch land for—

‘‘(A) hunting and fishing; and 


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‘‘(B) to the maximum extent practicable, other recreational purposes; and 

‘‘(2) the methods that will be used to achieve those benefits. 

‘‘(c) PRIORITY.—In approving applications and awarding grants 

under the program, the Secretary shall give priority to States and 

tribal governments that propose—

‘‘(1) to maximize participation by offering a program the 

terms of which are likely to meet with widespread acceptance 

among landowners; 

‘‘(2) to ensure that land enrolled under the State or tribal 

government program has appropriate wildlife habitat; 

‘‘(3) to strengthen wildlife habitat improvement efforts on 

land enrolled in a special conservation reserve enhancement 

program described in section 1234(f)(4) by providing incentives 

to increase public hunting and other recreational access on that 

land; 

‘‘(4) to use additional Federal, State, tribal government, or 

private resources in carrying out the program; and 

‘‘(5) to make available to the public the location of land enrolled. 

‘‘(d) RELATIONSHIP TO OTHER LAWS.—

‘‘(1) NO PREEMPTION.—Nothing in this section preempts a 

State or tribal government law, including any State or tribal 

government liability law. 

‘‘(2) EFFECT OF INCONSISTENT OPENING DATES FOR MIGRATORY BIRD HUNTING.—The Secretary shall reduce by 25 percent 

the amount of a grant otherwise determined for a State under 

the program if the opening dates for migratory bird hunting in 

the State are not consistent for residents and non-residents. 

‘‘(e) REGULATIONS.—The Secretary shall promulgate such regulations as are necessary to carry out this section. 

‘‘(f) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary shall use, to the maximum extent practicable, 

$50,000,000 for the period of fiscal years 2009 through 2012.’’. 

Subtitle H—Funding and Administration of Conservation 

Programs 

SEC. 2701. FUNDING OF CONSERVATION PROGRAMS UNDER FOOD SECURITY ACT OF 1985. 

(a) IN GENERAL.—Section 1241(a) of the Food Security Act of 

1985 (16 U.S.C. 3841(a)) is amended in the matter preceding paragraph (1), by striking ‘‘2007’’ and inserting ‘‘2012’’. 

(b) CONSERVATION RESERVE PROGRAM.—Paragraph (1) of section 1241(a) of the Food Security Act of 1985 (16 U.S.C. 3841(a)) 

is amended by striking the period at the end and inserting the following: ‘‘, including to the maximum extent practicable—

‘‘(A) $100,000,000 for the period of fiscal years 2009 

through 2012 to provide cost share payments under paragraph (3) of section 1234(b) in connection with thinning activities conducted on land described in subparagraph 

(A)(iii) of such paragraph; and 

‘‘(B) $25,000,000 for the period of fiscal years 2009 

through 2012 to carry out section 1235(f) to facilitate the 

transfer of land subject to contracts from retired or retiring 


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owners and operators to beginning farmers or ranchers and 

socially disadvantaged farmers or ranchers.’’. (c) CONSERVATION SECURITY AND CONSERVATION STEWARDSHIP

PROGRAMS.—Paragraph (3) of section 1241(a) of the Food Security 

Act of 1985 (16 U.S.C. 3841(a)) is amended to read as follows: ‘‘(3)(A) CONSERVATION SECURITY PROGRAM.—The conservation security program under subchapter A of chapter 2, using 

such sums as are necessary to administer contracts entered into 

before September 30, 2008. ‘‘(B) CONSERVATION STEWARDSHIP PROGRAM.—The conservation stewardship program under subchapter B of chapter 

2.’’. (d) FARMLAND PROTECTION PROGRAM.—Paragraph (4) of section 1241(a) of the Food Security Act of 1985 (16 U.S.C. 3841(a)) 

is amended to read as follows: ‘‘(4) The farmland protection program under subchapter C 

of chapter 2, using, to the maximum extent practicable— ‘‘(A) $97,000,000 in fiscal year 2008; 

‘‘(B) $121,000,000 in fiscal year 2009; 

‘‘(C) $150,000,000 in fiscal year 2010; 

‘‘(D) $175,000,000 in fiscal year 2011; and 

‘‘(E) $200,000,000 in fiscal year 2012.’’. 

(e) GRASSLAND RESERVE PROGRAM.—Paragraph (5) of section 

1241(a) of the Food Security Act of 1985 (16 U.S.C. 3841(a)) is 

amended to read as follows: 

‘‘(5) The grassland reserve program under subchapter D of 

chapter 2.’’. 

(f) ENVIRONMENTAL QUALITY INCENTIVES PROGRAM.—Paragraph (6) of section 1241(a) of the Food Security Act of 1985 (16 

U.S.C. 3841(a)) is amended to read as follows: 

‘‘(6) The environmental quality incentives program under 

chapter 4, using, to the maximum extent practicable—

‘‘(A) $1,200,000,000 in fiscal year 2008; 

‘‘(B) $1,337,000,000 in fiscal year 2009; 

‘‘(C) $1,450,000,000 in fiscal year 2010; 

‘‘(D) $1,588,000,000 in fiscal year 2011; and 

‘‘(E) $1,750,000,000 in fiscal year 2012.’’. (g) WILDLIFE HABITAT INCENTIVES PROGRAM.—Paragraph 

(7)(D) of section 1241(a) of the Food Security Act of 1985 (16 U.S.C. 

3841(a)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 2702. AUTHORITY TO ACCEPT CONTRIBUTIONS TO SUPPORT CONSERVATION PROGRAMS. 

Section 1241 of the Food Security Act of 1985 (16 U.S.C. 3841) 

is amended by adding at the end the following new subsection: 

‘‘(e) ACCEPTANCE AND USE OF CONTRIBUTIONS.—

‘‘(1) AUTHORITY TO ESTABLISH CONTRIBUTION ACCOUNTS.—

Subject to paragraph (2), the Secretary may establish a sub-account for each conservation program administered by the Secretary under subtitle D to accept contributions of non-Federal 

funds to support the purposes of the program. 

‘‘(2) DEPOSIT AND USE OF CONTRIBUTIONS.—Contributions 

of non-Federal funds received for a conservation program administered by the Secretary under subtitle D shall be deposited 

into the sub-account established under this subsection for the 

program and shall be available to the Secretary, without furVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00156 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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ther appropriation and until expended, to carry out the program.’’. 

SEC. 2703. REGIONAL EQUITY AND FLEXIBILITY. 

(a) REGIONAL EQUITY AND FLEXIBILITY.—Section 1241(d) of the 

Food Security Act of 1985 (16 U.S.C. 3841(d)) is amended—

(1) by striking ‘‘Before April 1’’ and inserting the following: 

‘‘(1) PRIORITY FUNDING TO PROMOTE EQUITY.—Before April 

1’’; 

(2) by striking ‘‘$12,000,000’’ and inserting ‘‘$15,000,000’’; 

and 

(3) by adding at the end the following new paragraph: 

‘‘(2) SPECIFIC FUNDING ALLOCATIONS.—In determining the 

specific funding allocations for States under paragraph (1), the 

Secretary shall consider the respective demand in each State for 

each program covered by such paragraph.’’. 

(b) ALLOCATIONS REVIEW AND UPDATE.—Section 1241 of the 

Food Security Act of 1985 (16 U.S.C. 3841) is amended by inserting 

after subsection (e), as added by section 2702, the following new 

subsection: 

‘‘(f) ALLOCATIONS REVIEW AND UPDATE.—

‘‘(1) REVIEW.—Not later than January 1, 2012, the Secretary shall conduct a review of conservation programs and authorities under this title that utilize allocation formulas to determine the sufficiency of the formulas in accounting for Statelevel economic factors, level of agricultural infrastructure, or related factors that affect conservation program costs. 

‘‘(2) UPDATE.—The Secretary shall improve conservation 

program allocation formulas as necessary to ensure that the formulas adequately reflect the costs of carrying out the conservation programs.’’. 

SEC. 2704. ASSISTANCE TO CERTAIN FARMERS AND RANCHERS TO IMPROVE THEIR ACCESS TO CONSERVATION PROGRAMS. 

Section 1241 of the Food Security Act of 1985 (16 U.S.C. 3841) 

is amended by inserting after subsection (f), as added by section 

2703(b), the following new subsection: 

‘‘(g) ASSISTANCE TO CERTAIN FARMERS OR RANCHERS FOR CONSERVATION ACCESS.—

‘‘(1) ASSISTANCE.—Of the funds made available for each of 

fiscal years 2009 through 2012 to carry out the environmental 

quality incentives program and the acres made available for 

each of such fiscal years to carry out the conservation stewardship program, the Secretary shall use, to the maximum extent 

practicable—

‘‘(A) 5 percent to assist beginning farmers or ranchers; 

and 

‘‘(B) 5 percent to assist socially disadvantaged farmers 

or ranchers. 

‘‘(2) REPOOLING OF FUNDS.—In any fiscal year, amounts not 

obligated under paragraph (1) by a date determined by the Secretary shall be available for payments and technical assistance 

to all persons eligible for payments or technical assistance in 

that fiscal year under the environmental quality incentives program. 


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‘‘(3) REPOOLING OF ACRES.—In any fiscal year, acres not obligated under paragraph (1) by a date determined by the Secretary shall be available for use in that fiscal year under the 

conservation stewardship program.’’. 

SEC. 2705. REPORT REGARDING ENROLLMENTS AND ASSISTANCE 

UNDER CONSERVATION PROGRAMS. 

Section 1241 of the Food Security Act of 1985 (16 U.S.C. 3841) 

is amended by inserting after subsection (g), as added by section 

2704, the following new subsection: 

‘‘(h) REPORT ON PROGRAM ENROLLMENTS AND ASSISTANCE.—

Beginning in calendar year 2009, and each year thereafter, the Secretary shall submit to the Committee on Agriculture of the House of 

Representatives and the Committee on Agriculture, Nutrition, and 

Forestry of the Senate a semiannual report containing statistics by 

State related to enrollments in conservation programs under this 

subtitle, as follows: 

‘‘(1) Payments made under the wetlands reserve program 

for easements valued at $250,000 or greater. 

‘‘(2) Payments made under the farmland protection program for easements in which the Federal share is $250,000 or 

greater. 

‘‘(3) Payments made under the grassland reserve program 

valued at $250,000 or greater. 

‘‘(4) Payments made under the environmental quality incentives program for land determined to have special environmental significance pursuant to section 1240G(b). 

‘‘(5) Payments made under the agricultural water enhancement program subject to the waiver of adjusted gross income 

limitations pursuant to section 1240I(g). 

‘‘(6) Waivers granted by the Secretary under section 

1001D(b)(2) of this Act in order to protect environmentally sensitive land of special significance.’’. 

SEC. 2706. DELIVERY OF CONSERVATION TECHNICAL ASSISTANCE. 

Section 1242 of the Food Security Act of 1985 (16 U.S.C. 3842) 

is amended to read as follows: 

‘‘SEC. 1242. DELIVERY OF TECHNICAL ASSISTANCE. 

‘‘(a) DEFINITION OF ELIGIBLE PARTICIPANT.—In this section, the 

term ‘eligible participant’ means a producer, landowner, or entity 

that is participating in, or seeking to participate in, programs for 

which the producer, landowner, or entity is otherwise eligible to participate in under this title or the agricultural management assistance program under section 524 of the Federal Crop Insurance Act 

(7 U.S.C. 1524). 

‘‘(b) PURPOSE OF TECHNICAL ASSISTANCE.—The purpose of technical assistance authorized by this section is to provide eligible participants with consistent, science-based, site-specific practices designed to achieve conservation objectives on land active in agricultural, forestry, or related uses. 

‘‘(c) PROVISION OF TECHNICAL ASSISTANCE.—The Secretary 

shall provide technical assistance under this title to an eligible participant—

‘‘(1) directly; 

‘‘(2) through an agreement with a third-party provider; or 


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‘‘(3) at the option of the eligible participant, through a payment, as determined by the Secretary, to the eligible participant 

for an approved third-party provider, if available. 

‘‘(d) NON-FEDERAL ASSISTANCE.—The Secretary may request the 

services of, and enter into cooperative agreements or contracts with, 

other agencies within the Department or non-Federal entities to assist the Secretary in providing technical assistance necessary to assist in implementing conservation programs under this title. 

‘‘(e) CERTIFICATION OF THIRD-PARTY PROVIDERS.—

‘‘(1) PURPOSE.—The purpose of the third-party provider 

program is to increase the availability and range of technical 

expertise available to eligible participants to plan and implement conservation measures. 

‘‘(2) REGULATIONS.—Not later than 180 days after the date 

of the enactment of the Food, Conservation, and Energy Act of 

2008, the Secretary shall promulgate such regulations as are 

necessary to carry out this section. 

‘‘(3) EXPERTISE.—In promulgating such regulations, the 

Secretary, to the maximum extent practicable, shall—

‘‘(A) ensure that persons with expertise in the technical 

aspects of conservation planning, watershed planning, and 

environmental engineering, including commercial entities, 

nonprofit entities, State or local governments or agencies, 

and other Federal agencies, are eligible to become approved 

providers of the technical assistance; 

‘‘(B) provide national criteria for the certification of 

third-party providers; and 

‘‘(C) approve any unique certification standards established at the State level. 

‘‘(f) ADMINISTRATION.—

‘‘(1) FUNDING.—Effective for fiscal year 2008 and each subsequent fiscal year, funds of the Commodity Credit Corporation 

made available to carry out technical assistance for each of the 

programs specified in section 1241 shall be available for the 

provision of technical assistance from third-party providers 

under this section. 

‘‘(2) TERM OF AGREEMENT.—An agreement with a thirdparty provider under this section shall have a term that—

‘‘(A) at a minimum, is equal to the period beginning on 

the date on which the agreement is entered into and ending 

on the date that is 1 year after the date on which all activities performed pursuant to the agreement have been completed; 

‘‘(B) does not exceed 3 years; and 

‘‘(C) can be renewed, as determined by the Secretary. 

‘‘(3) REVIEW OF CERTIFICATION REQUIREMENTS.—Not later 

than 1 year after the date of enactment of the Food, Conservation, and Energy Act of 2008, the Secretary shall—

‘‘(A) review certification requirements for third-party 

providers; and 

‘‘(B) make any adjustments considered necessary by the 

Secretary to improve participation. 

‘‘(4) ELIGIBLE ACTIVITIES.—


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‘‘(A) INCLUSION OF ACTIVITIES.—The Secretary may include as activities eligible for payments to a third party 

provider—

‘‘(i) technical services provided directly to eligible 

participants, such as conservation planning, education 

and outreach, and assistance with design and implementation of conservation practices; and ‘‘(ii) related technical assistance services that accelerate conservation program delivery. 

‘‘(B) EXCLUSIONS.—The Secretary shall not designate 

as an activity eligible for payments to a third party provider any service that is provided by a business, or equivalent, in connection with conducting business and that is 

customarily provided at no cost. 

‘‘(5) PAYMENT AMOUNTS.—The Secretary shall establish fair 

and reasonable amounts of payments for technical services provided by third-party providers. 

‘‘(g) AVAILABILITY OF TECHNICAL SERVICES.— ‘‘(1) IN GENERAL.—In carrying out the programs under this 

title and the agricultural management assistance program 

under section 524 of the Federal Crop Insurance Act (7 U.S.C. 

1524), the Secretary shall make technical services available to 

all eligible participants who are installing an eligible practice. 

‘‘(2) TECHNICAL SERVICE CONTRACTS.—In any case in which 

financial assistance is not provided under a program referred 

to in paragraph (1), the Secretary may enter into a technical 

service contract with the eligible participant for the purposes of 

assisting in the planning, design, or installation of an eligible 

practice. 

‘‘(h) REVIEW OF CONSERVATION PRACTICE STANDARDS.—

‘‘(1) REVIEW REQUIRED.—The Secretary shall— ‘‘(A) review conservation practice standards, including 

engineering design specifications, in effect on the date of the 

enactment of the Food, Conservation, and Energy Act of 

2008; 

‘‘(B) ensure, to the maximum extent practicable, the 

completeness and relevance of the standards to local agricultural, forestry, and natural resource needs, including 

specialty crops, native and managed pollinators, bioenergy 

crop production, forestry, and such other needs as are determined by the Secretary; and 

‘‘(C) ensure that the standards provide for the optimal 

balance between meeting site-specific conservation needs 

and minimizing risks of design failure and associated costs 

of construction and installation. 

‘‘(2) CONSULTATION.—In conducting the review under paragraph (1), the Secretary shall consult with eligible participants, 

crop consultants, cooperative extension and land grant universities, nongovernmental organizations, and other qualified entities. ‘‘(3) EXPEDITED REVISION OF STANDARDS.—If the Secretary 

determines under paragraph (1) that revisions to the conservation practice standards, including engineering design specifications, are necessary, the Secretary shall establish an administrative process for expediting the revisions. 


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‘‘(i) ADDRESSING CONCERNS OF SPECIALITY CROP, ORGANIC, AND

PRECISION AGRICULTURE PRODUCERS.—

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

‘‘(A) to the maximum extent practicable, fully incorporate specialty crop production, organic crop production, 

and precision agriculture into the conservation practice 

standards; and 

‘‘(B) provide for the appropriate range of conservation 

practices and resource mitigation measures available to 

producers involved with organic or specialty crop production or precision agriculture. 

‘‘(2) AVAILABILITY OF ADEQUATE TECHNICAL ASSISTANCE.—

‘‘(A) IN GENERAL.—The Secretary shall ensure that adequate technical assistance is available for the implementation of conservation practices by producers involved with 

organic, specialty crop production, or precision agriculture 

through Federal conservation programs. 

‘‘(B) REQUIREMENTS.—In carrying out subparagraph 

(A), the Secretary shall develop—

‘‘(i) programs that meet specific needs of producers 

involved with organic, specialty crop production or precision agriculture through cooperative agreements with 

other agencies and nongovernmental organizations; 

and 

‘‘(ii) program specifications that allow for innovative approaches to engage local resources in providing 

technical assistance for planning and implementation 

of conservation practices.’’. 

SEC. 2707. COOPERATIVE CONSERVATION PARTNERSHIP INITIATIVE. 

(a) TRANSFER OF EXISTING PROVISIONS.—Subsections (a), (c), 

and (d) of section 1243 of the Food Security Act of 1985 (16 U.S.C. 

3843) are—

(1) redesignated as subsections (c), (d), and (e), respectively; 

and 

(2) transferred to appear at the end of section 1244 of such 

Act (16 U.S.C. 3844). 

(b) ESTABLISHMENT OF PARTNERSHIP INITIATIVE.—Section 1243 

of the Food Security Act of 1985 (16 U.S.C. 3843), as amended by 

subsection (a), is amended to read as follows: 

‘‘SEC. 1243. COOPERATIVE CONSERVATION PARTNERSHIP INITIATIVE. 

‘‘(a) ESTABLISHMENT OF INITIATIVE.—The Secretary shall establish a cooperative conservation partnership initiative (in this section 

referred to as the ‘Initiative’) to work with eligible partners to provide assistance to producers enrolled in a program described in subsection (c)(1) that will enhance conservation outcomes on agricultural and nonindustrial private forest land. 

‘‘(b) PURPOSES.—The purposes of a partnership entered into 

under the Initiative shall be—

‘‘(1) to address conservation priorities involving agriculture 

and nonindustrial private forest land on a local, State, multiState, or regional level; 

‘‘(2) to encourage producers to cooperate in meeting applicable Federal, State, and local regulatory requirements related to 


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production involving agriculture and nonindustrial private forest land; ‘‘(3) to encourage producers to cooperate in the installation 

and maintenance of conservation practices that affect multiple 

agricultural or nonindustrial private forest operations; or ‘‘(4) to promote the development and demonstration of innovative conservation practices and delivery methods, including 

those for specialty crop and organic production and precision 

agriculture producers. 

‘‘(c) INITIATIVE PROGRAMS.— ‘‘(1) COVERED PROGRAMS.—Except as provided in paragraph (2), the Initiative applies to all conservation programs 

under subtitle D. ‘‘(2) EXCLUDED PROGRAMS.—The Initiative shall not include 

the following programs: 

‘‘(A) Conservation reserve program. 

‘‘(B) Wetlands reserve program. 

‘‘(C) Farmland protection program. 

‘‘(D) Grassland reserve program. 

‘‘(d) ELIGIBLE PARTNERS.—The Secretary may enter into a partnership under the Initiative with one or more of the following: 

‘‘(1) States and local governments. 

‘‘(2) Indian tribes. 

‘‘(3) Producer associations. 

‘‘(4) Farmer cooperatives. 

‘‘(5) Institutions of higher education. 

‘‘(6) Nongovernmental organizations with a history of working cooperatively with producers to effectively address conservation priorities related to agricultural production and nonindustrial private forest land. 

‘‘(e) IMPLEMENTATION AGREEMENTS.—The Secretary shall carry 

out the Initiative— ‘‘(1) by selecting, through a competitive process, eligible 

partners from among applications submitted under subsection 

(f); and 

‘‘(2) by entering into multi-year agreements with eligible 

partners so selected for a period not to exceed 5 years. 

‘‘(f) APPLICATIONS.— ‘‘(1) REQUIRED INFORMATION.—An application to enter into 

a partnership agreement under the Initiative shall include the 

following: ‘‘(A) A description of the area covered by the agreement, 

conservation priorities in the area, conservation objectives 

to be achieved, and the expected level of participation by 

agricultural producers and nonindustrial private forest 

landowners. ‘‘(B) A description of the partner, or partners, collaborating to achieve the objectives of the agreement, and the 

roles, responsibilities, and capabilities of the partner. ‘‘(C) A description of the resources that are requested 

from the Secretary, and the non-Federal resources that will 

be leveraged by the Federal contribution. 

‘‘(D) A description of the plan for monitoring, evaluating, and reporting on progress made towards achieving 

the objectives of the agreement. 


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‘‘(E) Such other information that may be required by 

the Secretary. 

‘‘(2) PRIORITIES.—The Secretary shall give priority to applications for agreements that— ‘‘(A) have a high percentage of producers involved and 

working agricultural or nonindustrial private forest land 

included in the area covered by the agreement; ‘‘(B) significantly leverage non-Federal financial and 

technical resources and coordinate with other local, State, 

or Federal efforts; ‘‘(C) deliver high percentages of applied conservation to 

address water quality, water conservation, or State, regional, or national conservation initiatives; ‘‘(D) provide innovation in conservation methods and 

delivery, including outcome-based performance measures 

and methods; or ‘‘(E) meet other factors, as determined by the Secretary. ‘‘(g) RELATIONSHIP TO COVERED PROGRAMS.— ‘‘(1) COMPLIANCE WITH PROGRAM RULES.—Except as provided in paragraph (2), the Secretary shall ensure that resources made available under the Initiative are delivered in accordance with the applicable rules of programs specified in subsection (c)(1) through normal program mechanisms relating to 

program functions, including rules governing appeals, payment 

limitations, and conservation compliance. 

‘‘(2) ADJUSTMENT.—The Secretary may adjust the elements 

of any program specified in subsection (c)(1)— ‘‘(A) to better reflect unique local circumstances and 

purposes if the Secretary determines such adjustments are 

necessary to achieve the purposes of the Initiative; and ‘‘(B) to provide preferential enrollment to producers 

who are eligible for the applicable program and to participate in the Initiative. ‘‘(h) TECHNICAL AND FINANCIAL ASSISTANCE.—The Secretary 

shall provide appropriate technical and financial assistance to producers participating in the Initiative in an amount determined to be 

necessary to achieve the purposes of the Initiative. 

‘‘(i) FUNDING.— ‘‘(1) RESERVATION.—Of the funds and acres made available 

for each of fiscal years 2009 through 2012 to implement the programs described in subsection (c)(1), the Secretary shall reserve 

6 percent of the funds and acres to ensure an adequate source 

of funds and acres for the Initiative. ‘‘(2) ALLOCATION REQUIREMENTS.—Of the funds and acres 

reserved for the Initiative for a fiscal year, the Secretary shall 

allocate—

‘‘(A) 90 percent of the funds and acres to projects based 

on the direction of State conservationists, with the advice of 

State technical committees; and ‘‘(B) 10 percent of the funds and acres to projects based 

on a national competitive process established by the Secretary. 

‘‘(3) UNUSED FUNDING.—Any funds and acres reserved for 

a fiscal year under paragraph (1) that are not obligated by 

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ties under the program that is the source of the funds or acres 

during the remainder of that fiscal year. ‘‘(4) ADMINISTRATIVE COSTS OF PARTNERS.—Overhead or 

administrative costs of partners may not be covered by funds 

provided through the Initiative.’’. 

SEC. 2708. ADMINISTRATIVE REQUIREMENTS FOR CONSERVATION 

PROGRAMS. 

Section 1244 of the Food Security Act of 1985 (16 U.S.C. 3844), 

as amended by section 2707, is further amended— (1) by striking subsection (a) and inserting the following 

new subsection: 

‘‘(a) INCENTIVES FOR CERTAIN FARMERS AND RANCHERS AND IN- DIAN TRIBES.— ‘‘(1) INCENTIVES AUTHORIZED.—In carrying out any conservation program administered by the Secretary, the Secretary 

may provide to a person or entity specified in paragraph (2) incentives to participate in the conservation program— ‘‘(A) to foster new farming and ranching opportunities; 

and ‘‘(B) to enhance long-term environmental goals. ‘‘(2) COVERED PERSONS.—Incentives authorized by paragraph (1) may be provided to the following: ‘‘(A) Beginning farmers or ranchers. 

‘‘(B) Socially disadvantaged farmers or ranchers. 

‘‘(C) Limited resource farmers or ranchers. 

‘‘(D) Indian tribes.’’; and 

(2) by adding at the end the following new subsections: ‘‘(f) ACREAGE LIMITATIONS.— ‘‘(1) LIMITATIONS.—

‘‘(A) ENROLLMENTS.—The Secretary shall not enroll 

more than 25 percent of the cropland in any county in the 

programs administered under subchapters B and C of 

chapter 1 of subtitle D. ‘‘(B) EASEMENTS.—Not more than 10 percent of the 

cropland in a country may be subject to an easement acquired under subchapter C of chapter 1 of subtitle D. 

‘‘(2) EXCEPTIONS.—The Secretary may exceed the limitation 

in paragraph (1)(A), if the Secretary determines that— ‘‘(A) the action would not adversely affect the local 

economy of a county; and ‘‘(B) operators in the county are having difficulties complying with conservation plans implemented under section 

1212. 

‘‘(3) WAIVER TO EXCLUDE CERTAIN ACREAGE.—The Secretary 

may grant a waiver to exclude acreage enrolled under subsection (c)(2)(B) or (f)(4) of section 1234 from the limitations in 

paragraph (1)(A) with the concurrence of the county government 

of the county involved. 

‘‘(4) SHELTERBELTS AND WINDBREAKS.—The limitations established under paragraph (1) shall not apply to cropland that 

is subject to an easement under subchapter C of chapter 1 that 

is used for the establishment of shelterbelts and windbreaks. 

‘‘(g) COMPLIANCE AND PERFORMANCE.—For each conservation 

program under subtitle D, the Secretary shall develop procedures—

‘‘(1) to monitor compliance with program requirements; 


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‘‘(2) to measure program performance; 

‘‘(3) to demonstrate whether the long-term conservation benefits of the program are being achieved; 

‘‘(4) to track participation by crop and livestock types; and 

‘‘(5) to coordinate activities described in this subsection 

with the national conservation program authorized under section 5 of the Soil and Water Resources Conservation Act of 1977 

(16 U.S.C. 2004). 

‘‘(h) ENCOURAGEMENT OF POLLINATOR HABITAT DEVELOPMENT

AND PROTECTION.—In carrying out any conservation program administered by the Secretary, the Secretary may, as appropriate, encourage—

‘‘(1) the development of habitat for native and managed pollinators; and 

‘‘(2) the use of conservation practices that benefit native and 

managed pollinators. 

‘‘(i) STREAMLINED APPLICATION PROCESS.—

‘‘(1) IN GENERAL.—In carrying out each conservation program under this title, the Secretary shall ensure that the application process used by producers and landowners is streamlined to minimize complexity and eliminate redundancy. 

‘‘(2) REVIEW AND STREAMLINING.—

‘‘(A) REVIEW.—The Secretary shall carry out a review 

of the application forms and processes for each conservation 

program covered by this subsection. 

‘‘(B) STREAMLINING.—On completion of the review the 

Secretary shall revise application forms and processes, as 

necessary, to ensure that—

‘‘(i) all required application information is essential for the efficient, effective, and accountable implementation of conservation programs; 

‘‘(ii) conservation program applicants are not required to provide information that is readily available 

to the Secretary through existing information systems 

of the Department of Agriculture; 

‘‘(iii) information provided by the applicant is 

managed and delivered efficiently for use in all stages 

of the application process, or for multiple applications; 

and 

‘‘(iv) information technology is used effectively to 

minimize data and information input requirements. 

‘‘(3) IMPLEMENTATION AND NOTIFICATION.—Not later than 1 

year after the date of enactment of the Food, Conservation, and 

Energy Act of 2008, the Secretary shall submit to Congress a 

written notification of completion of the requirements of this 

subsection.’’. 

SEC. 2709. ENVIRONMENTAL SERVICES MARKETS. 

Subtitle E of title XII of the Food Security Act of 1985 is 

amended by inserting after section 1244 (16 U.S.C. 3844) the following new section: 

‘‘SEC. 1245. ENVIRONMENTAL SERVICES MARKETS. 

‘‘(a) TECHNICAL GUIDELINES REQUIRED.—The Secretary shall 

establish technical guidelines that outline science-based methods to 

measure the environmental services benefits from conservation and 


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land management activities in order to facilitate the participation 

of farmers, ranchers, and forest landowners in emerging environmental services markets. The Secretary shall give priority to the establishment of guidelines related to farmer, rancher, and forest 

landowner participation in carbon markets. ‘‘(b) ESTABLISHMENT.—The Secretary shall establish guidelines 

under subsection (a) for use in developing the following: ‘‘(1) A procedure to measure environmental services benefits. ‘‘(2) A protocol to report environmental services benefits. 

‘‘(3) A registry to collect, record and maintain the benefits 

measured. 

‘‘(c) VERIFICATION REQUIREMENTS.— ‘‘(1) VERIFICATION OF REPORTS.—The Secretary shall establish guidelines for a process to verify that a farmer, rancher, or 

forest landowner who reports an environmental services benefit 

pursuant to the protocol required by paragraph (2) of subsection 

(b) for inclusion in the registry required by paragraph (3) of 

such subsection has implemented the conservation or land management activity covered by the report. ‘‘(2) ROLE OF THIRD PARTIES.—In establishing the 

verification guidelines required by paragraph (1), the Secretary 

shall consider the role of third-parties in conducting independent verification of benefits produced for environmental 

services markets and other functions, as determined by the Secretary. 

‘‘(d) USE OF EXISTING INFORMATION.—In carrying out subsection (b), the Secretary shall build on activities or information in 

existence on the date of the enactment of the Food, Conservation, 

and Energy Act of 2008 regarding environmental services markets. ‘‘(e) CONSULTATION.—In carrying out this section, the Secretary 

shall consult with the following: ‘‘(1) Federal and State government agencies. 

‘‘(2) Nongovernmental interests including— ‘‘(A) farm, ranch, and forestry producers; 

‘‘(B) financial institutions involved in environmental 

services trading; ‘‘(C) institutions of higher education with relevant expertise or experience; ‘‘(D) nongovernmental organizations with relevant expertise or experience; and 

‘‘(E) private sector representatives with relevant expertise or experience. 

‘‘(3) Other interested persons, as determined by the Secretary.’’. 

SEC. 2710. AGRICULTURE CONSERVATION EXPERIENCED SERVICES 

PROGRAM. 

Subtitle F of title XII of the Food Security Act of 1985 is 

amended by inserting after section 1251 (16 U.S.C. 2005a) the following new section: 

‘‘SEC. 1252. AGRICULTURE CONSERVATION EXPERIENCED SERVICES 

PROGRAM. 

‘‘(a) ESTABLISHMENT AND PURPOSE.—The Secretary shall establish a conservation experienced services program (in this section referred to as the ‘ACES Program’) for the purpose of utilizing the talVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00166 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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ents of individuals who are age 55 or older, but who are not employees of the Department of Agriculture or a State agriculture department, to provide technical services in support of the conservation-related programs and authorities carried out by the Secretary. Such 

technical services may include conservation planning assistance, 

technical consultation, and assistance with design and implementation of conservation practices. 

‘‘(b) PROGRAM AGREEMENTS.—

‘‘(1) RELATION TO OLDER AMERICAN COMMUNITY SERVICE

EMPLOYMENT PROGRAM.—Notwithstanding any other provision 

of law relating to Federal grants, cooperative agreements, or 

contracts, to carry out the ACES program during a fiscal year, 

the Secretary may enter into agreements with nonprofit private 

agencies and organizations eligible to receive grants for that fiscal year under the Community Service Senior Opportunities Act 

(42 U.S.C. 3056 et seq.) to secure participants for the ACES 

program who will provide technical services under the ACES 

program. 

‘‘(2) REQUIRED DETERMINATION.—Before entering into an 

agreement under paragraph (1), the Secretary shall ensure that 

the agreement would not—

‘‘(A) result in the displacement of individuals employed 

by the Department, including partial displacement through 

reduction of non-overtime hours, wages, or employment 

benefits; 

‘‘(B) result in the use of an individual under the ACES 

program for a job or function in a case in which a Federal 

employee is in a layoff status from the same or a substantially-equivalent job or function with the Department; or 

‘‘(C) affect existing contracts for services. 

‘‘(c) FUNDING SOURCE.—

‘‘(1) IN GENERAL.—Except as provided in paragraph (2), the 

Secretary may carry out the ACES program using funds made 

available to carry out each program under this title. 

‘‘(2) EXCLUSIONS.—Funds made available to carry out the 

following programs may not be used to carry out the ACES program: 

‘‘(A) The conservation reserve program. 

‘‘(B) The wetlands reserve program. 

‘‘(C) The grassland reserve program. 

‘‘(D) The conservation stewardship program. 

‘‘(d) LIABILITY.—An individual providing technical services 

under the ACES program is deemed to be an employee of the United 

States Government for purposes of chapter 171 of title 28, United 

States Code, if the individual—

‘‘(1) is providing technical services pursuant to an agreement entered into under subsection (b); and 

‘‘(2) is acting within the scope of the agreement.’’. 

SEC. 2711. ESTABLISHMENT OF STATE TECHNICAL COMMITTEES AND 

THEIR RESPONSIBILITIES. 

Subtitle G of title XII of the Farm Security Act of 1985 (16 

U.S.C. 3861, 3862) is amended to read as follows: 


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‘‘Subtitle G—State Technical Committees 

‘‘SEC. 1261. ESTABLISHMENT OF STATE TECHNICAL COMMITTEES. 

‘‘(a) ESTABLISHMENT.—The Secretary shall establish a technical 

committee in each State to assist the Secretary in the considerations 

relating to implementation and technical aspects of the conservation 

programs under this title. ‘‘(b) STANDARDS.—Not later than 180 days after the date of enactment of the Food, Conservation, and Energy Act of 2008, the Secretary shall develop— ‘‘(1) standard operating procedures to standardize the operations of State technical committees; and 

‘‘(2) standards to be used by State technical committees in 

the development of technical guidelines under section 1262(b) 

for the implementation of the conservation provisions of this 

title. 

‘‘(c) COMPOSITION.—Each State technical committee shall be 

composed of agricultural producers and other professionals that represent a variety of disciplines in the soil, water, wetland, and wildlife sciences. The technical committee for a State shall include representatives from among the following: 

‘‘(1) The Natural Resources Conservation Service. 

‘‘(2) The Farm Service Agency. 

‘‘(3) The Forest Service. 

‘‘(4) The National Institute of Food and Agriculture. 

‘‘(5) The State fish and wildlife agency. 

‘‘(6) The State forester or equivalent State official. 

‘‘(7) The State water resources agency. 

‘‘(8) The State department of agriculture. 

‘‘(9) The State association of soil and water conservation 

districts. 

‘‘(10) Agricultural producers representing the variety of 

crops and livestock or poultry raised within the State. 

‘‘(11) Owners of nonindustrial private forest land. 

‘‘(12) Nonprofit organizations within the meaning of section 

501(c)(3) of the Internal Revenue Code of 1986 with demonstrable conservation expertise and experience working with agriculture producers in the State. 

‘‘(13) Agribusiness. 

‘‘SEC. 1262. RESPONSIBILITIES. 

‘‘(a) IN GENERAL.—Each State technical committee established 

under section 1261 shall meet regularly to provide information, 

analysis, and recommendations to appropriate officials of the Department of Agriculture who are charged with implementing the 

conservation provisions of this title. 

‘‘(b) PUBLIC NOTICE AND ATTENDANCE.—Each State technical 

committee shall provide public notice of, and permit public attendance at, meetings considering issues of concern related to carrying 

out this title. 

‘‘(c) ROLE.—

‘‘(1) IN GENERAL.—The role of State technical committees is 

advisory in nature, and such committees shall have no implementation or enforcement authority. However, the Secretary 

shall give strong consideration to the recommendations of such 

committees in administering the programs under this title. 


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‘‘(2) ADVISORY ROLE IN ESTABLISHING PROGRAM PRIORITIES

AND CRITERIA.—Each State technical committee shall advise the 

Secretary in establishing priorities and criteria for the programs in this title, including the review of whether local working groups are addressing those priorities. 

‘‘(d) FACA REQUIREMENTS.—

‘‘(1) EXEMPTION.—Each State technical committee shall be 

exempt from the Federal Advisory Committee Act (5 U.S.C. 

App.). 

‘‘(2) LOCAL WORKING GROUPS.—For purposes of the Federal 

Advisory Committee Act (5 U.S.C. App.), any local working 

group established under this subtitle shall be considered to be 

a subcommittee of the applicable State technical committee.’’. 

Subtitle I—Conservation Programs Under Other Laws 

SEC. 2801. AGRICULTURAL MANAGEMENT ASSISTANCE PROGRAM. 

(a) ELIGIBLE STATES.—Section 524(b)(1) of the Federal Crop Insurance Act (7 U.S.C. 1524(b)(1)) is amended by inserting ‘‘Hawaii,’’

after ‘‘Delaware,’’. 

(b) FUNDING.—Section 524(b)(4)(B) of the Federal Crop Insurance Act (7 U.S.C. 1524(b)(4)(B)) is amended—

(1) in clause (i), by striking ‘‘Except as provided in clauses 

(ii) and (iii)’’ and inserting ‘‘Except as provided in clause (ii)’’; 

and 

(2) by striking clauses (ii) and (iii) and inserting the following new clause: 

‘‘(ii) EXCEPTION FOR FISCAL YEARS 2008 THROUGH

2012.—For each of fiscal years 2008 through 2012, the 

Commodity Credit Corporation shall make available to 

carry out this subsection $15,000,000.’’. 

(c) CERTAIN USES.—Section 524(b)(4) of the Federal Crop Insurance Act (7 U.S.C. 1524(b)(4)) is amended by adding at the end the 

following new subparagraph: 

‘‘(C) CERTAIN USES.—Of the amounts made available to 

carry out this subsection for a fiscal year, the Commodity 

Credit Corporation shall use not less than—

‘‘(i) 50 percent to carry out subparagraphs (A), (B), 

and (C) of paragraph (2) through the Natural Resources Conservation Service; 

‘‘(ii) 10 percent to provide organic certification cost 

share assistance through the Agricultural Marketing 

Service; and 

‘‘(iii) 40 percent to conduct activities to carry out 

subparagraph (F) of paragraph (2) through the Risk 

Management Agency.’’. 

SEC. 2802. TECHNICAL ASSISTANCE UNDER SOIL CONSERVATION AND 

DOMESTIC ALLOTMENT ACT. 

(a) PREVENTION OF SOIL EROSION.—

(1) IN GENERAL.—The first section of the Soil Conservation 

and Domestic Allotment Act (16 U.S.C. 590a) is amended—

(A) by striking ‘‘That it’’ and inserting the following: 

‘‘SECTION 1. PURPOSE. 

‘‘It’’; and 


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(B) in the matter preceding paragraph (1), by striking ‘‘and thereby to preserve natural resources,’’ and inserting ‘‘to preserve soil, water, and related resources, promote soil 

and water quality,’’. (2) POLICIES AND PURPOSES.—Section 7(a)(1) of the Soil 

Conservation and Domestic Allotment Act (16 U.S.C. 

590g(a)(1)) is amended by striking ‘‘fertility’’ and inserting ‘‘and 

water quality and related resources’’. (b) DEFINITIONS.—Section 10 of the Soil Conservation and Domestic Allotment Act (16 U.S.C. 590j) is amended to read as follows: 

‘‘SEC. 10. DEFINITIONS. 

‘‘In this Act: 

‘‘(1) AGRICULTURAL COMMODITY.—The term ‘agricultural 

commodity’ means—

‘‘(A) an agricultural commodity; and 

‘‘(B) any regional or market classification, type, or 

grade of an agricultural commodity. 

‘‘(2) TECHNICAL ASSISTANCE.—

‘‘(A) IN GENERAL.—The term ‘technical assistance’

means technical expertise, information, and tools necessary 

for the conservation of natural resources on land active in 

agricultural, forestry, or related uses. 

‘‘(B) INCLUSIONS.—The term ‘technical assistance’ includes—

‘‘(i) technical services provided directly to farmers, 

ranchers, and other eligible entities, such as conservation planning, technical consultation, and assistance 

with design and implementation of conservation practices; and 

‘‘(ii) technical infrastructure, including activities, 

processes, tools, and agency functions needed to support delivery of technical services, such as technical 

standards, resource inventories, training, data, technology, monitoring, and effects analyses.’’. 

SEC. 2803. SMALL WATERSHED REHABILITATION PROGRAM. 

(a) AVAILABILITY OF FUNDS.—Section 14(h)(1) of the Watershed 

Protection and Flood Prevention Act (16 U.S.C. 1012(h)(1)) is 

amended by adding at the end the following new subparagraph: 

‘‘(G) $100,000,000 for fiscal year 2009, to be available 

until expended.’’. 

(b) AUTHORIZATION OF APPROPRIATIONS.—Section 14(h)(2)(E) of 

the Watershed Protection and Flood Prevention Act (16 U.S.C. 

1012(h)(2)(E)) is amended by striking ‘‘fiscal year 2007’’ and inserting ‘‘each of fiscal years 2008 through 2012’’. 

SEC. 2804. AMENDMENTS TO SOIL AND WATER RESOURCES CONSERVATION ACT OF 1977. 

(a) CONGRESSIONAL FINDINGS.—Section 2 of the Soil and Water 

Resources Conservation Act of 1977 (16 U.S.C. 2001) is amended—

(1) in paragraph (2), by striking ‘‘base, of the’’ and inserting 

‘‘base of the’’; and 

(2) in paragraph (3), by striking ‘‘(3)’’ and all that follows 

through ‘‘Since individual’’ and inserting the following: 

‘‘(3) Appraisal and inventory of resources, assessment and 

inventory of conservation needs, evaluation of the effects of conVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00170 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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servation practices, and analyses of alternative approaches to 

existing conservation programs are basic to effective soil, water, 

and related natural resource conservation. 

‘‘(4) Since individual’’. 

(b) CONTINUING APPRAISAL OF SOIL, WATER, AND RELATED RESOURCES.—Section 5 of the Soil and Water Resources Conservation 

Act of 1977 (16 U.S.C. 2004) is amended—

(1) in subsection (a)—

(A) in paragraph (5), by striking ‘‘and’’ at the end; 

(B) in paragraph (6), by striking the period at the end 

and inserting ‘‘; and’’; and 

(C) by adding at the end the following new paragraph: 

‘‘(7) data on conservation plans, conservation practices 

planned or implemented, environmental outcomes, economic 

costs, and related matters under conservation programs administered by the Secretary.’’; 

(2) by redesignating subsection (d) as subsection (e); 

(3) by inserting after subsection (c) the following new subsection: 

‘‘(d) EVALUATION OF APPRAISAL.—In conducting the appraisal 

described in subsection (a), the Secretary shall concurrently solicit 

and evaluate recommendations for improving the appraisal, including the content, scope, process, participation in, and other elements 

of the appraisal, as determined by the Secretary.’’; and 

(4) in subsection (e), as redesignated by paragraph (2), by 

striking the first sentence and inserting the following: ‘‘The Secretary shall conduct comprehensive appraisals under this section, to be completed by December 31, 2010, and December 31, 

2015.’’. 

(c) SOIL AND WATER CONSERVATION PROGRAM.—Section 6 of the 

Soil and Water Resources Conservation Act of 1977 (16 U.S.C. 

2005) is amended—

(1) by redesignating subsection (b) as subsection (d); 

(2) by inserting after subsection (a) the following new subsections: 

‘‘(b) EVALUATION OF EXISTING CONSERVATION PROGRAMS.—In 

evaluating existing conservation programs, the Secretary shall emphasize demonstration, innovation, and monitoring of specific program components in order to encourage further development and 

adoption of practices and performance-based standards. 

‘‘(c) IMPROVEMENT TO PROGRAM.—In developing a national soil 

and water conservation program under subsection (a), the Secretary 

shall solicit and evaluate recommendations for improving the program, including the content, scope, process, participation in, and 

other elements of the program, as determined by the Secretary.’’; 

and 

(3) in subsection (d), as redesignated by paragraph (1), by 

striking ‘‘December 31, 1979’’ and all that follows through ‘‘December 31, 2007’’ and inserting ‘‘December 31, 2011, and December 31, 2016’’. 

(d) REPORTS TO CONGRESS.—Section 7 of the Soil and Water 

Resources Conservation Act of 1977 (16 U.S.C. 2006) is amended to 

read as follows: 


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‘‘SEC. 7. REPORTS TO CONGRESS. 

‘‘(a) APPRAISAL.—Not later than the date on which Congress 

convenes in 2011 and 2016, the President shall transmit to the 

Committee on Agriculture of the House of Representatives and the 

Committee on Agriculture, Nutrition, and Forestry of the Senate the 

appraisal developed under section 5 and completed before the end 

of the previous year. ‘‘(b) PROGRAM AND STATEMENT OF POLICY.—Not later than the 

date on which Congress convenes in 2012 and 2017, the President 

shall transmit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate— ‘‘(1) the initial program or updated program developed 

under section 6 and completed before the end of the previous 

year; ‘‘(2) a detailed statement of policy regarding soil and water 

conservation activities of the Department of Agriculture; and ‘‘(3) a special evaluation of the status, conditions, and 

trends of soil quality on cropland in the United States that addresses the challenges and opportunities for reducing soil erosion to tolerance levels. 

‘‘(c) IMPROVEMENTS TO APPRAISAL AND PROGRAM.—Not later 

than the date on which Congress convenes in 2012, the Secretary 

shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report describing the plans of the Department 

of Agriculture for improving the resource appraisal and national 

conservation program required under this Act, based on the recommendations received under sections 5(d) and 6(c).’’. (e) TERMINATION OF PROGRAM.—Section 10 of the Soil and 

Water Resources Conservation Act of 1977 (16 U.S.C. 2009) is 

amended by striking ‘‘2008’’ and inserting ‘‘2018’’. 

SEC. 2805. RESOURCE CONSERVATION AND DEVELOPMENT PROGRAM. 

(a) LOCALLY LED PLANNING PROCESS.—Section 1528 of the Agriculture and Food Act of 1981 (16 U.S.C. 3451) is amended—

(1) in paragraph (1), in the matter preceding subparagraph 

(A), by striking ‘‘planning process’’ and inserting ‘‘locally led 

planning process’’; 

(2) by redesignating paragraphs (8) and (9) as paragraphs 

(9) and (8), respectively, and moving those paragraphs so as to 

appear in numerical order; 

(3) in paragraph (8) (as so redesignated)—

(A) by striking ‘‘PLANNING PROCESS’’ and inserting 

‘‘LOCALLY LED PLANNING PROCESS’’; and 

(B) by striking ‘‘council’’ and inserting ‘‘locally led 

council’’. 

(b) AUTHORIZED TECHNICAL ASSISTANCE.—Section 1528(13) of 

the Agriculture and Food Act of 1981 (16 U.S.C. 3451(13)) is 

amended by striking subparagraphs (C) and (D) and inserting the 

following new subparagraphs: 

‘‘(C) providing assistance for the implementation of 

area plans and projects; and 

‘‘(D) providing services that involve the resources of Department of Agriculture programs in a local community, as 

defined in the locally led planning process.’’. 


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(c) IMPROVED PROVISION OF TECHNICAL ASSISTANCE.—Section 

1531 of the Agriculture and Food Act of 1981 (16 U.S.C. 3454) is 

amended—

(1) by inserting ‘‘(a) IN GENERAL.—’’ before ‘‘In carrying’’; 

and 

(2) by adding at the end the following new subsection: ‘‘(b) COORDINATOR.— ‘‘(1) IN GENERAL.—To improve the provision of technical assistance to councils under this subtitle, the Secretary shall designate for each council an individual to be the coordinator for 

the council. ‘‘(2) RESPONSIBILITY.—A coordinator for a council shall be 

directly responsible for the provision of technical assistance to 

the council.’’. (d) PROGRAM EVALUATION.—Section 1534 of the Agriculture 

and Food Act of 1981 (16 U.S.C. 3457) is repealed. 

SEC. 2806. USE OF FUNDS IN BASIN FUNDS FOR SALINITY CONTROL 

ACTIVITIES UPSTREAM OF IMPERIAL DAM. 

(a) IN GENERAL.—Section 202(a) of the Colorado River Basin 

Salinity Control Act (43 U.S.C. 1592(a)) is amended by adding at 

the end the following new paragraph: ‘‘(7) BASIN STATES PROGRAM.— ‘‘(A) IN GENERAL.—A Basin States Program that the 

Secretary, acting through the Bureau of Reclamation, shall 

implement to carry out salinity control activities in the Colorado River Basin using funds made available under section 205(f). ‘‘(B) ASSISTANCE.—The Secretary, in consultation with 

the Colorado River Basin Salinity Control Advisory Council, shall carry out this paragraph using funds described in 

subparagraph (A) directly or by providing grants, grant 

commitments, or advance funds to Federal or non-Federal 

entities under such terms and conditions as the Secretary 

may require. 

‘‘(C) ACTIVITIES.—Funds described in subparagraph 

(A) shall be used to carry out, as determined by the Secretary—

‘‘(i) cost-effective measures and associated works to 

reduce salinity from saline springs, leaking wells, irrigation sources, industrial sources, erosion of public 

and private land, or other sources; 

‘‘(ii) operation and maintenance of salinity control 

features constructed under the Colorado River Basin 

salinity control program; and 

‘‘(iii) studies, planning, and administration of salinity control activities. 

‘‘(D) REPORT.—

‘‘(i) IN GENERAL.—Not later than 30 days before 

implementing the program established under this 

paragraph, the Secretary shall submit to the appropriate committees of Congress a planning report that 

describes the proposed implementation of the program. 

‘‘(ii) IMPLEMENTATION.—The Secretary may not expend funds to implement the program established 

under this paragraph before the expiration of the 30- 


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day period beginning on the date on which the Secretary submits the report, or any revision to the report, 

under clause (i).’’. (b) CONFORMING AMENDMENTS.— (1) Section 202 of the Colorado River Basin Salinity Control Act (43 U.S.C. 1592) is amended— (A) in subsection (a), in the matter preceding paragraph (1), by striking ‘‘program’’ and inserting ‘‘programs’’; 

and 

(B) in subsection (b)(4)— (i) by striking ‘‘program’’ and inserting ‘‘programs’’; and 

(ii) by striking ‘‘and (6)’’ and inserting ‘‘(6), and 

(7)’’. (2) Section 205 of the Colorado River Basin Salinity Control Act (43 U.S.C. 1595) is amended by striking subsection (f) 

and inserting the following new subsection: 

‘‘(f) UP-FRONT COST SHARE.— ‘‘(1) IN GENERAL.—Effective beginning on the date of enactment of this paragraph, subject to paragraph (3), the cost share 

obligations required by this section shall be met through an upfront cost share from the Basin Funds, in the same proportions 

as the cost allocations required under subsection (a), as provided in paragraph (2). ‘‘(2) BASIN STATES PROGRAM.—The Secretary shall expend 

the required cost share funds described in paragraph (1) 

through the Basin States Program for salinity control activities 

established under section 202(a)(7). ‘‘(3) EXISTING SALINITY CONTROL ACTIVITIES.—The cost 

share contribution required by this section shall continue to be 

met through repayment in a manner consistent with this section 

for all salinity control activities for which repayment was commenced prior to the date of enactment of this paragraph.’’. 

SEC. 2807. DESERT TERMINAL LAKES. 

Section 2507 of the Farm Security and Rural Investment Act of 

2002 (43 U.S.C. 2211 note; Public Law 107–171) is amended— (1) in subsection (a)— (A) by striking ‘‘(a)’’ and all that follows through ‘‘$200,000,000’’ and inserting ‘‘(a) TRANSFER.—Subject to 

subsection (b) and paragraph (1) of section 207(a) of Public 

Law 108–7 (117 Stat. 146), notwithstanding paragraph (3) 

of that section, on the date of enactment of the Food, Conservation, and Energy Act of 2008, the Secretary of Agriculture shall transfer $175,000,000’’; and 

(B) by striking the quotation marks at the beginning of 

paragraphs (1) and (2); and 

(2) by striking subsection (b) and inserting the following 

new subsection: 

‘‘(b) PERMITTED USES.—In any case in which there are willing 

sellers, the funds described in subsection (a) may be used—

‘‘(1) to lease water; or 

‘‘(2) to purchase land, water appurtenant to the land, and 

related interests in the Walker River Basin in accordance with 

section 208(a)(1)(A) of the Energy and Water Development Appropriations Act, 2006 (Public Law 109–103; 119 Stat. 2268).’’. 


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Subtitle J—Miscellaneous Conservation Provisions 

SEC. 2901. HIGH PLAINS WATER STUDY. 

Notwithstanding any other provision of this Act, no person 

shall become ineligible for any program benefits under this Act or 

an amendment made by this Act solely as a result of participating 

in a 1-time study of recharge potential for the Ogallala Aquifer in 

the High Plains of the State of Texas. 

SEC. 2902. NAMING OF NATIONAL PLANT MATERIALS CENTER AT 

BELTSVILLE, MARYLAND, IN HONOR OF NORMAN A. BERG. 

The National Plant Materials Center at Beltsville, Maryland, 

referenced in section 613.5(a) of title 7, Code of Federal Regulations, 

shall be known and designated as the ‘‘Norman A. Berg National 

Plant Materials Center’’. Any reference in a law, map, regulation, 

document, paper, or other record of the United States to such National Plant Materials Center shall be deemed to be a reference to 

the Norman A. Berg National Plant Materials Center. 

SEC. 2903. TRANSITION. 

(a) CONTINUATION OF PROGRAMS IN FISCAL YEAR 2008.—Except 

as otherwise provided by an amendment made by this title, the Secretary of Agriculture shall continue to carry out any program or activity covered by title XII of the Food Security Act (16 U.S.C. 3801 

et seq.) until September 30, 2008, using the provisions of law applicable to the program or activity as they existed on the day before 

the date of the enactment of this Act and using funds made available under such title for fiscal year 2008 for the program or activity. 

(b) GROUND AND SURFACE WATER CONSERVATION PROGRAM.—

During the period beginning on the date of the enactment of this Act 

and ending on September 30, 2008, the Secretary of Agriculture 

shall continue to carry out the ground and surface water conservation program under section 1240I of the Food Security Act of 1985 

(16 U.S.C. 3839aa–9), as in effect before the amendment made by 

section 2510, using the terms, conditions, and funds available to the 

Secretary to carry out such program on the day before the date of 

the enactment of this Act. 

SEC. 2904. REGULATIONS. 

(a) ISSUANCE.—Except as otherwise provided in this title or an 

amendment made by this title, not later than 90 days after the date 

of enactment of this Act, the Secretary of Agriculture, in consultation with the Commodity Credit Corporation, shall promulgate such 

regulations as are necessary to implement this title. 

(b) APPLICABLE AUTHORITY.—The promulgation of regulations 

under subsection (a) and administration of this title—

(1) shall be carried out without regard to—

(A) chapter 35 of title 44, United States Code (commonly known as the Paperwork Reduction Act); and 

(B) 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 

(2) may—

(A) be promulgated with an opportunity for notice and 

comment; or 


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(B) if determined to be appropriate by the Secretary of 

Agriculture or the Commodity Credit Corporation, as an interim rule effective on publication with an opportunity for 

notice and comment. 

(c) CONGRESSIONAL REVIEW OF AGENCY RULEMAKING.—In carrying out this section, the Secretary shall use the authority provided 

under section 808(2) of title 5, United States Code. 

TITLE III—TRADE 

Subtitle A—Food for Peace Act 

SEC. 3001. SHORT TITLE. 

(a) IN GENERAL.—Section 1 of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1691 note; 104 Stat. 

3633) is amended by striking ‘‘Agricultural Trade Development and 

Assistance Act of 1954’’ and inserting ‘‘Food for Peace Act’’. (b) CONFORMING AMENDMENTS.— (1) IN GENERAL.—Each provision of law described in paragraph (2) is amended— (A) by striking ‘‘Agricultural Trade Development and 

Assistance Act of 1954’’ each place it appears and inserting ‘‘Food for Peace Act’’; and 

(B) in each section heading, by striking ‘‘AGRICUL- TURAL TRADE DEVELOPMENT AND ASSISTANCE ACT OF

1954’’ each place it appears and inserting ‘‘FOOD FOR 

PEACE ACT’’. (2) PROVISIONS OF LAW.—The provisions of law referred to 

in paragraph (1) are the following: 

(A) The Agriculture and Food Act of 1981 (Public Law 

97–98; 95 Stat. 1213). 

(B) The Agricultural Act of 1949 (7 U.S.C. 1421 et 

seq.). 

(C) Section 9(a) of the Military Construction Codification Act (7 U.S.C. 1704c). 

(D) Section 201 of the Africa: Seeds of Hope Act of 1998 

(7 U.S.C. 1721 note; Public Law 105–385). 

(E) The Bill Emerson Humanitarian Trust Act (7 

U.S.C. 1736f–1 et seq.). 

(F) The Food for Progress Act of 1985 (7 U.S.C. 1736o). 

(G) Section 3107 of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 1736o–1). 

(H) Sections 605B and 606C of the Act of August 28, 

1954 (commonly known as the ‘‘Agricultural Act of 1954’’) 

(7 U.S.C. 1765b, 1766b). 

(I) Section 206 of the Agricultural Act of 1956 (7 

U.S.C. 1856). 

(J) The Agricultural Competitiveness and Trade Act of 

1988 (7 U.S.C. 5201 et seq.). 

(K) The Agricultural Trade Act of 1978 (7 U.S.C. 5601 

et seq.). 

(L) The Export-Import Bank Act of 1945 (12 U.S.C. 635 

et seq.). 

(M) Section 301 of title 13, United States Code. 

(N) Section 8 of the Endangered Species Act of 1973 

(16 U.S.C. 1537). 


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(O) Section 604 of the Enterprise for the Americas Act 

of 1992 (22 U.S.C. 2077). 

(P) Section 5 of the International Health Research Act 

of 1960 (22 U.S.C. 2103). 

(Q) The Foreign Assistance Act of 1961 (22 U.S.C. 2151 

et seq.). 

(R) The Horn of Africa Recovery and Food Security Act 

(22 U.S.C. 2151 note; Public Law 102–274). 

(S) Section 105 of the Mutual Educational and Cultural Exchange Act of 1961 (22 U.S.C. 2455). 

(T) Section 35 of the Foreign Military Sales Act (22 

U.S.C. 2775). 

(U) The Support for East European Democracy (SEED) 

Act of 1989 (22 U.S.C. 5401 et seq.). 

(V) Section 1707 of the Cuban Democracy Act of 1992 

(22 U.S.C. 6006). 

(W) The Cuban Liberty and Democratic Solidarity 

(LIBERTAD) Act of 1996 (22 U.S.C. 6021 et seq.). 

(X) Section 902 of the Trade Sanctions Reform and Export Enhancement Act of 2000 (22 U.S.C. 7201). 

(Y) Chapter 553 of title 46, United State Code. 

(Z) Section 4 of the Strategic and Critical Materials 

Stock Piling Act (50 U.S.C. 98c). 

(AA) The Food, Agriculture, Conservation, and Trade 

Act of 1990 (Public Law 101–624; 104 Stat. 3359). 

(BB) Section 738 of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2001 (Public Law 106–387; 114 

Stat 1549A–34). 

(c) REFERENCES.—Any reference in any Federal, State, tribal, or 

local law (including regulations) to the ‘‘Agricultural Trade Development and Assistance Act of 1954’’ shall be considered to be a reference to the ‘‘Food for Peace Act’’. 

SEC. 3002. UNITED STATES POLICY. 

Section 2 of the Food for Peace Act (7 U.S.C. 1691) is amended—

(1) by striking paragraph (4); and 

(2) by redesignating paragraphs (5) and (6) as paragraphs 

(4) and (5), respectively. 

SEC. 3003. FOOD AID TO DEVELOPING COUNTRIES. 

Section 3(b) of the Food for Peace Act (7 U.S.C. 1691a(b)) is 

amended by striking ‘‘(b)’’ and all that follows through paragraph 

(1) and inserting the following: 

‘‘(b) SENSE OF CONGRESS.—It is the sense of Congress that—

‘‘(1) in negotiations at the Food Aid Convention, the World 

Trade Organization, the United Nations Food and Agriculture 

Organization, and other appropriate venues, the President 

shall—

‘‘(A) seek commitments of higher levels of food aid by 

donors in order to meet the legitimate needs of developing 

countries; 

‘‘(B) ensure, to the maximum extent practicable, that 

humanitarian nongovernmental organizations, recipient 


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country governments, charitable bodies, and international 

organizations shall continue— ‘‘(i) to be eligible to receive resources based on assessments of need conducted by those organizations 

and entities; and ‘‘(ii) to implement food aid programs in agreements 

with donor countries; and 

‘‘(C) ensure, to the maximum extent practicable, that 

options for providing food aid for emergency and nonemergency needs shall not be subject to limitation, including in-kind commodities, provision of funds for agricultural 

commodity procurement, and monetization of commodities, 

on the condition that the provision of those commodities or 

funds— ‘‘(i) is based on assessments of need and intended 

to benefit the food security of, or otherwise assist, recipients, and ‘‘(ii) is provided in a manner that avoids disincentives to local agricultural production and marketing 

and with minimal potential for disruption of commercial markets; and’’. 

SEC. 3004. TRADE AND DEVELOPMENT ASSISTANCE. 

(a) Title I of the Food for Peace Act (7 U.S.C. 1701 et seq.) is 

amended in the title heading, by striking ‘‘TRADE AND DEVELOPMENT ASSISTANCE’’ and inserting ‘‘ECONOMIC ASSISTANCE AND FOOD SECURITY’’. 

(b) Section 101 of the Food for Peace Act (7 U.S.C. 1701) is 

amended in the section heading, by striking ‘‘TRADE AND DEVELOPMENT ASSISTANCE’’ and inserting ‘‘ECONOMIC ASSISTANCE AND

FOOD SECURITY’’. 

SEC. 3005. AGREEMENTS REGARDING ELIGIBLE COUNTRIES AND PRIVATE ENTITIES. 

Section 102 of the Food for Peace Act (7 U.S.C. 1702) is amended—

(1) in subsection (a)—

(A) by striking paragraph (1); and 

(B) by redesignating paragraphs (2) and (3) as paragraphs (1) and (2), respectively; and 

(2) by striking subsection (c). 

SEC. 3006. USE OF LOCAL CURRENCY PAYMENTS. 

Section 104(c) of the Food for Peace Act (7 U.S.C. 1704(c)) is 

amended—

(1) in the matter preceding paragraph (1), by inserting ‘‘, 

through agreements with recipient governments, private voluntary organizations, and cooperatives,’’ after ‘‘developing country’’; 

(2) by striking paragraph (1); 

(3) in paragraph (2)— (A) in subparagraph (C), by striking ‘‘and’’ at the end; 

(B) in subparagraph (D), by striking the period at the 

end and inserting ‘‘; and’’; and 

(C) by adding at the end the following: 

‘‘(E) the improvement of the trade capacity of the recipient country.’’; 


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(4) in paragraph (3), by striking ‘‘agricultural business development and agricultural trade expansion’’ and inserting ‘‘development of agricultural businesses and agricultural trade capacity’’; 

(5) in paragraph (4), by striking ‘‘, or otherwise’’ and all 

that follows through ‘‘United States’’; 

(6) in paragraph (5), by inserting ‘‘to promote agricultural 

products produced in appropriate developing countries’’ after 

‘‘trade fairs’’; and 

(7) by redesignating paragraphs (2) through (9) as paragraphs (1) through (8), respectively. 

SEC. 3007. GENERAL AUTHORITY. 

Section 201 of the Food for Peace Act (7 U.S.C. 1721) is amended—

(1) by striking paragraph (1) and inserting the following: 

‘‘(1) address famine and food crises, and respond to emergency food needs, arising from man-made and natural disasters;’’; 

(2) in paragraph (5)—

(A) by inserting ‘‘food security and support’’ after ‘‘promote’’; and 

(B) by striking ‘‘; and’’ and inserting a semicolon; 

(3) in paragraph (6), by striking the period at the end and 

inserting ‘‘; and’’; and 

(4) by adding at the end the following: 

‘‘(7) promote economic and nutritional security by increasing educational, training, and other productive activities.’’. 

SEC. 3008. PROVISION OF AGRICULTURAL COMMODITIES. 

Section 202 of the Food for Peace Act (7 U.S.C. 1722) is amended—

(1) in subsection (b)(2), by striking ‘‘may not deny a request 

for funds’’ and inserting ‘‘may not use as a sole rationale for denying a request for funds’’; 

(2) in subsection (e)(1)—

(A) in the matter preceding subparagraph (A), by striking ‘‘not less than 5 percent nor more than 10 percent’’ and 

inserting ‘‘not less than 7.5 percent nor more than 13 percent’’; 

(B) in subparagraph (A), by striking ‘‘; and’’ and inserting a semicolon; 

(C) in subparagraph (B), by striking the period at the 

end and inserting ‘‘; and’’; and 

(D) by adding at the end the following: 

‘‘(C) improving and implementing methodologies for 

food aid programs, including needs assessments (upon the 

request of the Administrator), monitoring, and evaluation.’’; 

and 

(3) by striking subsection (h) and inserting the following: 

‘‘(h) FOOD AID QUALITY.—

‘‘(1) IN GENERAL.—The Administrator shall use funds made 

available for fiscal year 2009 and subsequent fiscal years to 

carry out this title— ‘‘(A) to assess the types and quality of agricultural commodities and products donated for food aid; 


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‘‘(B) to adjust products and formulations (including the 

potential introduction of new fortificants and products) as 

necessary to cost-effectively meet nutrient needs of target 

populations; and ‘‘(C) to test prototypes. ‘‘(2) ADMINISTRATION.—The Administrator— ‘‘(A) shall carry out this subsection in consultation with 

and through independent entities with proven expertise in 

food aid commodity quality enhancements; ‘‘(B) may enter into contracts to obtain the services of 

such entities; and ‘‘(C) shall consult with the Food Aid Consultative 

Group on how to carry out this subsection. 

‘‘(3) FUNDING LIMITATION.—Of the funds made available 

under section 207(f), for fiscal years 2009 through 2011, not 

more than $4,500,000 may be used to carry out this subsection.’’. 

SEC. 3009. GENERATION AND USE OF CURRENCIES BY PRIVATE VOLUNTARY ORGANIZATIONS AND COOPERATIVES. 

Section 203(b) of the Food for Peace Act (7 U.S.C. 1723(b)) is 

amended by striking ‘‘1 or more recipient countries’’ and inserting ‘‘in 1 or more recipient countries’’. 

SEC. 3010. LEVELS OF ASSISTANCE. 

Section 204(a) of the Food for Peace Act (7 U.S.C. 1724(a)) is 

amended—

(1) in paragraph (1), by striking ‘‘2002 through 2007’’ and 

inserting ‘‘2008 through 2012’’; and 

(2) in paragraph (2), by striking ‘‘2002 through 2007’’ and 

inserting ‘‘2008 through 2012’’. 

SEC. 3011. FOOD AID CONSULTATIVE GROUP. 

Section 205 of the Food for Peace Act (7 U.S.C. 1725) is amended— (1) in subsection (b)— (A) in paragraph (5), by striking ‘‘and’’ at the end; 

(B) in paragraph (6), by striking the period and inserting ‘‘; and’’; and 

(C) by inserting at the end the following: ‘‘(7) representatives from the maritime transportation sector 

involved in transporting agricultural commodities overseas for 

programs under this Act.’’; and 

(2) in subsection (f), by striking ‘‘2007’’ and inserting 

‘‘2012’’. 

SEC. 3012. ADMINISTRATION. 

Section 207 of the Food for Peace Act (7 U.S.C. 1726a) is 

amended—

(1) in subsection (a)(3), by striking ‘‘and the conditions that 

must be met for the approval of such proposal’’; 

(2) in subsection (c), by striking paragraph (3); 

(3) by striking subsection (d) and inserting the following: 

‘‘(d) TIMELY PROVISION OF COMMODITIES.—The Administrator, 

in consultation with the Secretary, shall develop procedures that ensure expedited processing of commodity call forwards in order to 

provide commodities overseas in a timely manner and to the extent 

feasible, according to planned delivery schedules.’’; and 


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(4) by adding at the end the following: ‘‘(f) PROGRAM OVERSIGHT, MONITORING, AND EVALUATION.— ‘‘(1) DUTIES OF ADMINISTRATOR.—The Administrator, in 

consultation with the Secretary, shall establish systems and 

carry out activities— ‘‘(A) to determine the need for assistance provided 

under this title; and ‘‘(B) to improve, monitor, and evaluate the effectiveness 

and efficiency of the assistance provided under this title to 

maximize the impact of the assistance. 

‘‘(2) REQUIREMENTS OF SYSTEMS AND ACTIVITIES.—The systems and activities described in paragraph (1) shall include— ‘‘(A) program monitors in countries that receive assistance under this title; ‘‘(B) country and regional food aid impact evaluations; 

‘‘(C) the identification and implementation of best practices for food aid programs; ‘‘(D) the evaluation of monetization programs; 

‘‘(E) early warning assessments and systems to help 

prevent famines; and ‘‘(F) upgraded information technology systems. ‘‘(3) IMPLEMENTATION REPORT.—Not later than 180 days 

after the date of enactment of the Food, Conservation, and Energy Act of 2008, the Administrator shall submit to the appropriate committees of Congress a report on efforts undertaken by 

the Administrator to conduct oversight of nonemergency programs under this title. ‘‘(4) GOVERNMENT ACCOUNTABILITY OFFICE REPORT.—Not 

later than 270 days after the date of submission of the report 

under paragraph (3), the Comptroller General of the United 

States shall submit to the appropriate committees of Congress 

a report that contains— ‘‘(A) a review of, and comments addressing, the report 

described in paragraph (3); and 

‘‘(B) recommendations relating to any additional actions that the Comptroller General of the United States determines to be necessary to improve the monitoring and 

evaluation of assistance provided under this title. 

‘‘(5) CONTRACT AUTHORITY.— ‘‘(A) IN GENERAL.—Subject to subparagraphs (B) and 

(C), in carrying out administrative and management activities relating to each activity carried out by the Administrator under paragraph (1), the Administrator may enter 

into contracts with 1 or more individuals for personal service to be performed in recipient countries or neighboring 

countries. 

‘‘(B) PROHIBITION.—An individual who enters into a 

contract with the Administrator under subparagraph (A) 

shall not be considered to be an employee of the Federal 

Government for the purpose of any law (including regulations) administered by the Office of Personnel Management. ‘‘(C) PERSONAL SERVICE.—Subparagraph (A) does not 

limit the ability of the Administrator to enter into a contract with any individual for personal service under section 

202(a). 


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‘‘(6) FUNDING.—

‘‘(A) IN GENERAL.—Subject to section 202(h)(3), in addition to other funds made available to the Administrator to 

carry out the monitoring of emergency food assistance, the 

Administrator may implement this subsection using up to 

$22,000,000 of the funds made available under this title for 

each of fiscal years 2009 through 2012, except for paragraph (2)(F), for which only $2,500,000 shall be made 

available during fiscal year 2009. 

‘‘(B) LIMITATIONS.—

‘‘(i) IN GENERAL.—Subject to clause (ii), of the 

funds made available under subparagraph (A), for 

each of fiscal years 2009 through 2012, not more than 

$8,000,000 may be used by the Administrator to carry 

out paragraph (2)(E). 

‘‘(ii) CONDITION.—No funds shall be made available under subparagraph (A), in accordance with 

clause (i), unless not less than $8,000,000 is made 

available under chapter 1 of part I of the Foreign Assistance Act of 1961 (22 U.S.C. 2151 et seq.) for such 

purposes for such fiscal year. 

‘‘(g) PROJECT REPORTING.—

‘‘(1) IN GENERAL.—In submitting project reports to the Administrator, a private voluntary organization or cooperative 

shall provide a copy of the report in such form as is necessary 

for the report to be displayed for public use on the website of 

the United States Agency for International Development. 

‘‘(2) CONFIDENTIAL INFORMATION.—An organization or cooperative described in paragraph (1) may omit any confidential 

information from the copy of the report submitted for public 

display under that paragraph.’’. 

SEC. 3013. ASSISTANCE FOR STOCKPILING AND RAPID TRANSPORTATION, DELIVERY, AND DISTRIBUTION OF SHELF-STABLE 

PREPACKAGED FOODS. 

Section 208(f) of the Food for Peace Act (7 U.S.C. 1726b(f)) is 

amended—

(1) by striking ‘‘$3,000,000’’ and inserting ‘‘$8,000,000’’; 

and 

(2) by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 3014. GENERAL AUTHORITIES AND REQUIREMENTS. 

(a) IN GENERAL.—Section 401 of the Food for Peace Act (7 

U.S.C. 1731) is amended—

(1) by striking subsection (a); 

(2) by redesignating subsections (b) and (c) as subsections 

(a) and (b), respectively; and 

(3) in subsection (b) (as so redesignated), by striking ‘‘(b)(1)’’

and inserting ‘‘(a)(1)’’. 

(b) CONFORMING AMENDMENTS.—

(1) Section 406(a) of the Food for Peace Act (7 U.S.C. 

1736(a)) is amended by striking ‘‘(that have been determined to 

be available under section 401(a))’’. 

(2) Subsection (e)(1) of the Food for Progress Act of 1985 (7 

U.S.C. 1736o(e)(1)) is amended by striking ‘‘determined to be 

available under section 401 of the Food for Peace Act’’. 


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SEC. 3015. DEFINITIONS. 

Section 402 of the Food for Peace Act (7 U.S.C. 1732) is amended—

(1) by redesignating paragraphs (3) through (8) as paragraphs (4) through (9), respectively; and 

(2) by inserting after paragraph (2) the following: 

‘‘(3) APPROPRIATE COMMITTEE OF CONGRESS.—The term ‘appropriate committee of Congress’ means—

‘‘(A) the Committee on Agriculture, Nutrition, and Forestry of the Senate; 

‘‘(B) the Committee on Agriculture of the House of Representatives; and 

‘‘(C) the Committee on Foreign Affairs of the House of 

Representatives.’’. 

SEC. 3016. USE OF COMMODITY CREDIT CORPORATION. 

Section 406(b)(2) of the Food for Peace Act (7 U.S.C. 1736(b)(2)) 

is amended by inserting ‘‘, including the costs of carrying out section 

415’’ before the semicolon. 

SEC. 3017. ADMINISTRATIVE PROVISIONS. 

Section 407(c) of the Food for Peace Act (7 U.S.C. 1736a(c)) is 

amended—

(1) in paragraph (4)—

(A) by striking ‘‘Funds made’’ and inserting the following: 

‘‘(A) IN GENERAL.—Funds made’’; 

(B) in subparagraph (A) (as so designated)—

(i) by striking ‘‘2007’’ and inserting ‘‘2012’’; and 

(ii) by striking ‘‘$2,000,000’’ and inserting 

‘‘$10,000,000’’; and 

(C) by adding at the end the following: 

‘‘(B) ADDITIONAL PREPOSITIONING SITES.—

‘‘(i) FEASIBILITY ASSESSMENTS.—The Administrator may carry out assessments for the establishment 

of not less than 2 sites to determine the feasibility of, 

and costs associated with, using the sites to store and 

handle agricultural commodities for prepositioning in 

foreign countries. 

‘‘(ii) ESTABLISHMENT OF SITES.—Based on the results of each assessment carried out under clause (i), 

the Administrator may establish additional sites for 

prepositioning in foreign countries.’’; and 

(2) by adding at the end the following: 

‘‘(5) NONEMERGENCY OR MULTIYEAR AGREEMENTS.—Annual 

resource requests for ongoing nonemergency or ongoing 

multiyear agreements under title II shall be finalized not later 

than October 1 of the fiscal year in which the agricultural commodities will be shipped under the agreement.’’. 

SEC. 3018. CONSOLIDATION AND MODIFICATION OF ANNUAL REPORTS 

REGARDING AGRICULTURAL TRADE ISSUES. 

(a) ANNUAL REPORTS.—Section 407 of the Food for Peace Act (7 

U.S.C. 1736a) is amended by striking subsection (f) and inserting 

the following: 

‘‘(f) ANNUAL REPORTS.—


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‘‘(1) ANNUAL REPORT REGARDING AGRICULTURAL TRADE PROGRAMS AND ACTIVITIES.—

‘‘(A) ANNUAL REPORT.—Not later than April 1 of each 

fiscal year, the Administrator and the Secretary shall jointly prepare and submit to the appropriate committees of 

Congress a report regarding each program and activity carried out under this Act during the prior fiscal year. 

‘‘(B) CONTENTS.—An annual report described in subparagraph (A) shall include, with respect to the prior fiscal 

year—

‘‘(i) a list that contains a description of each country and organization that receives food and other assistance under this Act (including the quantity of food 

and assistance provided to each country and organization); 

‘‘(ii) a general description of each project and activity implemented under this Act (including each activity 

funded through the use of local currencies); 

‘‘(iii) a statement describing the quantity of agricultural commodities made available to each country 

pursuant to—

‘‘(I) section 416(b) of the Agricultural Act of 

1949 (7 U.S.C. 1431(b)); and 

‘‘(II) the Food for Progress Act of 1985 (7 

U.S.C. 1736o); 

‘‘(iv) an assessment of the progress made through 

programs under this Act towards reducing food insecurity in the populations receiving food assistance from 

the United States; 

‘‘(v) a description of efforts undertaken by the Food 

Aid Consultative Group under section 205 to achieve 

an integrated and effective food assistance program; 

‘‘(vi) an assessment of—

‘‘(I) each program oversight, monitoring, and 

evaluation system implemented under section 

207(f); and 

‘‘(II) the impact of each program oversight, 

monitoring, and evaluation system on the effectiveness and efficiency of assistance provided under 

this title; and 

‘‘(vii) an assessment of the progress made by the 

Administrator in addressing issues relating to quality 

with respect to the provision of food assistance. 

‘‘(2) ANNUAL REPORT REGARDING THE PROVISION OF AGRICULTURAL COMMODITIES TO FOREIGN COUNTRIES.—

‘‘(A) ANNUAL REPORT.—Not later than February 1 of 

each fiscal year, the Administrator shall prepare and submit to the appropriate committees of Congress a report regarding the administration of food assistance programs 

under title II to benefit foreign countries during the prior 

fiscal year. 

‘‘(B) CONTENTS.—An annual report described in subparagraph (A) shall include, with respect to the prior fiscal 

year—


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‘‘(i) a list that contains a description of each program, country, and commodity approved for assistance 

under section 207; and ‘‘(ii) a statement that contains a description of the 

total amount of funds approved for transportation and 

administrative costs under section 207.’’. (b) CONFORMING AMENDMENT.—Section 207(e) of the Food for 

Peace Act (7 U.S.C. 1726a(e)) is amended— (1) by striking ‘‘TIMELY APPROVAL.’’ and all that follows 

through ‘‘The Administrator’’ and inserting ‘‘TIMELY AP- PROVAL.—The Administrator’’; and 

(2) by striking paragraph (2). 

SEC. 3019. EXPIRATION OF ASSISTANCE. 

Section 408 of the Food for Peace Act (7 U.S.C. 1736b) is 

amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 3020. AUTHORIZATION OF APPROPRIATIONS. 

Section 412 of the Food for Peace Act (7 U.S.C. 1736f) is 

amended by striking subsection (a) and inserting the following: ‘‘(a) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated— ‘‘(1) for fiscal year 2008 and each fiscal year thereafter, 

$2,500,000,000 to carry out the emergency and nonemergency 

food assistance programs under title II; and 

‘‘(2) such sums as are necessary—

‘‘(A) to carry out the concessional credit sales program 

established under title I; 

‘‘(B) to carry out the grant program established under 

title III; and 

‘‘(C) to make payments to the Commodity Credit Corporation to the extent the Commodity Credit Corporation is 

not reimbursed under the programs under this Act for the 

actual costs incurred or to be incurred by the Commodity 

Credit Corporation in carrying out such programs.’’. 

SEC. 3021. MINIMUM LEVEL OF NONEMERGENCY FOOD ASSISTANCE. 

Section 412 of the Food for Peace Act (7 U.S.C. 1736f) is 

amended by adding at the end the following: 

‘‘(e) MINIMUM LEVEL OF NONEMERGENCY FOOD ASSISTANCE.—

‘‘(1) FUNDS AND COMMODITIES.—Of the amounts made 

available to carry out emergency and nonemergency food assistance programs under title II, not less than $375,000,000 for fiscal year 2009, $400,000,000 for fiscal year 2010, $425,000,000 

for fiscal year 2011, and $450,000,000 for fiscal year 2012 shall 

be expended for nonemergency food assistance programs under 

title II. 

‘‘(2) EXCEPTION.—The President may use less than the 

amount specified in paragraph (1) in a fiscal year for nonemergency food assistance programs under title II only if—

‘‘(A) the President has made a determination that there 

is an urgent need for additional emergency food assistance; 

‘‘(B) the funds and commodities held in the Bill Emerson Humanitarian Trust have been exhausted; and 

‘‘(C) the President has submitted to Congress a supplemental appropriations request for a sum equal to the 

amount needed to reach the required spending level for 


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nonemergency food assistance under paragraph (1) and the 

amount exhausted under paragraph (2)(B). 

‘‘(3) NOTIFICATION TO CONGRESS.—If the President makes 

the determination described in paragraph (2)(A), the President 

shall submit to Congress written notification that the determination has been made.’’. 

SEC. 3022. COORDINATION OF FOREIGN ASSISTANCE PROGRAMS. 

Section 413 of the Food for Peace Act (7 U.S.C. 1736g) is 

amended—

(1) by striking ‘‘To the maximum’’ and inserting the following: 

‘‘(a) IN GENERAL.—To the maximum’’; and 

(2) by adding at the end the following: 

‘‘(b) REPORT REGARDING EFFORTS TO IMPROVE PROCUREMENT

PLANNING.—

‘‘(1) REPORT REQUIRED.—Not later than 90 days after the 

date of enactment of the Food, Conservation, and Energy Act of 

2008, the Administrator and the Secretary shall submit to each 

appropriate committee of Congress a report that contains a description of each effort taken by the Administrator and the Secretary to improve planning for food and transportation procurement (including efforts to eliminate bunching of food purchases). 

‘‘(2) CONTENTS.—A report required under paragraph (1) 

should include a description of each effort taken by the Administrator and the Secretary—

‘‘(A) to improve the coordination of food purchases 

made by—

‘‘(i) the United States Agency for International Development; and 

‘‘(ii) the Department of Agriculture; 

‘‘(B) to increase flexibility with respect to procurement 

schedules; 

‘‘(C) to increase the use of historical analyses and forecasting; and 

‘‘(D) to improve and streamline legal claims processes 

for resolving transportation disputes.’’. 

SEC. 3023. MICRONUTRIENT FORTIFICATION PROGRAMS. 

Section 415 of the Food for Peace Act (7 U.S.C. 1736g–2) is 

amended—

(1) in subsection (a)—

(A) in paragraph (1), by striking ‘‘Not later than September 30, 2003, the Administrator, in consultation with 

the Secretary’’ and inserting ‘‘Not later than September 30, 

2008, the Administrator, in consultation with the Secretary’’; and 

(B) in paragraph (2)—

(i) in subparagraph (A), by adding ‘‘and’’ after the 

semicolon at the end; and 

(ii) by striking subparagraphs (B) and (C) and inserting the following: 

‘‘(B) assess and apply technologies and systems to improve and ensure the quality, shelf life, bioavailability, and 

safety of fortified food aid agricultural commodities, and 


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products of those agricultural commodities, using recommendations included in the report entitled ‘Micronutrient Compliance Review of Fortified Public Law 480 

Commodities’, published in October 2001, with implementation by independent entities with proven experience and 

expertise in food aid commodity quality enhancements.’’; 

(2) by striking subsection (b) and redesignating subsections 

(c) and (d) as subsections (b) and (c), respectively; and 

(3) in subsection (c) (as redesignated by paragraph (2)), by 

striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 3024. JOHN OGONOWSKI AND DOUG BEREUTER FARMER-TOFARMER PROGRAM. 

(a) MINIMUM FUNDING.—Section 501(d) of the Food for Peace 

Act (7 U.S.C. 1737(d)) is amended in the matter preceding paragraph (1)—

(1) by striking ‘‘not less than’’ and inserting ‘‘not less than 

the greater of $10,000,000 or’’; and 

(2) by striking ‘‘2002 through 2007’’ and inserting ‘‘2008 

through 2012’’. 

(b) AUTHORIZATION OF APPROPRIATIONS.—Section 501(e) of the 

Food for Peace Act (7 U.S.C. 1737(e)) is amended by striking paragraph (1) and inserting the following: 

‘‘(1) IN GENERAL.—There are authorized to be appropriated 

for each of fiscal years 2008 through 2012 to carry out the programs under this section—

‘‘(A) $10,000,000 for sub-Saharan African and Caribbean Basin countries; and 

‘‘(B) $5,000,000 for other developing or middle-income 

countries or emerging markets not described in subparagraph (A).’’. 

Subtitle B—Agricultural Trade Act of 1978 and Related 

Statutes 

SEC. 3101. EXPORT CREDIT GUARANTEE PROGRAM. 

(a) REPEAL OF SUPPLIER CREDIT GUARANTEE PROGRAM AND INTERMEDIATE EXPORT CREDIT GUARANTEE PROGRAM.—Section 202 of 

the Agricultural Trade Act of 1978 (7 U.S.C. 5622) is amended—

(1) in subsection (a)—

(A) by striking ‘‘GUARANTEES.—’’ and all that follows 

through ‘‘The Commodity’’ in paragraph (1) and inserting 

‘‘GUARANTEES.—The Commodity’’; and 

(B) by striking paragraphs (2) and (3); 

(2) by striking subsections (b) and (c); 

(3) by redesignating subsections (d) through (l) as subsections (b) through (j), respectively; and 

(4) by adding at the end the following: 

‘‘(k) ADMINISTRATION.—

‘‘(1) DEFINITION OF LONG TERM.—In this subsection, the 

term ‘long term’ means a period of 10 or more years. 

‘‘(2) GUARANTEES.—In administering the export credit 

guarantees authorized under this section, the Secretary shall—

‘‘(A) maximize the export sales of agricultural commodities; 


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‘‘(B) maximize the export credit guarantees that are 

made available and used during the course of a fiscal year; 

‘‘(C) develop an approach to risk evaluation that facilitates accurate country risk designations and timely adjustments to the designations (on an ongoing basis) in response 

to material changes in country risk conditions, with ongoing opportunity for input and evaluation from the private 

sector; 

‘‘(D) adjust risk-based guarantees as necessary to ensure program effectiveness and United States competitiveness; and 

‘‘(E) work with industry to ensure, to the maximum extent practicable, that risk-based fees associated with the 

guarantees cover, but do not exceed, the operating costs and 

losses over the long term.’’. 

(b) FUNDING LEVELS.—Section 211 of the Agricultural Trade 

Act of 1978 (7 U.S.C. 5641) is amended by striking subsection (b) 

and inserting the following: 

‘‘(b) EXPORT CREDIT GUARANTEE PROGRAMS.—The Commodity 

Credit Corporation shall make available for each of fiscal years 

1996 through 2012 credit guarantees under section 202(a) in an 

amount equal to but not more than the lesser of—

‘‘(1) $5,500,000,000 in credit guarantees; or 

‘‘(2) the sum of—

‘‘(A) the amount of credit guarantees that the Commodity Credit Corporation can make available using budget authority of $40,000,000 for each fiscal year for the costs 

of the credit guarantees; and 

‘‘(B) the amount of credit guarantees that the Commodity Credit Corporation can make available using unobligated budget authority for prior fiscal years.’’. 

(c) CONFORMING AMENDMENTS.—Section 202 of the Agricultural Trade Act of 1978 (7 U.S.C. 5622) is amended—

(1) in subsection (b)(4) (as redesignated by subsection 

(a)(3)), by striking ‘‘, consistent with the provisions of subsection 

(c)’’; 

(2) in subsection (d) (as redesignated by subsection (a)(3))—

(A) by striking ‘‘(1)’’ and all that follows through ‘‘The 

Commodity’’ and inserting ‘‘The Commodity’’; and 

(B) by striking paragraph (2); and 

(3) in subsection (g)(2) (as redesignated by subsection 

(a)(3)), by striking ‘‘subsections (a) and (b)’’ and inserting ‘‘subsection (a)’’. 

SEC. 3102. MARKET ACCESS PROGRAM. 

(a) ORGANIC COMMODITIES.—Section 203(a) of the Agricultural 

Trade Act of 1978 (7 U.S.C. 5623(a)) is amended by inserting after 

‘‘agricultural commodities’’ the following: ‘‘(including commodities 

that are organically produced (as defined in section 2103 of the Organic Foods Production Act of 1990 (7 U.S.C. 6502)))’’. 

(b) FUNDING.—Section 211(c)(1)(A) of the Agricultural Trade 

Act of 1978 (7 U.S.C. 5641(c)(1)(A)) is amended by striking 

‘‘$200,000,000 for each of fiscal years 2006 and 2007’’ and inserting 

‘‘$200,000,000 for each of fiscal years 2008 through 2012’’. 


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SEC. 3103. EXPORT ENHANCEMENT PROGRAM. 

(a) IN GENERAL.—Section 301 of the Agricultural Trade Act of 

1978 (7 U.S.C. 5651) is repealed. 

(b) CONFORMING AMENDMENTS.—The Agricultural Trade Act of 

1978 is amended—

(1) in title III, by striking the title heading and inserting 

the following: 

‘‘TITLE III—BARRIERS TO EXPORTS’’; 

(2) by redesignating sections 302 and 303 (7 U.S.C. 5652 

and 5653) as sections 301 and 302, respectively; 

(3) in section 302 (as redesignated by paragraph (2)), by 

striking ‘‘, such as that established under section 301,’’; 

(4) in section 401 (7 U.S.C. 5661)—

(A) in subsection (a), by striking ‘‘section 201, 202, or 

301’’ and inserting ‘‘section 201 or 202’’; and 

(B) in subsection (b), by striking ‘‘sections 201, 202, 

and 301’’ and inserting ‘‘sections 201 and 202’’; and 

(5) in section 402(a)(1) (7 U.S.C. 5662(a)(1)), by striking 

‘‘sections 201, 202, 203, and 301’’ and inserting ‘‘sections 201, 

202, and 203’’. 

SEC. 3104. FOREIGN MARKET DEVELOPMENT COOPERATOR PROGRAM. 

(a) REPORT TO CONGRESS.—Section 702(c) of the Agricultural 

Trade Act of 1978 (7 U.S.C. 5722(c)) is amended by striking ‘‘Committee on International Relations’’ and inserting ‘‘Committee on Foreign Affairs’’. 

(b) FUNDING.—Section 703(a) of the Agricultural Trade Act of 

1978 (7 U.S.C. 5723(a)) is amended by striking ‘‘2002 through 

2007’’ and inserting ‘‘2008 through 2012’’. 

SEC. 3105. FOOD FOR PROGRESS ACT OF 1985. 

(a) IN GENERAL.—The Food for Progress Act of 1985 (7 U.S.C. 

1736o) is amended by striking ‘‘2007’’ each place it appears and inserting ‘‘2012’’. 

(b) DESIGNATION OF PROJECT IN SUB-SAHARAN AFRICA.—The 

Food for Progress Act of 1985 (7 U.S.C. 1736o) is amended in subsection (f) by adding at the end the following: 

‘‘(6) PROJECT IN MALAWI.—

‘‘(A) IN GENERAL.—In carrying out this section during 

fiscal year 2009, the President shall approve not less than 

1 multiyear project for Malawi—

‘‘(i) to promote sustainable agriculture; and 

‘‘(ii) to increase the number of women in leadership 

positions. 

‘‘(B) USE OF ELIGIBLE COMMODITIES.—Of the eligible 

commodities used to carry out this section during the period in which the project described in subparagraph (A) is 

carried out, the President shall carry out the project using 

eligible commodities with a total value of not less than 

$3,000,000 during the course of the project.’’. 

SEC. 3106. MCGOVERN-DOLE INTERNATIONAL FOOD FOR EDUCATION 

AND CHILD NUTRITION PROGRAM. 

Section 3107 of the Farm Security and Rural Investment Act of 

2002 (7 U.S.C. 1736o–1) is amended—


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(1) in subsections (b), (c)(2)(B), (f)(1), (h), (i), and (l)(1), by 

striking ‘‘President’’ each place it appears and inserting ‘‘Secretary’’; 

(2) in subsection (d), by striking ‘‘The President shall designate 1 or more Federal agencies’’ and inserting ‘‘The Secretary 

shall’’; 

(3) in paragraph (f)(2), by striking ‘‘implementing agency’’ and inserting ‘‘Secretary’’; and 

(4) in subsection (l)— (A) by striking paragraph (1) and inserting the following: 

‘‘(1) USE OF COMMODITY CREDIT CORPORATION FUNDS.—Of 

the funds of the Commodity Credit Corporation, the Secretary 

shall use to carry out this section $84,000,000 for fiscal year 

2009, to remain available until expended.’’; 

(B) in paragraph (2), by striking ‘‘2004 through 2007’’ and inserting ‘‘2008 through 2012’’; and 

(C) in paragraph (3), by striking ‘‘any Federal agency 

implementing or assisting’’ and inserting ‘‘the Department 

of Agriculture or any other Federal agency assisting’’. 

Subtitle C—Miscellaneous 

SEC. 3201. BILL EMERSON HUMANITARIAN TRUST. 

Section 302 of the Bill Emerson Humanitarian Trust Act (7 

U.S.C. 1736f–1) is amended— (1) in subsection (a)— (A) by striking ‘‘establish a trust stock’’ and inserting ‘‘establish and maintain a trust’’; and 

(B) by striking ‘‘or any combination of the commodities, 

totaling not more than 4,000,000 metric tons’’ and inserting ‘‘any combination of the commodities, or funds’’; 

(2) in subsection (b)— (A) in paragraph (1), by striking subparagraph (D) and 

inserting the following: ‘‘(D) funds made available— ‘‘(i) under paragraph (2)(B); 

‘‘(ii) as a result of an exchange of any commodity 

held in the trust for an equivalent amount of funds 

from the market, if the Secretary determines that such 

a sale of the commodity on the market will not unduly 

disrupt domestic markets; or ‘‘(iii) to maximize the value of the trust, in accordance with subsection (d)(3).’’; and 

(B) in paragraph (2)(B)— (i) in clause (i)— (I) by striking ‘‘2007’’ each place it appears 

and inserting ‘‘2012’’; 

(II) by striking ‘‘(c)(2)’’ and inserting ‘‘(c)(1)’’; 

and 

(III) by striking ‘‘and’’ at the end; 

(ii) in clause (ii), by striking the period at the end 

and inserting ‘‘; or’’; and 

(iii) by adding at the end the following: 

‘‘(iii) from funds accrued through the management 

of the trust under subsection (d).’’; 


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(3) in subsection (c)—

(A) by striking paragraphs (1) and (2) and inserting 

the following: 

‘‘(1) RELEASES FOR EMERGENCY ASSISTANCE.—

‘‘(A) DEFINITION OF EMERGENCY.—

‘‘(i) IN GENERAL.—In this paragraph, the term 

‘emergency’ means an urgent situation—

‘‘(I) in which there is clear evidence that an 

event or series of events described in clause (ii) has 

occurred—

‘‘(aa) that causes human suffering; and 

‘‘(bb) for which a government concerned 

has not chosen, or has not the means, to remedy; or 

‘‘(II) created by a demonstrably abnormal 

event or series of events that produces dislocation 

in the lives of residents of a country or region of 

a country on an exceptional scale. 

‘‘(ii) EVENT OR SERIES OF EVENTS.—An event or series of events referred to in clause (i) includes 1 or more 

of—

‘‘(I) a sudden calamity, such as an earthquake, 

flood, locust infestation, or similar unforeseen disaster; 

‘‘(II) a human-made emergency resulting in—

‘‘(aa) a significant influx of refugees; 

‘‘(bb) the internal displacement of populations; or 

‘‘(cc) the suffering of otherwise affected 

populations; 

‘‘(III) food scarcity conditions caused by slowonset events, such as drought, crop failure, pest infestation, and disease, that result in an erosion of 

the ability of communities and vulnerable populations to meet food needs; and 

‘‘(IV) severe food access or availability conditions resulting from sudden economic shocks, market failure, or economic collapse, that result in an 

erosion of the ability of communities and vulnerable populations to meet food needs. 

‘‘(B) RELEASES.—

‘‘(i) IN GENERAL.—Any funds or commodities held 

in the trust may be released to provide food, and cover 

any associated costs, under title II of the Food for 

Peace Act (7 U.S.C. 1721 et seq.)—

‘‘(I) to assist in averting an emergency, including during the period immediately preceding the 

emergency; 

‘‘(II) to respond to an emergency; or 

‘‘(III) for recovery and rehabilitation after an 

emergency. 

‘‘(ii) PROCEDURE.—A release under clause (i) shall 

be carried out in the same manner, and pursuant to 

the same authority as provided in title II of that Act. 


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‘‘(C) INSUFFICIENCY OF OTHER FUNDS.—The funds and 

commodities held in the trust shall be made immediately 

available on a determination by the Administrator that 

funds available for emergency needs under title II of that 

Act (7 U.S.C. 1721 et seq.) for a fiscal year are insufficient 

to meet emergency needs during the fiscal year. ‘‘(D) WAIVER RELATING TO MINIMUM TONNAGE REQUIRE- MENTS.—Nothing in this paragraph requires a waiver by 

the Administrator of the Agency for International Development under section 204(a)(3) of the Food for Peace Act (7 

U.S.C. 1724(a)(3)) as a condition for a release of funds or 

commodities under subparagraph (B).’’; and 

(B) by redesignating paragraphs (3) through (5) as 

paragraphs (2) through (4), respectively; 

(4) in subsection (d)— (A) by redesignating paragraphs (1) through (3) as subparagraphs (A) through (C), respectively, and indenting the 

subparagraphs appropriately; 

(B) by striking the subsection designation and heading 

and all that follows through ‘‘provide—’’ and inserting the 

following: ‘‘(d) MANAGEMENT OF TRUST.— ‘‘(1) IN GENERAL.—The Secretary shall provide for the management of eligible commodities and funds held in the trust in 

a manner that is consistent with maximizing the value of the 

trust, as determined by the Secretary. ‘‘(2) ELIGIBLE COMMODITIES.—The Secretary shall provide—’’; 

(C) in paragraph (2) (as redesignated by subparagraph 

(B))— (i) in subparagraph (B) (as redesignated by subparagraph (A)), by striking ‘‘and’’ at the end; and 

(ii) in subparagraph (C) (as redesignated by subparagraph (A)), by striking the period at the end and 

inserting ‘‘; and’’; and 

(D) by adding at the end the following: ‘‘(3) FUNDS.— ‘‘(A) EXCHANGES.—If any commodity held in the trust 

is exchanged for funds under subsection (b)(1)(D)(ii), the 

funds shall be held in the trust until the date on which the 

funds are released in the case of an emergency under subsection (c). 

‘‘(B) INVESTMENT.—The Secretary may invest funds 

held in the trust in any short-term obligation of the United 

States or any other low-risk short-term instrument or security insured by the Federal Government in which a regulated insurance company may invest under the laws of the 

District of Columbia.’’; and 

(5) in subsection (h), in each of paragraphs (1) and (2), by 

striking ‘‘2007’’ each place it appears and inserting ‘‘2012’’. 

SEC. 3202. GLOBAL CROP DIVERSITY TRUST. 

(a) CONTRIBUTION.—The Administrator of the United States 

Agency for International Development shall contribute funds to 

endow the Global Crop Diversity Trust (referred to in this section 

as the ‘‘Trust’’) to assist in the conservation of genetic diversity in 


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food crops through the collection and storage of the germplasm of 

food crops in a manner that provides for—

(1) the maintenance and storage of seed collections; 

(2) the documentation and cataloguing of the genetics and 

characteristics of conserved seeds to ensure efficient reference 

for researchers, plant breeders, and the public; 

(3) building the capacity of seed collection in developing 

countries; 

(4) making information regarding crop genetic data publicly available for researchers, plant breeders, and the public 

(including through the provision of an accessible Internet 

website); 

(5) the operation and maintenance of a back-up facility in 

which are stored duplicate samples of seeds, in the case of natural or man-made disasters; and 

(6) oversight designed to ensure international coordination 

of those actions and efficient, public accessibility to that diversity through a cost-effective system. 

(b) UNITED STATES CONTRIBUTION LIMIT.—The aggregate contributions of funds of the Federal Government provided to the Trust 

shall not exceed 25 percent of the total amount of funds contributed 

to the Trust from all sources. 

(c) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to 

be appropriated to carry out this section $60,000,000 for the period 

of fiscal years 2008 through 2012. 

SEC. 3203. TECHNICAL ASSISTANCE FOR SPECIALTY CROPS. 

Section 3205 of the Farm Security and Rural Investment Act of 

2002 (7 U.S.C. 5680) is amended by striking subsection (d) and inserting the following: 

‘‘(d) ANNUAL REPORT.—Not later than 180 days after the date 

of enactment of the Food, Conservation, and Energy Act of 2008 and 

annually thereafter, the Secretary shall submit to the appropriate 

committees of Congress a report that contains, for the period covered 

by the report, a description of each factor that affects the export of 

specialty crops, including each factor relating to any—

‘‘(1) significant sanitary or phytosanitary issue; or 

‘‘(2) trade barrier. 

‘‘(e) FUNDING.—

‘‘(1) COMMODITY CREDIT CORPORATION.—The Secretary 

shall use the funds, facilities, and authorities of the Commodity 

Credit Corporation to carry out this section. 

‘‘(2) FUNDING AMOUNTS.—Of the funds of the Commodity 

Credit Corporation, the Secretary shall use to carry out this section—

‘‘(A) $4,000,000 for fiscal year 2008; 

‘‘(B) $7,000,000 for fiscal year 2009; 

‘‘(C) $8,000,000 for fiscal year 2010; 

‘‘(D) $9,000,000 for fiscal year 2011; and 

‘‘(E) $9,000,000 for fiscal year 2012.’’. 

SEC. 3204. EMERGING MARKETS AND FACILITY GUARANTEE LOAN PROGRAM. 

Section 1542 of the Food, Agriculture, Conservation, and Trade 

Act of 1990 (7 U.S.C. 5622 note; Public Law 101–624) is amended—


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(1) in subsection (a), by striking ‘‘2007’’ and inserting ‘‘2012’’; 

(2) in subsection (b)— (A) in the first sentence, by redesignating paragraphs 

(1) and (2) as subparagraphs (A) and (B), respectively, and 

indenting appropriately; 

(B) by striking ‘‘A portion’’ and inserting the following: ‘‘(1) IN GENERAL.—A portion’’; 

(C) in the second sentence, by striking ‘‘The Commodity 

Credit Corporation’’ and inserting the following: ‘‘(2) PRIORITY.—The Commodity Credit Corporation’’; and 

(D) by adding at the end the following: ‘‘(3) CONSTRUCTION WAIVER.—The Secretary may waive any 

applicable requirements relating to the use of United States 

goods in the construction of a proposed facility, if the Secretary 

determines that—

‘‘(A) goods from the United States are not available; or 

‘‘(B) the use of goods from the United States is not 

practicable. 

‘‘(4) TERM OF GUARANTEE.—A facility payment guarantee 

under this subsection shall be for a term that is not more than 

the lesser of—

‘‘(A) the term of the depreciation schedule of the facility 

assisted; or 

‘‘(B) 20 years.’’; and 

(3) in subsection (d)(1)(A)(i) by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 3205. CONSULTATIVE GROUP TO ELIMINATE THE USE OF CHILD 

LABOR AND FORCED LABOR IN IMPORTED AGRICULTURAL 

PRODUCTS. 

(a) DEFINITIONS.—In this section: 

(1) CHILD LABOR.—The term ‘‘child labor’’ means the worst 

forms of child labor as defined in International Labor Convention 182, the Convention Concerning the Prohibition and Immediate Action for the Elimination of the Worst Forms of Child 

Labor, done at Geneva on June 17, 1999. 

(2) CONSULTATIVE GROUP.—The term ‘‘Consultative Group’’ means the Consultative Group to Eliminate the Use of Child 

Labor and Forced Labor in Imported Agricultural Products established under subsection (b). 

(3) FORCED LABOR.—The term ‘‘forced labor’’ means all 

work or service—

(A) that is exacted from any individual under menace 

of any penalty for nonperformance of the work or service, 

and for which—

(i) the work or service is not offered voluntarily; or 

(ii) the work or service is performed as a result of 

coercion, debt bondage, or involuntary servitude (as 

those terms are defined in section 103 of the Trafficking Victims Protection Act of 2000 (22 U.S.C. 

7102)); and 

(B) by 1 or more individuals who, at the time of performing the work or service, were being subjected to a severe form of trafficking in persons (as that term is defined 

in that section). 


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(b) ESTABLISHMENT.—There is established a group to be known 

as the ‘‘Consultative Group to Eliminate the Use of Child Labor and 

Forced Labor in Imported Agricultural Products’’ to develop recommendations relating to guidelines to reduce the likelihood that 

agricultural products or commodities imported into the United 

States are produced with the use of forced labor and child labor. 

(c) DUTIES.— (1) IN GENERAL.—Not later than 2 years after the date of 

enactment of this Act and in accordance with section 105(d) of 

the Trafficking Victims Protection Act of 2000 (22 U.S.C. 

7103(d)), as applicable to the importation of agricultural products made with the use of child labor or forced labor, the Consultative Group shall develop, and submit to the Secretary, recommendations relating to a standard set of practices for independent, third-party monitoring and verification for the production, processing, and distribution of agricultural products or 

commodities to reduce the likelihood that agricultural products 

or commodities imported into the United States are produced 

with the use of forced labor or child labor. 

(2) GUIDELINES.—

(A) IN GENERAL.—Not later than 1 year after the date 

on which the Secretary receives recommendations under 

paragraph (1), the Secretary shall release guidelines for a 

voluntary initiative to enable entities to address issues 

raised by the Trafficking Victims Protection Act of 2000 (22 

U.S.C. 7101 et seq.). 

(B) REQUIREMENTS.—Guidelines released under subparagraph (A) shall be published in the Federal Register 

and made available for public comment for a period of 90 

days. 

(d) MEMBERSHIP.—The Consultative Group shall be composed 

of not more than 13 individuals, of whom— (1) 2 members shall represent the Department of Agriculture, as determined by the Secretary; 

(2) 1 member shall be the Deputy Under Secretary for 

International Affairs of the Department of Labor; 

(3) 1 member shall represent the Department of State, as 

determined by the Secretary of State; 

(4) 3 members shall represent private agriculture-related 

enterprises, which may include retailers, food processors, importers, and producers, of whom at least 1 member shall be an 

importer, food processor, or retailer who utilizes independent, 

third-party supply chain monitoring for forced labor or child 

labor; 

(5) 2 members shall represent institutions of higher education and research institutions, as determined appropriate by 

the Bureau of International Labor Affairs of the Department of 

Labor; 

(6) 1 member shall represent an organization that provides 

independent, third-party certification services for labor standards for producers or importers of agricultural commodities or 

products; and 

(7) 3 members shall represent organizations described in 

section 501(c)(3) of the Internal Revenue Code of 1986 that have 

expertise on the issues of international child labor and do not 


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possess a conflict of interest associated with establishment of 

the guidelines issued under subsection (c)(2), as determined by 

the Bureau of International Labor Affairs of the Department of 

Labor, including representatives from consumer organizations 

and trade unions, if appropriate. 

(e) CHAIRPERSON.—A representative of the Department of Agriculture appointed under subsection (d)(1), as determined by the Secretary, shall serve as the chairperson of the Consultative Group. 

(f) REQUIREMENTS.—Not less than 4 times per year, the Consultative Group shall meet at the call of the Chairperson, after reasonable notice to all members, to develop recommendations described in subsection (c)(1). 

(g) NONAPPLICABILITY OF FACA.—The Federal Advisory Committee Act (5 U.S.C. App.) shall not apply to the Consultative 

Group. 

(h) ANNUAL REPORTS.—Not later than 1 year after the date of 

enactment of this Act, and annually thereafter through December 

31, 2012, the Secretary shall submit to the Committees on Agriculture and Foreign Affairs of the House of Representatives and the 

Committee on Agriculture, Nutrition, and Forestry of the Senate a 

report describing the activities and recommendations of the Consultative Group. 

(i) TERMINATION OF AUTHORITY.—The Consultative Group shall 

terminate on December 31, 2012. 

SEC. 3206. LOCAL AND REGIONAL FOOD AID PROCUREMENT 

PROJECTS. 

(a) DEFINITIONS.—In this section: 

(1) ADMINISTRATOR.—The term ‘‘Administrator’’ means the 

Administrator of the Agency for International Development. 

(2) APPROPRIATE COMMITTEE OF CONGRESS.—The term ‘‘appropriate committee of Congress’’ means— (A) the Committee on Agriculture, Nutrition, and Forestry of the Senate; 

(B) the Committee on Agriculture of the House of Representatives; and 

(C) the Committee on Foreign Affairs of the House of 

Representatives. 

(3) ELIGIBLE COMMODITY.—The term ‘‘eligible commodity’’

means an agricultural commodity (or the product of an agricultural commodity) that—

(A) is produced in, and procured from, a developing 

country; and 

(B) at a minimum, meets each nutritional, quality, and 

labeling standard of the country that receives the agricultural commodity, as determined by the Secretary. 

(4) ELIGIBLE ORGANIZATION.—The term ‘‘eligible organization’’ means an organization that is—

(A) described in section 202(d) of the Food for Peace 

Act (7 U.S.C. 1722(d)); and 

(B) with respect to nongovernmental organizations, 

subject to regulations promulgated or guidelines issued to 

carry out this section, including United States audit requirements that are applicable to nongovernmental organizations. 

(b) STUDY; FIELD-BASED PROJECTS.—


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(1) STUDY.— (A) IN GENERAL.—Not later than 30 days after the date 

of enactment of this Act, the Secretary shall initiate a study 

of prior local and regional procurements for food aid programs conducted by— (i) other donor countries; 

(ii) private voluntary organizations; and 

(iii) the World Food Program of the United Nations. 

(B) REPORT.—Not later than 180 days after the date of 

enactment of this Act, the Secretary shall submit to the appropriate committees of Congress a report containing the 

results of the study conducted under subparagraph (A). 

(2) FIELD-BASED PROJECTS.—

(A) IN GENERAL.—In accordance with subparagraph 

(B), the Secretary shall provide grants to, or enter into cooperative agreements with, eligible organizations to carry 

out field-based projects that consist of local or regional procurements of eligible commodities to respond to food crises 

and disasters in accordance with this section. 

(B) CONSULTATION WITH ADMINISTRATOR.—In carrying 

out the development and implementation of field-based 

projects under subparagraph (A), the Secretary shall consult with the Administrator. 

(c) PROCUREMENT.— (1) IN GENERAL.—Any eligible commodity that is procured 

for a field-based project carried out under subsection (b)(2) 

shall be procured through any approach or methodology that 

the Secretary considers to be an effective approach or methodology to provide adequate information regarding the manner by 

which to expedite, to the maximum extent practicable, the provision of food aid to affected populations without significantly increasing commodity costs for low-income consumers who procure commodities sourced from the same markets at which the 

eligible commodity is procured. 

(2) REQUIREMENTS.— (A) IMPACT ON LOCAL FARMERS AND COUNTRIES.—The 

Secretary shall ensure that the local or regional procurement of any eligible commodity under this section will not 

have a disruptive impact on farmers located in, or the economy of—

(i) the recipient country of the eligible commodity; 

or 

(ii) any country in the region in which the eligible 

commodity may be procured. 

(B) TRANSSHIPMENT.—The Secretary shall, in accordance with such terms and conditions as the Secretary considers to be appropriate, require from each eligible organization commitments designed to prevent or restrict— (i) the resale or transshipment of any eligible commodity procured under this section to any country 

other than the recipient country; and 

(ii) the use of the eligible commodity for any purpose other than food aid. 

(C) WORLD PRICES.—


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(i) IN GENERAL.—In carrying out this section, the 

Secretary shall take any precaution that the Secretary 

considers to be reasonable to ensure that the procurement of eligible commodities will not unduly disrupt—

(I) world prices for agricultural commodities; 

or 

(II) normal patterns of commercial trade with 

foreign countries. 

(ii) PROCUREMENT PRICE.—The procurement of any 

eligible commodity shall be made at a reasonable market price with respect to the economy of the country in 

which the eligible commodity is procured, as determined by the Secretary. 

(d) REGULATIONS; GUIDELINES.—

(1) IN GENERAL.—In accordance with paragraph (2), not 

later than 180 days after the date of completion of the study 

under subsection (b)(1), the Secretary shall promulgate regulations or issue guidelines to carry out field-based projects under 

this section. 

(2) REQUIREMENTS.—

(A) USE OF STUDY.—In promulgating regulations or 

issuing guidelines under paragraph (1), the Secretary shall 

take into consideration the results of the study described in 

subsection (b)(1). 

(B) PUBLIC REVIEW AND COMMENT.—In promulgating 

regulations or issuing guidelines under paragraph (1), the 

Secretary shall provide an opportunity for public review 

and comment. 

(3) AVAILABILITY.—The Secretary shall not approve the procurement of any eligible commodity under this section until the 

date on which the Secretary promulgates regulations or issues 

guidelines under paragraph (1). 

(e) FIELD-BASED PROJECT GRANTS OR COOPERATIVE AGREEMENTS.—

(1) IN GENERAL.—The Secretary shall award grants to, or 

enter into cooperative agreements with, eligible organizations to 

carry out field-based projects. 

(2) REQUIREMENTS OF ELIGIBLE ORGANIZATIONS.—

(A) APPLICATION.—

(i) IN GENERAL.—To be eligible to receive a grant 

from, or enter into a cooperative agreement with, the 

Secretary under this subsection, an eligible organization shall submit to the Secretary an application by 

such date, in such manner, and containing such information as the Secretary may require. 

(ii) OTHER APPLICABLE REQUIREMENTS.—Any other 

applicable requirement relating to the submission of 

proposals for consideration shall apply to the submission of an application required under clause (i), as determined by the Secretary. 

(B) COMPLETION REQUIREMENT.—To be eligible to receive a grant from, or enter into a cooperative agreement 

with, the Secretary under this subsection, an eligible organization shall agree—


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(i) to collect by September 30, 2011, data containing the information required under subsection 

(f)(1)(B) relating to the field-based project funded 

through the grant; and 

(ii) to provide to the Secretary the data collected 

under clause (i). 

(3) REQUIREMENTS OF SECRETARY.— (A) PROJECT DIVERSITY.— (i) IN GENERAL.—Subject to clause (ii) and subparagraph (B), in selecting proposals for field-based 

projects to fund under this section, the Secretary shall 

select a diversity of projects, including projects located 

in— (I) food surplus regions; 

(II) food deficit regions (that are carried out 

using regional procurement methods); and 

(III) multiple geographical regions. 

(ii) PRIORITY.—In selecting proposals for fieldbased projects under clause (i), the Secretary shall ensure that the majority of selected proposals are for 

field-based projects that— (I) are located in Africa; and 

(II) procure eligible commodities that are produced in Africa. 

(B) DEVELOPMENT ASSISTANCE.—A portion of the funds 

provided under this subsection shall be made available for 

field-based projects that provide development assistance for 

a period of not less than 1 year. 

(4) AVAILABILITY.—The Secretary shall not award a grant 

to any eligible organization under paragraph (1) until the date 

on which the Secretary promulgates regulations or issues guidelines under subsection (d)(1). 

(f) INDEPENDENT EVALUATIONS; REPORT.— (1) INDEPENDENT EVALUATIONS.—

(A) IN GENERAL.—Not later than November 1, 2011, the 

Secretary shall ensure that an independent third party conducts an independent evaluation of all field-based projects 

that— (i) addresses each factor described in subparagraph (B); and 

(ii) is conducted in accordance with this section. 

(B) REQUIRED FACTORS.—The Secretary shall require 

the independent third party to develop—

(i) with respect to each relevant market in which 

an eligible commodity was procured under this section, 

a description of—

(I) the prevailing and historic supply, demand, 

and price movements of the market (including the 

extent of competition for procurement bids); 

(II) the impact of the procurement of the eligible commodity on producer and consumer prices in 

the market; 

(III) each government market interference or 

other activity of the donor country that might have 

significantly affected the supply or demand of the 


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eligible commodity in the area at which the local 

or regional procurement occurred; 

(IV) the quantities and types of eligible commodities procured in the market; 

(V) the time frame for procurement of each eligible commodity; and 

(VI) the total cost of the procurement of each 

eligible commodity (including storage, handling, 

transportation, and administrative costs); 

(ii) an assessment regarding— (I) whether the requirements of this section 

have been met; 

(II) the impact of different methodologies and 

approaches on— (aa) local and regional agricultural producers (including large and small agricultural 

producers); 

(bb) markets; 

(cc) low-income consumers; and 

(dd) program recipients; and 

(III) the length of the period beginning on the 

date on which the Secretary initiated the procurement process and ending on the date of delivery of 

eligible commodities; 

(iii) a comparison of different methodologies used 

to carry out this section, with respect to— (I) the benefits to local agriculture; 

(II) the impact on markets and consumers; 

(III) the period of time required for procurement and delivery; 

(IV) quality and safety assurances; and 

(V) implementation costs; and 

(iv) to the extent adequate information is available 

(including the results of the report required under subsection (b)(1)(B)), a comparison of the different methodologies used by other donor countries to make local 

and regional procurements. 

(C) INDEPENDENT THIRD PARTY ACCESS TO RECORDS

AND REPORTS.—The Secretary shall provide to the independent third party access to each record and report that 

the independent third party determines to be necessary to 

complete the independent evaluation. 

(D) PUBLIC ACCESS TO RECORDS AND REPORTS.—Not 

later than 180 days after the date described in paragraph 

(2), the Secretary shall provide public access to each record 

and report described in subparagraph (C). 

(2) REPORT.—Not later than 4 years after the date of enactment of this Act, the Secretary shall submit to the appropriate 

committees of Congress a report that contains the analysis and 

findings of the independent evaluation conducted under paragraph (1)(A). 

(g) FUNDING.— (1) COMMODITY CREDIT CORPORATION.—The Secretary shall 

use the funds, facilities, and authorities of the Commodity 

Credit Corporation to carry out this section. 


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(2) FUNDING AMOUNTS.—Of the funds of the Commodity 

Credit Corporation, the Secretary shall use to carry out this section—

(A) $5,000,000 for fiscal year 2009; 

(B) $25,000,000 for fiscal year 2010; 

(C) $25,000,000 for fiscal year 2011; and 

(D) $5,000,000 for fiscal year 2012. 

Subtitle D—Softwood Lumber 

SEC. 3301. SOFTWOOD LUMBER. 

(a) IN GENERAL.—The Tariff Act of 1930 (19 U.S.C. 1202 et 

seq.) is amended by adding at the end the following new title: 

‘‘TITLE VIII—SOFTWOOD LUMBER 

‘‘SEC. 801. SHORT TITLE; TABLE OF CONTENTS. 

‘‘(a) SHORT TITLE.—This title may be cited as the ‘Softwood 

Lumber Act of 2008’. 

‘‘(b) TABLE OF CONTENTS.—The table of contents for this title is 

as follows: 

‘‘TITLE VIII—SOFTWOOD LUMBER 

‘‘Sec. 801. Short title; table of contents. 

‘‘Sec. 802. Definitions. 

‘‘Sec. 803. Establishment of softwood lumber importer declaration program. 

‘‘Sec. 804. Scope of softwood lumber importer declaration program. 

‘‘Sec. 805. Export charge determination and publication. 

‘‘Sec. 806. Reconciliation. 

‘‘Sec. 807. Verification. 

‘‘Sec. 808. Penalties. 

‘‘Sec. 809. Reports. 

‘‘SEC. 802. DEFINITIONS. 

‘‘In this title: 

‘‘(1) APPROPRIATE CONGRESSIONAL COMMITTEES.—The term 

‘appropriate congressional committees’ means the Committee on 

Finance of the Senate and the Committee on Ways and Means 

of the House of Representatives. 

‘‘(2) COUNTRY OF EXPORT.—The term ‘country of export’

means the country (including any political subdivision of the 

country) from which softwood lumber or a softwood lumber 

product is exported before entering the United States. 

‘‘(3) CUSTOMS LAWS OF THE UNITED STATES.—The term ‘customs laws of the United States’ means any law or regulation 

enforced or administered by U.S. Customs and Border Protection. ‘‘(4) EXPORT CHARGES.—The term ‘export charges’ means 

any tax, charge, or other fee collected by the country from which 

softwood lumber or a softwood lumber product, described in 

section 804(a), is exported pursuant to an international agreement entered into by that country and the United States. 

‘‘(5) EXPORT PRICE.—

‘‘(A) IN GENERAL.—The term ‘export price’ means one of 

the following: 

‘‘(i) In the case of softwood lumber or a softwood 

lumber product that has undergone only primary processing, the value that would be determined F.O.B. at 


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the facility where the product underwent the last primary processing before export. ‘‘(ii)(I) In the case of softwood lumber or a softwood 

lumber product described in subclause (II), the value 

that would be determined F.O.B. at the facility where 

the lumber or product underwent the last primary 

processing. ‘‘(II) Softwood lumber or a softwood lumber product described in this subclause is lumber or a product 

that underwent the last remanufacturing before export 

by a manufacturer who— ‘‘(aa) does not hold tenure rights provided by 

the country of export; ‘‘(bb) did not acquire standing timber directly 

from the country of export; and ‘‘(cc) is not related to the person who holds tenure rights or acquired standing timber directly 

from the country of export. 

‘‘(iii)(I) In the case of softwood lumber or a 

softwood lumber product described in subclause (II), 

the value that would be determined F.O.B. at the facility where the product underwent the last processing before export. ‘‘(II) Softwood lumber or a softwood lumber product described in this subclause is lumber or a product 

that undergoes the last remanufacturing before export 

by a manufacturer who— ‘‘(aa) holds tenure rights provided by the country of export; ‘‘(bb) acquired standing timber directly from 

the country of export; or ‘‘(cc) is related to a person who holds tenure 

rights or acquired standing timber directly from 

the country of export. 

‘‘(B) RELATED PERSONS.—For purposes of this paragraph, a person is related to another person if— ‘‘(i) the person bears a relationship to such other 

person described in section 152(a) of the Internal Revenue Code of 1986; ‘‘(ii) the person bears a relationship to such other 

person described in section 267(b) of such Code, except 

that ‘5 percent’ shall be substituted for ‘50 percent’ each 

place it appears; ‘‘(iii) the person and such other person are part of 

a controlled group of corporations, as that term is defined in section 1563(a) of such Code, except that ‘5 

percent’ shall be substituted for ‘80 percent’ each place 

it appears; ‘‘(iv) the person is an officer or director of such 

other person; or 

‘‘(v) the person is the employer of such other person. 

‘‘(C) TENURE RIGHTS.—For purposes of this paragraph, 

the term ‘tenure rights’ means rights to harvest timber from 

public land granted by the country of export. 


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‘‘(D) EXPORT PRICE WHERE F.O.B. VALUE CANNOT BE DE- TERMINED.—

‘‘(i) IN GENERAL.—In the case of softwood lumber 

or a softwood lumber product described in clause (i), 

(ii), or (iii) of subparagraph (A) for which an F.O.B. 

value cannot be determined, the export price shall be 

the market price for the identical lumber or product 

sold in an arm’s-length transaction in the country of 

export at approximately the same time as the exported 

lumber or product. The market price shall be determined in the following order of preference: ‘‘(I) The market price for the lumber or a product sold at substantially the same level of trade as 

the exported lumber or product but in different 

quantities. ‘‘(II) The market price for the lumber or a 

product sold at a different level of trade than the 

exported lumber or product but in similar quantities. ‘‘(III) The market price for the lumber or a 

product sold at a different level of trade than the 

exported lumber or product and in different quantities. 

‘‘(ii) LEVEL OF TRADE.—For purposes of clause (i), 

‘level of trade’ shall be determined in the same manner 

as provided under section 351.412(c) of title 19, Code 

of Federal Regulations (as in effect on January 1, 

2008). 

‘‘(6) F.O.B.—The term ‘F.O.B.’ means a value consisting of 

all charges payable by a purchaser, including those charges incurred in the placement of merchandise on board of a conveyance for shipment, but does not include the actual shipping 

charges or any applicable export charges. ‘‘(7) HTS.—The term ‘HTS’ means the Harmonized Tariff 

Schedule of the United States (19 U.S.C. 1202) (as in effect on 

January 1, 2008). ‘‘(8) PERSON.—The term ‘person’ includes any individual, 

partnership, corporation, association, organization, business 

trust, government entity, or other entity subject to the jurisdiction of the United States. ‘‘(9) UNITED STATES.—The term ‘United States’ means the 

customs territory of the United States, as defined in General 

Note 2 of the HTS. 

‘‘SEC. 803. ESTABLISHMENT OF SOFTWOOD LUMBER IMPORTER DECLARATION PROGRAM. 

‘‘(a) ESTABLISHMENT OF PROGRAM.—

‘‘(1) IN GENERAL.—The President shall establish and maintain an importer declaration program with respect to the importation of softwood lumber and softwood lumber products described in section 804(a). The importer declaration program 

shall require importers of softwood lumber and softwood lumber products described in section 804(a) to provide the information required under subsection (b) and declare the information 

required by subsection (c), and require that such information 

accompany the entry summary documentation. 


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‘‘(2) ELECTRONIC RECORD.—The President shall establish 

an electronic record that includes the importer information required under subsection (b) and the declarations required under 

subsection (c). 

‘‘(b) REQUIRED INFORMATION.—The President shall require the 

following information to be submitted by any person seeking to import softwood lumber or softwood lumber products described in section 804(a): ‘‘(1) The export price for each shipment of softwood lumber 

or softwood lumber products. ‘‘(2) The estimated export charge, if any, applicable to each 

shipment of softwood lumber or softwood lumber products as 

calculated by applying the percentage determined and published by the Under Secretary for International Trade of the Department of Commerce pursuant to section 805 to the export 

price provided in subsection (b)(1). 

‘‘(c) IMPORTER DECLARATIONS.—Pursuant to procedures prescribed by the President, any person seeking to import softwood 

lumber or softwood lumber products described in section 804(a) 

shall declare that— ‘‘(1) the person has made appropriate inquiry, including 

seeking appropriate documentation from the exporter and consulting the determinations published by the Under Secretary for 

International Trade of the Department of Commerce pursuant 

to section 805(b); and 

‘‘(2) to the best of the person’s knowledge and belief—

‘‘(A) the export price provided pursuant to subsection 

(b)(1) is determined in accordance with the definition provided in section 802(5); 

‘‘(B) the export price provided pursuant to subsection 

(b)(1) is consistent with the export price provided on the export permit, if any, granted by the country of export; and 

‘‘(C) the exporter has paid, or committed to pay, all export charges due— ‘‘(i) in accordance with the volume, export price, 

and export charge rate or rates, if any, as calculated 

under an international agreement entered into by the 

country of export and the United States; and ‘‘(ii) consistent with the export charge determinations published by the Under Secretary for International Trade pursuant to section 805(b). 

‘‘SEC. 804. SCOPE OF SOFTWOOD LUMBER IMPORTER DECLARATION 

PROGRAM. 

‘‘(a) PRODUCTS INCLUDED IN PROGRAM.—The following products 

shall be subject to the importer declaration program established 

under section 803: 

‘‘(1) IN GENERAL.—All softwood lumber and softwood lumber products classified under subheading 4407.10.00, 

4409.10.10, 4409.10.20, or 4409.10.90 of the HTS, including the 

following softwood lumber, flooring, and siding: 

‘‘(A) Coniferous wood, sawn or chipped lengthwise, 

sliced or peeled, whether or not planed, sanded, or fingerjointed, of a thickness exceeding 6 millimeters. 

‘‘(B) Coniferous wood siding (including strips and 

friezes for parquet flooring, not assembled) continuously 


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shaped (tongued, grooved, rabbeted, chamfered, v-jointed, 

beaded, molded, rounded, or the like) along any of its edges 

or faces, whether or not planed, sanded, or finger-jointed. ‘‘(C) Other coniferous wood (including strips and 

friezes for parquet flooring, not assembled) continuously 

shaped (tongued, grooved, rabbeted, chamfered, v-jointed, 

beaded, molded, rounded, or the like) along any of its edges 

or faces (other than wood moldings and wood dowel rods) 

whether or not planed, sanded, or finger-jointed. ‘‘(D) Coniferous wood flooring (including strips and 

friezes for parquet flooring, not assembled) continuously 

shaped (tongued, grooved, rabbeted, chamfered, v-jointed, 

beaded, molded, rounded, or the like) along any of its edges 

or faces, whether or not planed, sanded, or finger-jointed. ‘‘(E) Coniferous drilled and notched lumber and angle 

cut lumber. 

‘‘(2) PRODUCTS CONTINUALLY SHAPED.—Any product classified under subheading 4409.10.05 of the HTS that is continually shaped along its end or side edges. 

‘‘(3) OTHER LUMBER PRODUCTS.—Except as otherwise provided in subsection (b) or (c), softwood lumber products that are 

stringers, radius-cut box-spring frame components, fence pickets, truss components, pallet components, and door and window 

frame parts classified under subheading 4418.90.46.95, 

4421.90.70.40, or 4421.90.97.40 of the HTS. 

‘‘(b) PRODUCTS EXCLUDED FROM PROGRAM.—The following 

products shall be excluded from the importer declaration program 

established under section 803: ‘‘(1) Trusses and truss kits, properly classified under subheading 4418.90 of the HTS. ‘‘(2) I-joist beams. 

‘‘(3) Assembled box-spring frames. 

‘‘(4) Pallets and pallet kits, properly classified under subheading 4415.20 of HTS. 

‘‘(5) Garage doors. 

‘‘(6) Edge-glued wood, properly classified under subheading 

4421.90.97.40 of the HTS. 

‘‘(7) Complete door frames. 

‘‘(8) Complete window frames. 

‘‘(9) Furniture. 

‘‘(10) Articles brought into the United States temporarily 

and for which an exemption from duty is claimed under subchapter XIII of chapter 98 of the HTS. 

‘‘(11) Household and personal effects. 

‘‘(c) EXCEPTIONS FOR CERTAIN PRODUCTS.—The following 

softwood lumber products shall not be subject to the importer declaration program established under section 803: 

‘‘(1) STRINGERS.—Stringers (pallet components used for 

runners), if the stringers—

‘‘(A) have at least 2 notches on the side, positioned at 

equal distance from the center, to properly accommodate 

forklift blades; and 

‘‘(B) are properly classified under subheading 

4421.90.97.40 of the HTS. 

‘‘(2) BOX-SPRING FRAME KITS.—


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‘‘(A) IN GENERAL.—Box-spring frame kits, if—

‘‘(i) the kits contain—

‘‘(I) 2 wooden side rails; 

‘‘(II) 2 wooden end (or top) rails; and 

‘‘(III) varying numbers of wooden slats; and 

‘‘(ii) the side rails and the end rails are radius-cut 

at both ends. 

‘‘(B) PACKAGING.—Any kit described in subparagraph 

(A) shall be individually packaged, and contain the exact 

number of wooden components needed to make the boxspring frame described on the entry documents, with no 

further processing required. None of the components contained in the package may exceed 1 inch in actual thickness 

or 83 inches in length. 

‘‘(3) RADIUS-CUT BOX-SPRING FRAME COMPONENTS.—Radius-cut box-spring frame components, not exceeding 1 inch in 

actual thickness or 83 inches in length, ready for assembly 

without further processing, if radius cuts are present on both 

ends of the boards and are substantial cuts so as to completely 

round 1 corner. 

‘‘(4) FENCE PICKETS.—Fence pickets requiring no further 

processing and properly classified under subheading 4421.90.70 

of the HTS, 1 inch or less in actual thickness, up to 8 inches 

wide, and 6 feet or less in length, and having finials or decorative cuttings that clearly identify them as fence pickets. In the 

case of dog-eared fence pickets, the corners of the boards shall 

be cut off so as to remove pieces of wood in the shape of isosceles right angle triangles with sides measuring 3⁄4 of an inch 

or more. 

‘‘(5) UNITED STATES-ORIGIN LUMBER.—Lumber originating 

in the United States that is exported to another country for 

minor processing and imported into the United States if—

‘‘(A) the processing occurring in another country is limited to kiln drying, planing to create smooth-to-size board, 

and sanding; and 

‘‘(B) the importer establishes to the satisfaction of U.S. 

Customs and Border Protection upon entry that the lumber 

originated in the United States. 

‘‘(6) SOFTWOOD LUMBER.—Any softwood lumber or softwood 

lumber product that originated in the United States, if the importer, exporter, foreign processor, or original United States 

producer establishes to the satisfaction of U.S. Customs and 

Border Protection upon entry that the softwood lumber entered 

and documented as originating in the United States was first 

produced in the United States. 

‘‘(7) HOME PACKAGES OR KITS.—

‘‘(A) IN GENERAL.—Softwood lumber or softwood lumber products contained in a single family home package or 

kit, regardless of the classification under the HTS, if the 

importer declares that the following requirements have been 

met: 

‘‘(i) The package or kit constitutes a full package of 

the number of wooden pieces specified in the plan, design, or blueprint necessary to produce a home of at 


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least 700 square feet produced to a specified plan, design, or blueprint. ‘‘(ii) The package or kit contains— ‘‘(I) all necessary internal and external doors 

and windows, nails, screws, glue, subfloor, sheathing, beams, posts, and connectors; and ‘‘(II) if included in the purchase contract, the 

decking, trim, drywall, and roof shingles specified 

in the plan, design, or blueprint. 

‘‘(iii) Prior to importation, the package or kit is 

sold to a United States retailer that sells complete 

home packages or kits pursuant to a valid purchase 

contract referencing the particular home design, plan, 

or blueprint, and the contract is signed by a customer 

not affiliated with the importer. ‘‘(iv) Softwood lumber products entered as part of 

the package or kit, whether in a single entry or multiple entries on multiple days, are to be used solely for 

the construction of the single family home specified by 

the home design, plan, or blueprint matching the U.S. 

Customs and Border Protection import entry. 

‘‘(B) ADDITIONAL DOCUMENTATION REQUIRED FOR HOME

PACKAGES AND KITS.—In the case of each entry of products 

described in clauses (i) through (iv) of subparagraph (A) 

the following documentation shall be retained by the importer and made available to U.S. Customs and Border 

Protection upon request: ‘‘(i) A copy of the appropriate home design, plan, or 

blueprint matching the customs entry in the United 

States. ‘‘(ii) A purchase contract from a retailer of home 

kits or packages signed by a customer not affiliated 

with the importer. ‘‘(iii) A listing of all parts in the package or kit 

being entered into the United States that conforms to 

the home design, plan, or blueprint for which such 

parts are being imported. ‘‘(iv) If a single contract involves multiple entries, 

an identification of all the items required to be listed 

under clause (iii) that are included in each individual 

shipment. ‘‘(d) PRODUCTS COVERED.—For purposes of determining if a 

product is covered by the importer declaration program, the President shall be guided by the article descriptions provided in this section. 

‘‘SEC. 805. EXPORT CHARGE DETERMINATION AND PUBLICATION. 

‘‘(a) DETERMINATION.—The Under Secretary for International 

Trade of the Department of Commerce shall determine, on a monthly basis, any export charges (expressed as a percentage of export 

price) to be collected by a country of export from exporters of 

softwood lumber or softwood lumber products described in section 

804(a) in order to ensure compliance with any international agreement entered into by that country and the United States. 

‘‘(b) PUBLICATION.—The Under Secretary for International 

Trade shall immediately publish any determination made under 


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subsection (a) on the website of the International Trade Administration of the Department of Commerce, and in any other manner the 

Under Secretary considers appropriate. 

‘‘SEC. 806. RECONCILIATION. 

‘‘The Secretary of the Treasury shall conduct reconciliations to 

ensure the proper implementation and operation of international 

agreements entered into between a country of export of softwood 

lumber or softwood lumber products described in section 804(a) and 

the United States. The Secretary of Treasury shall reconcile the following: ‘‘(1) The export price declared by a United States importer 

pursuant to section 803(b)(1) with the export price reported to 

the United States by the country of export, if any. ‘‘(2) The export price declared by a United States importer 

pursuant to section 803(b)(1) with the revised export price reported to the United States by the country of export, if any. 

‘‘SEC. 807. VERIFICATION. 

‘‘(a) IN GENERAL.—The Secretary of Treasury shall periodically 

verify the declarations made by a United States importer pursuant 

to section 803(c), including by determining whether— ‘‘(1) the export price declared by a United States importer 

pursuant to section 803(b)(1) is the same as the export price provided on the export permit, if any, issued by the country of export; and 

‘‘(2) the estimated export charge declared by a United 

States importer pursuant to section 803(b)(2) is consistent with 

the determination published by the Under Secretary for International Trade pursuant to section 805(b). 

‘‘(b) EXAMINATION OF BOOKS AND RECORDS.—

‘‘(1) IN GENERAL.—Any record relating to the importer declaration program required under section 803 shall be treated as 

a record required to be maintained and produced under title V 

of this Act. 

‘‘(2) EXAMINATION OF RECORDS.—The Secretary of the 

Treasury is authorized to take such action, and examine such 

records, under section 509 of this Act, as the Secretary determines necessary to verify the declarations made pursuant to section 803(c) are true and accurate. 

‘‘SEC. 808. PENALTIES. 

‘‘(a) IN GENERAL.—It shall be unlawful for any person to import 

into the United States softwood lumber or softwood lumber products 

in knowing violation of this title. 

‘‘(b) CIVIL PENALTIES.—Any person who commits an unlawful 

act as set forth in subsection (a) shall be liable for a civil penalty 

not to exceed $10,000 for each knowing violation. 

‘‘(c) OTHER PENALTIES.—In addition to the penalties provided 

for in subsection (b), any violation of this title that violates any 

other customs law of the United States shall be subject to any applicable civil and criminal penalty, including seizure and forfeiture, 

that may be imposed under such custom law or title 18, United 

States Code, with respect to the importation of softwood lumber and 

softwood lumber products described in section 804(a). 

‘‘(d) FACTORS TO CONSIDER IN ASSESSING PENALTIES.—In determining the amount of civil penalties to be assessed under this 


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section, consideration shall be given to any history of prior violations of this title by the person, the ability of the person to pay the 

penalty, the seriousness of the violation, and such other matters as 

fairness may require. 

‘‘(e) NOTICE.—No penalty may be assessed under this section 

against a person for violating a provision of this title unless the person is given notice and opportunity to make statements, both oral 

and written, with respect to such violation. 

‘‘(f) EXCEPTION.—Notwithstanding any other provision of this 

title, and without limitation, an importer shall not be found to have 

violated subsection 803(c) if—

‘‘(1) the importer made an appropriate inquiry in accordance with section 803(c)(1) with respect to the declaration; 

‘‘(2) the importer produces records maintained pursuant to 

section 807(b) that substantiate the declaration; and 

‘‘(3) there is not substantial evidence indicating that the importer knew that the fact to which the importer made the declaration was false. 

‘‘SEC. 809. REPORTS. 

‘‘(a) SEMIANNUAL REPORTS.—Not later than 180 days after the 

effective date of this title, and every 180 days thereafter, the President shall submit to the appropriate congressional committees a report—

‘‘(1) describing the reconciliations conducted under section 

806, and the verifications conducted under section 807; 

‘‘(2) identifying the manner in which the United States importers subject to reconciliations conducted under section 806 

and verifications conducted under section 807 were chosen; 

‘‘(3) identifying any penalties imposed under section 808; 

‘‘(4) identifying any patterns of noncompliance with this 

title; and 

‘‘(5) identifying any problems or obstacles encountered in 

the implementation and enforcement of this title. 

‘‘(b) SUBSIDIES REPORTS.—Not later than 180 days after the 

date of the enactment of this title, and every 180 days thereafter, the 

Secretary of Commerce shall provide to the appropriate congressional committees a report on any subsidies on softwood lumber or 

softwood lumber products, including stumpage subsidies, provided 

by countries of export. 

‘‘(c) GAO REPORTS.—The Comptroller General of the United 

States shall submit the following reports to the appropriate congressional committees: 

‘‘(1) Not later than 18 months after the date of the enactment of this title, a report on the effectiveness of the reconciliations conducted under section 806, and verifications conducted 

under section 807. 

‘‘(2) Not later than 12 months after the date of the enactment of this title, a report on whether countries that export 

softwood lumber or softwood lumber products to the United 

States are complying with any international agreements entered 

into by those countries and the United States.’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall take effect on the date that is 60 days after the date of the enactment of this Act. 


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TITLE IV—NUTRITION 

Subtitle A—Food Stamp Program 

PART I—RENAMING OF FOOD STAMP ACT AND 

PROGRAM 

SEC. 4001. RENAMING OF FOOD STAMP ACT AND PROGRAM. 

(a) SHORT TITLE.—The first section of the Food Stamp Act of 

1977 (7 U.S.C. 2011 note; Public Law 88–525) is amended by striking ‘‘Food Stamp Act of 1977’’ and inserting ‘‘Food and Nutrition 

Act of 2008’’. 

(b) PROGRAM.—The Food and Nutrition Act of 2008 (7 U.S.C. 

2011 et seq.) (as amended by subsection (a)) is amended by striking 

‘‘food stamp program’’ each place it appears and inserting ‘‘supplemental nutrition assistance program’’. 

SEC. 4002. CONFORMING AMENDMENTS. 

(a) IN GENERAL.—

(1) Section 4 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2013) is amended in the section heading by striking 

‘‘FOOD STAMP PROGRAM’’ and inserting ‘‘SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM’’. 

(2) Section 5(h)(2)(A) of the Food and Nutrition Act of 2008 

(7 U.S.C. 2014(h)(2)(A)) is amended by striking ‘‘Food Stamp 

Disaster Task Force’’ and inserting ‘‘Disaster Task Force’’. 

(3) Section 6 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2015) is amended—

(A) in subsection (d)(3), by striking ‘‘for food stamps’’; 

(B) in subsection (j), in the subsection heading, by 

striking ‘‘FOOD STAMP’’; and 

(C) in subsection (o)—

(i) in paragraph (2), by striking ‘‘food stamp benefits’’ and inserting ‘‘supplemental nutrition assistance 

program benefits’’; and 

(ii) in paragraph (6)—

(I) in subparagraph (A)—

(aa) in clause (i), by striking ‘‘food 

stamps’’ and inserting ‘‘supplemental nutrition 

assistance program benefits’’; and 

(bb) in clause (ii)—

(AA) in the matter preceding subclause (I), by striking 

‘‘a food stamp recipient’’ and inserting ‘‘a member of a 

household that receives supplemental nutrition assistance 

program benefits’’; and 

(BB) by striking ‘‘food stamp benefits’’ each place it appears and inserting ‘‘supplemental nutrition assistance program benefits’’; and 

(II) in subparagraphs (D) and (E), by striking 

‘‘food stamp recipients’’ each place it appears and 

inserting ‘‘members of households that receive supplemental nutrition assistance program benefits’’. (4) Section 7 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2016) is amended— (A) in subsection (i)—


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(i) in paragraph (3)(B)(ii), by striking ‘‘food stamp 

households’’ and inserting ‘‘households receiving supplemental nutrition assistance program benefits’’; and 

(ii) in paragraph (7), by striking ‘‘food stamp 

issuance’’ and inserting ‘‘supplemental nutrition assistance issuance’’; and 

(B) in subsection (k)—

(i) in paragraph (2), by striking ‘‘food stamp benefits’’ and inserting ‘‘supplemental nutrition assistance 

program benefits’’; and 

(ii) in paragraph (3), by striking ‘‘food stamp retail’’ and inserting ‘‘retail’’. 

(5) Section 9(b)(1) of that Food and Nutrition Act of 2008 

(7 U.S.C. 2018(b)(1)) is amended by striking ‘‘food stamp households’’ and inserting ‘‘households that receive supplemental nutrition assistance program benefits’’. 

(6) Section 11 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2020) is amended—

(A) in subsection (e)—

(i) by striking ‘‘food stamps’’ each place it appears 

and inserting ‘‘supplemental nutrition assistance program benefits’’; 

(ii) by striking ‘‘food stamp offices’’ each place it 

appears and inserting ‘‘supplemental nutrition assistance program offices’’; 

(iii) by striking ‘‘food stamp office’’ each place it 

appears and inserting ‘‘supplemental nutrition assistance program office’’; and 

(iv) in paragraph (25)—

(I) in the matter preceding subparagraph (A), 

by striking ‘‘Simplified Food Stamp Program’’ and 

inserting ‘‘Simplified Supplemental Nutrition Assistance Program’’; and 

(II) in subparagraph (A), by striking ‘‘food 

stamp benefits’’ and inserting ‘‘supplemental nutrition assistance program benefits’’; 

(B) in subsection (k), by striking ‘‘may issue, upon request by the State agency, food stamps’’ and inserting ‘‘may 

provide, on request by the State agency, supplemental nutrition assistance program benefits’’; 

(C) in subsection (l), by striking ‘‘food stamp participation’’ and inserting ‘‘supplemental nutrition assistance program participation’’; 

(D) in subsections (q) and (r), in the subsection headings, by striking ‘‘FOOD STAMPS’’ each place it appears and 

inserting ‘‘BENEFITS’’; 

(E) in subsection (s), by striking ‘‘food stamp benefits’’

each place it appears and inserting ‘‘supplemental nutrition 

assistance program benefits’’; and 

(F) in subsection (t)(1)—

(i) in subparagraph (A), by striking ‘‘food stamp 

application’’ and inserting ‘‘supplemental nutrition assistance program application’’; and 


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(ii) in subparagraph (B), by striking ‘‘food stamp 

benefits’’ and inserting ‘‘supplemental nutrition assistance program benefits’’. (7) Section 14(b) of the Food and Nutrition Act of 2008 (7 

U.S.C. 2023(b)) is amended by striking ‘‘food stamp’’. (8) Section 16 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2025) is amended— (A) in subsection (a)(4), by striking ‘‘food stamp informational activities’’ and inserting ‘‘informational activities 

relating to the supplemental nutrition assistance program’’; 

(B) in subsection (c)(9)(C), by striking ‘‘food stamp caseload’’ and inserting ‘‘the caseload under the supplemental 

nutrition assistance program’’; and 

(C) in subsection (h)(1)(E)(i), by striking ‘‘food stamp 

recipients’’ and inserting ‘‘members of households receiving 

supplemental nutrition assistance program benefits’’. (9) Section 17 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2026) is amended— (A) in subsection (a)(2), by striking ‘‘food stamp benefits’’ each place it appears and inserting ‘‘supplemental nutrition assistance program benefits’’; 

(B) in subsection (b)— (i) in paragraph (1)— (I) in subparagraph (A), by striking ‘‘food 

stamp benefits’’ and inserting ‘‘supplemental nutrition assistance program benefits’’; and 

(II) in subparagraph (B)— (aa) in clause (ii)(II), by striking ‘‘food 

stamp recipients’’ and inserting ‘‘supplemental 

nutrition assistance program recipients’’; 

(bb) in clause (iii)(I), by striking ‘‘the 

State’s food stamp households’’ and inserting ‘‘the number of households in the State receiving supplemental nutrition assistance program 

benefits’’; and 

(cc) in clause (iv)(IV)(bb), by striking ‘‘food 

stamp deductions’’ and inserting ‘‘supplemental nutrition assistance program deductions’’; 

(ii) in paragraph (2), by striking ‘‘food stamp benefits’’ and inserting ‘‘supplemental nutrition assistance 

program benefits’’; and 

(iii) in paragraph (3)—

(I) in subparagraph (A), by striking ‘‘food 

stamp employment’’ and inserting ‘‘supplemental 

nutrition assistance program employment’’; 

(II) in subparagraph (B), by striking ‘‘food 

stamp recipients’’ and inserting ‘‘supplemental nutrition assistance program recipients’’; 

(III) in subparagraph (C), by striking ‘‘food 

stamps’’ and inserting ‘‘supplemental nutrition assistance program benefits’’; and 

(IV) in subparagraph (D), by striking ‘‘food 

stamp benefits’’ and inserting ‘‘supplemental nutrition assistance program benefits’’; 


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(C) in subsection (c), by striking ‘‘food stamps’’ and inserting ‘‘supplemental nutrition assistance’’; 

(D) in subsection (d)—

(i) in paragraph (1)(B), by striking ‘‘food stamp 

benefits’’ and inserting ‘‘supplemental nutrition assistance program benefits’’; 

(ii) in paragraph (2)—

(I) in subparagraph (A), by striking ‘‘food 

stamp allotments’’ each place it appears and inserting ‘‘allotments’’; and 

(II) in subparagraph (C)(ii), by striking ‘‘food 

stamp benefit’’ and inserting ‘‘supplemental nutrition assistance program benefits’’; and 

(iii) in paragraph (3)(E), by striking ‘‘food stamp 

benefits’’ and inserting ‘‘supplemental nutrition assistance program benefits’’; 

(E) in subsections (e) and (f), by striking ‘‘food stamp 

benefits’’ each place it appears and inserting ‘‘supplemental 

nutrition assistance program benefits’’; 

(F) in subsection (g), in the first sentence, by striking 

‘‘receipt of food stamp’’ and inserting ‘‘receipt of supplemental nutrition assistance program’’; and 

(G) in subsection (j), by striking ‘‘food stamp agencies’’

and inserting ‘‘supplemental nutrition assistance program 

agencies’’. 

(10) Section 18(a)(3)(A)(ii) of the Food and Nutrition Act of 

2008 (7 U.S.C. 2027(a)(3)(A)(ii)) is amended by striking ‘‘food 

stamps’’ and inserting ‘‘supplemental nutrition assistance program benefits’’. 

(11) Section 22 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2031) is amended—

(A) in the section heading, by striking ‘‘FOOD STAMP

PORTION OF MINNESOTA FAMILY INVESTMENT PLAN’’ and 

inserting ‘‘MINNESOTA FAMILY INVESTMENT PROJECT’’; 

(B) in subsections (b)(12) and (d)(3), by striking ‘‘the 

Food Stamp Act, as amended,’’ each place it appears and 

inserting ‘‘this Act’’; and 

(C) in subsection (g)(1), by striking ‘‘the Food Stamp 

Act of 1977 (7 U.S.C. 2011 et seq.)’’ and inserting ‘‘this 

Act’’. 

(12) Section 26 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2035) is amended—

(A) in the section heading, by striking ‘‘SIMPLIFIED

FOOD STAMP PROGRAM’’ and inserting ‘‘SIMPLIFIED SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM’’; and 

(B) in subsection (b), by striking ‘‘simplified food stamp 

program’’ and inserting ‘‘simplified supplemental nutrition 

assistance program’’. 

(b) CONFORMING CROSS-REFERENCES.—

(1) IN GENERAL.—Each provision of law described in paragraph (2) is amended (as applicable)—

(A) by striking ‘‘food stamp program’’ each place it appears and inserting ‘‘supplemental nutrition assistance program’’; 


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(B) by striking ‘‘Food Stamp Act of 1977’’ each place it 

appears and inserting ‘‘Food and Nutrition Act of 2008’’; 

(C) by striking ‘‘Food Stamp Act’’ each place it appears 

and inserting ‘‘Food and Nutrition Act of 2008’’; 

(D) by striking ‘‘food stamp’’ each place it appears and 

inserting ‘‘supplemental nutrition assistance program benefits’’; 

(E) by striking ‘‘food stamps’’ each place it appears and 

inserting ‘‘supplemental nutrition assistance program benefits’’; 

(F) in each applicable title, subtitle, chapter, subchapter, and section heading, by striking ‘‘FOOD STAMP

ACT’’ each place it appears and inserting ‘‘FOOD AND NUTRITION ACT OF 2008’’; 

(G) in each applicable subsection and appropriations 

heading, by striking ‘‘FOOD STAMP ACT’’ each place it appears and inserting ‘‘FOOD AND NUTRITION ACT OF 2008’’; 

(H) in each applicable heading other than a title, subtitle, chapter, subchapter, section, subsection, or appropriations heading, by striking ‘‘FOOD STAMP ACT’’ each place it 

appears and inserting ‘‘FOOD AND NUTRITION ACT OF

2008’’; 

(I) in each applicable title, subtitle, chapter, subchapter, and section heading, by striking ‘‘FOOD STAMP

PROGRAM’’ each place it appears and inserting ‘‘SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM’’; 

(J) in each applicable subsection and appropriations 

heading, by striking ‘‘FOOD STAMP PROGRAM’’ each place it 

appears and inserting ‘‘SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM’’; 

(K) in each applicable heading other than a title, subtitle, chapter, subchapter, section, subsection, or appropriations heading, by striking ‘‘FOOD STAMP PROGRAM’’ each 

place it appears and inserting ‘‘SUPPLEMENTAL NUTRITION

ASSISTANCE PROGRAM’’; 

(L) in each applicable title, subtitle, chapter, subchapter, and section heading, by striking ‘‘FOOD STAMPS’’

each place it appears and inserting ‘‘SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM BENEFITS’’; 

(M) in each applicable subsection and appropriations 

heading, by striking ‘‘FOOD STAMPS’’ each place it appears 

and inserting ‘‘SUPPLEMENTAL NUTRITION ASSISTANCE

PROGRAM BENEFITS’’; and 

(N) in each applicable heading other than a title, subtitle, chapter, subchapter, section, subsection, or appropriations heading, by striking ‘‘FOOD STAMPS’’ each place it appears and inserting ‘‘SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM BENEFITS’’. 

(2) PROVISIONS OF LAW.—The provisions of law referred to 

in paragraph (1) are the following: 

(A) The Hunger Prevention Act of 1988 (Public Law 

100–435; 102 Stat. 1645). 

(B) The Food Stamp Program Improvements Act of 

1994 (Public Law 103–225; 108 Stat. 106). 


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(C) Title IV of the Farm Security and Rural Investment 

Act of 2002 (Public Law 107–171; 116 Stat. 305). 

(D) Section 2 of Public Law 103–205 (7 U.S.C. 2012 

note). 

(E) Section 807(b) of the Stewart B. McKinney Homeless Assistance Act (7 U.S.C. 2014 note; Public Law 100–

77). 

(F) The Electronic Benefit Transfer Interoperability 

and Portability Act of 2000 (Public Law 106–171; 114 Stat. 

3). 

(G) Section 502(b) of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 2025 

note; Public Law 105–185). 

(H) The National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3101 et seq.). 

(I) The Emergency Food Assistance Act of 1983 (7 

U.S.C. 7501 et seq.). 

(J) The Immigration and Nationality Act (8 U.S.C. 

1101 et seq.). 

(K) Section 8119 of the Department of Defense Appropriations Act, 1999 (10 U.S.C. 113 note; Public Law 105–

262). 

(L) The Armored Car Industry Reciprocity Act of 1993 

(15 U.S.C. 5901 et seq.). 

(M) Title 18, United States Code. 

(N) The Higher Education Act of 1965 (20 U.S.C. 1001 

et seq.). 

(O) The Internal Revenue Code of 1986. 

(P) Section 650 of the Treasury and General Government Appropriations Act, 2000 (26 U.S.C. 7801 note; Public 

Law 106–58). 

(Q) The Wagner-Peysner Act (29 U.S.C. 49 et seq.). 

(R) The Workforce Investment Act of 1998 (29 U.S.C. 

2801 et seq.). 

(S) Title 31, United States Code. 

(T) Title 37, United States Code. 

(U) The Public Health Service Act (42 U.S.C. 201 et 

seq.). 

(V) Titles II through XIX of the Social Security Act (42 

U.S.C. 401 et seq.). 

(W) Section 406 of the Family Support Act of 1988 

(Public Law 100–485; 102 Stat. 2400). 

(X) Section 232 of the Social Security Act Amendments 

of 1994 (42 U.S.C. 1314a). 

(Y) The United States Housing Act of 1937 (42 U.S.C. 

1437 et seq.). 

(Z) The Richard B. Russell National School Lunch Act 

(42 U.S.C. 1751 et seq.). 

(AA) The Child Nutrition Act of 1966 (42 U.S.C. 1771 

et seq.). 

(BB) The Older Americans Act of 1965 (42 U.S.C. 3001 

et seq.). 

(CC) Section 208 of the Intergovernmental Personnel 

Act of 1970 (42 U.S.C. 4728). 


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(DD) The Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et seq.). 

(EE) The Low-Income Home Energy Assistance Act of 

1981 (42 U.S.C. 8621 et seq.). 

(FF) Section 658K of the Child Care and Development 

Block Grant Act of 1990 (42 U.S.C. 9858i). 

(GG) The Alaska Native Claims Settlement Act (43 

U.S.C. 1601 et seq.). 

(HH) Public Law 95–348 (92 Stat. 487). 

(II) The Agriculture and Food Act of 1981 (Public Law 

97–98; 95 Stat. 1213). 

(JJ) The Disaster Assistance Act of 1988 (Public Law 

100–387; 102 Stat. 924). 

(KK) The Food, Agriculture, Conservation, and Trade 

Act of 1990 (Public Law 101–624; 104 Stat. 3359). 

(LL) The Cranston-Gonzalez National Affordable Housing Act (Public Law 101–625; 104 Stat. 4079). 

(MM) Section 388 of the Persian Gulf Conflict Supplemental Authorization and Personnel Benefits Act of 1991 

(Public Law 102–25; 105 Stat. 98). 

(NN) The Food, Agriculture, Conservation, and Trade 

Act Amendments of 1991 (Public Law 102–237; 105 Stat. 

1818). 

(OO) The Act of March 26, 1992 (Public Law 102–265; 

106 Stat. 90). 

(PP) Public Law 105–379 (112 Stat. 3399). 

(QQ) Section 101(c) of the Emergency Supplemental 

Act, 2000 (Public Law 106–246; 114 Stat. 528). 

(c) REFERENCES.—Any reference in any Federal, State, tribal, or 

local law (including regulations) to the ‘‘food stamp program’’ established under the Food and Nutrition Act of 2008 (7 U.S.C. 2011 et 

seq.) shall be considered to be a reference to the ‘‘supplemental nutrition assistance program’’ established under that Act. 

PART II—BENEFIT IMPROVEMENTS 

SEC. 4101. EXCLUSION OF CERTAIN MILITARY PAYMENTS FROM INCOME. 

Section 5(d) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2014(d)) is amended—

(1) by striking ‘‘(d) Household’’ and inserting ‘‘(d) EXCLUSIONS FROM INCOME.—Household’’; 

(2) by striking ‘‘only (1) any’’ and inserting ‘‘only—

‘‘(1) any’’; 

(3) by indenting each of paragraphs (2) through (18) so as 

to align with the margin of paragraph (1) (as amended by paragraph (2)); 

(4) by striking the comma at the end of each of paragraphs 

(1) through (16) and inserting a semicolon; 

(5) in paragraph (3)—

(A) by striking ‘‘like (A) awarded’’ and inserting ‘‘like—

‘‘(A) awarded’’; 

(B) by striking ‘‘thereof, (B) to’’ and inserting ‘‘thereof; 

‘‘(B) to’’; and 


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(C) by striking ‘‘program, and (C) to’’ and inserting ‘‘program; and ‘‘(C) to’’; 

(6) in paragraph (11), by striking ‘‘)), or (B) a’’ and inserting ‘‘)); or 

‘‘(B) a’’; 

(7) in paragraph (17), by striking ‘‘, and’’ at the end and 

inserting a semicolon; 

(8) in paragraph (18), by striking the period at the end and 

inserting ‘‘; and’’; and 

(9) by adding at the end the following: 

‘‘(19) any additional payment under chapter 5 of title 37, 

United States Code, or otherwise designated by the Secretary to 

be appropriate for exclusion under this paragraph, that is received by or from a member of the United States Armed Forces 

deployed to a designated combat zone, if the additional pay— ‘‘(A) is the result of deployment to or service in a combat zone; and ‘‘(B) was not received immediately prior to serving in 

a combat zone.’’. 

SEC. 4102. STRENGTHENING THE FOOD PURCHASING POWER OF LOWINCOME AMERICANS. 

Section 5(e)(1) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2014(e)(1)) is amended— (1) in subparagraph (A)(ii), by striking ‘‘not less than $134’’ and all that follows through the end of the clause and inserting 

the following: ‘‘not less than— ‘‘(I) for fiscal year 2009, $144, $246, $203, and $127, respectively; and ‘‘(II) for fiscal year 2010 and each fiscal year 

thereafter, an amount that is equal to the amount 

from the previous fiscal year adjusted to the nearest lower dollar increment to reflect changes for the 

12-month period ending on the preceding June 30 

in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics of the Department of Labor, for items other 

than food.’’; 

(2) in subparagraph (B)(ii), by striking ‘‘not less than $269’’

and all that follows through the end of the clause and inserting 

the following: ‘‘not less than—

‘‘(I) for fiscal year 2009, $289; and 

‘‘(II) for fiscal year 2010 and each fiscal year 

thereafter, an amount that is equal to the amount 

from the previous fiscal year adjusted to the nearest lower dollar increment to reflect changes for the 

12-month period ending on the preceding June 30 

in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics of the Department of Labor, for items other 

than food.’’; and 

(3) by adding at the end the following: 

‘‘(C) REQUIREMENT.—Each adjustment under subparagraphs (A)(ii)(II) and (B)(ii)(II) shall be based on the 

unrounded amount for the prior 12-month period.’’. 


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SEC. 4103. SUPPORTING WORKING FAMILIES WITH CHILD CARE EXPENSES. 

Section 5(e)(3)(A) of the Food and Nutrition Act of 2008 (7 

U.S.C. 2014(e)(3)(A)) is amended by striking ‘‘, the maximum allowable level of which shall be $200 per month for each dependent 

child under 2 years of age and $175 per month for each other dependent,’’. 

SEC. 4104. ASSET INDEXATION, EDUCATION, AND RETIREMENT ACCOUNTS. 

(a) ADJUSTING COUNTABLE RESOURCES FOR INFLATION.—Section (5)(g) of the Food and Nutrition Act of 2008 (7 U.S.C. 2014(g)) 

is amended—

(1) by striking ‘‘(g)(1) The Secretary’’ and inserting the following: 

‘‘(g) ALLOWABLE FINANCIAL RESOURCES.—

‘‘(1) TOTAL AMOUNT.—

‘‘(A) IN GENERAL.—The Secretary’’. 

(2) in subparagraph (A) (as so designated by paragraph 

(1))—

(A) by inserting ‘‘(as adjusted in accordance with subparagraph (B))’’ after ‘‘$2,000’’; and 

(B) by inserting ‘‘(as adjusted in accordance with subparagraph (B))’’ after ‘‘$3,000’’; and 

(3) by adding at the end the following: 

‘‘(B) ADJUSTMENT FOR INFLATION.—

‘‘(i) IN GENERAL.—Beginning on October 1, 2008, 

and each October 1 thereafter, the amounts specified in 

subparagraph (A) shall be adjusted and rounded down 

to the nearest $250 increment to reflect changes for the 

12-month period ending the preceding June in the Consumer Price Index for All Urban Consumers published 

by the Bureau of Labor Statistics of the Department of 

Labor. 

‘‘(ii) REQUIREMENT.—Each adjustment under 

clause (i) shall be based on the unrounded amount for 

the prior 12-month period.’’. 

(b) EXCLUSION OF RETIREMENT ACCOUNTS FROM ALLOWABLE

FINANCIAL RESOURCES.—

(1) IN GENERAL.—Section 5(g)(2)(B)(v) of the Food and Nutrition Act of 2008 (7 U.S.C. 2014(g)(2)(B)(v)) is amended by 

striking ‘‘or retirement account (including an individual account)’’ and inserting ‘‘account’’. 

(2) MANDATORY AND DISCRETIONARY EXCLUSIONS.—Section 

5(g) of the Food and Nutrition Act of 2008 (7 U.S.C. 2014(g)) 

is amended by adding at the end the following: 

‘‘(7) EXCLUSION OF RETIREMENT ACCOUNTS FROM ALLOWABLE FINANCIAL RESOURCES.—

‘‘(A) MANDATORY EXCLUSIONS.—The Secretary shall exclude from financial resources under this subsection the 

value of—

‘‘(i) any funds in a plan, contract, or account, described in sections 401(a), 403(a), 403(b), 408, 408A, 

457(b), and 501(c)(18) of the Internal Revenue Code of 

1986 and the value of funds in a Federal Thrift SavVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00218 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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ings Plan account as provided in section 8439 of title 

5, United States Code; and ‘‘(ii) any retirement program or account included 

in any successor or similar provision that may be enacted and determined to be exempt from tax under the 

Internal Revenue Code of 1986. 

‘‘(B) DISCRETIONARY EXCLUSIONS.—The Secretary may 

exclude from financial resources under this subsection the 

value of any other retirement plans, contracts, or accounts 

(as determined by the Secretary).’’. (c) EXCLUSION OF EDUCATION ACCOUNTS FROM ALLOWABLE FI- NANCIAL RESOURCES.—Section 5(g) of the Food and Nutrition Act of 

2008 (7 U.S.C. 2014(g)) (as amended by subsection (b)) is amended 

by adding at the end the following: ‘‘(8) EXCLUSION OF EDUCATION ACCOUNTS FROM ALLOWABLE

FINANCIAL RESOURCES.— ‘‘(A) MANDATORY EXCLUSIONS.—The Secretary shall exclude from financial resources under this subsection the 

value of any funds in a qualified tuition program described 

in section 529 of the Internal Revenue Code of 1986 or in 

a Coverdell education savings account under section 530 of 

that Code. 

‘‘(B) DISCRETIONARY EXCLUSIONS.—The Secretary may 

exclude from financial resources under this subsection the 

value of any other education programs, contracts, or accounts (as determined by the Secretary).’’. 

SEC. 4105. FACILITATING SIMPLIFIED REPORTING. 

Section 6(c)(1)(A) of the Food and Nutrition Act of 2008 (7 

U.S.C. 2015(c)(1)(A)) is amended—

(1) by striking ‘‘reporting by’’ and inserting ‘‘reporting’’; 

(2) in clause (i), by inserting ‘‘for periods shorter than 4 

months by’’ before ‘‘migrant’’; 

(3) in clause (ii), by inserting ‘‘for periods shorter than 4 

months by’’ before ‘‘households’’; and 

(4) in clause (iii), by inserting ‘‘for periods shorter than 1 

year by’’ before ‘‘households’’. 

SEC. 4106. TRANSITIONAL BENEFITS OPTION. 

Section 11(s)(1) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2020(s)(1)) is amended—

(1) by striking ‘‘benefits to a household’’; and inserting 

‘‘benefits—

‘‘(A) to a household’’; 

(2) by striking the period at the end and inserting ‘‘; or’’; 

and 

(3) by adding at the end the following: 

‘‘(B) at the option of the State, to a household with children that ceases to receive cash assistance under a Statefunded public assistance program.’’. 

SEC. 4107. INCREASING THE MINIMUM BENEFIT. 

Section 8(a) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2017(a)) is amended by striking ‘‘$10 per month’’ and inserting ‘‘8 

percent of the cost of the thrifty food plan for a household containing 1 member, as determined by the Secretary under section 3, 

rounded to the nearest whole dollar increment’’. 


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SEC. 4108. EMPLOYMENT, TRAINING, AND JOB RETENTION. 

Section 6(d)(4) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2015(d)(4)) is amended—

(1) in subparagraph (B)—

(A) by redesignating clause (vii) as clause (viii); and 

(B) by inserting after clause (vi) the following: 

‘‘(vii) Programs intended to ensure job retention by 

providing job retention services, if the job retention 

services are provided for a period of not more than 90 

days after an individual who received employment and 

training services under this paragraph gains employment.’’; and 

(2) in subparagraph (F), by adding at the end the following: 

‘‘(iii) Any individual voluntarily electing to participate in a program under this paragraph shall not be 

subject to the limitations described in clauses (i) and 

(ii).’’. 

PART III—PROGRAM OPERATIONS 

SEC. 4111. NUTRITION EDUCATION. 

(a) AUTHORITY TO PROVIDE NUTRITION EDUCATION.—Section 

4(a) of the Food and Nutrition Act of 2008 (7 U.S.C. 2013(a)) is 

amended in the first sentence by inserting ‘‘and, through an approved State plan, nutrition education’’ after ‘‘an allotment’’. 

(b) IMPLEMENTATION.—Section 11 of the Food and Nutrition 

Act of 2008 (7 U.S.C. 2020) is amended by striking subsection (f) 

and inserting the following: 

‘‘(f) NUTRITION EDUCATION.—

‘‘(1) IN GENERAL.—State agencies may implement a nutrition education program for individuals eligible for program 

benefits that promotes healthy food choices consistent with the 

most recent Dietary Guidelines for Americans published under 

section 301 of the National Nutrition Monitoring and Related 

Research Act of 1990 (7 U.S.C. 5341). 

‘‘(2) DELIVERY OF NUTRITION EDUCATION.—State agencies 

may deliver nutrition education directly to eligible persons or 

through agreements with the National Institute of Food and Agriculture, including through the expanded food and nutrition 

education program under section 3(d) of the Act of May 8, 1914 

(7 U.S.C. 343(d)), and other State and community health and 

nutrition providers and organizations. 

‘‘(3) NUTRITION EDUCATION STATE PLANS.—

‘‘(A) IN GENERAL.—A State agency that elects to provide 

nutrition education under this subsection shall submit a 

nutrition education State plan to the Secretary for approval. 

‘‘(B) REQUIREMENTS.—The plan shall—

‘‘(i) identify the uses of the funding for local 

projects; and 

‘‘(ii) conform to standards established by the Secretary through regulations or guidance. 


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‘‘(C) REIMBURSEMENT.—State costs for providing nutrition education under this subsection shall be reimbursed 

pursuant to section 16(a). 

‘‘(4) NOTIFICATION.—To the maximum extent practicable, 

State agencies shall notify applicants, participants, and eligible 

program participants of the availability of nutrition education 

under this subsection.’’. 

SEC. 4112. TECHNICAL CLARIFICATION REGARDING ELIGIBILITY. 

Section 6(k) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2015(k)) is amended—

(1) by redesignating paragraphs (1) and (2) as subparagraphs (A) and (B), respectively, and indenting appropriately; 

(2) by striking ‘‘No member’’ and inserting the following: 

‘‘(1) IN GENERAL.—No member’’; and 

(3) by adding at the end the following: 

‘‘(2) PROCEDURES.—The Secretary shall—

‘‘(A) define the terms ‘fleeing’ and ‘actively seeking’ for 

purposes of this subsection; and 

‘‘(B) ensure that State agencies use consistent procedures established by the Secretary that disqualify individuals whom law enforcement authorities are actively seeking 

for the purpose of holding criminal proceedings against the 

individual.’’. 

SEC. 4113. CLARIFICATION OF SPLIT ISSUANCE. 

Section 7(h) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2016(h)) is amended by striking paragraph (2) and inserting the following: 

‘‘(2) REQUIREMENTS.—

‘‘(A) IN GENERAL.—Any procedure established under 

paragraph (1) shall—

‘‘(i) not reduce the allotment of any household for 

any period; and 

‘‘(ii) ensure that no household experiences an interval between issuances of more than 40 days. 

‘‘(B) MULTIPLE ISSUANCES.—The procedure may include issuing benefits to a household in more than 1 

issuance during a month only when a benefit correction is 

necessary.’’. 

SEC. 4114. ACCRUAL OF BENEFITS. 

Section 7(i) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2016(i)) is amended by adding at the end the following: 

‘‘(12) RECOVERING ELECTRONIC BENEFITS.—

‘‘(A) IN GENERAL.—A State agency shall establish a 

procedure for recovering electronic benefits from the account 

of a household due to inactivity. 

‘‘(B) BENEFIT STORAGE.—A State agency may store recovered electronic benefits off-line in accordance with subparagraph (D), if the household has not accessed the account after 6 months. 

‘‘(C) BENEFIT EXPUNGING.—A State agency shall expunge benefits that have not been accessed by a household 

after a period of 12 months. 

‘‘(D) NOTICE.—A State agency shall—


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‘‘(i) send notice to a household the benefits of which 

are stored under subparagraph (B); and 

‘‘(ii) not later than 48 hours after request by the 

household, make the stored benefits available to the 

household.’’. 

SEC. 4115. ISSUANCE AND USE OF PROGRAM BENEFITS. 

(a) IN GENERAL.—Section 7 of the Food and Nutrition Act of 

2008 (7 U.S.C. 2016) is amended—

(1) by striking the section designation and heading and all 

that follows through ‘‘subsection (j)) shall be’’ and inserting the 

following: 

‘‘SEC. 7. ISSUANCE AND USE OF PROGRAM BENEFITS. 

‘‘(a) IN GENERAL.—Except as provided in subsection (i), EBT 

cards shall be’’; 

(2) in subsection (b)—

(A) by striking ‘‘(b) Coupons’’ and inserting the following: 

‘‘(b) USE.—Benefits’’; and 

(B) by striking the second proviso; 

(3) in subsection (c)—

(A) by striking ‘‘(c) Coupons’’ and inserting the following: 

‘‘(c) DESIGN.—

‘‘(1) IN GENERAL.—EBT cards’’; 

(B) in the first sentence, by striking ‘‘and define their 

denomination’’; and 

(C) by striking the second sentence and inserting the 

following: 

‘‘(2) PROHIBITION.—The name of any public official shall 

not appear on any EBT card.’’; 

(4) by striking subsection (d); 

(5) in subsection (e)—

(A) by striking ‘‘coupons’’ each place it appears and inserting ‘‘benefits’’; and 

(B) by striking ‘‘coupon issuers’’ each place it appears 

and inserting ‘‘benefit issuers’’; 

(6) in subsection (f)—

(A) by striking ‘‘coupons’’ each place it appears and inserting ‘‘benefits’’; 

(B) by striking ‘‘coupon issuer’’ and inserting ‘‘benefit 

issuers’’; 

(C) by striking ‘‘including any losses’’ and all that follows through ‘‘section 11(e)(20),’’; and 

(D) by striking ‘‘and allotments’’; 

(7) by striking subsection (g) and inserting the following: 

‘‘(g) ALTERNATIVE BENEFIT DELIVERY.—

‘‘(1) IN GENERAL.—If the Secretary determines, in consultation with the Inspector General of the Department of Agriculture, that it would improve the integrity of the supplemental 

nutrition assistance program, the Secretary shall require a 

State agency to issue or deliver benefits using alternative methods. ‘‘(2) NO IMPOSITION OF COSTS.—The cost of documents or 

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posed upon a retail food store participating in the supplemental 

nutrition assistance program. ‘‘(3) DEVALUATION AND TERMINATION OF ISSUANCE OF

PAPER COUPONS.— ‘‘(A) COUPON ISSUANCE.—Effective on the date of enactment of the Food, Conservation, and Energy Act of 2008, no 

State shall issue any coupon, stamp, certificate, or authorization card to a household that receives supplemental nutrition assistance under this Act. ‘‘(B) EBT CARDS.—Effective beginning on the date that 

is 1 year after the date of enactment of the Food, Conservation, and Energy Act of 2008, only an EBT card issued 

under subsection (i) shall be eligible for exchange at any retail food store. ‘‘(C) DE-OBLIGATION OF COUPONS.—Coupons not redeemed during the 1-year period beginning on the date of 

enactment of the Food, Conservation, and Energy Act of 

2008 shall—

‘‘(i) no longer be an obligation of the Federal Government; and 

‘‘(ii) not be redeemable.’’; 

(8) in subsection (h)(1), by striking ‘‘coupons’’ and inserting 

‘‘benefits’’; 

(9) in subsection (i), by adding at the end the following: 

‘‘(12) INTERCHANGE FEES.—No interchange fees shall apply 

to electronic benefit transfer transactions under this subsection.’’; 

(10) in subsection (j)— (A) in paragraph (2)(A)(ii), by striking ‘‘printing, shipping, and redeeming coupons’’ and inserting ‘‘issuing and 

redeeming benefits’’; and 

(B) in paragraph (5), by striking ‘‘coupon’’ and inserting ‘‘benefit’’; 

(11) in subsection (k)—

(A) by striking ‘‘coupons in the form of’’ each place it 

appears and inserting ‘‘program benefits in the form of’’; 

(B) by striking ‘‘a coupon issued in the form of’’ each 

place it appears and inserting ‘‘program benefits in the 

form of’’; and 

(C) in subparagraph (A), by striking ‘‘subsection 

(i)(11)(A)’’ and inserting ‘‘subsection (h)(11)(A)’’; and 

(12) by redesignating subsections (e) through (k) as subsections (d) through (j), respectively. 

(b) CONFORMING AMENDMENTS.—

(1) Section 3 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2012) is amended—

(A) in subsection (a), by striking ‘‘coupons’’ and inserting ‘‘benefits’’; 

(B) by striking subsection (b) and inserting the following: ‘‘(b) BENEFIT.—The term ‘benefit’ means the value of supplemental nutrition assistance provided to a household by means of— ‘‘(1) an electronic benefit transfer under section 7(i); or 

‘‘(2) other means of providing assistance, as determined by 

the Secretary.’’; 


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(C) in subsection (c), in the first sentence, by striking 

‘‘authorization cards’’ and inserting ‘‘benefits’’; 

(D) in subsection (d), by striking ‘‘or access device’’ and 

all that follows through the end of the subsection and inserting a period; 

(E) in subsection (e)—

(i) by striking ‘‘(e) ‘Coupon issuer’ means’’ and inserting the following: 

‘‘(e) BENEFIT ISSUER.—The term ‘benefit issuer’ means’’; and 

(ii) by striking ‘‘coupons’’ and inserting ‘‘benefits’’; 

(F) in subsection (g)(7), by striking ‘‘subsection (r)’’ and 

inserting ‘‘subsection (j)’’; 

(G) in subsection (i)(5)—

(i) in subparagraph (B), by striking ‘‘subsection (r)’’

and inserting ‘‘subsection (j)’’; and 

(ii) in subparagraph (D), by striking ‘‘coupons’’ and 

inserting ‘‘benefits’’; 

(H) in subsection (j), by striking ‘‘(as that term is defined in subsection (p))’’; 

(I) in subsection (k)—

(i) in paragraph (1)(A), by striking ‘‘subsection 

(u)(1)’’ and inserting ‘‘subsection (r)(1)’’; 

(ii) in paragraph (2), by striking ‘‘subsections 

(g)(3), (4), (5), (7), (8), and (9) of this section’’ and inserting ‘‘paragraphs (3), (4), (5), (7), (8), and (9) of subsection (k)’’; and 

(iii) in paragraph (3), by striking ‘‘subsection (g)(6) 

of this section’’ and inserting ‘‘subsection (k)(6)’’; 

(J) in subsection (t), by inserting ‘‘, including point of 

sale devices,’’ after ‘‘other means of access’’; 

(K) in subsection (u), by striking ‘‘(as defined in subsection (g))’’; 

(L) by adding at the end the following: 

‘‘(v) EBT CARD.—The term ‘EBT card’ means an electronic benefit transfer card issued under section 7(i).’’; and 

(M) by redesignating subsections (a) through (v) as 

subsections (b), (d), (f), (g), (e), (h), (k), (l), (n), (o), (p), (q), 

(s), (t), (u), (v), (c), (j), (m), (a), (r), and (i), respectively, and 

moving the subsections so as to appear in alphabetical 

order. 

(2) Section 4(a) of the Food and Nutrition Act of 2008 (7 

U.S.C. 2013(a)) is amended—

(A) by striking ‘‘coupons’’ each place it appears and inserting ‘‘benefits’’; and 

(B) by striking ‘‘Coupons issued’’ and inserting ‘‘benefits issued’’. 

(3) Section 5 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2014) is amended—

(A) in subsection (a), by striking ‘‘section 3(i)(4)’’ and 

inserting ‘‘section 3(n)(4)’’; 

(B) in subsection (h)(3)(B), in the second sentence, by 

striking ‘‘section 7(i)’’ and inserting ‘‘section 7(h)’’; and 

(C) in subsection (i)(2)(E), by striking ‘‘, as defined in 

section 3(i) of this Act,’’. 


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(4) Section 6 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2015) is amended— (A) in subsection (b)(1)— (i) in subparagraph (B), by striking ‘‘coupons or 

authorization cards’’ and inserting ‘‘program benefits’’; 

and 

(ii) by striking ‘‘coupons’’ each place it appears and 

inserting ‘‘benefits’’; and 

(B) in subsection (d)(4)(L), by striking ‘‘section 

11(e)(22)’’ and inserting ‘‘section 11(e)(19)’’. (5) Section 8 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2017) is amended— (A) in subsection (b), by striking ‘‘, whether through 

coupons, access devices, or otherwise’’; and 

(B) in subsections (e)(1) and (f), by striking ‘‘section 

3(i)(5)’’ each place it appears and inserting ‘‘section 3(n)(5)’’. (6) Section 9 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2018) is amended— (A) by striking ‘‘coupons’’ each place it appears and inserting ‘‘benefits’’; 

(B) in subsection (a)— (i) in paragraph (1), by striking ‘‘coupon business’’ and inserting ‘‘benefit transactions’’; and 

(ii) by striking paragraph (3) and inserting the following: ‘‘(3) AUTHORIZATION PERIODS.—The Secretary shall establish specific time periods during which authorization to accept 

and redeem benefits shall be valid under the supplemental nutrition assistance program.’’; and 

(C) in subsection (g), by striking ‘‘section 3(g)(9)’’ and 

inserting ‘‘section 3(k)(9)’’. (7) Section 10 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2019) is amended— (A) by striking the section designation and heading 

and all that follows through ‘‘Regulations’’ and inserting 

the following: 

‘‘SEC. 10. REDEMPTION OF PROGRAM BENEFITS. 

‘‘Regulations’’; 

(B) by striking ‘‘section 3(k)(4) of this Act’’ and inserting ‘‘section 3(p)(4)’’; 

(C) by striking ‘‘section 7(i)’’ and inserting ‘‘section 

7(h)’’; and 

(D) by striking ‘‘coupons’’ each place it appears and inserting ‘‘benefits’’. 

(8) Section 11 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2020) is amended—

(A) in subsection (d)—

(i) by striking ‘‘section 3(n)(1) of this Act’’ each 

place it appears and inserting ‘‘section 3(t)(1)’’; and 

(ii) by striking ‘‘section 3(n)(2) of this Act’’ each 

place it appears and inserting ‘‘section 3(t)(2)’’; 

(B) in subsection (e)—

(i) in paragraph (8)(E), by striking ‘‘paragraph 

(16) or (20)(B)’’ and inserting ‘‘paragraph (15) or 

(18)(B)’’; 


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(ii) by striking paragraphs (15) and (19); 

(iii) by redesignating paragraphs (16) through (18) 

and (20) through (25) as paragraphs (15) through (17) 

and (18) through (23), respectively; and 

(iv) in paragraph (17) (as so redesignated), by 

striking ‘‘(described in section 3(n)(1) of this Act)’’ and 

inserting ‘‘described in section 3(t)(1)’’; 

(C) in subsection (h), by striking ‘‘coupon or coupons’’ and inserting ‘‘benefits’’; 

(D) by striking ‘‘coupon’’ each place it appears and inserting ‘‘benefit’’; 

(E) by striking ‘‘coupons’’ each place it appears and inserting ‘‘benefits’’; and 

(F) in subsection (q), by striking ‘‘section 11(e)(20)(B)’’ and inserting ‘‘subsection (e)(18)(B)’’. (9) Section 13 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2022) is amended by striking ‘‘coupons’’ each place it appears and inserting ‘‘benefits’’. (10) Section 15 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2024) is amended— (A) in subsection (a), by striking ‘‘coupons’’ and inserting ‘‘benefits’’; 

(B) in subsection (b)(1)— (i) by striking ‘‘coupons, authorization cards, or access devices’’ each place it appears and inserting ‘‘benefits’’; 

(ii) by striking ‘‘coupons or authorization cards’’ and inserting ‘‘benefits’’; and 

(iii) by striking ‘‘access device’’ each place it appears and inserting ‘‘benefit’’; 

(C) in subsection (c), by striking ‘‘coupons’’ each place 

it appears and inserting ‘‘benefits’’; 

(D) in subsection (d), by striking ‘‘Coupons’’ and inserting ‘‘Benefits’’; 

(E) by striking subsections (e) and (f); 

(F) by redesignating subsections (g) and (h) as subsections (e) and (f), respectively; and 

(G) in subsection (e) (as so redesignated), by striking 

‘‘coupon, authorization cards or access devices’’ and inserting ‘‘benefits’’. 

(11) Section 16(a) of the Food and Nutrition Act of 2008 (7 

U.S.C. 2025(a)) is amended by striking ‘‘coupons’’ each place it 

appears and inserting ‘‘benefits’’. 

(12) Section 17 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2026) is amended—

(A) in subsection (a)(2), by striking ‘‘coupon’’ and inserting ‘‘benefit’’; 

(B) in subsection (b)(1)—

(i) in subparagraph (B)—

(I) in clause (iv)—

(aa) in subclause (I), inserting ‘‘or otherwise providing benefits in a form not restricted 

to the purchase of food’’ after ‘‘of cash’’; 

(bb) in subclause (III)(aa), by striking 

‘‘section 3(i)’’ and inserting ‘‘section 3(n)’’; and 


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(cc) in subclause (VII), by striking ‘‘section 

7(j)’’ and inserting ‘‘section 7(i)’’; and 

(II) in clause (v)—

(aa) by striking ‘‘countersigned food coupons or similar’’; and 

(bb) by striking ‘‘food coupons’’ and inserting ‘‘EBT cards’’; and 

(ii) in subparagraph (C)(i)(I), by striking ‘‘coupons’’

and inserting ‘‘EBT cards’’; 

(C) in subsection (f), by striking ‘‘section 7(g)(2)’’ and 

inserting ‘‘section 7(f)(2)’’; and 

(D) in subsection (j), by striking ‘‘coupon’’ and inserting 

‘‘benefit’’. 

(13) Section 19(a)(2)(A)(ii) of the Food and Nutrition Act of 

2008 (7 U.S.C. 2028(a)(2)(A)(ii)) is amended by striking ‘‘section 

3(o)(4)’’ and inserting ‘‘section 3(u)(4)’’. 

(14) Section 21 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2030) is repealed. 

(15) Section 22 of the Food and Nutrition Act of 2008 (7 

U.S.C. 2031) is amended—

(A) by striking ‘‘food coupons’’ each place it appears 

and inserting ‘‘benefits’’; 

(B) by striking ‘‘coupons’’ each place it appears and inserting ‘‘benefits’’; and 

(C) in subsection (g)(1)(A), by striking ‘‘coupon’’ and inserting ‘‘benefits’’. 

(16) Section 26(f)(3) of the Food and Nutrition Act of 2008 

(7 U.S.C. 2035(f)(3)) is amended—

(A) in subparagraph (A), by striking ‘‘subsections (a) 

through (g)’’ and inserting ‘‘subsections (a) through (f)’’; and 

(B) in subparagraph (E), by striking ‘‘(16), (18), (20), 

(24), and (25)’’ and inserting ‘‘(15), (17), (18), (22), and 

(23)’’. 

(c) CONFORMING CROSS-REFERENCES.—

(1) IN GENERAL.—

(A) USE OF TERMS.—Each provision of law described in 

subparagraph (B) is amended (as applicable)—

(i) by striking ‘‘coupons’’ each place it appears and 

inserting ‘‘benefits’’; 

(ii) by striking ‘‘coupon’’ each place it appears and 

inserting ‘‘benefit’’; 

(iii) by striking ‘‘food coupons’’ each place it appears and inserting ‘‘benefits’’; 

(iv) in each section heading, by striking ‘‘FOOD

COUPONS’’ each place it appears and inserting ‘‘BENEFITS’’; 

(v) by striking ‘‘food stamp coupon’’ each place it 

appears and inserting ‘‘benefit’’; and 

(vi) by striking ‘‘food stamps’’ each place it appears 

and inserting ‘‘benefits’’. 

(B) PROVISIONS OF LAW.—The provisions of law referred to in subparagraph (A) are the following: 

(i) Section 2 of Public Law 103–205 (7 U.S.C. 2012 

note; 107 Stat. 2418). 


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(ii) Section 1956(c)(7)(D) of title 18, United States 

Code. 

(iii) Titles II through XIX of the Social Security 

Act (42 U.S.C. 401 et seq.). 

(iv) Section 401(b)(3) of the Social Security Amendments of 1972 (42 U.S.C. 1382e note; Public Law 92–

603). 

(v) The Robert T. Stafford Disaster Relief and 

Emergency Assistance Act (42 U.S.C. 5121 et seq.). 

(vi) Section 802(d)(2)(A)(i)(II) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 

8011(d)(2)(A)(i)(II)). 

(2) DEFINITION REFERENCES.—

(A) Section 2 of Public Law 103–205 (7 U.S.C. 2012 

note; 107 Stat. 2418) is amended by striking ‘‘section 

3(k)(1)’’ and inserting ‘‘section 3(p)(1)’’. 

(B) Section 205 of the Food Stamp Program Improvements Act of 1994 (7 U.S.C. 2012 note; Public Law 103–

225) is amended by striking ‘‘section 3(k) of such Act (as 

amended by section 201)’’ and inserting ‘‘section 3(p) of that 

Act’’. 

(C) Section 115 of the Personal Responsibility and 

Work Opportunity Reconciliation Act of 1996 (21 U.S.C. 

862a) is amended—

(i) by striking ‘‘section 3(h)’’ each place it appears 

and inserting ‘‘section 3(l)’’; and 

(ii) in subsection (e)(2), by striking ‘‘section 3(m)’’

and inserting ‘‘section 3(s)’’. 

(D) Section 402(a) of the Personal Responsibility and 

Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 

1612(a)) is amended—

(i) in paragraph (2)(F)(ii), by striking ‘‘section 3(r)’’

and inserting ‘‘section 3(j)’’; and 

(ii) in paragraph (3)(B), by striking ‘‘section 3(h)’’

and inserting ‘‘section 3(l)’’. 

(E) Section 3803(c)(2)(C)(vii) of title 31, United States 

Code, is amended by striking ‘‘section 3(h)’’ and inserting 

‘‘section 3(l)’’. 

(F) Section 303(d)(4) of the Social Security Act (42 

U.S.C. 503(d)(4)) is amended by striking ‘‘section 3(n)(1)’’

and inserting ‘‘section 3(t)(1)’’. 

(G) Section 404 of the Social Security Act (42 U.S.C. 

604) is amended by striking ‘‘section 3(h)’’ each place it appears and inserting ‘‘section 3(l)’’. 

(H) Section 531 of the Social Security Act (42 U.S.C. 

654) is amended by striking ‘‘section 3(h)’’ each place it appears and inserting ‘‘section 3(l)’’. 

(I) Section 802(d)(2)(A)(i)(II) of the Cranston-Gonzalez 

National Affordable Housing Act (42 U.S.C. 

8011(d)(2)(A)(i)(II)) is amended by striking ‘‘(as defined in 

section 3(e) of such Act)’’. 

(d) REFERENCES.—Any reference in any Federal, State, tribal, 

or local law (including regulations) to a ‘‘coupon’’, ‘‘authorization 

card’’, or other access device provided under the Food and Nutrition 


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Act of 2008 (7 U.S.C. 2011 et seq.) shall be considered to be a reference to a ‘‘benefit’’ provided under that Act. 

SEC. 4116. REVIEW OF MAJOR CHANGES IN PROGRAM DESIGN. 

Section 11 of the Food and Nutrition Act of 2008 (7 U.S.C. 

2020) is amended by striking the section enumerator and heading 

and subsection (a) and inserting the following: 

‘‘SEC. 11. ADMINISTRATION. 

‘‘(a) STATE RESPONSIBILITY.—

‘‘(1) IN GENERAL.—The State agency of each participating 

State shall have responsibility for certifying applicant households and issuing EBT cards. 

‘‘(2) LOCAL ADMINISTRATION.—The responsibility of the 

agency of the State government shall not be affected by whether 

the program is operated on a State-administered or county-administered basis, as provided under section 3(t)(1). 

‘‘(3) RECORDS.—

‘‘(A) IN GENERAL.—Each State agency shall keep such 

records as may be necessary to determine whether the program is being conducted in compliance with this Act (including regulations issued under this Act). 

‘‘(B) INSPECTION AND AUDIT.—Records described in 

subparagraph (A) shall—

‘‘(i) be available for inspection and audit at any 

reasonable time; 

‘‘(ii) subject to subsection (e)(8), be available for review in any action filed by a household to enforce any 

provision of this Act (including regulations issued 

under this Act); and 

‘‘(iii) be preserved for such period of not less than 

3 years as may be specified in regulations. 

‘‘(4) REVIEW OF MAJOR CHANGES IN PROGRAM DESIGN.—

‘‘(A) IN GENERAL.—The Secretary shall develop standards for identifying major changes in the operations of a 

State agency, including—

‘‘(i) large or substantially-increased numbers of 

low-income households that do not live in reasonable 

proximity to an office performing the major functions 

described in subsection (e); 

‘‘(ii) substantial increases in reliance on automated 

systems for the performance of responsibilities previously performed by personnel described in subsection 

(e)(6)(B); 

‘‘(iii) changes that potentially increase the difficulty of reporting information under subsection (e) or 

section 6(c); and 

‘‘(iv) changes that may disproportionately increase 

the burdens on any of the types of households described 

in subsection (e)(2)(A). 

‘‘(B) NOTIFICATION.—If a State agency implements a 

major change in operations, the State agency shall—

‘‘(i) notify the Secretary; and 

‘‘(ii) collect such information as the Secretary shall 

require to identify and correct any adverse effects on 

program integrity or access, including access by any of 


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the types of households described in subsection 

(e)(2)(A).’’. 

SEC. 4117. CIVIL RIGHTS COMPLIANCE. 

Section 11 of the Food and Nutrition Act of 2008 (7 U.S.C. 

2020) is amended by striking subsection (c) and inserting the following: 

‘‘(c) CIVIL RIGHTS COMPLIANCE.—

‘‘(1) IN GENERAL.—In the certification of applicant households for the supplemental nutrition assistance program, there 

shall be no discrimination by reason of race, sex, religious 

creed, national origin, or political affiliation. 

‘‘(2) RELATION TO OTHER LAWS.—The administration of the 

program by a State agency shall be consistent with the rights 

of households under the following laws (including implementing regulations): 

‘‘(A) The Age Discrimination Act of 1975 (42 U.S.C. 

6101 et seq.). 

‘‘(B) Section 504 of the Rehabilitation Act of 1973 (29 

U.S.C. 794). 

‘‘(C) The Americans with Disabilities Act of 1990 (42 

U.S.C. 12101 et seq.). 

‘‘(D) Title VI of the Civil Rights Act of 1964 (42 U.S.C. 

2000d et seq.).’’. 

SEC. 4118. CODIFICATION OF ACCESS RULES. 

Section 11(e)(1) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2020(e)(1)) is amended—

(1) by striking ‘‘shall (A) at’’ and inserting ‘‘shall—

‘‘(A) at’’; and 

(2) by striking ‘‘and (B) use’’ and inserting ‘‘and 

‘‘(B) comply with regulations of the Secretary requiring 

the use of’’. 

SEC. 4119. STATE OPTION FOR TELEPHONIC SIGNATURE. 

Section 11(e)(2)(C) of the Food and Nutrition Act of 2008 (7 

U.S.C. 2020(e)(2)(C)) is amended—

(1) by striking ‘‘(C) Nothing in this Act’’ and inserting the 

following: 

‘‘(C) ELECTRONIC AND AUTOMATED SYSTEMS.—

‘‘(i) IN GENERAL.—Nothing in this Act’’; and 

(2) by adding at the end the following: 

‘‘(ii) STATE OPTION FOR TELEPHONIC SIGNATURE.—

A State agency may establish a system by which an applicant household may sign an application through a 

recorded verbal assent over the telephone. 

‘‘(iii) REQUIREMENTS.—A system established under 

clause (ii) shall—

‘‘(I) record for future reference the verbal assent of the household member and the information 

to which assent was given; 

‘‘(II) include effective safeguards against impersonation, identity theft, and invasions of privacy; 

‘‘(III) not deny or interfere with the right of the 

household to apply in writing; 


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‘‘(IV) promptly provide to the household member a written copy of the completed application, 

with instructions for a simple procedure for correcting any errors or omissions; 

‘‘(V) comply with paragraph (1)(B); 

‘‘(VI) satisfy all requirements for a signature 

on an application under this Act and other laws 

applicable to the supplemental nutrition assistance 

program, with the date on which the household 

member provides verbal assent considered as the 

date of application for all purposes; and 

‘‘(VII) comply with such other standards as the 

Secretary may establish.’’. 

SEC. 4120. PRIVACY PROTECTIONS. 

Section 11(e)(8) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2020(e)(8)) is amended—

(1) in the matter preceding subparagraph (A)—

(A) by striking ‘‘limit’’ and inserting ‘‘prohibit’’; and 

(B) by striking ‘‘to persons’’ and all that follows 

through ‘‘State programs’’; 

(2) by redesignating subparagraphs (A) through (E) as subparagraphs (B) through (F), respectively; 

(3) by inserting before subparagraph (B) (as so redesignated) the following: 

‘‘(A) the safeguards shall permit—

‘‘(i) the disclosure of such information to persons 

directly connected with the administration or enforcement of the provisions of this Act, regulations issued 

pursuant to this Act, Federal assistance programs, or 

federally-assisted State programs; and 

‘‘(ii) the subsequent use of the information by persons described in clause (i) only for such administration or enforcement;’’; and 

(4) in subparagraph (F) (as so redesignated) by inserting 

‘‘or subsection (u)’’ before the semicolon at the end. 

SEC. 4121. PRESERVATION OF ACCESS AND PAYMENT ACCURACY. 

Section 16 of the Food and Nutrition Act of 2008 (7 U.S.C. 

2025) is amended by striking subsection (g) and inserting the following: 

‘‘(g) COST SHARING FOR COMPUTERIZATION.—

‘‘(1) IN GENERAL.—Except as provided in paragraphs (2) 

and (3), the Secretary is authorized to pay to each State agency 

the amount provided under subsection (a)(6) for the costs incurred by the State agency in the planning, design, development, or installation of 1 or more automatic data processing 

and information retrieval systems that the Secretary determines—

‘‘(A) would assist in meeting the requirements of this 

Act; 

‘‘(B) meet such conditions as the Secretary prescribes; 

‘‘(C) are likely to provide more efficient and effective 

administration of the supplemental nutrition assistance 

program; 


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‘‘(D) would be compatible with other systems used in 

the administration of State programs, including the program funded under part A of title IV of the Social Security 

Act (42 U.S.C. 601 et seq.); 

‘‘(E) would be tested adequately before and after implementation, including through pilot projects in limited areas 

for major systems changes as determined under rules promulgated by the Secretary, data from which shall be thoroughly evaluated before the Secretary approves the system 

to be implemented more broadly; and 

‘‘(F) would be operated in accordance with an adequate 

plan for—

‘‘(i) continuous updating to reflect changed policy 

and circumstances; and 

‘‘(ii) testing the effect of the system on access for eligible households and on payment accuracy. 

‘‘(2) LIMITATION.—The Secretary shall not make payments 

to a State agency under paragraph (1) to the extent that the 

State agency—

‘‘(A) is reimbursed for the costs under any other Federal program; or 

‘‘(B) uses the systems for purposes not connected with 

the supplemental nutrition assistance program.’’. 

SEC. 4122. FUNDING OF EMPLOYMENT AND TRAINING PROGRAMS. 

Section 16(h)(1)(A) of the Food and Nutrition Act of 2008 (7 

U.S.C. 2025(h)(1)(A)) is amended in subparagraph (A), by striking 

‘‘to remain available until expended’’ and inserting ‘‘to remain available for 15 months’’. 

PART IV—PROGRAM INTEGRITY 

SEC. 4131. ELIGIBILITY DISQUALIFICATION. 

Section 6 of the Food and Nutrition Act of 2008 (7 U.S.C. 2015) 

is amended by adding at the end the following: 

‘‘(p) DISQUALIFICATION FOR OBTAINING CASH BY DESTROYING

FOOD AND COLLECTING DEPOSITS.—Subject to any requirements established by the Secretary, any person who has been found by a 

State or Federal court or administrative agency in a hearing under 

subsection (b) to have intentionally obtained cash by purchasing 

products with supplemental nutrition assistance program benefits 

that have containers that require return deposits, discarding the 

product, and returning the container for the deposit amount shall 

be ineligible for benefits under this Act for such period of time as 

the Secretary shall prescribe by regulation. 

‘‘(q) DISQUALIFICATION FOR SALE OF FOOD PURCHASED WITH

SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM BENEFITS.—Subject to any requirements established by the Secretary, any person 

who has been found by a State or Federal court or administrative 

agency in a hearing under subsection (b) to have intentionally sold 

any food that was purchased using supplemental nutrition assistance program benefits shall be ineligible for benefits under this Act 

for such period of time as the Secretary shall prescribe by regulation.’’. 


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SEC. 4132. CIVIL PENALTIES AND DISQUALIFICATION OF RETAIL FOOD 

STORES AND WHOLESALE FOOD CONCERNS. 

Section 12 of the Food and Nutrition Act of 2008 (7 U.S.C. 

2021) is amended—

(1) by striking the section designation and heading and all 

that follows through the end of subsection (a) and inserting the 

following: 

‘‘SEC. 12. CIVIL PENALTIES AND DISQUALIFICATION OF RETAIL FOOD 

STORES AND WHOLESALE FOOD CONCERNS. 

‘‘(a) DISQUALIFICATION.—

‘‘(1) IN GENERAL.—An approved retail food store or wholesale food concern that violates a provision of this Act or a regulation under this Act may be— ‘‘(A) disqualified for a specified period of time from further participation in the supplemental nutrition assistance 

program; ‘‘(B) assessed a civil penalty of up to $100,000 for each 

violation; or ‘‘(C) both. ‘‘(2) REGULATIONS.—Regulations promulgated under this 

Act shall provide criteria for the finding of a violation of, the 

suspension or disqualification of and the assessment of a civil 

penalty against a retail food store or wholesale food concern on 

the basis of evidence that may include facts established through 

on-site investigations, inconsistent redemption data, or evidence 

obtained through a transaction report under an electronic benefit transfer system.’’; 

(2) in subsection (b)— (A) by striking ‘‘(b) Disqualification’’ and inserting the 

following: ‘‘(b) PERIOD OF DISQUALIFICATION.—Subject to subsection (c), a 

disqualification’’; 

(B) in paragraph (1), by striking ‘‘of no less than six 

months nor more than five years’’ and inserting ‘‘not to exceed 5 years’’; 

(C) in paragraph (2), by striking ‘‘of no less than twelve 

months nor more than ten years’’ and inserting ‘‘not to exceed 10 years’’; 

(D) in paragraph (3)(B)—

(i) by inserting ‘‘or a finding of the unauthorized 

redemption, use, transfer, acquisition, alteration, or 

possession of EBT cards’’ after ‘‘concern’’ the first place 

it appears; and 

(ii) by striking ‘‘civil money penalties’’ and inserting ‘‘civil penalties’’; and 

(E) by striking ‘‘civil money penalty’’ each place it appears and inserting ‘‘civil penalty’’; 

(3) in subsection (c)—

(A) by striking ‘‘(c) The action’’ and inserting the following: 

‘‘(c) CIVIL PENALTY AND REVIEW OF DISQUALIFICATION AND PENALTY DETERMINATIONS.—

‘‘(1) CIVIL PENALTY.—In addition to a disqualification 

under this section, the Secretary may assess a civil penalty in 

an amount not to exceed $100,000 for each violation. 


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‘‘(2) REVIEW.—The action’’; and 

(B) in paragraph (2) (as designated by subparagraph 

(A)), by striking ‘‘civil money penalty’’ and inserting ‘‘civil 

penalty’’; 

(4) in subsection (d)—

(A) by striking ‘‘(d)’’ and all that follows through ‘‘. The 

Secretary shall’’ and inserting the following: 

‘‘(d) CONDITIONS OF AUTHORIZATION.—

‘‘(1) IN GENERAL.—As a condition of authorization to accept 

and redeem benefits, the Secretary may require a retail food 

store or wholesale food concern that, pursuant to subsection (a), 

has been disqualified for more than 180 days, or has been subjected to a civil penalty in lieu of a disqualification period of 

more than 180 days, to furnish a collateral bond or irrevocable 

letter of credit for a period of not more than 5 years to cover 

the value of benefits that the store or concern may in the future 

accept and redeem in violation of this Act. 

‘‘(2) COLLATERAL.—The Secretary also may require a retail 

food store or wholesale food concern that has been sanctioned 

for a violation and incurs a subsequent sanction regardless of 

the length of the disqualification period to submit a collateral 

bond or irrevocable letter of credit. 

‘‘(3) BOND REQUIREMENTS.—The Secretary shall’’; 

(B) by striking ‘‘If the Secretary finds’’ and inserting 

the following: 

‘‘(4) FORFEITURE.—If the Secretary finds’’; and 

(C) by striking ‘‘Such store or concern’’ and inserting 

the following: 

‘‘(5) HEARING.—A store or concern described in paragraph 

(4)’’; 

(5) in subsection (e), by striking ‘‘civil money penalty’’ each 

place it appears and inserting ‘‘civil penalty’’; and 

(6) by adding at the end the following: 

‘‘(h) FLAGRANT VIOLATIONS.—

‘‘(1) IN GENERAL.—The Secretary, in consultation with the 

Inspector General of the Department of Agriculture, shall establish procedures under which the processing of program benefit 

redemptions for a retail food store or wholesale food concern 

may be immediately suspended pending administrative action 

to disqualify the retail food store or wholesale food concern. 

‘‘(2) REQUIREMENTS.—Under the procedures described in 

paragraph (1), if the Secretary, in consultation with the Inspector General, determines that a retail food store or wholesale 

food concern is engaged in flagrant violations of this Act (including regulations promulgated under this Act), unsettled program benefits that have been redeemed by the retail food store 

or wholesale food concern—

‘‘(A) may be suspended; and 

‘‘(B)(i) if the program disqualification is upheld, may 

be subject to forfeiture pursuant to section 15(g); or 

‘‘(ii) if the program disqualification is not upheld, shall 

be released to the retail food store or wholesale food concern. 


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‘‘(3) NO LIABILITY FOR INTEREST.—The Secretary shall not 

be liable for the value of any interest on funds suspended under 

this subsection.’’. 

SEC. 4133. MAJOR SYSTEMS FAILURES. 

Section 13(b) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2022(b)) is amended by adding at the end the following: 

‘‘(5) OVERISSUANCES CAUSED BY SYSTEMIC STATE ERRORS.—

‘‘(A) IN GENERAL.—If the Secretary determines that a 

State agency overissued benefits to a substantial number of 

households in a fiscal year as a result of a major systemic 

error by the State agency, as defined by the Secretary, the 

Secretary may prohibit the State agency from collecting 

these overissuances from some or all households. 

‘‘(B) PROCEDURES.—

‘‘(i) INFORMATION REPORTING BY STATES.—Every 

State agency shall provide to the Secretary all information requested by the Secretary concerning the issuance 

of benefits to households by the State agency in the applicable fiscal year. 

‘‘(ii) FINAL DETERMINATION.—After reviewing relevant information provided by a State agency, the Secretary shall make a final determination—

‘‘(I) whether the State agency overissued benefits to a substantial number of households as a result of a systemic error in the applicable fiscal 

year; and 

‘‘(II) as to the amount of the overissuance in 

the applicable fiscal year for which the State agency is liable. 

‘‘(iii) ESTABLISHING A CLAIM.—Upon determining 

under clause (ii) that a State agency has overissued 

benefits to households due to a major systemic error determined under subparagraph (A), the Secretary shall 

establish a claim against the State agency equal to the 

value of the overissuance caused by the systemic error. 

‘‘(iv) ADMINISTRATIVE AND JUDICIAL REVIEW.—Administrative and judicial review, as provided in section 

14, shall apply to the final determinations by the Secretary under clause (ii). 

‘‘(v) REMISSION TO THE SECRETARY.—

‘‘(I) DETERMINATION NOT APPEALED.—If the determination of the Secretary under clause (ii) is not 

appealed, the State agency shall, as soon as practicable, remit to the Secretary the dollar amount 

specified in the claim under clause (iii). 

‘‘(II) DETERMINATION APPEALED.—If the determination of the Secretary under clause (ii) is appealed, upon completion of administrative and judicial review under clause (iv), and a finding of liability on the part of the State, the appealing State 

agency shall, as soon as practicable, remit to the 

Secretary a dollar amount subject to the finding 

made in the administrative and judicial review. 

‘‘(vi) ALTERNATIVE METHOD OF COLLECTION.—


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‘‘(I) IN GENERAL.—If a State agency fails to 

make a payment under clause (v) within a reasonable period of time, as determined by the Secretary, the Secretary may reduce any amount due 

to the State agency under any other provision of 

this Act by the amount due. 

‘‘(II) ACCRUAL OF INTEREST.—During the period of time determined by the Secretary to be reasonable under subclause (I), interest in the amount 

owed shall not accrue. 

‘‘(vii) LIMITATION.—Any liability amount established under section 16(c)(1)(C) shall be reduced by the 

amount of the claim established under this subparagraph.’’. 

PART V—MISCELLANEOUS 

SEC. 4141. PILOT PROJECTS TO EVALUATE HEALTH AND NUTRITION 

PROMOTION IN THE SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM. 

Section 17 of the Food and Nutrition Act of 2008 (7 U.S.C. 

2026) is amended by adding at the end the following: 

‘‘(k) PILOT PROJECTS TO EVALUATE HEALTH AND NUTRITION

PROMOTION IN THE SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM.—

‘‘(1) IN GENERAL.—The Secretary shall carry out, under 

such terms and conditions as the Secretary considers to be appropriate, pilot projects to develop and test methods—

‘‘(A) of using the supplemental nutrition assistance program to improve the dietary and health status of households eligible for or participating in the supplemental nutrition assistance program; and 

‘‘(B) to reduce overweight, obesity (including childhood 

obesity), and associated co-morbidities in the United States. 

‘‘(2) GRANTS.—

‘‘(A) IN GENERAL.—In carrying out this subsection, the 

Secretary may enter into competitively awarded contracts 

or cooperative agreements with, or provide grants to, public 

or private organizations or agencies (as defined by the Secretary), for use in accordance with projects that meet the 

strategy goals of this subsection. 

‘‘(B) APPLICATION.—To be eligible to receive a contract, 

cooperative agreement, or grant under this paragraph, an 

organization shall submit to the Secretary an application 

at such time, in such manner, and containing such information as the Secretary may require. 

‘‘(C) SELECTION CRITERIA.—Pilot projects shall be evaluated against publicly disseminated criteria that may include—

‘‘(i) identification of a low-income target audience 

that corresponds to individuals living in households 

with incomes at or below 185 percent of the poverty 

level; 


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‘‘(ii) incorporation of a scientifically based strategy 

that is designed to improve diet quality through more 

healthful food purchases, preparation, or consumption; ‘‘(iii) a commitment to a pilot project that allows 

for a rigorous outcome evaluation, including data collection; ‘‘(iv) strategies to improve the nutritional value of 

food served during school hours and during afterschool hours; ‘‘(v) innovative ways to provide significant improvement to the health and wellness of children; ‘‘(vi) other criteria, as determined by the Secretary. ‘‘(D) USE OF FUNDS.—Funds provided under this paragraph shall not be used for any project that limits the use 

of benefits under this Act. 

‘‘(3) PROJECTS.—Pilot projects carried out under paragraph 

(1) may include projects to determine whether healthier food 

purchases by and healthier diets among households participating in the supplemental nutrition assistance program result 

from projects that—

‘‘(A) increase the supplemental nutrition assistance 

purchasing power of the participating households by providing increased supplemental nutrition assistance program benefit allotments to the participating households; 

‘‘(B) increase access to farmers markets by participating households through the electronic redemption of 

supplemental nutrition assistance program benefits at 

farmers’ markets; 

‘‘(C) provide incentives to authorized supplemental nutrition assistance program retailers to increase the availability of healthy foods to participating households; 

‘‘(D) subject authorized supplemental nutrition assistance program retailers to stricter retailer requirements with 

respect to carrying and stocking healthful foods; ‘‘(E) provide incentives at the point of purchase to encourage households participating in the supplemental nutrition assistance program to purchase fruits, vegetables, or 

other healthful foods; or ‘‘(F) provide to participating households integrated 

communication and education programs, including the provision of funding for a portion of a school-based nutrition 

coordinator to implement a broad nutrition action plan and 

parent nutrition education programs in elementary schools, 

separately or in combination with pilot projects carried out 

under subparagraphs (A) through (E). 

‘‘(4) EVALUATION AND REPORTING.—

‘‘(A) EVALUATION.—

‘‘(i) INDEPENDENT EVALUATION.—

‘‘(I) IN GENERAL.—The Secretary shall provide 

for an independent evaluation of projects selected 

under this subsection that measures the impact of 

the pilot program on health and nutrition as described in paragraph (1). ‘‘(II) REQUIREMENT.—The independent evaluation under subclause (I) shall use rigorous methVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00237 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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odologies, particularly random assignment or 

other methods that are capable of producing scientifically valid information regarding which activities are effective. 

‘‘(ii) COSTS.—The Secretary may use funds provided to carry out this section to pay costs associated 

with monitoring and evaluating each pilot project. 

‘‘(B) REPORTING.—Not later than 90 days after the last 

day of fiscal year 2009 and each fiscal year thereafter until 

the completion of the last evaluation under subparagraph 

(A), the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee 

on Agriculture, Nutrition, and Forestry of the Senate a report that includes a description of— ‘‘(i) the status of each pilot project; 

‘‘(ii) the results of the evaluation completed during 

the previous fiscal year; and ‘‘(iii) to the maximum extent practicable— ‘‘(I) the impact of the pilot project on appropriate health, nutrition, and associated behavioral 

outcomes among households participating in the 

pilot project; 

‘‘(II) baseline information relevant to the stated goals and desired outcomes of the pilot project; 

and 

‘‘(III) equivalent information about similar or 

identical measures among control or comparison 

groups that did not participate in the pilot project. 

‘‘(C) PUBLIC DISSEMINATION.—In addition to the reporting requirements under subparagraph (B), evaluation results shall be shared broadly to inform policy makers, service providers, other partners, and the public in order to promote wide use of successful strategies. 

‘‘(5) FUNDING.— ‘‘(A) AUTHORIZATION OF APPROPRIATIONS.—There are 

authorized to be appropriated such sums as are necessary 

to carry out this section for each of fiscal years 2008 

through 2012. ‘‘(B) MANDATORY FUNDING.—Out of any funds made 

available under section 18, on October 1, 2008, the Secretary shall make available $20,000,000 to carry out a 

project described in paragraph (3)(E), to remain available 

until expended.’’. 

SEC. 4142. STUDY ON COMPARABLE ACCESS TO SUPPLEMENTAL NUTRITION ASSISTANCE FOR PUERTO RICO. 

(a) IN GENERAL.—The Secretary shall carry out a study of the 

feasibility and effects of including the Commonwealth of Puerto 

Rico in the definition of the term ‘‘State’’ under section 3 of the Food 

and Nutrition Act of 2008 (7 U.S.C. 2012), in lieu of providing block 

grants under section 19 of that Act (7 U.S.C. 2028). 

(b) INCLUSIONS.—The study shall include—

(1) an assessment of the administrative, financial management, and other changes that would be necessary for the Commonwealth to establish a comparable supplemental nutrition 

assistance program, including compliance with appropriate proVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00238 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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gram rules under the Food and Nutrition Act of 2008 (7 U.S.C. 

2011 et seq.), such as— (A) benefit levels under section 3(u) of that Act (7 

U.S.C. 2012(u)); 

(B) income eligibility standards under sections 5(c) and 

6 of that Act (7 U.S.C. 2014(c), 2015); and 

(C) deduction levels under section 5(e) of that Act (7 

U.S.C. 2014(e)); 

(2) an estimate of the impact on Federal and Commonwealth benefit and administrative costs; 

(3) an assessment of the impact of the program on low-income Puerto Ricans, as compared to the program under section 

19 of that Act (7 U.S.C. 2028); and 

(4) such other matters as the Secretary considers to be appropriate. 

(c) REPORT.—Not later than 2 years after the date of enactment 

of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes 

the results of the study conducted under this section. 

(d) FUNDING.— (1) IN GENERAL.—On October 1, 2008, out of any funds in 

the Treasury not otherwise appropriated, the Secretary of the 

Treasury shall transfer to the Secretary to carry out this section 

$1,000,000, to remain available until expended. 

(2) RECEIPT AND ACCEPTANCE.—The Secretary shall be entitled to receive, shall accept, and shall use to carry out this section the funds transferred under paragraph (1), without further 

appropriation. 

Subtitle B—Food Distribution Programs 

PART I—EMERGENCY FOOD ASSISTANCE 

PROGRAM 

SEC. 4201. EMERGENCY FOOD ASSISTANCE. 

(a) PURCHASE OF COMMODITIES.—Section 27(a) of the Food and 

Nutrition Act of 2008 (7 U.S.C. 2036(a)) is amended by—

(1) by striking ‘‘(A) PURCHASE OF COMMODITIES’’ and all 

that follows through ‘‘$140,000,000 of’’ and inserting the following: 

‘‘(a) PURCHASE OF COMMODITIES.—

‘‘(1) IN GENERAL.—From amounts made available to carry 

out this Act, for each of the fiscal years 2008 through 2012, the 

Secretary shall purchase a dollar amount described in paragraph (2) of’’; and 

(2) by adding at the end the following: 

‘‘(2) AMOUNTS.—The Secretary shall use to carry out paragraph (1)—

‘‘(A) for fiscal year 2008, $190,000,000; 

‘‘(B) for fiscal year 2009, $250,000,000; and 

‘‘(C) for each of fiscal years 2010 through 2012, the dollar amount of commodities specified in subparagraph (B) 

adjusted by the percentage by which the thrifty food plan 

has been adjusted under section 3(u)(4) between June 30, 


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2008, and June 30 of the immediately preceding fiscal 

year.’’. 

(b) STATE PLANS.—Section 202A of the Emergency Food Assistance Act of 1983 (7 U.S.C. 7503) is amended by striking subsection 

(a) and inserting the following: 

‘‘(a) PLANS.—

‘‘(1) IN GENERAL.—To receive commodities under this Act, a 

State shall submit to the Secretary an operation and administration plan for the provision of benefits under this Act. 

‘‘(2) UPDATES.—A State shall submit to the Secretary for 

approval any amendment to a plan submitted under paragraph 

(1) in any case in which the State proposes to make a change 

to the operation or administration of a program described in 

the plan.’’. 

(c) AUTHORIZATION AND APPROPRIATIONS.—Section 204(a)(1) of 

the Emergency Food Assistance Act of 1983 (7 U.S.C. 7508(a)(1)) is 

amended in the first sentence—

(1) by striking ‘‘$60,000,000’’ and inserting ‘‘$100,000,000’’; 

and 

(2) by inserting ‘‘and donated wild game’’ before the period 

at the end. 

SEC. 4202. EMERGENCY FOOD PROGRAM INFRASTRUCTURE GRANTS. 

The Emergency Food Assistance Act of 1983 is amended by inserting after section 208 (7 U.S.C. 7511) the following: 

‘‘SEC. 209. EMERGENCY FOOD PROGRAM INFRASTRUCTURE GRANTS. 

‘‘(a) DEFINITION OF ELIGIBLE ENTITY.—In this section, the term 

‘eligible entity’ means an emergency feeding organization. 

‘‘(b) PROGRAM AUTHORIZED.—

‘‘(1) IN GENERAL.—The Secretary shall use funds made 

available under subsection (d) to make grants to eligible entities 

to pay the costs of an activity described in subsection (c). 

‘‘(2) RURAL PREFERENCE.—The Secretary shall use not less 

than 50 percent of the funds described in paragraph (1) for a 

fiscal year to make grants to eligible entities that serve predominantly rural communities for the purposes of—

‘‘(A) expanding the capacity and infrastructure of food 

banks, State-wide food bank associations, and food bank 

collaboratives that operate in rural areas; and 

‘‘(B) improving the capacity of the food banks to procure, receive, store, distribute, track, and deliver time-sensitive or perishable food products. 

‘‘(c) USE OF FUNDS.—An eligible entity shall use a grant received under this section for any fiscal year to carry out activities 

of the eligible entity, including—

‘‘(1) the development and maintenance of a computerized 

system for the tracking of time-sensitive food products; 

‘‘(2) capital, infrastructure, and operating costs associated 

with the collection, storage, distribution, and transportation of 

time-sensitive and perishable food products; ‘‘(3) improving the security and diversity of the emergency 

food distribution and recovery systems of the United States 

through the support of small or mid-size farms and ranches, 

fisheries, and aquaculture, and donations from local food producers and manufacturers to persons in need; 


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‘‘(4) providing recovered foods to food banks and similar 

nonprofit emergency food providers to reduce hunger in the 

United States; ‘‘(5) improving the identification of— ‘‘(A) potential providers of donated foods; 

‘‘(B) potential nonprofit emergency food providers; and 

‘‘(C) persons in need of emergency food assistance in 

rural areas; and 

‘‘(6) constructing, expanding, or repairing a facility or 

equipment to support hunger relief agencies in the community. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $15,000,000 for each of 

fiscal years 2008 through 2012.’’. 

PART II—FOOD DISTRIBUTION PROGRAM ON 

INDIAN RESERVATIONS 

SEC. 4211. ASSESSING THE NUTRITIONAL VALUE OF THE FDPIR FOOD 

PACKAGE. 

(a) IN GENERAL.—Section 4 of the Food and Nutrition Act of 

2008 (7 U.S.C. 2013) is amended by striking subsection (b) and inserting the following: ‘‘(b) FOOD DISTRIBUTION PROGRAM ON INDIAN RESERVATIONS.— ‘‘(1) IN GENERAL.—Distribution of commodities, with or 

without the supplemental nutrition assistance program, shall be 

made whenever a request for concurrent or separate food program operations, respectively, is made by a tribal organization. ‘‘(2) ADMINISTRATION.— ‘‘(A) IN GENERAL.—Subject to subparagraphs (B) and 

(C), in the event of distribution on all or part of an Indian 

reservation, the appropriate agency of the State government 

in the area involved shall be responsible for the distribution. ‘‘(B) ADMINISTRATION BY TRIBAL ORGANIZATION.—If the 

Secretary determines that a tribal organization is capable 

of effectively and efficiently administering a distribution 

described in paragraph (1), then the tribal organization 

shall administer the distribution. 

‘‘(C) PROHIBITION.—The Secretary shall not approve 

any plan for a distribution described in paragraph (1) that 

permits any household on any Indian reservation to participate simultaneously in the supplemental nutrition assistance program and the program established under this subsection. 

‘‘(3) DISQUALIFIED PARTICIPANTS.—An individual who is 

disqualified from participation in the food distribution program 

on Indian reservations under this subsection is not eligible to 

participate in the supplemental nutrition assistance program 

under this Act for a period of time to be determined by the Secretary. 

‘‘(4) ADMINISTRATIVE COSTS.—The Secretary is authorized 

to pay such amounts for administrative costs and distribution 

costs on Indian reservations as the Secretary finds necessary for 

effective administration of such distribution by a State agency 

or tribal organization. 


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‘‘(5) BISON MEAT.—Subject to the availability of appropriations to carry out this paragraph, the Secretary may purchase 

bison meat for recipients of food distributed under this subsection, including bison meat from— ‘‘(A) Native American bison producers; and 

‘‘(B) producer-owned cooperatives of bison ranchers. ‘‘(6) TRADITIONAL AND LOCALLY-GROWN FOOD FUND.— ‘‘(A) IN GENERAL.—Subject to the availability of appropriations, the Secretary shall establish a fund for use in 

purchasing traditional and locally-grown foods for recipients of food distributed under this subsection. ‘‘(B) NATIVE AMERICAN PRODUCERS.—Where practicable, of the food provided under subparagraph (A), at 

least 50 percent shall be produced by Native American 

farmers, ranchers, and producers. 

‘‘(C) DEFINITION OF TRADITIONAL AND LOCALLY

GROWN.—The Secretary shall determine the definition of 

the term ‘traditional and locally-grown’ with respect to food 

distributed under this paragraph. 

‘‘(D) SURVEY.—In carrying out this paragraph, the Secretary shall—

‘‘(i) survey participants of the food distribution program on Indian reservations established under this 

subsection to determine which traditional foods are 

most desired by those participants; and 

‘‘(ii) purchase or offer to purchase those traditional 

foods that may be procured cost-effectively. 

‘‘(E) REPORT.—Not later than 1 year after the date of 

enactment of this paragraph, and annually thereafter, the 

Secretary shall submit to the Committee on Agriculture of 

the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report describing the activities carried out under this paragraph 

during the preceding calendar year. 

‘‘(F) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to the Secretary to carry out 

this paragraph $5,000,000 for each of fiscal years 2008 

through 2012.’’. (b) FDPIR FOOD PACKAGE.—Not later than 180 days after the 

date of enactment of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report 

that describes— (1) how the Secretary derives the process for determining 

the food package under the food distribution program on Indian 

reservations established under section 4(b) of the Food and Nutrition Act of 2008 (7 U.S.C. 2013(b)) (referred to in this subsection as the ‘‘food package’’); 

(2) the extent to which the food package— (A) addresses the nutritional needs of low-income Native Americans compared to the supplemental nutrition assistance program, particularly for very low-income households; 

(B) conforms (or fails to conform) to the 2005 Dietary 

Guidelines for Americans published under section 301 of 


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the National Nutrition Monitoring and Related Research 

Act of 1990 (7 U.S.C. 5341); 

(C) addresses (or fails to address) the nutritional and 

health challenges that are specific to Native Americans; 

and 

(D) is limited by distribution costs or challenges in infrastructure; and 

(3)(A) any plans of the Secretary to revise and update the 

food package to conform with the most recent Dietary Guidelines for Americans, including any costs associated with the 

planned changes; or 

(B) if the Secretary does not plan changes to the food package, the rationale of the Secretary for retaining the food package. 

PART III—COMMODITY SUPPLEMENTAL FOOD 

PROGRAM 

SEC. 4221. COMMODITY SUPPLEMENTAL FOOD PROGRAM. 

Section 5 of the Agriculture and Consumer Protection Act of 

1973 (7 U.S.C. 612c note; Public Law 93–86) is amended by striking 

subsection (g) and inserting the following: 

‘‘(g) PROHIBITION.—Notwithstanding any other provision of law 

(including regulations), the Secretary may not require a State or 

local agency to prioritize assistance to a particular group of individuals that are—

‘‘(1) low-income persons aged 60 and older; or 

‘‘(2) women, infants, and children.’’. 

PART IV—SENIOR FARMERS’ MARKET 

NUTRITION PROGRAM 

SEC. 4231. SENIORS FARMERS’ MARKET NUTRITION PROGRAM. 

Section 4402 of the Farm Security and Rural Investment Act of 

2002 (7 U.S.C. 3007) is amended—

(1) in subsection (b)(1), by inserting ‘‘honey,’’ after ‘‘vegetables,’’; 

(2) by striking subsection (c) and inserting the following: 

‘‘(c) EXCLUSION OF BENEFITS IN DETERMINING ELIGIBILITY FOR

OTHER PROGRAMS.—The value of any benefit provided to any eligible seniors farmers’ market nutrition program recipient under this 

section shall not be considered to be income or resources for any 

purposes under any Federal, State, or local law.’’; and 

(3) by adding at the end the following: 

‘‘(d) PROHIBITION ON COLLECTION OF SALES TAX.—Each State 

shall ensure that no State or local tax is collected within the State 

on a purchase of food with a benefit distributed under the seniors 

farmers’ market nutrition program. 

‘‘(e) REGULATIONS.—The Secretary may promulgate such regulations as the Secretary considers to be necessary to carry out the 

seniors farmers’ market nutrition program.’’. 


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Subtitle C—Child Nutrition and Related Programs 

SEC. 4301. STATE PERFORMANCE ON ENROLLING CHILDREN RECEIVING PROGRAM BENEFITS FOR FREE SCHOOL MEALS. 

(a) IN GENERAL.—Not later than December 31, 2008 and June 

30 of each year thereafter, the Secretary shall submit to the Committees on Agriculture and Education and Labor of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that assesses the effectiveness of each 

State in enrolling school-aged children in households receiving program benefits under the Food and Nutrition Act of 2008 (7 U.S.C. 

2011 et seq.) (referred to in this section as ‘‘program benefits’’) for 

free school meals using direct certification. 

(b) SPECIFIC MEASURES.—The assessment of the Secretary of 

the performance of each State shall include—

(1) an estimate of the number of school-aged children, by 

State, who were members of a household receiving program 

benefits at any time in July, August, or September of the prior 

year; 

(2) an estimate of the number of school-aged children, by 

State, who were directly certified as eligible for free lunches 

under the Richard B. Russell National School Lunch Act (42 

U.S.C. 1751 et seq.), based on receipt of program benefits, as of 

October 1 of the prior year; and 

(3) an estimate of the number of school-aged children, by 

State, who were members of a household receiving program 

benefits at any time in July, August, or September of the prior 

year who were not candidates for direct certification because on 

October 1 of the prior year the children attended a school operating under the special assistance provisions of section 11(a)(1) 

of the Richard B. Russell National School Lunch Act (42 U.S.C. 

1759a(a)(1)) that is not operating in a base year. 

(c) PERFORMANCE INNOVATIONS.—The report of the Secretary 

shall describe best practices from States with the best performance 

or the most improved performance from the previous year. 

SEC. 4302. PURCHASES OF LOCALLY PRODUCED FOODS. 

Section 9(j) of the Richard B. Russell National School Lunch 

Act (42 U.S.C. 1758(j)) is amended to read as follows: 

‘‘(j) PURCHASES OF LOCALLY PRODUCED FOODS.—The Secretary 

shall—

‘‘(1) encourage institutions receiving funds under this Act 

and the Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq.) to 

purchase unprocessed agricultural products, both locally grown 

and locally raised, to the maximum extent practicable and appropriate; 

‘‘(2) advise institutions participating in a program described in paragraph (1) of the policy described in that paragraph and paragraph (3) and post information concerning the 

policy on the website maintained by the Secretary; and 

‘‘(3) allow institutions receiving funds under this Act and 

the Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq.), including the Department of Defense Fresh Fruit and Vegetable Program, to use a geographic preference for the procurement of unprocessed agricultural products, both locally grown and locally 

raised.’’. 


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SEC. 4303. HEALTHY FOOD EDUCATION AND PROGRAM 

REPLICABILITY. 

Section 18(h) of the Richard B. Russell National School Lunch 

Act (42 U.S.C. 1769(h)) is amended—

(1) in paragraph (1)(C), by inserting ‘‘promotes healthy food 

education in the school curriculum and’’ before ‘‘incorporates’’; 

(2) by redesignating paragraph (2) as paragraph (4); and 

(3) by inserting after paragraph (1) the following: 

‘‘(2) ADMINISTRATION.—In providing grants under paragraph (1), the Secretary shall give priority to projects that can 

be replicated in schools. 

‘‘(3) PILOT PROGRAM FOR HIGH-POVERTY SCHOOLS.—

‘‘(A) DEFINITIONS.—In this paragraph: 

‘‘(i) ELIGIBLE PROGRAM.—The term ‘eligible program’ means—

‘‘(I) a school-based program with hands-on 

vegetable gardening and nutrition education that 

is incorporated into the curriculum for 1 or more 

grades at 2 or more eligible schools; or 

‘‘(II) a community-based summer program 

with hands-on vegetable gardening and nutrition 

education that is part of, or coordinated with, a 

summer enrichment program at 2 or more eligible 

schools. 

‘‘(ii) ELIGIBLE SCHOOL.—The term ‘eligible school’

means a public school, at least 50 percent of the students of which are eligible for free or reduced price 

meals under this Act. 

‘‘(B) ESTABLISHMENT.—The Secretary shall carry out a 

pilot program under which the Secretary shall provide to 

nonprofit organizations or public entities in not more than 

5 States grants to develop and run, through eligible programs, community gardens at eligible schools in the States 

that would—

‘‘(i) be planted, cared for, and harvested by students at the eligible schools; and 

‘‘(ii) teach the students participating in the community gardens about agriculture production practices 

and diet. 

‘‘(C) PRIORITY STATES.—Of the States in which grantees under this paragraph are located—

‘‘(i) at least 1 State shall be among the 15 largest 

States, as determined by the Secretary; 

‘‘(ii) at least 1 State shall be among the 16th to 

30th largest States, as determined by the Secretary; 

and 

‘‘(iii) at least 1 State shall be a State that is not 

described in clause (i) or (ii). 

‘‘(D) USE OF PRODUCE.—Produce from a community 

garden provided a grant under this paragraph may be—

‘‘(i) used to supplement food provided at the eligible school; 

‘‘(ii) distributed to students to bring home to the 

families of the students; or 


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‘‘(iii) donated to a local food bank or senior center 

nutrition program. 

‘‘(E) NO COST-SHARING REQUIREMENT.—A nonprofit organization or public entity that receives a grant under this 

paragraph shall not be required to share the cost of carrying out the activities assisted under this paragraph. 

‘‘(F) EVALUATION.—A nonprofit organization or public 

entity that receives a grant under this paragraph shall be 

required to cooperate in an evaluation in accordance with 

paragraph (1)(H).’’. 

SEC. 4304. FRESH FRUIT AND VEGETABLE PROGRAM. 

(a) PROGRAM.—

(1) IN GENERAL.—The Richard B. Russell National School 

Lunch Act is amended by inserting after section 18 (42 U.S.C. 

1769) the following: 

‘‘SEC. 19. FRESH FRUIT AND VEGETABLE PROGRAM. 

‘‘(a) IN GENERAL.—For the school year beginning July 2008 and 

each subsequent school year, the Secretary shall provide grants to 

States to carry out a program to make free fresh fruits and vegetables available in elementary schools (referred to in this section as 

the ‘program’). 

‘‘(b) PROGRAM.—A school participating in the program shall 

make free fresh fruits and vegetables available to students throughout the school day (or at such other times as are considered appropriate by the Secretary) in 1 or more areas designated by the school. 

‘‘(c) FUNDING TO STATES.—

‘‘(1) MINIMUM GRANT.—Except as provided in subsection 

(i)(2), the Secretary shall provide to each of the 50 States and 

the District of Columbia an annual grant in an amount equal 

to 1 percent of the funds made available for a year to carry out 

the program. 

‘‘(2) ADDITIONAL FUNDING.—Of the funds remaining after 

grants are made under paragraph (1), the Secretary shall allocate additional funds to each State that is operating a school 

lunch program under section 4 based on the proportion that—

‘‘(A) the population of the State; bears to 

‘‘(B) the population of the United States. 

‘‘(d) SELECTION OF SCHOOLS.—

‘‘(1) IN GENERAL.—Except as provided in paragraph (2) of 

this subsection and section 4304(a)(2) of the Food, Conservation, and Energy Act of 2008, each year, in selecting schools to 

participate in the program, each State shall—

‘‘(A) ensure that each school chosen to participate in the 

program is a school—

‘‘(i) in which not less than 50 percent of the students are eligible for free or reduced price meals under 

this Act; and 

‘‘(ii) that submits an application in accordance 

with subparagraph (D); 

‘‘(B) to the maximum extent practicable, give the highest priority to schools with the highest proportion of children who are eligible for free or reduced price meals under 

this Act; 


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‘‘(C) ensure that each school selected is an elementary 

school (as defined in section 9101 of the Elementary and 

Secondary Education Act of 1965 (20 U.S.C. 7801)); 

‘‘(D) solicit applications from interested schools that include—

‘‘(i) information pertaining to the percentage of students enrolled in the school submitting the application 

who are eligible for free or reduced price school lunches 

under this Act; 

‘‘(ii) a certification of support for participation in 

the program signed by the school food manager, the 

school principal, and the district superintendent (or 

equivalent positions, as determined by the school); 

‘‘(iii) a plan for implementation of the program, including efforts to integrate activities carried out under 

this section with other efforts to promote sound health 

and nutrition, reduce overweight and obesity, or promote physical activity; and 

‘‘(iv) such other information as may be requested 

by the Secretary; and 

‘‘(E) encourage applicants to submit a plan for implementation of the program that includes a partnership with 

1 or more entities that will provide non-Federal resources 

(including entities representing the fruit and vegetable industry). 

‘‘(2) EXCEPTION.—Clause (i) of paragraph (1)(A) shall not 

apply to a State if all schools that meet the requirements of that 

clause have been selected and the State does not have a sufficient number of additional schools that meet the requirement of 

that clause. 

‘‘(3) OUTREACH TO LOW-INCOME SCHOOLS.—

‘‘(A) IN GENERAL.—Prior to making decisions regarding 

school participation in the program, a State agency shall 

inform the schools within the State with the highest proportion of free and reduced price meal eligibility, including 

Native American schools, of the eligibility of the schools for 

the program with respect to priority granted to schools with 

the highest proportion of free and reduced price eligibility 

under paragraph (1)(B). 

‘‘(B) REQUIREMENT.—In providing information to 

schools in accordance with subparagraph (A), a State agency shall inform the schools that would likely be chosen to 

participate in the program under paragraph (1)(B). 

‘‘(e) NOTICE OF AVAILABILITY.—If selected to participate in the 

program, a school shall widely publicize within the school the availability of free fresh fruits and vegetables under the program. 

‘‘(f) PER-STUDENT GRANT.—The per-student grant provided to a 

school under this section shall be—

‘‘(1) determined by a State agency; and 

‘‘(2) not less than $50, nor more than $75. 

‘‘(g) LIMITATION.—To the maximum extent practicable, each 

State agency shall ensure that in making the fruits and vegetables 

provided under this section available to students, schools offer the 

fruits and vegetables separately from meals otherwise provided at 


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the school under this Act or the Child Nutrition Act of 1966 (42 

U.S.C. 1771 et seq.). ‘‘(h) EVALUATION AND REPORTS.— ‘‘(1) IN GENERAL.—The Secretary shall conduct an evaluation of the program, including a determination as to whether 

children experienced, as a result of participating in the program— ‘‘(A) increased consumption of fruits and vegetables; 

‘‘(B) other dietary changes, such as decreased consumption of less nutritious foods; and ‘‘(C) such other outcomes as are considered appropriate 

by the Secretary. 

‘‘(2) REPORT.—Not later than September 30, 2011, the Secretary shall submit to the Committee on Education and Labor 

of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report that describes the results of the evaluation under paragraph (1). 

‘‘(i) FUNDING.— ‘‘(1) IN GENERAL.—Out of the funds made available under 

subsection (b)(2)(A) of section 14222 of the Food, Conservation, 

and Energy Act of 2008, the Secretary shall use the following 

amounts to carry out this section: 

‘‘(A) On October 1, 2008, $40,000,000. 

‘‘(B) On July 1, 2009, $65,000,000. 

‘‘(C) On July 1, 2010, $101,000,000. 

‘‘(D) On July 1, 2011, $150,000,000. 

‘‘(E) On July 1, 2012, and each July 1 thereafter, the 

amount made available for the preceding fiscal year, as adjusted to reflect changes for the 12-month period ending the 

preceding April 30 in the Consumer Price Index for All 

Urban Consumers published by the Bureau of Labor Statistics of the Department of Labor, for items other than food. 

‘‘(2) MAINTENANCE OF EXISTING FUNDING.—In allocating 

funding made available under paragraph (1) among the States 

in accordance with subsection (c), the Secretary shall ensure 

that each State that received funding under section 18(f) on the 

day before the date of enactment of the Food, Conservation, and 

Energy Act of 2008 shall continue to receive sufficient funding 

under this section to maintain the caseload level of the State 

under that section as in effect on that date. ‘‘(3) EVALUATION FUNDING.—On October 1, 2008, out of any 

funds made available under subsection (b)(2)(A) of section 

14222 of the Food, Conservation, and Energy Act of 2008, the 

Secretary shall use to carry out the evaluation required under 

subsection (h), $3,000,000, to remain available for obligation 

until September 30, 2010. 

‘‘(4) RECEIPT AND ACCEPTANCE.—The Secretary shall be entitled to receive, shall accept, and shall use to carry out this section any funds transferred for that purpose, without further appropriation. ‘‘(5) AUTHORIZATION OF APPROPRIATIONS.—In addition to 

any other amounts made available to carry out this section, 

there are authorized to be appropriated such sums as are necessary to expand the program established under this section. ‘‘(6) ADMINISTRATIVE COSTS.—


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‘‘(A) IN GENERAL.—Of funds made available to carry 

out this section for a fiscal year, the Secretary may use not 

more than $500,000 for the administrative costs of carrying 

out the program. 

‘‘(B) RESERVATION OF FUNDS.—The Secretary shall 

allow each State to reserve such funding as the Secretary 

determines to be necessary to administer the program in the 

State (with adjustments for the size of the State and the 

grant amount), but not to exceed the amount required to 

pay the costs of 1 full-time coordinator for the program in 

the State. 

‘‘(7) REALLOCATION.—

‘‘(A) AMONG STATES.—The Secretary may reallocate 

any amounts made available to carry out this section that 

are not obligated or expended by a date determined by the 

Secretary. 

‘‘(B) WITHIN STATES.—A State that receives a grant 

under this section may reallocate any amounts made available under the grant that are not obligated or expended by 

a date determined by the Secretary.’’. 

(2) TRANSITION OF EXISTING SCHOOLS.—

(A) EXISTING SECONDARY SCHOOLS.—Section 

19(d)(1)(C) of the Richard B. Russell National School 

Lunch Act (as amended by paragraph (1)) may be waived 

by a State until July 1, 2010, for each secondary school in 

the State that has been awarded funding under section 

18(f) of that Act (42 U.S.C. 1769(f)) for the school year beginning July 1, 2008. 

(B) SCHOOL YEAR BEGINNING JULY 1, 2008.—To facilitate transition from the program authorized under section 

18(f) of the Richard B. Russell National School Lunch Act 

(42 U.S.C. 1769(f)) (as in effect on the day before the date 

of enactment of this Act) to the program established under 

section 19 of that Act (as amended by paragraph (1))—

(i) for the school year beginning July 1, 2008, the 

Secretary may permit any school selected for participation under section 18(f) of that Act (42 U.S.C. 1769(f)) 

for that school year to continue to participate under 

section 19 of that Act until the end of that school year; 

and 

(ii) funds made available under that Act for fiscal 

year 2009 may be used to support the participation of 

any schools selected to participate in the program authorized under section 18(f) of that Act (42 U.S.C. 

1769(f)) (as in effect on the day before the date of enactment of this Act). 

(b) CONFORMING AMENDMENTS.—Section 18 of the Richard B. 

Russell National School Lunch Act (42 U.S.C. 1769) is amended—

(1) by striking subsection (f); and 

(2) by redesignating subsections (g) through (j) as subsections (f) through (i), respectively. 

SEC. 4305. WHOLE GRAIN PRODUCTS. 

(a) PURPOSE.—The purpose of this section is to encourage greater awareness and interest in the number and variety of whole grain 


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products available to schoolchildren, as recommended by the 2005 

Dietary Guidelines for Americans. 

(b) DEFINITION OF ELIGIBLE WHOLE GRAINS AND WHOLE GRAIN

PRODUCTS.—In this section, the terms ‘‘whole grains’’ and ‘‘whole 

grain products’’ have the meaning given the terms by the Food and 

Nutrition Service in the HealthierUS School Challenge. 

(c) PURCHASE OF WHOLE GRAINS AND WHOLE GRAIN PRODUCTS.—In addition to the commodities delivered under section 6 of 

the Richard B. Russell National School Lunch Act (42 U.S.C. 1755), 

the Secretary shall purchase whole grains and whole grain products 

for use in—

(1) the school lunch program established under the Richard 

B. Russell National School Lunch Act (42 U.S.C. 1751 et seq.); 

and 

(2) the school breakfast program established by section 4 of 

the Child Nutrition Act of 1966 (42 U.S.C. 1773). 

(d) EVALUATION.—Not later than September 30, 2011, the Secretary shall conduct an evaluation of the activities conducted under 

subsection (c) that includes—

(1) an evaluation of whether children participating in the 

school lunch and breakfast programs increased their consumption of whole grains; 

(2) an evaluation of which whole grains and whole grain 

products are most acceptable for use in the school lunch and 

breakfast programs; 

(3) any recommendations of the Secretary regarding the integration of whole grain products in the school lunch and 

breakfast programs; and 

(4) an evaluation of any other outcomes determined to be 

appropriate by the Secretary. 

(e) REPORT.—As soon as practicable after the completion of the 

evaluation under subsection (d), the Secretary shall submit to the 

Committee on Agriculture, Nutrition, and Forestry of the Senate 

and the Committee on Education and Labor of the House of Representative a report describing the results of the evaluation. 

SEC. 4306. BUY AMERICAN REQUIREMENTS. 

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

(1) Federal law requires that commodities and products 

purchased with Federal funds be, to the extent practicable, of 

domestic origin. 

(2) Federal Buy American statutory requirements seek to 

ensure that purchases made with Federal funds benefit domestic producers. 

(3) The Richard B. Russell National School Lunch Act (42 

U.S.C. 1751 et seq.) requires the use of domestic food products 

for all meals served under the program, including food products 

purchased with local funds. 

(b) BUY AMERICAN STATUTORY REQUIREMENTS.—The Department of Agriculture should undertake training, guidance, and enforcement of the various current Buy American statutory requirements and regulations, including those of the Richard B. Russell 

National School Lunch Act (42 U.S.C. 1751 et seq.). 


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SEC. 4307. SURVEY OF FOODS PURCHASED BY SCHOOL FOOD AUTHORITIES. 

(a) IN GENERAL.—For fiscal year 2009, the Secretary shall carry 

out a nationally representative survey of the foods purchased during 

the most recent school year for which data is available by school authorities participating in the school lunch program established 

under the Richard B. Russell National School Lunch Act (42 U.S.C. 

1751 et seq.). 

(b) REPORT.— (1) IN GENERAL.—On completion of the survey, the Secretary shall submit to the Committees on Agriculture and Education and Labor of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a 

report that describes the results of the survey. 

(2) INTERIM REQUIREMENT.—If the initial report required 

under paragraph (1) is not submitted to the Committees referred to in that paragraph by June 30, 2009, the Secretary 

shall submit to the Committees an interim report that describes 

the relevant survey data, or a sample of such data, available to 

the Secretary as of that date. 

(c) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary shall use to carry out this section not more than 

$3,000,000. 

Subtitle D—Miscellaneous 

SEC. 4401. BILL EMERSON NATIONAL HUNGER FELLOWS AND MICKEY 

LELAND INTERNATIONAL HUNGER FELLOWS. 

Section 4404 of the Farm Security and Rural Investment Act of 

2002 (2 U.S.C. 1161) is amended to read as follows: 

‘‘SEC. 4404. BILL EMERSON NATIONAL HUNGER FELLOWS AND MICKEY 

LELAND INTERNATIONAL HUNGER FELLOWS. 

‘‘(a) SHORT TITLE.—This section may be cited as the ‘Bill Emerson National Hunger Fellows and Mickey Leland International 

Hunger Fellows Program Act of 2008’. 

‘‘(b) DEFINITIONS.—In this subsection: 

‘‘(1) DIRECTOR.—The term ‘Director’ means the head of the 

Congressional Hunger Center. 

‘‘(2) FELLOW.—The term ‘fellow’ means—

‘‘(A) a Bill Emerson Hunger Fellow; or 

‘‘(B) Mickey Leland Hunger Fellow. 

‘‘(3) FELLOWSHIP PROGRAMS.—The term ‘Fellowship Programs’ means the Bill Emerson National Hunger Fellowship 

Program and the Mickey Leland International Hunger Fellowship Program established under subsection (c)(1). 

‘‘(c) FELLOWSHIP PROGRAMS.—

‘‘(1) IN GENERAL.—There is established the Bill Emerson 

National Hunger Fellowship Program and the Mickey Leland 

International Hunger Fellowship Program. 

‘‘(2) PURPOSES.—

‘‘(A) IN GENERAL.—The purposes of the Fellowship Programs are—

‘‘(i) to encourage future leaders of the United 

States—

‘‘(I) to pursue careers in humanitarian and 

public service; 


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‘‘(II) to recognize the needs of low-income people and hungry people; 

‘‘(III) to provide assistance to people in need; 

and 

‘‘(IV) to seek public policy solutions to the challenges of hunger and poverty; 

‘‘(ii) to provide training and development opportunities for such leaders through placement in programs 

operated by appropriate organizations or entities; and 

‘‘(iii) to increase awareness of the importance of 

public service. 

‘‘(B) BILL EMERSON HUNGER FELLOWSHIP PROGRAM.—

The purpose of the Bill Emerson Hunger Fellowship Program is to address hunger and poverty in the United 

States. 

‘‘(C) MICKEY LELAND HUNGER FELLOWSHIP PROGRAM.—

The purpose of the Mickey Leland Hunger Fellowship Program is to address international hunger and other humanitarian needs. 

‘‘(3) ADMINISTRATION.—

‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

Secretary shall offer to provide a grant to the Congressional 

Hunger Center to administer the Fellowship Programs. 

‘‘(B) TERMS OF GRANT.—The terms of the grant provided under subparagraph (A), including the length of the 

grant and provisions for the alteration or termination of 

the grant, shall be determined by the Secretary in accordance with this section. 

‘‘(d) FELLOWSHIPS.—

‘‘(1) IN GENERAL.—The Director shall make available Bill 

Emerson Hunger Fellowships and Mickey Leland Hunger Fellowships in accordance with this subsection. 

‘‘(2) CURRICULUM.—

‘‘(A) IN GENERAL.—The Fellowship Programs shall provide experience and training to develop the skills necessary 

to train fellows to carry out the purposes described in subsection (c)(2), including—

‘‘(i) training in direct service programs for the hungry and other anti-hunger programs in conjunction 

with community-based organizations through a program of field placement; and 

‘‘(ii) providing experience in policy development 

through placement in a governmental entity or nongovernmental, nonprofit, or private sector organization. 

‘‘(B) WORK PLAN.—To carry out subparagraph (A) and 

assist in the evaluation of the fellowships under paragraph 

(6), the Director shall, for each fellow, approve a work plan 

that identifies the target objectives for the fellow in the fellowship, including specific duties and responsibilities relating to those objectives. 

‘‘(3) PERIOD OF FELLOWSHIP.—

‘‘(A) BILL EMERSON HUNGER FELLOW.—A Bill Emerson 

Hunger Fellowship awarded under this section shall be for 

not more than 15 months. 


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‘‘(B) MICKEY LELAND HUNGER FELLOW.—A Mickey Leland Hunger Fellowship awarded under this section shall 

be for not more than 2 years. 

‘‘(4) SELECTION OF FELLOWS.—

‘‘(A) IN GENERAL.—Fellowships shall be awarded pursuant to a nationwide competition established by the Director. 

‘‘(B) QUALIFICATIONS.—A successful program applicant 

shall be an individual who has demonstrated—

‘‘(i) an intent to pursue a career in humanitarian 

services and outstanding potential for such a career; 

‘‘(ii) leadership potential or actual leadership experience; 

‘‘(iii) diverse life experience; 

‘‘(iv) proficient writing and speaking skills; 

‘‘(v) an ability to live in poor or diverse communities; and 

‘‘(vi) such other attributes as are considered to be 

appropriate by the Director. 

‘‘(5) AMOUNT OF AWARD.—

‘‘(A) IN GENERAL.—A fellow shall receive—

‘‘(i) a living allowance during the term of the Fellowship; and 

‘‘(ii) subject to subparagraph (B), an end-of-service 

award. 

‘‘(B) REQUIREMENT FOR SUCCESSFUL COMPLETION OF

FELLOWSHIP.—Each fellow shall be entitled to receive an 

end-of-service award at an appropriate rate for each month 

of satisfactory service completed, as determined by the Director. 

‘‘(C) TERMS OF FELLOWSHIP.—A fellow shall not be considered an employee of—

‘‘(i) the Department of Agriculture; 

‘‘(ii) the Congressional Hunger Center; or 

‘‘(iii) a host agency in the field or policy placement 

of the fellow. 

‘‘(D) RECOGNITION OF FELLOWSHIP AWARD.—

‘‘(i) EMERSON FELLOW.—An individual awarded a 

fellowship from the Bill Emerson Hunger Fellowship 

shall be known as an ‘Emerson Fellow’. 

‘‘(ii) LELAND FELLOW.—An individual awarded a 

fellowship from the Mickey Leland Hunger Fellowship 

shall be known as a ‘Leland Fellow’. 

‘‘(6) EVALUATIONS AND AUDITS.—Under terms stipulated in 

the contract entered into under subsection (c)(3), the Director 

shall—

‘‘(A) conduct periodic evaluations of the Fellowship 

Programs; and 

‘‘(B) arrange for annual independent financial audits 

of expenditures under the Fellowship Programs. 

‘‘(e) AUTHORITY.—

‘‘(1) IN GENERAL.—Subject to paragraph (2), in carrying out 

this section, the Director may solicit, accept, use, and dispose of 

gifts, bequests, or devises of services or property, both real and 


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personal, for the purpose of facilitating the work of the Fellowship Programs. 

‘‘(2) LIMITATION.—Gifts, bequests, or devises of money and 

proceeds from sales of other property received as gifts, bequests, 

or devises shall be used exclusively for the purposes of the Fellowship Programs. 

‘‘(f) REPORT.—The Director shall annually submit to the Secretary of Agriculture, the Committee on Agriculture of the House of 

Representatives, and the Committee on Agriculture, Nutrition, and 

Forestry of the Senate a report that—

‘‘(1) describes the activities and expenditures of the Fellowship Programs during the preceding fiscal year, including expenditures made from funds made available under subsection 

(g); and 

‘‘(2) includes the results of evaluations and audits required 

by subsection (d). 

‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to the Secretary such sums as are necessary to 

carry out this section, to remain available until expended.’’. 

SEC. 4402. ASSISTANCE FOR COMMUNITY FOOD PROJECTS. 

Section 25 of the Food and Nutrition Act of 2008 (7 U.S.C. 

2034) is amended—

(1) by striking subsection (a) and inserting the following: 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) COMMUNITY FOOD PROJECT.—In this section, the term 

‘community food project’ means a community-based project 

that—

‘‘(A) requires a 1-time contribution of Federal assistance to become self-sustaining; and 

‘‘(B) is designed—

‘‘(i)(I) to meet the food needs of low-income individuals; 

‘‘(II) to increase the self-reliance of communities in 

providing for the food needs of the communities; and 

‘‘(III) to promote comprehensive responses to local 

food, farm, and nutrition issues; or 

‘‘(ii) to meet specific State, local, or neighborhood 

food and agricultural needs, including needs relating 

to—

‘‘(I) infrastructure improvement and development; 

‘‘(II) planning for long-term solutions; or 

‘‘(III) the creation of innovative marketing activities that mutually benefit agricultural producers and low-income consumers. 

‘‘(2) CENTER.—The term ‘Center’ means the healthy urban 

food enterprise development center established under subsection 

(h). 

‘‘(3) UNDERSERVED COMMUNITY.—The term ‘underserved 

community’ means a community (including an urban or rural 

community or an Indian tribe) that, as determined by the Secretary, has—

‘‘(A) limited access to affordable, healthy foods, including fresh fruits and vegetables; 


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‘‘(B) a high incidence of a diet-related disease (including obesity) as compared to the national average; ‘‘(C) a high rate of hunger or food insecurity; or 

‘‘(D) severe or persistent poverty.’’; 

(2) by redesignating subsection (h) as subsection (i); and 

(3) by inserting after subsection (g) the following: ‘‘(h) HEALTHY URBAN FOOD ENTERPRISE DEVELOPMENT CEN- TER.— ‘‘(1) DEFINITION OF ELIGIBLE ENTITY.—In this subsection, 

the term ‘eligible entity’ means— ‘‘(A) a nonprofit organization; 

‘‘(B) a cooperative; 

‘‘(C) a commercial entity; 

‘‘(D) an agricultural producer; 

‘‘(E) an academic institution; 

‘‘(F) an individual; and 

‘‘(G) such other entities as the Secretary may designate. ‘‘(2) ESTABLISHMENT.—The Secretary shall offer to provide 

a grant to a nonprofit organization to establish and support a 

healthy urban food enterprise development center to carry out 

the purpose described in paragraph (3). ‘‘(3) PURPOSE.—The purpose of the Center is to increase access to healthy affordable foods, including locally produced agricultural products, to underserved communities. ‘‘(4) ACTIVITIES.— ‘‘(A) TECHNICAL ASSISTANCE AND INFORMATION.—The 

Center shall collect, develop, and provide technical assistance and information to small and medium-sized agricultural producers, food wholesalers and retailers, schools, 

and other individuals and entities regarding best practices 

and the availability of assistance for aggregating, storing, 

processing, and marketing locally produced agricultural 

products and increasing the availability of such products in 

underserved communities. 

‘‘(B) AUTHORITY TO SUBGRANT.—The Center may provide subgrants to eligible entities— ‘‘(i) to carry out feasibility studies to establish businesses for the purpose described in paragraph (3); and ‘‘(ii) to establish and otherwise assist enterprises 

that process, distribute, aggregate, store, and market 

healthy affordable foods. ‘‘(5) PRIORITY.—In providing technical assistance and 

grants under paragraph (4), the Center shall give priority to applications that include projects—

‘‘(A) to benefit underserved communities; and 

‘‘(B) to develop market opportunities for small- and 

mid-sized farm and ranch operations. 

‘‘(6) REPORT.—For each fiscal year for which the nonprofit 

organization described in paragraph (2) receives funds, the organization shall submit to the Secretary a report describing the 

activities carried out in the preceding fiscal year, including—

‘‘(A) a description of technical assistance provided by 

the Center; 

‘‘(B) the total number and a description of the subgrants provided under paragraph (4)(B); 


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‘‘(C) a complete listing of cases in which the activities 

of the Center have resulted in increased access to healthy, 

affordable foods, such as fresh fruit and vegetables, particularly for school-aged children and individuals in lowincome communities; and ‘‘(D) a determination of whether the activities identified 

in subparagraph (C) are sustained during the years following the initial provision of technical assistance and subgrants under this section. 

‘‘(7) COMPETITIVE AWARD PROCESS.—The Secretary shall 

use a competitive process to award funds to establish the Center. ‘‘(8) LIMITATION ON ADMINISTRATIVE EXPENSES.—Not more 

than 10 percent of the total amount allocated for this subsection 

in a given fiscal year may be used for administrative expenses. ‘‘(9) FUNDING.— ‘‘(A) IN GENERAL.—Out of any funds in the Treasury 

not otherwise appropriated, the Secretary of the Treasury 

shall transfer to the Secretary to carry out this subsection 

$1,000,000 for each of fiscal years 2009 through 2011. ‘‘(B) ADDITIONAL FUNDING.—There is authorized to be 

appropriated $2,000,000 to carry out this subsection for fiscal year 2012.’’. 

SEC. 4403. JOINT NUTRITION MONITORING AND RELATED RESEARCH 

ACTIVITIES. 

The Secretary and the Secretary of Health and Human Services 

shall continue to provide jointly for national nutrition monitoring 

and related research activities carried out as of the date of enactment of this Act— (1) to collect continuous dietary, health, physical activity, 

and diet and health knowledge data on a nationally representative sample; 

(2) to periodically collect data on special at-risk populations, as identified by the Secretaries; 

(3) to distribute information on health, nutrition, the environment, and physical activity to the public in a timely fashion; 

(4) to analyze new data that becomes available; 

(5) to continuously update food composition tables; and 

(6) to research and develop data collection methods and 

standards. 

SEC. 4404. SECTION 32 FUNDS FOR PURCHASE OF FRUITS, VEGETABLES, AND NUTS TO SUPPORT DOMESTIC NUTRITION ASSISTANCE PROGRAMS. 

(a) FUNDING FOR ADDITIONAL PURCHASES OF FRUITS, VEGETABLES, AND NUTS.—In addition to the purchases of fruits, vegetables, 

and nuts required by section 10603 of the Farm Security and Rural 

Investment Act of 2002 (7 U.S.C. 612c–4), the Secretary of Agriculture shall purchase fruits, vegetables, and nuts for the purpose 

of providing nutritious foods for use in domestic nutrition assistance 

programs, using, of the funds made available under section 32 of 

the Act of August 24, 1935 (7 U.S.C. 612c), the following amounts: 

(1) $190,000,000 for fiscal year 2008. 

(2) $193,000,000 for fiscal year 2009. 

(3) $199,000,000 for fiscal year 2010. 

(4) $203,000,000 for fiscal year 2011. 


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(5) $206,000,000 for fiscal year 2012 and each fiscal year 

thereafter. 

(b) FORM OF PURCHASES.—Fruits, vegetables, and nuts may be 

purchased under this section in the form of frozen, canned, dried, 

or fresh fruits, vegetables, and nuts. 

(c) PURCHASE OF FRESH FRUITS AND VEGETABLES FOR DISTRIBUTION TO SCHOOLS AND SERVICE INSTITUTIONS.—Section 10603 

of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

612c–4) is amended by striking subsection (b) and inserting the following: 

‘‘(b) PURCHASE OF FRESH FRUITS AND VEGETABLES FOR DISTRIBUTION TO SCHOOLS AND SERVICE INSTITUTIONS.—The Secretary 

of Agriculture shall purchase fresh fruits and vegetables for distribution to schools and service institutions in accordance with section 6(a) of the Richard B. Russell National School Lunch Act (42 

U.S.C. 1755(a)) using, of the amount specified in subsection (a), not 

less than $50,000,000 for each of fiscal years 2008 through 2012.’’. 

SEC. 4405. HUNGER-FREE COMMUNITIES. 

(a) DEFINITIONS.—In this section: 

(1) ELIGIBLE ENTITY.—The term ‘‘eligible entity’’ means a 

public food program service provider or nonprofit organization, 

including an emergency feeding organization, that has collaborated, or will collaborate, with 1 or more local partner organizations to achieve at least 1 hunger-free communities goal. 

(2) EMERGENCY FEEDING ORGANIZATION.—The term ‘‘emergency feeding organization’’ has the meaning given the term in 

section 201A of the Emergency Food Assistance Act of 1983 (7 

U.S.C. 7501). 

(3) HUNGER-FREE COMMUNITIES GOAL.—The term ‘‘hungerfree communities goal’’ means any of the 14 goals described in 

the H. Con. Res. 302 (102nd Congress). 

(b) HUNGER-FREE COMMUNITIES COLLABORATIVE GRANTS.—

(1) PROGRAM.—

(A) IN GENERAL.—The Secretary shall use not more 

than 50 percent of any funds made available under subsection (e) to make grants to eligible entities to pay the Federal share of the costs of an activity described in paragraph 

(2). 

(B) FEDERAL SHARE.—The Federal share of the cost of 

carrying out an activity under this subsection shall not exceed 80 percent. 

(C) NON-FEDERAL SHARE.—

(i) CALCULATION.—The non-Federal share of the 

cost of an activity under this subsection may be provided in cash or fairly evaluated in-kind contributions, 

including facilities, equipment, or services. 

(ii) SOURCES.—Any entity may provide the nonFederal share of the cost of an activity under this subsection through a State government, a local government, or a private source. 

(2) USE OF FUNDS.—An eligible entity in a community shall 

use a grant received under this subsection for any fiscal year for 

hunger relief activities, including—


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(A) meeting the immediate needs of people who experience hunger in the community served by the eligible entity 

by—

(i) distributing food; 

(ii) providing community outreach to assist in participation in federally assisted nutrition programs, including—

(I) the school breakfast program established by 

section 4 of the Child Nutrition Act of 1966 (42 

U.S.C. 1773); 

(II) the school lunch program established 

under the Richard B. Russell National School 

Lunch Act (42 U.S.C. 1751 et seq.); 

(III) the summer food service program for children established under section 13 of that Act; and 

(IV) other Federal programs that provide food 

for children in child care facilities and homeless 

and older individuals; or 

(iii) improving access to food as part of a comprehensive service; and 

(B) developing new resources and strategies to help reduce hunger in the community and prevent hunger in the 

future by—

(i) developing creative food resources, such as community gardens, buying clubs, food cooperatives, community-owned and operated grocery stores, and farmers’ markets; 

(ii) coordinating food services with park and recreation programs and other community-based outlets to 

reduce barriers to access; or 

(iii) creating nutrition education programs for atrisk populations to enhance food-purchasing and foodpreparation skills and to heighten awareness of the 

connection between diet and health. 

(c) HUNGER-FREE COMMUNITIES INFRASTRUCTURE GRANTS.—

(1) PROGRAM AUTHORIZED.—

(A) IN GENERAL.—The Secretary shall use not more 

than 50 percent of any funds made available for a fiscal 

year under subsection (e) to make grants to eligible entities 

to pay the Federal share of the costs of an activity described 

in paragraph (2). 

(B) FEDERAL SHARE.—The Federal share of the cost of 

carrying out an activity under this subsection shall not exceed 80 percent. 

(2) APPLICATION.—

(A) IN GENERAL.—To receive a grant under this subsection, an eligible entity shall submit an application at 

such time, in such form, and containing such information 

as the Secretary may prescribe. 

(B) CONTENTS.—Each application submitted under 

subparagraph (A) shall—

(i) identify any activity described in paragraph (3) 

that the grant will be used to fund; and 


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(ii) describe the means by which an activity identified under clause (i) will reduce hunger in the community of the eligible entity. 

(C) PRIORITY.—In making grants under this subsection, the Secretary shall give priority to eligible entities 

that demonstrate 2 or more of the following: 

(i) The eligible entity serves a community in which 

the rates of food insecurity, hunger, poverty, or unemployment are demonstrably higher than national average rates. 

(ii) The eligible entity serves a community that has 

successfully carried out long-term efforts to reduce hunger in the community. 

(iii) The eligible entity serves a community that 

provides public support for the efforts of the eligible entity. 

(iv) The eligible entity is committed to achieving 

more than 1 hunger-free communities goal. 

(3) USE OF FUNDS.—An eligible entity shall use a grant received under this subsection to construct, expand, or repair a facility or equipment to support hunger relief efforts in the community. 

(d) REPORT.—If funds are made available under subsection (e) 

to carry out this section, not later than September 30, 2012, the Secretary shall submit to Congress a report that describes—

(1) each grant made under this section, including—

(A) a description of any activity funded; and 

(B) the degree of success of each activity funded in 

achieving hunger free-communities goals; and 

(2) the degree of success of all activities funded under this 

section in achieving domestic hunger goals. 

(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this section for each of fiscal years 2008 through 2012. 

SEC. 4406. REAUTHORIZATION OF FEDERAL FOOD ASSISTANCE PROGRAMS. 

(a) SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM.—

(1) AUTHORIZATION OF APPROPRIATIONS.—Section 18(a)(1) 

of the Food and Nutrition Act of 2008 (7 U.S.C. 2027(a)(1)) is 

amended in the first sentence by striking ‘‘for each of the fiscal 

years 2003 through 2007’’ and inserting ‘‘for each of fiscal years 

2008 through 2012’’. 

(2) GRANTS FOR SIMPLE APPLICATION AND ELIGIBILITY DETERMINATION SYSTEMS AND IMPROVED ACCESS TO BENEFITS.—

Section 11(t)(1) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2020(t)(1)) is amended by striking ‘‘For each of fiscal years 2003 

through 2007’’ and inserting ‘‘Subject to the availability of appropriations under section 18(a), for each fiscal year’’. 

(3) FUNDING OF EMPLOYMENT AND TRAINING PROGRAMS.—

Section 16(h)(1) of the Food and Nutrition Act of 2008 (7 U.S.C. 

2025(h)(1)) is amended—

(A) in subparagraph (A), by striking ‘‘the amount 

of—’’ and all that follows through the end of the subparagraph and inserting ‘‘, $90,000,000 for each fiscal year.’’; 

and 


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(B) in subparagraph (E)(i), by striking ‘‘for each of fiscal years 2002 through 2007’’ and inserting ‘‘for each fiscal 

year’’. 

(4) REDUCTIONS IN PAYMENTS FOR ADMINISTRATIVE

COSTS.—Section 16(k)(3) of the Food and Nutrition Act of 2008 

(7 U.S.C. 2025(k)(3)) is amended—

(A) in the first sentence of subparagraph (A), by striking ‘‘effective for each of fiscal years 1999 through 2007,’’; 

and 

(B) in subparagraph (B)(ii), by striking ‘‘through fiscal 

year 2007’’. 

(5) CASH PAYMENT PILOT PROJECTS.—Section 17(b)(1)(B)(vi) 

of the Food and Nutrition Act of 2008 (7 U.S.C. 

2026(b)(1)(B)(vi)) is amended—

(A) by striking ‘‘Any pilot’’ and inserting ‘‘Subject to the 

availability of appropriations under section 18(a), any 

pilot’’; and 

(B) by striking ‘‘through October 1, 2007,’’. 

(6) CONSOLIDATED BLOCK GRANTS FOR PUERTO RICO AND

AMERICAN SAMOA.—Section 19(a)(2)(A)(ii) of the Food and Nutrition Act of 2008 (7 U.S.C. 2028(a)(2)(A)(ii)) is amended by 

striking ‘‘for each of fiscal years 2004 through 2007’’ and inserting ‘‘subject to the availability of appropriations under section 

18(a), for each fiscal year thereafter’’. 

(7) ASSISTANCE FOR COMMUNITY FOOD PROJECTS.—Section 

25 of the Food and Nutrition Act of 2008 (7 U.S.C. 2034) is 

amended—

(A) in subsection (b)(2)(B), by striking ‘‘for each of fiscal years 1997 through 2007’’ and inserting ‘‘for fiscal year 

2008 and each fiscal year thereafter’’; and 

(B) in subsection (i)(4) (as redesignated by section 

4402), by striking ‘‘of fiscal years 2003 through 2007’’ and 

inserting ‘‘fiscal year thereafter’’. 

(b) COMMODITY DISTRIBUTION.—

(1) EMERGENCY FOOD ASSISTANCE.—Section 204(a)(1) of the 

Emergency Food Assistance Act of 1983 (7 U.S.C. 7508(a)(1)) is 

amended in the first sentence by striking ‘‘for each of the fiscal 

years 2003 through 2007’’ and inserting ‘‘for fiscal year 2008 

and each fiscal year thereafter’’. 

(2) COMMODITY DISTRIBUTION PROGRAM.—Section 4(a) of 

the Agriculture and Consumer Protection Act of 1973 (7 U.S.C. 

612c note; Public Law 93–86) is amended in the first sentence 

by striking ‘‘years 1991 through 2007’’ and inserting ‘‘years 

2008 through 2012’’. 

(3) COMMODITY SUPPLEMENTAL FOOD PROGRAM.—Section 5 

of the Agriculture and Consumer Protection Act of 1973 (7 

U.S.C. 612c note; Public Law 93–86) is amended—

(A) in subsection (a)—

(i) in paragraph (1), by striking ‘‘each of fiscal 

years 2003 through 2007’’ and inserting ‘‘each of fiscal 

years 2008 through 2012’’; and 

(ii) in paragraph (2)(B), by striking the subparagraph designation and heading and all that follows 

through ‘‘2007’’ and inserting the following: 


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‘‘(B) SUBSEQUENT FISCAL YEARS.—For each of fiscal 

years 2004 through 2012’’; and 

(B) in subsection (d)(2), by striking ‘‘each of the fiscal 

years 1991 through 2007’’ and inserting ‘‘each of fiscal 

years 2008 through 2012’’. 

(4) DISTRIBUTION OF SURPLUS COMMODITIES TO SPECIAL

NUTRITION PROJECTS.—Section 1114(a)(2)(A) of the Agriculture 

and Food Act of 1981 (7 U.S.C. 1431e(2)(A)) is amended in the 

first sentence by striking ‘‘Effective through September 30, 

2007’’ and inserting ‘‘For each of fiscal years 2008 through 

2012’’. 

(c) FARM SECURITY AND RURAL INVESTMENT.—

(1) SENIORS FARMERS’ MARKET NUTRITION PROGRAM.—Section 4402 of the Farm Security and Rural Investment Act of 

2002 (7 U.S.C. 3007) is amended by striking subsection (a) and 

inserting the following: 

‘‘(a) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary of Agriculture shall use to carry out and expand 

the seniors farmers’ market nutrition program $20,600,000 for each 

of fiscal years 2008 through 2012.’’. 

(2) NUTRITION INFORMATION AND AWARENESS PILOT PROGRAM.—Section 4403(f) of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 3171 note; Public Law 107–171) is 

amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 4407. EFFECTIVE AND IMPLEMENTATION DATES. 

Except as otherwise provided in this title, this title and the 

amendments made by this title take effect on October 1, 2008. 

TITLE V—CREDIT 

Subtitle A—Farm Ownership Loans 

SEC. 5001. DIRECT LOANS. 

Section 302 of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1922) is amended—

(1) by striking the section designation and heading and all 

that follows through ‘‘(a) The Secretary is authorized to’’ and 

inserting the following: 

‘‘SEC. 302. PERSONS ELIGIBLE FOR REAL ESTATE LOANS. 

‘‘(a) IN GENERAL.—The Secretary may’’; and 

(2) in subsection (a)(2), by inserting ‘‘, taking into consideration all farming experience of the applicant, without regard to 

any lapse between farming experiences’’ after ‘‘farming operations’’. 

SEC. 5002. CONSERVATION LOAN AND LOAN GUARANTEE PROGRAM. 

Section 304 of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1924) is amended to read as follows: 

‘‘SEC. 304. CONSERVATION LOAN AND LOAN GUARANTEE PROGRAM. 

‘‘(a) IN GENERAL.—The Secretary may make or guarantee qualified conservation loans to eligible borrowers under this section. 

‘‘(b) DEFINITIONS.—In this section: 

‘‘(1) QUALIFIED CONSERVATION LOAN.—The term ‘qualified 

conservation loan’ means a loan, the proceeds of which are used 


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to cover the costs to the borrower of carrying out a qualified 

conservation project. 

‘‘(2) QUALIFIED CONSERVATION PROJECT.—The term ‘qualified conservation project’ means conservation measures that address provisions of a conservation plan of the eligible borrower. 

‘‘(3) CONSERVATION PLAN.—The term ‘conservation plan’

means a plan, approved by the Secretary, that, for a farming 

or ranching operation, identifies the conservation activities that 

will be addressed with loan funds provided under this section, 

including—

‘‘(A) the installation of conservation structures to address soil, water, and related resources; 

‘‘(B) the establishment of forest cover for sustained 

yield timber management, erosion control, or shelter belt 

purposes; 

‘‘(C) the installation of water conservation measures; 

‘‘(D) the installation of waste management systems; 

‘‘(E) the establishment or improvement of permanent 

pasture; 

‘‘(F) compliance with section 1212 of the Food Security 

Act of 1985; and 

‘‘(G) other purposes consistent with the plan, including 

the adoption of any other emerging or existing conservation 

practices, techniques, or technologies approved by the Secretary. 

‘‘(c) ELIGIBILITY.—

‘‘(1) IN GENERAL.—The Secretary may make or guarantee 

loans to farmers or ranchers in the United States, farm cooperatives, private domestic corporations, partnerships, joint operations, trusts, or limited liability companies that are controlled by farmers or ranchers and engaged primarily and directly in agricultural production in the United States. 

‘‘(2) REQUIREMENTS.—To be eligible for a loan under this 

section, applicants shall meet the requirements in paragraphs 

(1) and (2) of section 302(a). 

‘‘(d) PRIORITY.—In making or guaranteeing loans under this 

section, the Secretary shall give priority to—

‘‘(1) qualified beginning farmers or ranchers and socially 

disadvantaged farmers or ranchers; 

‘‘(2) owners or tenants who use the loans to convert to sustainable or organic agricultural production systems; and 

‘‘(3) producers who use the loans to build conservation 

structures or establish conservation practices to comply with 

section 1212 of the Food Security Act of 1985. 

‘‘(e) LIMITATIONS APPLICABLE TO LOAN GUARANTEES.—The portion of a loan that the Secretary may guarantee under this section 

shall be 75 percent of the principal amount of the loan. 

‘‘(f) ADMINISTRATIVE PROVISIONS.—The Secretary shall ensure, 

to the maximum extent practicable, that loans made or guaranteed 

under this section are distributed across diverse geographic regions. 

‘‘(g) CREDIT ELIGIBILITY.—The provisions of paragraphs (1) and 

(3) of section 333 shall not apply to loans made or guaranteed 

under this section. 


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‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—For each of fiscal 

years 2008 through 2012, there are authorized to be appropriated to 

the Secretary such funds as are necessary to carry out this section.’’. 

SEC. 5003. LIMITATIONS ON AMOUNT OF FARM OWNERSHIP LOANS. 

Section 305(a)(2) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1925(a)(2)) is amended by striking ‘‘$200,000’’

and inserting ‘‘$300,000’’. 

SEC. 5004. DOWN PAYMENT LOAN PROGRAM. 

Section 310E of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1935) is amended—

(1) in subsection (a)(1), by striking ‘‘and ranchers’’ and inserting ‘‘or ranchers and socially disadvantaged farmers or 

ranchers’’; 

(2) in subsection (b)—

(A) by striking paragraph (1) and inserting the following; 

‘‘(1) PRINCIPAL.—Each loan made under this section shall 

be in an amount that does not exceed 45 percent of the least 

of—

‘‘(A) the purchase price of the farm or ranch to be acquired; 

‘‘(B) the appraised value of the farm or ranch to be acquired; or 

‘‘(C) $500,000. 

‘‘(2) INTEREST RATE.—The interest rate on any loan made 

by the Secretary under this section shall be a rate equal to the 

greater of—

‘‘(A) the difference obtained by subtracting 4 percent 

from the interest rate for farm ownership loans under this 

subtitle; or 

‘‘(B) 1.5 percent.’’; and 

(B) in paragraph (3), by striking ‘‘15’’ and inserting 

‘‘20’’; 

(3) in subsection (c)—

(A) in paragraph (1), by striking ‘‘10’’ and inserting 

‘‘5’’; 

(B) by striking paragraph (2) and redesignating paragraph (3) as paragraph (2); and 

(C) in paragraph (2)(B) (as so redesignated), by striking ‘‘15-year’’ and inserting ‘‘20-year’’; 

(4) in subsection (d)—

(A) in paragraph (3)—

(i) by inserting ‘‘and socially disadvantaged farmers or ranchers’’ after ‘‘ranchers’’; and 

(ii) by striking ‘‘and’’ at the end; 

(B) in paragraph (4), by striking ‘‘and ranchers.’’ and 

inserting ‘‘or ranchers or socially disadvantaged farmers or 

ranchers; and’’; and 

(C) by adding at the end the following: 

‘‘(5) establish annual performance goals to promote the use 

of the down payment loan program and other joint financing 

arrangements as the preferred choice for direct real estate loans 

made by any lender to a qualified beginning farmer or rancher 

or socially disadvantaged farmer or rancher.’’; and 


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(5) by adding at the end the following: ‘‘(e) SOCIALLY DISADVANTAGED FARMER OR RANCHER DE- FINED.—In this section, the term ‘socially disadvantaged farmer or 

rancher’ has the meaning given that term in section 355(e)(2).’’. 

SEC. 5005. BEGINNING FARMER OR RANCHER AND SOCIALLY DISADVANTAGED FARMER OR RANCHER CONTRACT LAND 

SALES PROGRAM. 

Section 310F of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1936) is amended to read as follows: 

‘‘SEC. 310F. BEGINNING FARMER OR RANCHER AND SOCIALLY DISADVANTAGED FARMER OR RANCHER CONTRACT LAND 

SALES PROGRAM. 

‘‘(a) IN GENERAL.—The Secretary shall, in accordance with this 

section, guarantee a loan made by a private seller of a farm or 

ranch to a qualified beginning farmer or rancher or socially disadvantaged farmer or rancher (as defined in section 355(e)(2)) on a 

contract land sales basis. ‘‘(b) ELIGIBILITY.—In order to be eligible for a loan guarantee 

under subsection (a)— ‘‘(1) the qualified beginning farmer or rancher or socially 

disadvantaged farmer or rancher shall— ‘‘(A) on the date the contract land sale that is subject 

of the loan is complete, own and operate the farm or ranch 

that is the subject of the contract land sale; ‘‘(B) have a credit history that— ‘‘(i) includes a record of satisfactory debt repayment, as determined by the Secretary; and ‘‘(ii) is acceptable to the Secretary; and ‘‘(C) demonstrate to the Secretary that the farmer or 

rancher, as the case may be, is unable to obtain sufficient 

credit without a guarantee to finance any actual need of the 

farmer or rancher, as the case may be, at a reasonable rate 

or term; and 

‘‘(2) the loan shall meet applicable underwriting criteria, as 

determined by the Secretary. 

‘‘(c) LIMITATIONS.—

‘‘(1) DOWN PAYMENT.—The Secretary shall not provide a 

loan guarantee under subsection (a) if the contribution of the 

qualified beginning farmer or rancher or socially disadvantaged farmer or rancher to the down payment for the farm or 

ranch that is the subject of the contract land sale would be less 

than 5 percent of the purchase price of the farm or ranch. 

‘‘(2) MAXIMUM PURCHASE PRICE.—The Secretary shall not 

provide a loan guarantee under subsection (a) if the purchase 

price or the appraisal value of the farm or ranch that is the 

subject of the contract land sale is greater than $500,000. 

‘‘(d) PERIOD OF GUARANTEE.—The period during which a loan 

guarantee under this section is in effect shall be the 10-year period 

beginning with the date the guarantee is provided. 

‘‘(e) GUARANTEE PLAN.—

‘‘(1) SELECTION OF PLAN.—A private seller of a farm or 

ranch who makes a loan that is guaranteed by the Secretary 

under subsection (a) may select—

‘‘(A) a prompt payment guarantee plan, which shall 

cover—


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‘‘(i) 3 amortized annual installments; or 

‘‘(ii) an amount equal to 3 annual installments (including an amount equal to the total cost of any tax 

and insurance incurred during the period covered by 

the annual installments); or 

‘‘(B) a standard guarantee plan, which shall cover an 

amount equal to 90 percent of the outstanding principal of 

the loan. 

‘‘(2) ELIGIBLITY FOR STANDARD GUARANTEE PLAN.—In order 

for a private seller to be eligible for a standard guarantee plan 

referred to in paragraph (1)(B), the private seller shall—

‘‘(A) secure a commercial lending institution or similar 

entity, as determined by the Secretary, to serve as an escrow agent; or 

‘‘(B) in cooperation with the farmer or rancher, use an 

appropriate alternate arrangement, as determined by the 

Secretary. 

‘‘(f) TRANSITION FROM PILOT PROGRAM.—

‘‘(1) IN GENERAL.—The Secretary may phase-in the implementation of the changes to the Beginning Farmer and Rancher 

and Socially Disadvantaged Farmer or Rancher Contract Land 

Sales Program provided for in this section. 

‘‘(2) LIMITATION.—All changes to the Beginning Farmer 

and Rancher and Socially Disadvantaged Farmer or Rancher 

Contract Land Sales Program must be implemented for the 

2011 Fiscal Year.’’. 

Subtitle B—Operating Loans 

SEC. 5101. FARMING EXPERIENCE AS ELIGIBILITY REQUIREMENT. 

Section 311 of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1941) is amended—

(1) by striking the section designation and all that follows 

through ‘‘(a) The Secretary is authorized to’’ and inserting the 

following: 

‘‘SEC. 311. PERSONS ELIGIBLE FOR LOANS. 

‘‘(a) IN GENERAL.—The Secretary may’’; 

(2) in subsection (a)(2), by inserting ‘‘, taking into consideration all farming experience of the applicant, without regard to 

any lapse between farming experiences’’ after ‘‘farming operations’’. 

SEC. 5102. LIMITATIONS ON AMOUNT OF OPERATING LOANS. 

Section 313(a)(1) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1943(a)(1)) is amended by striking ‘‘$200,000’’

and inserting ‘‘$300,000’’. 

SEC. 5103. SUSPENSION OF LIMITATION ON PERIOD FOR WHICH BORROWERS ARE ELIGIBLE FOR GUARANTEED ASSISTANCE. 

Section 5102 of the Farm Security And Rural Investment Act 

of 2002 (7 U.S.C. 1949 note; Public Law 107–171) is amended by 

striking ‘‘September 30, 2007’’ and inserting ‘‘December 31, 2010’’. 


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Subtitle C—Emergency Loans 

SEC. 5201. ELIGIBILITY OF EQUINE FARMERS AND RANCHERS FOR 

EMERGENCY LOANS. 

Section 321(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961(a)) is amended— (1) in paragraph (1), by striking ‘‘farmers, ranchers’’ and 

inserting ‘‘farmers or ranchers (including equine farmers or 

ranchers)’’; and 

(2) in paragraph (2)(A), by striking ‘‘farming, ranching,’’ and inserting ‘‘farming or ranching (including equine farming 

or ranching)’’. 

Subtitle D—Administrative Provisions 

SEC. 5301. BEGINNING FARMER AND RANCHER INDIVIDUAL DEVELOPMENT ACCOUNTS PILOT PROGRAM. 

Subtitle D of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1981–2008r) is amended by inserting after section 

333A the following: 

‘‘SEC. 333B. BEGINNING FARMER AND RANCHER INDIVIDUAL DEVELOPMENT ACCOUNTS PILOT PROGRAM. 

‘‘(a) DEFINITIONS.—In this section: ‘‘(1) DEMONSTRATION PROGRAM.—The term ‘demonstration 

program’ means a demonstration program carried out by a 

qualified entity under the pilot program established in subsection (b)(1). ‘‘(2) ELIGIBLE PARTICIPANT.—The term ‘eligible participant’ means a qualified beginning farmer or rancher that— ‘‘(A) lacks significant financial resources or assets; and 

‘‘(B) has an income that is less than— ‘‘(i) 80 percent of the median income of the State 

in which the farmer or rancher resides; or ‘‘(ii) 200 percent of the most recent annual Federal 

Poverty Income Guidelines published by the Department of Health and Human Services for the State. 

‘‘(3) INDIVIDUAL DEVELOPMENT ACCOUNT.—The term ‘individual development account’ means a savings account described 

in subsection (b)(4)(A). ‘‘(4) QUALIFIED ENTITY.— ‘‘(A) IN GENERAL.—The term ‘qualified entity’ means—

‘‘(i) 1 or more organizations—

‘‘(I) described in section 501(c)(3) of the Internal Revenue Code of 1986; and 

‘‘(II) exempt from taxation under section 501(a) 

of such Code; or 

‘‘(ii) a State, local, or tribal government submitting 

an application jointly with an organization described 

in clause (i). 

‘‘(B) NO PROHIBITION ON COLLABORATION.—An organization described in subparagraph (A)(i) may collaborate 

with a financial institution or for-profit community development corporation to carry out the purposes of this section. ‘‘(b) PILOT PROGRAM.—

‘‘(1) IN GENERAL.—The Secretary shall establish a pilot program to be known as the ‘New Farmer Individual Development 


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Accounts Pilot Program’ under which the Secretary shall work 

through qualified entities to establish demonstration programs—‘‘(A) of at least 5 years in duration; and 

‘‘(B) in at least 15 States. ‘‘(2) COORDINATION.—The Secretary shall operate the pilot 

program through, and in coordination with the farm loan programs of, the Farm Service Agency. ‘‘(3) RESERVE FUNDS.— ‘‘(A) IN GENERAL.—A qualified entity carrying out a 

demonstration program under this section shall establish a 

reserve fund consisting of a non-Federal match of 50 percent of the total amount of the grant awarded to the demonstration program under this section. ‘‘(B) FEDERAL FUNDS.—After the qualified entity has 

deposited the non-Federal matching funds described in subparagraph (A) in the reserve fund, the Secretary shall provide the total amount of the grant awarded under this section to the demonstration program for deposit in the reserve 

fund. 

‘‘(C) USE OF FUNDS.—Of the funds deposited under 

subparagraph (B) in the reserve fund established for a 

demonstration program, the qualified entity carrying out 

the demonstration program— ‘‘(i) may use up to 10 percent for administrative expenses; and ‘‘(ii) shall use the remainder in making matching 

awards described in paragraph (4)(B)(ii)(I). 

‘‘(D) INTEREST.—Any interest earned on amounts in a 

reserve fund established under subparagraph (A) may be 

used by the qualified entity as additional matching funds 

for, or to administer, the demonstration program. 

‘‘(E) GUIDANCE.—The Secretary shall issue guidance 

regarding the investment requirements of reserve funds established under this paragraph. ‘‘(F) REVERSION.—On the date on which all funds remaining in any individual development account established 

by a qualified entity have reverted under paragraph 

(5)(B)(ii) to the reserve fund established by the qualified entity, there shall revert to the Treasury of the United States 

a percentage of the amount (if any) in the reserve fund 

equal to—

‘‘(i) the amount of Federal funds deposited in the 

reserve fund under subparagraph (B) that were not 

used for administrative expenses; divided by ‘‘(ii) the total amount of funds deposited in the reserve fund. ‘‘(4) INDIVIDUAL DEVELOPMENT ACCOUNTS.—

‘‘(A) IN GENERAL.—A qualified entity receiving a grant 

under this section shall establish and administer individual development accounts for eligible participants. ‘‘(B) CONTRACT REQUIREMENTS.—To be eligible to receive funds under this section from a qualified entity, an eligible participant shall enter into a contract with only 1 

qualified entity under which—


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‘‘(i) the eligible participant agrees— ‘‘(I) to deposit a certain amount of funds of the 

eligible participant in a personal savings account, 

as prescribed by the contractual agreement between the eligible participant and the qualified entity; ‘‘(II) to use the funds described in subclause (I) 

only for 1 or more eligible expenditures described 

in paragraph (5)(A); and ‘‘(III) to complete financial training; and ‘‘(ii) the qualified entity agrees— ‘‘(I) to deposit, not later than 1 month after an 

amount is deposited pursuant to clause (i)(I), at 

least a 100-percent, and up to a 200-percent, 

match of that amount into the individual development account established for the eligible participant; and ‘‘(II) with uses of funds proposed by the eligible participant. ‘‘(C) LIMITATION.—

‘‘(i) IN GENERAL.—A qualified entity administering 

a demonstration program under this section may provide not more than $6,000 for each fiscal year in 

matching funds to the individual development account 

established by the qualified entity for an eligible participant. ‘‘(ii) TREATMENT OF AMOUNT.—An amount provided under clause (i) shall not be considered to be a 

gift or loan for mortgage purposes. ‘‘(5) ELIGIBLE EXPENDITURES.—

‘‘(A) IN GENERAL.—An eligible expenditure described in 

this subparagraph is an expenditure— ‘‘(i) to purchase farmland or make a down payment on an accepted purchase offer for farmland; 

‘‘(ii) to make mortgage payments on farmland purchased pursuant to clause (i), for up to 180 days after 

the date of the purchase; 

‘‘(iii) to purchase breeding stock, fruit or nut trees, 

or trees to harvest for timber; and 

‘‘(iv) for other similar expenditures, as determined 

by the Secretary. 

‘‘(B) TIMING.—

‘‘(i) IN GENERAL.—An eligible participant may 

make an eligible expenditure at any time during the 2- 

year period beginning on the date on which the last 

matching funds are provided under paragraph 

(4)(B)(ii)(I) to the individual development account established for the eligible participant. 

‘‘(ii) UNEXPENDED FUNDS.—At the end of the period 

described in clause (i), any funds remaining in an individual development account established for an eligible 

participant shall revert to the reserve fund of the demonstration program under which the account was established. ‘‘(c) APPLICATIONS.—


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‘‘(1) IN GENERAL.—A qualified entity that seeks to carry out 

a demonstration program under this section may submit to the 

Secretary an application at such time, in such form, and containing such information as the Secretary may prescribe. 

‘‘(2) CRITERIA.—In considering whether to approve an application to carry out a demonstration program under this section, the Secretary shall assess—

‘‘(A) the degree to which the demonstration program described in the application is likely to aid eligible participants in successfully pursuing new farming opportunities; 

‘‘(B) the experience and ability of the qualified entity to 

responsibly administer the demonstration program; 

‘‘(C) the experience and ability of the qualified entity in 

recruiting, educating, and assisting eligible participants to 

increase economic independence and pursue or advance 

farming opportunities; 

‘‘(D) the aggregate amount of direct funds from nonFederal public sector and private sources that are formally 

committed to the demonstration program as matching contributions; 

‘‘(E) the adequacy of the plan of the qualified entity to 

provide information relevant to an evaluation of the demonstration program; and 

‘‘(F) such other factors as the Secretary considers to be 

appropriate. 

‘‘(3) PREFERENCES.—In considering an application to conduct a demonstration program under this section, the Secretary 

shall give preference to an application from a qualified entity 

that demonstrates—

‘‘(A) a track record of serving clients targeted by the 

program, including, as appropriate, socially disadvantaged 

farmers or ranchers (as defined in section 355(e)(2)); and 

‘‘(B) expertise in dealing with financial management 

aspects of farming. 

‘‘(4) APPROVAL.—Not later than 1 year after the date of enactment of this section, in accordance with this section, the Secretary shall, on a competitive basis, approve such applications 

to conduct demonstration programs as the Secretary considers 

appropriate. 

‘‘(5) TERM OF AUTHORITY.—If the Secretary approves an application to carry out a demonstration program, the Secretary 

shall authorize the applicant to carry out the project for a period of 5 years, plus an additional 2 years to make eligible expenditures in accordance with subsection (b)(5)(B). 

‘‘(d) GRANT AUTHORITY.—

‘‘(1) IN GENERAL.—The Secretary shall make a grant to a 

qualified entity authorized to carry out a demonstration program under this section. 

‘‘(2) MAXIMUM AMOUNT OF GRANTS.—The aggregate amount 

of grant funds provided to a demonstration program carried out 

under this section shall not exceed $250,000. 

‘‘(3) TIMING OF GRANT PAYMENTS.—The Secretary shall pay 

the amounts awarded under a grant made under this section—

‘‘(A) on the awarding of the grant; or 


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‘‘(B) pursuant to such payment plan as the qualified 

entity may specify. ‘‘(e) REPORTS.— ‘‘(1) ANNUAL PROGRESS REPORTS.— ‘‘(A) IN GENERAL.—Not later than 60 days after the end 

of the calendar year in which the Secretary authorizes a 

qualified entity to carry out a demonstration program 

under this section, and annually thereafter until the conclusion of the demonstration program, the qualified entity 

shall prepare an annual report that includes, for the period 

covered by the report— ‘‘(i) an evaluation of the progress of the demonstration program; ‘‘(ii) information about the demonstration program, 

including the eligible participants and the individual 

development accounts that have been established; and ‘‘(iii) such other information as the Secretary may 

require. 

‘‘(B) SUBMISSION OF REPORTS.—A qualified entity shall 

submit each report required under subparagraph (A) to the 

Secretary. 

‘‘(2) REPORTS BY THE SECRETARY.—Not later than 1 year 

after the date on which all demonstration programs under this 

section are concluded, the Secretary shall submit to Congress a 

final report that describes the results and findings of all reports 

and evaluations carried out under this section. 

‘‘(f) ANNUAL REVIEW.—The Secretary may conduct an annual 

review of the financial records of a qualified entity— ‘‘(1) to assess the financial soundness of the qualified entity; 

and ‘‘(2) to determine the use of grant funds made available to 

the qualified entity under this section. 

‘‘(g) REGULATIONS.—In carrying out this section, the Secretary 

may promulgate regulations to ensure that the program includes 

provisions for— ‘‘(1) the termination of demonstration programs; 

‘‘(2) control of the reserve funds in the case of such a termination; ‘‘(3) transfer of demonstration programs to other qualified 

entities; and ‘‘(4) remissions from a reserve fund to the Secretary in a 

case in which a demonstration program is terminated without 

transfer to a new qualified entity. 

‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $5,000,000 for each of 

fiscal years 2008 through 2012.’’. 

SEC. 5302. INVENTORY SALES PREFERENCES; LOAN FUND SET-ASIDES. 

(a) INVENTORY SALES PREFERENCES.—Section 335(c) of the 

Consolidated Farm and Rural Development Act (7 U.S.C. 1985(c)) 

is amended—

(1) in paragraph (1)—

(A) in subparagraph (B)—

(i) in the subparagraph heading, by inserting ‘‘; 

SOCIALLY DISADVANTAGED FARMER OR RANCHER’’ after 

‘‘OR RANCHER’’; 


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(ii) in clause (i), by inserting ‘‘or a socially disadvantaged farmer or rancher’’ after ‘‘or rancher’’; 

(iii) in clause (ii), by inserting ‘‘or socially disadvantaged farmer or rancher’’ after ‘‘or rancher’’; 

(iv) in clause (iii), by inserting ‘‘or a socially disadvantaged farmer or rancher’’ after ‘‘or rancher’’; and 

(v) in clause (iv), by striking ‘‘and ranchers’’ and 

inserting ‘‘or ranchers and socially disadvantaged 

farmers or ranchers’’; and 

(B) in subparagraph (C), by inserting ‘‘or a socially disadvantaged farmer or rancher’’ after ‘‘or rancher’’; 

(2) in paragraph (5)(B)—

(A) in clause (i)—

(i) in the clause heading, by inserting ‘‘; SOCIALLY

DISADVANTAGED FARMER OR RANCHER’’ after ‘‘OR

RANCHER’’; 

(ii) by inserting ‘‘or a socially disadvantaged farmer or rancher’’ after ‘‘a beginning farmer or rancher’’; 

and 

(iii) by inserting ‘‘or the socially disadvantaged 

farmer or rancher’’ after ‘‘the beginning farmer or 

rancher’’; and 

(B) in clause (ii)—

(i) in the matter preceding subclause (I), by inserting ‘‘or a socially disadvantaged farmer or rancher’’

after ‘‘or rancher’’; and 

(ii) in subclause (II), by inserting ‘‘or the socially 

disadvantaged farmer or rancher’’ after ‘‘or rancher’’; 

and 

(3) in paragraph (6)—

(A) in subparagraph (A), by inserting ‘‘or a socially disadvantaged farmer or rancher’’ after ‘‘or rancher’’; and 

(B) in subparagraph (C)—

(i) in clause (i)(I), by striking ‘‘and ranchers’’ and 

inserting ‘‘or ranchers and socially disadvantaged 

farmers or ranchers’’; and 

(ii) in clause (ii), by inserting ‘‘or socially disadvantaged farmers or ranchers’’ after ‘‘or ranchers’’. 

(b) LOAN FUND SET-ASIDES.—Section 346(b)(2) of such Act (7 

U.S.C. 1994(b)(2)) is amended—

(1) in subparagraph (A)—

(A) in clause (i)—

(i) in subclause (I), by striking ‘‘70 percent’’ and inserting ‘‘an amount that is not less than 75 percent of 

the total amount’’; and 

(ii) in subclause (II)—

(I) in the subclause heading, by inserting ‘‘; 

JOINT FINANCING ARRANGEMENTS’’ after ‘‘PAYMENT

LOANS’’; 

(II) by striking ‘‘60 percent’’ and inserting ‘‘an 

amount not less than 2⁄3 of the amount’’; and 

(III) by inserting ‘‘and joint financing arrangements under section 307(a)(3)(D)’’ after ‘‘section 

310E’’; and 


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(B) in clause (ii)(III), by striking ‘‘2003 through 2007, 

35 percent’’ and inserting ‘‘2008 through 2012, an amount 

that is not less than 50 percent of the total amount’’; and 

(2) in subparagraph (B)(i), by striking ‘‘25 percent’’ and inserting ‘‘an amount that is not less than 40 percent of the total 

amount’’. 

SEC. 5303. LOAN AUTHORIZATION LEVELS. 

Section 346(b)(1) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1994(b)(1)) is amended—

(1) in the matter preceding subparagraph (A), by striking 

‘‘$3,796,000,000 for each of fiscal years 2003 through 2007’’ and 

inserting ‘‘$4,226,000,000 for each of fiscal years 2008 through 

2012’’; and 

(2) in subparagraph (A)—

(A) in the matter preceding clause (i), by striking 

‘‘$770,000,000’’ and inserting ‘‘$1,200,000,000’’; 

(B) in clause (i), by striking ‘‘$205,000,000’’ and inserting ‘‘$350,000,000’’; and 

(C) in clause (ii), by striking ‘‘$565,000,000’’ and inserting ‘‘$850,000,000’’. 

SEC. 5304. TRANSITION TO PRIVATE COMMERCIAL OR OTHER 

SOURCES OF CREDIT. 

Subtitle D of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1981–2008r) is amended by inserting after section 344 

the following: 

‘‘SEC. 345. TRANSITION TO PRIVATE COMMERCIAL OR OTHER 

SOURCES OF CREDIT. 

‘‘(a) IN GENERAL.—In making or insuring a farm loan under 

subtitle A or B, the Secretary shall establish a plan and promulgate 

regulations (including performance criteria) that promote the goal of 

transitioning borrowers to private commercial credit and other 

sources of credit in the shortest period of time practicable. 

‘‘(b) COORDINATION.—In carrying out this section, the Secretary 

shall integrate and coordinate the transition policy described in 

subsection (a) with—

‘‘(1) the borrower training program established by section 

359; 

‘‘(2) the loan assessment process established by section 360; 

‘‘(3) the supervised credit requirement established by section 

361; 

‘‘(4) the market placement program established by section 

362; and 

‘‘(5) other appropriate programs and authorities, as determined by the Secretary.’’. 

SEC. 5305. EXTENSION OF THE RIGHT OF FIRST REFUSAL TO REACQUIRE HOMESTEAD PROPERTY TO IMMEDIATE FAMILY 

MEMBERS OF BORROWER-OWNER. 

Section 352(c)(4)(B) of the Consolidated Farm and Rural Development Act (7 U.S.C. 2000(c)(4)(B)) is amended— (1) in the 1st sentence, by striking ‘‘, the borrower-owner’’ inserting ‘‘of a borrower-owner who is a socially disadvantaged 

farmer or rancher (as defined in section 355(e)(2)), the borrower-owner or a member of the immediate family of the borrower-owner’’; and 


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(2) in the 2nd sentence, by inserting ‘‘or immediate family 

member, as the case may be,’’ before ‘‘from’’. 

SEC. 5306. RURAL DEVELOPMENT AND FARM LOAN PROGRAM ACTIVITIES. 

Subtitle D of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1981–2008r) is amended by inserting after section 364 

the following: 

‘‘SEC. 365. RURAL DEVELOPMENT AND FARM LOAN PROGRAM ACTIVITIES. 

‘‘The Secretary may not complete a study of, or enter into a contract with a private party to carry out, without specific authorization in a subsequent Act of Congress, a competitive sourcing activity 

of the Secretary, including support personnel of the Department of 

Agriculture, relating to rural development or farm loan programs.’’. 

Subtitle E—Farm Credit 

SEC. 5401. FARM CREDIT SYSTEM INSURANCE CORPORATION. 

(a) IN GENERAL.—Section 1.12(b) of the Farm Credit Act of 

1971 (12 U.S.C. 2020(b)) is amended—

(1) in the first sentence, by striking ‘‘Each Farm’’ and inserting the following; 

‘‘(1) IN GENERAL.—Each Farm’’; and 

(2) by striking the second sentence and inserting the following: 

‘‘(2) COMPUTATION.—The assessment on any association or 

other financing institution described in paragraph (1) for any 

period shall be computed in an equitable manner, as determined by the Corporation.’’. 

(b) RULES AND REGULATIONS.—Section 5.58(10) of such Act (12 

U.S.C. 2277a–7(10)) is amended by inserting ‘‘and section 1.12(b)’’

after ‘‘part’’. 

SEC. 5402. TECHNICAL CORRECTION. 

Section 3.3(b) of the Farm Credit Act of 1971 (12 U.S.C. 

2124(b)) is amended in the first sentence by striking ‘‘per’’ and inserting ‘‘par’’. 

SEC. 5403. BANK FOR COOPERATIVES VOTING STOCK. 

(a) IN GENERAL.—Section 3.3(c) of the Farm Credit Act of 1971 

(12 U.S.C. 2124(c)) is amended by striking ‘‘and (ii)’’ and inserting 

‘‘(ii) other categories of persons and entities described in sections 3.7 

and 3.8 eligible to borrow from the bank, as determined by the 

bank’s board of directors; and (iii)’’. 

(b) CONFORMING AMENDMENTS.—Section 4.3A(c)(1)(D) of such 

Act (12 U.S.C. 2154a(c)(1)(D)) is amended by redesignating clauses 

(ii) and (iii) as clauses (iii) and (iv), respectively, and inserting after 

clause (i) the following: 

‘‘(ii) persons and entities eligible to borrow from 

the banks for cooperatives, as described in section 

3.3(c)(ii);’’. 

SEC. 5404. PREMIUMS. 

(a) AMOUNT IN FUND NOT EXCEEDING SECURE BASE

AMOUNT.—Section 5.55(a) of the Farm Credit Act of 1971 (12 

U.S.C. 2277a–4(a)) is amended—

(1) in paragraph (1)—


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(A) in the matter preceding subparagraph (A)— (i) by striking ‘‘paragraph (2)’’ and inserting ‘‘paragraph (3)’’; and 

(ii) by striking ‘‘annual’’ ; and 

(B) by striking subparagraphs (A) through (D) and inserting the following: ‘‘(A) the average outstanding insured obligations issued 

by the bank for the calendar year, after deducting from the 

obligations the percentages of the guaranteed portions of 

loans and investments described in paragraph (2), multiplied by 0.0020; and ‘‘(B) the product obtained by multiplying— ‘‘(i) the sum of— ‘‘(I) the average principal outstanding for the 

calendar year on loans made by the bank that are 

in nonaccrual status; and ‘‘(II) the average amount outstanding for the 

calendar year of other-than-temporarily impaired 

investments made by the bank; by 

‘‘(ii) 0.0010.’’; 

(2) by striking paragraph (4); 

(3) by redesignating paragraphs (2) and (3) as paragraphs 

(3) and (4), respectively; 

(4) by inserting after paragraph (1) the following: 

‘‘(2) DEDUCTIONS FROM AVERAGE OUTSTANDING INSURED

OBLIGATIONS.—The average outstanding insured obligations 

issued by the bank for the calendar year referred to in paragraph (1)(A) shall be reduced by deducting from the obligations 

the sum of (as determined by the Corporation)— ‘‘(A) 90 percent of each of— ‘‘(i) the average principal outstanding for the calendar year on the guaranteed portions of Federal government-guaranteed loans made by the bank that are 

in accrual status; and 

‘‘(ii) the average amount outstanding for the calendar year of the guaranteed portions of Federal government-guaranteed investments made by the bank 

that are not permanently impaired; and 

‘‘(B) 80 percent of each of—

‘‘(i) the average principal outstanding for the calendar year on the guaranteed portions of State government-guaranteed loans made by the bank that are in 

accrual status; and 

‘‘(ii) the average amount outstanding for the calendar year of the guaranteed portions of State government-guaranteed investments made by the bank that 

are not permanently impaired.’’; 

(5) in paragraph (3) (as so redesignated by paragraph (3) 

of this subsection), by striking ‘‘annual’’; and 

(6) in paragraph (4) (as so redesignated by paragraph (3) 

of this subsection)—

(A) in the paragraph heading, by inserting ‘‘OR INVEST- MENTS’’ after ‘‘LOANS’’; and 

(B) in the matter preceding subparagraph (A), by striking ‘‘As used’’ and all that follows through ‘‘guaranteed—’’


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and inserting ‘‘In this section, the term ‘government-guaranteed’, when applied to a loan or an investment, means a 

loan, credit, or investment, or portion of a loan, credit, or 

investment, that is guaranteed—’’. (b) AMOUNT IN FUND EXCEEDING SECURE BASE AMOUNT.—Section 5.55(b) of such Act (12 U.S.C. 2277a–4(b)) is amended by striking ‘‘annual’’. (c) SECURE BASE AMOUNT.—Section 5.55(c) of such Act (12 

U.S.C. 2277a–4(c)) is amended— (1) by striking ‘‘For purposes’’ and inserting the following: ‘‘(1) IN GENERAL.—For purposes’’; 

(2) by striking ‘‘(adjusted downward’’ and all that follows 

through ‘‘by the Corporation)’’ and inserting ‘‘(as adjusted 

under paragraph (2))’’; and 

(3) by adding at the end the following: 

‘‘(2) ADJUSTMENT.—The aggregate outstanding insured obligations of all insured System banks under paragraph (1) shall 

be adjusted downward to exclude an amount equal to the sum 

of (as determined by the corporation)—

‘‘(A) 90 percent of each of—

‘‘(i) the guaranteed portions of principal outstanding on Federal government-guaranteed loans in 

accrual status made by the banks; and 

‘‘(ii) the guaranteed portions of the amount of Federal government-guaranteed investments made by the 

banks that are not permanently impaired; and 

‘‘(B) 80 percent of each of—

‘‘(i) the guaranteed portions of principal outstanding on State government-guaranteed loans in accrual status made by the banks; and 

‘‘(ii) the guaranteed portions of the amount of State 

government-guaranteed investments made by the banks 

that are not permanently impaired.’’. (d) DETERMINATION OF LOAN AND INVESTMENT AMOUNTS.—Section 5.55(d) of such Act (12 U.S.C. 2277a–4(d)) is amended—

(1) in the subsection heading, by striking ‘‘PRINCIPAL OUT- STANDING’’ and inserting ‘‘LOAN AND INVESTMENT AMOUNTS’’; 

(2) in the matter preceding paragraph (1), by striking ‘‘For 

the purpose’’ and all that follows through ‘‘made—’’ and inserting ‘‘For the purpose of subsections (a) and (c), the principal 

outstanding on all loans made by an insured System bank, and 

the amount outstanding on all investments made by an insured 

System bank, shall be determined based on—’’; 

(3) in each of paragraphs (1), (2), and (3), by inserting ‘‘all 

loans or investments made’’ before ‘‘by’’ the first place it appears; and 

(4) in each of paragraphs (1) and (2), by inserting ‘‘or investments’’ after ‘‘that is able to make such loans’’ each place it 

appears. 

(e) ALLOCATION TO SYSTEM INSTITUTIONS OF EXCESS RE- SERVES.—Section 5.55(e) of such Act (12 U.S.C. 2277a–4(e)) is 

amended—

(1) in paragraph (3), by striking ‘‘the average secure base 

amount for the calendar year (as calculated on an average daily 

balance basis)’’ and inserting ‘‘the secure base amount’’; 


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(2) in paragraph (4), by striking subparagraph (B) and inserting the following: 

‘‘(B) there shall be credited to the allocated insurance 

reserves account of each insured system bank an amount 

that bears the same ratio to the total amount (less any 

amount credited under subparagraph (A)) as—

‘‘(i) the average principal outstanding for the calendar year on insured obligations issued by the bank 

(after deducting from the principal the percentages of 

the guaranteed portions of loans and investments described in subsection (a)(2)); bears to 

‘‘(ii) the average principal outstanding for the calendar year on insured obligations issued by all insured 

System banks (after deducting from the principal the 

percentages of the guaranteed portions of loans and investments described in subsection (a)(2)).’’; and 

(3) in paragraph (6)—

(A) in subparagraph (A)—

(i) in the matter preceding clause (i), by striking 

‘‘beginning more’’ and all that follows through ‘‘January 1, 2005’’; 

(ii) by striking clause (i) and inserting the following: 

‘‘(i) subject to subparagraph (D), pay to each insured System bank, in a manner determined by the 

Corporation, an amount equal to the balance in the Allocated Insurance Reserves Account of the System 

bank; and’’; and 

(iii) in clause (ii)—

(I) by striking ‘‘subparagraphs (C), (E), and 

(F)’’ and inserting ‘‘subparagraphs (C) and (E)’’; 

and 

(II) by striking ‘‘, of the lesser of—’’ and all 

that follows through the end of subclause (II) and 

inserting ‘‘at the time of the termination of the Financial Assistance Corporation, of the balance in 

the Allocated Insurance Reserves Account established under paragraph (1)(B).’’; 

(B) in subparagraph (C)—

(i) in clause (i), by striking ‘‘(in addition to the 

amounts described in subparagraph (F)(ii))’’; and 

(ii) by striking clause (ii) and inserting the following: 

‘‘(ii) TERMINATION OF ACCOUNT.—On disbursement 

of an amount equal to $56,000,000, the Corporation 

shall—

‘‘(I) close the account established under paragraph (1)(B); and 

‘‘(II) transfer any remaining funds in the Account to the remaining Allocated Insurance Reserves Accounts in accordance with paragraph 

(4)(B) for the calendar year in which the transfer 

occurs.’’; and 

(C) by striking subparagraph (F). 


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SEC. 5405. CERTIFICATION OF PREMIUMS. 

(a) FILING CERTIFIED STATEMENT.—Section 5.56 of the Farm 

Credit Act of 1971 (12 U.S.C. 2277a–5) is amended by striking subsection (a) and inserting the following: 

‘‘(a) FILING CERTIFIED STATEMENT.—On a date to be determined in the sole discretion of the Board of Directors of the Corporation, each insured System bank that became insured before the 

beginning of the period for which premiums are being assessed (referred to in this section as the ‘period’) shall file with the Corporation a certified statement showing—

‘‘(1) the average outstanding insured obligations for the period issued by the bank; 

‘‘(2)(A) the average principal outstanding for the period on 

the guaranteed portion of Federal government-guaranteed loans 

that are in accrual status; and 

‘‘(B) the average amount outstanding for the period of Federal government-guaranteed investments that are not permanently impaired (as defined in section 5.55(a)(4)); 

‘‘(3)(A) the average principal outstanding for the period on 

State government-guaranteed loans that are in accrual status; 

and 

‘‘(B) the average amount outstanding for the period of State 

government-guaranteed investments that are not permanently 

impaired (as defined in section 5.55(a)(4)); 

‘‘(4)(A) the average principal outstanding for the period on 

loans that are in nonaccrual status; and 

‘‘(B) the average amount outstanding for the period of 

other-than-temporarily impaired investments; and 

‘‘(5) the amount of the premium due the Corporation from 

the bank for the period.’’. 

(b) PREMIUM PAYMENTS.—Section 5.56 of such Act (12 U.S.C. 

2277a–5) is amended by striking subsection (c) and inserting the following: 

‘‘(c) PREMIUM PAYMENTS.—

‘‘(1) IN GENERAL.—Except as provided in paragraph (2), 

each insured System bank shall pay to the Corporation the premium payments required under subsection (a), not more frequently than once in each calendar quarter, in such manner 

and at such 1 or more times as the Board of Directors shall prescribe. 

‘‘(2) PREMIUM AMOUNT.—The amount of the premium shall 

be established not later than 60 days after filing the certified 

statement specifying the amount of the premium.’’. 

(c) SUBSEQUENT PREMIUM PAYMENTS.—Section 5.56 of such Act 

(12 U.S.C. 2277a–5) is amended—

(1) by striking subsection (d); and 

(2) by redesignating subsection (e) as subsection (d). 

SEC. 5406. RURAL UTILITY LOANS. 

(a) DEFINITION OF QUALIFIED LOAN.—Section 8.0(9) of the 

Farm Credit Act of 1971 (12 U.S.C. 2279aa(9)) is amended—

(1) in subparagraph (A)(iii), by striking ‘‘or’’ at the end; 

(2) in subparagraph (B)(ii), by striking the period at the 

end and inserting ‘‘; or’’; and 

(3) by adding at the end the following: 


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‘‘(C) that is a loan, or an interest in a loan, for an electric or telephone facility by a cooperative lender to a borrower that has received, or is eligible to receive, a loan 

under the Rural Electrification Act of 1936 (7 U.S.C. 901 

et seq.).’’. 

(b) GUARANTEE OF QUALIFIED LOANS.—Section 8.6(a)(1) of such 

Act (12 U.S.C. 2279aa–6(a)(1)) is amended by inserting ‘‘applicable’’

before ‘‘standards’’ each place it appears in subparagraphs (A) and 

(B)(i). 

(c) STANDARDS FOR QUALIFIED LOANS.—Section 8.8 of such Act 

(12 U.S.C. 2279aa–8) is amended—

(1) in subsection (a)—

(A) by striking the first sentence and inserting the following: 

‘‘(1) IN GENERAL.—The Corporation shall establish underwriting, security appraisal, and repayment standards for qualified loans taking into account the nature, risk profile, and other 

differences between different categories of qualified loans. 

‘‘(2) SUPERVISION, EXAMINATION, AND REPORT OF CONDITION.—The standards shall be subject to the authorities of the 

Farm Credit Administration under section 8.11.’’; and 

(B) in the last sentence, by striking ‘‘In establishing’’

and inserting the following: 

‘‘(3) MORTGAGE LOANS.—In establishing’’; 

(2) in subsection (b)—

(A) in the matter preceding paragraph (1), by inserting 

‘‘with respect to loans secured by agricultural real estate’’

after ‘‘subsection (a)’’; and 

(B) in paragraph (5)—

(i) by striking ‘‘borrower’’ the first place it appears 

and inserting ‘‘farmer or rancher’’; and 

(ii) by striking ‘‘site’’ and inserting ‘‘farm or 

ranch’’; 

(3) in subsection (c)(1), by inserting ‘‘secured by agricultural real estate’’ after ‘‘A loan’’; 

(4) by striking subsection (d); and 

(5) by redesignating subsection (e) as subsection (d). 

(d) RISK-BASED CAPITAL LEVELS.—Section 8.32(a)(1) of such 

Act (12 U.S.C. 2279bb–1(a)(1)) is amended—

(1) by striking ‘‘With respect’’ and inserting the following: 

‘‘(A) IN GENERAL.—With respect’’; and 

(2) by adding at the end the following: 

‘‘(B) RURAL UTILITY LOANS.—With respect to securities 

representing an interest in, or obligation backed by, a pool 

of qualified loans described in section 8.0(9)(C) owned or 

guaranteed by the Corporation, losses occur at a rate of default and severity reasonably related to risks in electric and 

telephone facility loans (as applicable), as determined by 

the Director.’’. 

SEC. 5407. EQUALIZATION OF LOAN-MAKING POWERS OF CERTAIN DISTRICT ASSOCIATIONS. 

(a) IN GENERAL.—The Farm Credit Act of 1971 is amended by 

inserting after section 7.6 (12 U.S.C. 2279b) the following: 


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‘‘SEC. 7.7. EQUALIZATION OF LOAN-MAKING POWERS OF CERTAIN DISTRICT ASSOCIATIONS. 

‘‘(a) EQUALIZATION OF LOAN-MAKING POWERS.—

‘‘(1) IN GENERAL.—

‘‘(A) FEDERAL LAND BANK ASSOCIATIONS.—Subject to 

paragraph (2), any association that owns a Federal land 

bank association authorized as of January 1, 2007, to make 

long-term loans under title I in its chartered territory within the geographic area described in subsection (b) may 

make short- and intermediate-term loans and otherwise operate as a production credit association under title II within that same chartered territory. 

‘‘(B) PRODUCTION CREDIT ASSOCIATIONS.—Subject to 

paragraph (2), any association that under its charter has 

title I lending authority and that owns a production credit 

association authorized as of January 1, 2007, to make 

short- and intermediate-term loans under title II in the geographic area described in subsection (b) may make longterm loans and otherwise operate, directly or through a 

subsidiary association, as a Federal land bank association 

or Federal land credit association under title I in the geographic area. 

‘‘(C) FARM CREDIT BANK.—Notwithstanding section 

5.17(a), the Farm Credit Bank with which any association 

had a written financing agreement as of January 1, 2007, 

may make loans and extend other comparable financial assistance with respect to, and may purchase, any loans 

made under the new authority provided under subparagraph (A) or (B) by an association exercising such authority. 

‘‘(2) REQUIRED APPROVALS.—An association may exercise 

the additional authority provided for in paragraph (1) only 

after the exercise of the authority is approved by—

‘‘(A) the board of directors of the association; and 

‘‘(B) a majority of the voting stockholders of the association (or, if the association is a subsidiary of another association, the voting stockholders of the parent association) 

voting, in person or by proxy, at a duly authorized meeting 

of stockholders in accordance with the process described in 

section 7.11. 

‘‘(b) APPLICABILITY.—This section applies only to associations 

the chartered territory of which was within the geographic area 

served by the Federal intermediate credit bank immediately prior to 

its merger with a Farm Credit Bank under section 410(e)(1) of the 

Agricultural Credit Act of 1987 (12 U.S.C. 2011 note; Public Law 

100–233).’’. 

(b) CHARTER AMENDMENTS.—Section 5.17(a) of the Farm Credit 

Act of 1971 (12 U.S.C. 2252(a)) is amended by adding at the end 

the following: 

‘‘(15)(A) Approve amendments to the charters of institutions 

of the Farm Credit System to implement the equalization of 

loan-making powers of a Farm Credit System association under 

section 7.7. 

‘‘(B) Amendments described in subparagraph (A) to the 

charters of an association and the related Farm Credit Bank 


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shall be approved by the Farm Credit Administration, subject 

to any conditions of approval imposed, by not later than 30 

days after the date on which the Farm Credit Administration 

receives all approvals required by section 7.7(a)(2).’’. 

(c) CONFORMING AMENDMENTS.—

(1) Section 5.17(a)(2) of the Farm Credit Act of 1971 (12 

U.S.C. 2252(a)(2)) is amended—

(A) by striking ‘‘(2)(A)’’ and inserting ‘‘(2)’’; and 

(B) by striking subparagraphs (B) and (C). 

(2) SECTION 410 OF THE 1987 ACT.—Section 410(e)(1)(A)(iii) 

of the Agricultural Credit Act of 1987 (12 U.S.C. 2011 note; 

Public Law 100–233) is amended by inserting ‘‘(except section 

7.7 of that Act)’’ after ‘‘(12 U.S.C. 2001 et seq.)’’. 

(3) SECTION 401 OF THE 1992 ACT.—Section 401(b) of the 

Farm Credit Banks and Associations Safety and Soundness Act 

of 1992 (12 U.S.C. 2011 note; Public Law 102–552) is amended—

(A) by inserting ‘‘(except section 7.7 of the Farm Credit 

Act of 1971)’’ after ‘‘provision of law’’; and 

(B) by striking ‘‘, subject to such limitations’’ and all 

that follows through the end of the paragraph and inserting a period. 

(d) EFFECTIVE DATE.—The amendments made by this section 

take effect on January 1, 2010. 

Subtitle F—Miscellaneous 

SEC. 5501. LOANS TO PURCHASERS OF HIGHLY FRACTIONED LAND. 

The first section of Public Law 91–229 (25 U.S.C. 488) is 

amended—

(1) by striking ‘‘That the Secretary’’ and inserting the following: 

‘‘SECTION 1. LOANS TO PURCHASERS OF HIGHLY FRACTIONED LAND. 

‘‘(a) IN GENERAL.—The Secretary’’; and 

(2) by adding at the end the following: 

‘‘(b) HIGHLY FRACTIONATED LAND.—

‘‘(1) IN GENERAL.—Subject to paragraph (2), the Secretary 

of Agriculture may make and insure loans in accordance with 

section 309 of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1929) to eligible purchasers of highly fractionated 

land pursuant to section 205(c) of the Indian Land Consolidation Act (25 U.S.C. 2204(c)). 

‘‘(2) EXCLUSION.—Section 4 shall not apply to trust land, 

restricted tribal land, or tribal corporation land that is mortgaged in accordance with paragraph (1).’’. 

TITLE VI—RURAL DEVELOPMENT 

Subtitle A—Consolidated Farm and Rural Development Act 

SEC. 6001. WATER, WASTE DISPOSAL, AND WASTEWATER FACILITY 

GRANTS. 

Section 306(a)(2)(B)(vii) of the Consolidated Farm and Rural 

Development Act (7 U.S.C. 1926(a)(2)(B)(vii)) is amended by striking ‘‘2002 through 2007’’ and inserting ‘‘2008 through 2012’’. 


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SEC. 6002. SEARCH GRANTS. 

(a) IN GENERAL.—Section 306(a)(2) of the Consolidated Farm 

and Rural Development Act (7 U.S.C. 1926(a)(2)) is amended by 

adding at the end the following: 

‘‘(C) SPECIAL EVALUATION ASSISTANCE FOR RURAL COMMUNITIES AND HOUSEHOLDS PROGRAM.—

‘‘(i) IN GENERAL.—The Secretary may establish the 

Special Evaluation Assistance for Rural Communities 

and Households (SEARCH) program, to make 

predevelopment planning grants for feasibility studies, 

design assistance, and technical assistance, to financially distressed communities in rural areas with populations of 2,500 or fewer inhabitants for water and 

waste disposal projects described in paragraph (1), this 

paragraph, and paragraph (24). 

‘‘(ii) TERMS.—

‘‘(I) DOCUMENTATION.—With respect to grants 

made under this subparagraph, the Secretary shall 

require the lowest amount of documentation practicable. 

‘‘(II) MATCHING.—Notwithstanding any other 

provisions in this subsection, the Secretary may 

fund up to 100 percent of the eligible costs of 

grants provided under this subparagraph, as determined by the Secretary. 

‘‘(iii) FUNDING.—The Secretary may use not more 

than 4 percent of the total amount of funds made 

available for a fiscal year for water, waste disposal, 

and essential community facility activities under this 

title to carry out this subparagraph. 

‘‘(iv) RELATIONSHIP TO OTHER AUTHORITY.—The 

funds and authorities provided under this subparagraph are in addition to any other funds or authorities 

the Secretary may have to carry out activities described 

in clause (i).’’. 

(b) CONFORMING AMENDMENT.—Subtitle D of title VI of the 

Farm Security and Rural Investment Act of 2002 (7 U.S.C. 2009ee 

et seq.) is repealed. 

SEC. 6003. RURAL BUSINESS OPPORTUNITY GRANTS. 

Section 306(a)(11)(D) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926(a)(11)(D)) is amended by striking 

‘‘1996 through 2007’’ and inserting ‘‘2008 through 2012’’. 

SEC. 6004. CHILD DAY CARE FACILITY GRANTS, LOANS, AND LOAN 

GUARANTEES. 

Section 306(a)(19)(C)(ii) of the Consolidated Farm and Rural 

Development Act (7 U.S.C. 1926(a)(19)(C)(ii)) is amended by striking ‘‘April’’ and inserting ‘‘June’’. 

SEC. 6005. COMMUNITY FACILITY GRANTS TO ADVANCE BROADBAND. 

Section 306(a)(20)(E) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926(a)(20)(E)) is amended—

(1) by striking ‘‘state’’ and inserting ‘‘State’’; and 

(2) by striking ‘‘dial-up Internet access or’’. 


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SEC. 6006. RURAL WATER AND WASTEWATER CIRCUIT RIDER PROGRAM. 

Section 306(a)(22)(C) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926(a)(22)(C)) is amended by striking 

‘‘$15,000,000 for fiscal year 2003’’ and inserting ‘‘$25,000,000 for 

fiscal year 2008’’. 

SEC. 6007. TRIBAL COLLEGE AND UNIVERSITY ESSENTIAL COMMUNITY 

FACILITIES. 

Section 306(a)(25) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926(a)(25)) is amended—

(1) in subparagraph (A)—

(A) by striking ‘‘tribal colleges and universities’’ and inserting ‘‘an entity that is a Tribal College or University’’; 

and 

(B) by striking ‘‘tribal college or university’’ and inserting ‘‘Tribal College or University’’; 

(2) by striking subparagraph (B) and inserting the following: 

‘‘(B) FEDERAL SHARE.—The Secretary shall establish 

the maximum percentage of the cost of the facility that may 

be covered by a grant under this paragraph, except that the 

Secretary may not require non-Federal financial support in 

an amount that is greater than 5 percent of the total cost 

of the facility.’’; and 

(3) in subparagraph (C), by striking ‘‘2003 through 2007’’

and inserting ‘‘2008 through 2012’’. 

SEC. 6008. EMERGENCY AND IMMINENT COMMUNITY WATER ASSISTANCE GRANT PROGRAM. 

Section 306A(i)(2) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1926a(i)(2)) is amended by striking ‘‘2003 

through 2007’’ and inserting ‘‘2008 through 2012’’. 

SEC. 6009. WATER SYSTEMS FOR RURAL AND NATIVE VILLAGES IN 

ALASKA. 

(a) IN GENERAL.—Section 306D(d)(1) of the Consolidated Farm 

and Rural Development Act (7 U.S.C. 1926d(d)(1)) is amended by 

striking ‘‘2001 through 2007’’ and inserting ‘‘2008 through 2012’’. 

(b) RURAL COMMUNITIES ASSISTANCE.—Section 4009 of the 

Solid Waste Disposal Act (42 U.S.C. 6949) is amended by adding 

at the end the following: 

‘‘(e) ADDITIONAL APPROPRIATIONS.—

‘‘(1) IN GENERAL.—There are authorized to be appropriated 

to carry out this section for the Denali Commission to provide 

assistance to municipalities in the State of Alaska $1,500,000 

for each of fiscal years 2008 through 2012. 

‘‘(2) ADMINISTRATION.—For the purpose of carrying out this 

subsection, the Denali Commission shall—

‘‘(A) be considered a State; and 

‘‘(B) comply with all other requirements and limitations of this section.’’. 


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SEC. 6010. GRANTS TO NONPROFIT ORGANIZATIONS TO FINANCE THE 

CONSTRUCTION, REFURBISHING, AND SERVICING OF INDIVIDUALLY-OWNED HOUSEHOLD WATER WELL SYSTEMS 

IN RURAL AREAS FOR INDIVIDUALS WITH LOW OR MODERATE INCOMES. 

Section 306E of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1926e) is amended— (1) in subsection (b)(2)(C), by striking ‘‘$8,000’’ and inserting ‘‘$11,000’’; and 

(2) in subsection (d), by striking ‘‘2003 through 2007’’ and 

inserting ‘‘2008 through 2012’’. 

SEC. 6011. INTEREST RATES FOR WATER AND WASTE DISPOSAL FACILITIES LOANS. 

Section 307(a)(3) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1927(a)(3)) is amended by adding at the end the 

following: 

‘‘(E) INTEREST RATES FOR WATER AND WASTE DISPOSAL

FACILITIES LOANS.—

‘‘(i) IN GENERAL.—Except as provided in clause (ii) 

and notwithstanding subparagraph (A), in the case of 

a direct loan for a water or waste disposal facility—

‘‘(I) in the case of a loan that would be subject 

to the 5 percent interest rate limitation under subparagraph (A), the Secretary shall establish the interest rate at a rate that is equal to 60 percent of 

the current market yield for outstanding municipal 

obligations with remaining periods to maturity 

comparable to the average maturity of the loan, 

adjusted to the nearest 1⁄8 of 1 percent; and 

‘‘(II) in the case of a loan that would be subject 

to the 7 percent limitation under subparagraph 

(A), the Secretary shall establish the interest rate 

at a rate that is equal to 80 percent of the current 

market yield for outstanding municipal obligations 

with remaining periods to maturity comparable to 

the average maturity of the loan, adjusted to the 

nearest 1⁄8 of 1 percent. 

‘‘(ii) EXCEPTION.—Clause (i) does not apply to a 

loan for a specific project that is the subject of a loan 

that has been approved, but not closed, as of the date 

of enactment of this subparagraph.’’. 

SEC. 6012. COOPERATIVE EQUITY SECURITY GUARANTEE. 

(a) IN GENERAL.—Section 310B of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 1932) is amended—

(1) by striking ‘‘SEC. 310B. (a)’’ and inserting the following: 

‘‘SEC. 310B. ASSISTANCE FOR RURAL ENTITIES. 

‘‘(a) LOANS TO PRIVATE BUSINESS ENTERPRISES.—

‘‘(1) DEFINITIONS.—In this subsection:’’; 

(2) in subsection (a)—

(A) by moving the second and fourth sentences so as to 

appear as the second and first sentences, respectively; 

(B) in the sentence beginning ‘‘As used in this subsection, the’’ (as moved by subparagraph (A)), by striking 

‘‘As used in this subsection, the’’ and inserting the following: 


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‘‘(A) AQUACULTURE.—The’’; 

(C) in the sentence beginning ‘‘For the purposes of this 

subsection, the’’, by striking ‘‘For the purposes of this subsection, the’’ and inserting the following: ‘‘(B) SOLAR ENERGY.—The’’; 

(D) in the sentence beginning ‘‘The Secretary may 

also’’—

(i) by striking ‘‘The Secretary may also’’ and inserting the following: ‘‘(2) LOAN PURPOSES.—The Secretary may’’; 

(ii) by inserting ‘‘and private investment funds that 

invest primarily in cooperative organizations’’ after ‘‘or 

nonprofit’’; 

(iii) by striking ‘‘of (1) improving’’ and inserting ‘‘of— ‘‘(A) improving’’; 

(iv) by striking ‘‘control, (2) the’’ and inserting ‘‘control; 

‘‘(B) the’’; 

(v) by striking ‘‘areas, (3) reducing’’ and inserting ‘‘areas; 

‘‘(C) reducing’’; 

(vi) by striking ‘‘areas, and (4) to’’ and inserting ‘‘areas; and 

‘‘(D) to’’; 

(E) in the sentence beginning ‘‘Such loans,’’, by striking ‘‘Such loans,’’ and inserting the following: ‘‘(3) LOAN GUARANTEES.—Loans described in paragraph 

(2),’’; and 

(F) in the last sentence, by striking ‘‘No loan’’ and inserting the following: 

‘‘(4) MAXIMUM AMOUNT OF PRINCIPAL.—No loan’’; and 

(3) in subsection (g)— (A) in paragraph (1), by inserting ‘‘, including guarantees described in paragraph (3)(A)(ii)’’ before the period at 

the end; 

(B) in paragraph (3)(A)— (i) by striking ‘‘(A) IN GENERAL.—The Secretary’’ and inserting the following: 

‘‘(A) ELIGIBILITY.—

‘‘(i) IN GENERAL.—The Secretary’’; and 

(ii) by adding at the end the following: 

‘‘(ii) EQUITY.—The Secretary may guarantee a loan 

made for the purchase of preferred stock or similar equity issued by a cooperative organization or a fund 

that invests primarily in cooperative organizations, if 

the guarantee significantly benefits 1 or more entities 

eligible for assistance for the purposes described in 

subsection (a)(1), as determined by the Secretary.’’; and 

(C) in paragraph (8)(A)(ii), by striking ‘‘a project—’’

and all that follows through the end of subclause (II) and 

inserting ‘‘a project that— ‘‘(I)(aa) is in a rural area; and 

‘‘(bb) provides for the value-added processing 

of agricultural commodities; or 


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‘‘(II) significantly benefits 1 or more entities eligible for assistance for the purposes described in 

subsection (a)(1), as determined by the Secretary.’’. (b) CONFORMING AMENDMENTS.— (1) Section 307(a)(6)(B) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 1927(a)(6)(B)) is amended by 

striking clause (ii) and inserting the following: ‘‘(ii) section 310B(a)(2)(A); and’’. (2) Section 310B(g) of the Consolidated Farm and Rural 

Development Act (7 U.S.C. 1932(g)) is amended by striking 

‘‘subsection (a)(1)’’ each place it appears in paragraphs (1), 

(6)(A)(iii), and (8)(C) and inserting ‘‘subsection (a)(2)(A)’’. (3) Section 333A(g)(1)(B) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 1983a(g)(1)(B)) is amended by 

striking ‘‘section 310B(a)(1)’’ and inserting ‘‘section 

310B(a)(2)(A)’’. (4) Section 381E(d)(3)(B) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 2009d(d)(3)(B)) is amended by 

striking ‘‘section 310B(a)(1)’’ and inserting ‘‘section 

310B(a)(2)(A)’’. 

SEC. 6013. RURAL COOPERATIVE DEVELOPMENT GRANTS. 

(a) ELIGIBILITY.—Section 310B(e)(5) of the Consolidated Farm 

and Rural Development Act (7 U.S.C. 1932(e)(5)) is amended— (1) in subparagraph (A), by striking ‘‘administering a nationally coordinated, regionally or State-wide operated project’’ and inserting ‘‘carrying out activities to promote and assist the 

development of cooperatively and mutually owned businesses’’; 

(2) in subparagraph (B), by inserting ‘‘to promote and assist the development of cooperatively and mutually owned businesses’’ before the semicolon; 

(3) by striking subparagraph (D); 

(4) by redesignating subparagraph (E) as subparagraph 

(D); 

(5) in subparagraph (D) (as so redesignated), by striking ‘‘and’’ at the end; 

(6) by inserting after subparagraph (D) (as so redesignated) 

the following: ‘‘(E) demonstrate a commitment to— ‘‘(i) networking with and sharing the results of the 

efforts of the center with other cooperative development 

centers and other organizations involved in rural economic development efforts; and ‘‘(ii) developing multiorganization and multistate 

approaches to addressing the economic development 

and cooperative needs of rural areas; and’’; and 

(7) in subparagraph (F), by striking ‘‘providing greater 

than’’ and inserting ‘‘providing’’. (b) AUTHORITY TO AWARD MULTIYEAR GRANTS.—Section 

310B(e) of the Consolidated Farm and Rural Development Act (7 

U.S.C. 1932(e)) is amended by striking paragraph (6) and inserting 

the following: 

‘‘(6) GRANT PERIOD.—

‘‘(A) IN GENERAL.—A grant awarded to a center that 

has received no prior funding under this subsection shall 

be made for a period of 1 year. 


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‘‘(B) MULTIYEAR GRANTS.—If the Secretary determines 

it to be in the best interest of the program, the Secretary 

shall award grants for a period of more than 1 year, but 

not more than 3 years, to a center that has successfully met 

the parameters described in paragraph (5), as determined 

by the Secretary.’’. 

(c) AUTHORITY TO EXTEND GRANT PERIOD.—Section 310B(e) of 

the Consolidated Farm and Rural Development Act (7 U.S.C. 

1932(e)) is amended—

(1) by redesignating paragraphs (7), (8), and (9) as paragraphs (8), (9), and (12), respectively; and 

(2) by inserting after paragraph (6) the following: 

‘‘(7) AUTHORITY TO EXTEND GRANT PERIOD.—The Secretary 

may extend for 1 additional 12-month period the period in 

which a grantee may use a grant made under this subsection.’’. 

(d) COOPERATIVE RESEARCH PROGRAM.—Section 310B(e) of the 

Consolidated Farm and Rural Development Act (7 U.S.C. 1932(e)) 

is amended by inserting after paragraph (9) (as redesignated by 

subsection (c)(1)) the following: 

‘‘(10) COOPERATIVE RESEARCH PROGRAM.—The Secretary 

shall enter into a cooperative research agreement with 1 or 

more qualified academic institutions in each fiscal year to conduct research on the effects of all types of cooperatives on the 

national economy.’’. 

(e) ADDRESSING NEEDS OF MINORITY COMMUNITIES.—Section 

310B(e) of the Consolidated Farm and Rural Development Act (7 

U.S.C. 1932(e)) is amended by inserting after paragraph (10) (as 

added by subsection (d)) the following: 

‘‘(11) ADDRESSING NEEDS OF MINORITY COMMUNITIES.—

‘‘(A) DEFINITION OF SOCIALLY DISADVANTAGED

GROUP.—In this paragraph, the term ‘socially disadvantaged group’ has the meaning given the term in section 

355(e). 

‘‘(B) RESERVATION OF FUNDS.—

‘‘(i) IN GENERAL.—If the total amount appropriated 

under paragraph (12) for a fiscal year exceeds 

$7,500,000, the Secretary shall reserve an amount 

equal to 20 percent of the total amount appropriated 

for grants for cooperative development centers, individual cooperatives, or groups of cooperatives—

‘‘(I) that serve socially disadvantaged groups; 

and 

‘‘(II) a majority of the boards of directors or 

governing boards of which are comprised of individuals who are members of socially disadvantaged groups. 

‘‘(ii) INSUFFICIENT APPLICATIONS.—To the extent 

there are insufficient applications to carry out clause 

(i), the Secretary shall use the funds as otherwise authorized by this subsection.’’. 

(f) AUTHORIZATION OF APPROPRIATIONS.—Paragraph (12) of section 310B(e) of the Consolidated Farm and Rural Development Act 

(7 U.S.C. 1932(e)) (as redesignated by subsection (c)(1)) is amended 

by striking ‘‘1996 through 2007’’ and inserting ‘‘2008 through 2012’’. 


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SEC. 6014. GRANTS TO BROADCASTING SYSTEMS. 

Section 310B(f)(3) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1932(f)(3)) is amended by striking ‘‘2002 

through 2007’’ and inserting ‘‘2008 through 2012’’. 

SEC. 6015. LOCALLY OR REGIONALLY PRODUCED AGRICULTURAL 

FOOD PRODUCTS. 

Section 310B(g) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1932(g)) is amended by adding at the end the 

following: ‘‘(9) LOCALLY OR REGIONALLY PRODUCED AGRICULTURAL

FOOD PRODUCTS.— ‘‘(A) DEFINITIONS.—In this paragraph: ‘‘(i) LOCALLY OR REGIONALLY PRODUCED AGRICUL- TURAL FOOD PRODUCT.—The term ‘locally or regionally 

produced agricultural food product’ means any agricultural food product that is raised, produced, and distributed in—

‘‘(I) the locality or region in which the final 

product is marketed, so that the total distance that 

the product is transported is less than 400 miles 

from the origin of the product; or ‘‘(II) the State in which the product is produced. 

‘‘(ii) UNDERSERVED COMMUNITY.—The term ‘underserved community’ means a community (including an 

urban or rural community and an Indian tribal community) that has, as determined by the Secretary— ‘‘(I) limited access to affordable, healthy foods, 

including fresh fruits and vegetables, in grocery retail stores or farmer-to-consumer direct markets; 

and ‘‘(II) a high rate of hunger or food insecurity 

or a high poverty rate. ‘‘(B) LOAN AND LOAN GUARANTEE PROGRAM.—

‘‘(i) IN GENERAL.—The Secretary shall make or 

guarantee loans to individuals, cooperatives, cooperative organizations, businesses, and other entities to establish and facilitate enterprises that process, distribute, aggregate, store, and market locally or regionally produced agricultural food products to support 

community development and farm and ranch income. 

‘‘(ii) REQUIREMENT.—The recipient of a loan or 

loan guarantee under clause (i) shall include in an appropriate agreement with retail and institutional facilities to which the recipient sells locally or regionally 

produced agricultural food products a requirement to 

inform consumers of the retail or institutional facilities 

that the consumers are purchasing or consuming locally or regionally produced agricultural food products. 

‘‘(iii) PRIORITY.—In making or guaranteeing a loan 

under clause (i), the Secretary shall give priority to 

projects that have components benefitting underserved 

communities. 

‘‘(iv) REPORTS.—Not later than 2 years after the 

date of enactment of this paragraph and annually 


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thereafter, the Secretary shall submit to the Committee 

on Agriculture of the House of Representatives and the 

Committee on Agriculture, Nutrition, and Forestry of 

the Senate a report that describes projects carried out 

using loans or loan guarantees made under clause (i), 

including—

‘‘(I) the characteristics of the communities 

served; and 

‘‘(II) resulting benefits. 

‘‘(v) RESERVATION OF FUNDS.—

‘‘(I) IN GENERAL.—For each of fiscal years 

2008 through 2012, the Secretary shall reserve not 

less than 5 percent of the funds made available to 

carry out this subsection to carry out this subparagraph. 

‘‘(II) AVAILABILITY OF FUNDS.—Funds reserved 

under subclause (I) for a fiscal year shall be reserved until April 1 of the fiscal year.’’. 

SEC. 6016. APPROPRIATE TECHNOLOGY TRANSFER FOR RURAL AREAS. 

Section 310B of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1932) is amended by adding at the end the following: 

‘‘(i) APPROPRIATE TECHNOLOGY TRANSFER FOR RURAL AREAS

PROGRAM.—

‘‘(1) DEFINITION OF NATIONAL NONPROFIT AGRICULTURAL

ASSISTANCE INSTITUTION.—In this subsection, the term ‘national nonprofit agricultural assistance institution’ means an 

organization that—

‘‘(A) is described in section 501(c)(3) of the Internal 

Revenue Code of 1986 and exempt from taxation under 

501(a) of that Code; 

‘‘(B) has staff and offices in multiple regions of the 

United States; 

‘‘(C) has experience and expertise in operating national 

agriculture technical assistance programs; 

‘‘(D) expands markets for the agricultural commodities 

produced by producers through the use of practices that enhance the environment, natural resource base, and quality 

of life; and 

‘‘(E) improves the economic viability of agricultural operations. 

‘‘(2) ESTABLISHMENT.—The Secretary shall establish a national appropriate technology transfer for rural areas program 

to assist agricultural producers that are seeking information 

to—

‘‘(A) reduce input costs; 

‘‘(B) conserve energy resources; 

‘‘(C) diversify operations through new energy crops and 

energy generation facilities; and 

‘‘(D) expand markets for agricultural commodities produced by the producers by using practices that enhance the 

environment, natural resource base, and quality of life. 

‘‘(3) IMPLEMENTATION.—

‘‘(A) IN GENERAL.—The Secretary shall carry out the 

program under this subsection by making a grant to, or ofVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00288 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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fering to enter into a cooperative agreement with, a national nonprofit agricultural assistance institution. 

‘‘(B) GRANT AMOUNT.—A grant made, or cooperative 

agreement entered into, under subparagraph (A) shall provide 100 percent of the cost of providing information described in paragraph (2). 

‘‘(4) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this subsection 

$5,000,000 for each of fiscal years 2008 through 2012.’’. 

SEC. 6017. RURAL ECONOMIC AREA PARTNERSHIP ZONES. 

Section 310B of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1932) (as amended by section 6016) is amended by 

adding at the end the following: 

‘‘(j) RURAL ECONOMIC AREA PARTNERSHIP ZONES.—Effective beginning on the date of enactment of this subsection through September 30, 2012, the Secretary shall carry out those rural economic 

area partnership zones administratively in effect on the date of enactment of this subsection in accordance with the terms and conditions contained in the memorandums of agreement entered into by 

the Secretary for the rural economic area partnership zones, except 

as otherwise provided in this subsection.’’. 

SEC. 6018. DEFINITIONS. 

(a) RURAL AREA.—Section 343(a) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 1991(a)) is amended by striking 

paragraph (13) and inserting the following: 

‘‘(13) RURAL AND RURAL AREA.—

‘‘(A) IN GENERAL.—Subject to subparagraphs (B) 

through (G), the terms ‘rural’ and ‘rural area’ mean any 

area other than—

‘‘(i) a city or town that has a population of greater 

than 50,000 inhabitants; and 

‘‘(ii) any urbanized area contiguous and adjacent 

to a city or town described in clause (i). 

‘‘(B) WATER AND WASTE DISPOSAL GRANTS AND DIRECT

AND GUARANTEED LOANS.—For the purpose of water and 

waste disposal grants and direct and guaranteed loans provided under paragraphs (1), (2), and (24) of section 306(a), 

the terms ‘rural’ and ‘rural area’ mean a city, town, or unincorporated area that has a population of no more than 

10,000 inhabitants. 

‘‘(C) COMMUNITY FACILITY LOANS AND GRANTS.—For 

the purpose of community facility direct and guaranteed 

loans and grants under paragraphs (1), (19), (20), (21), and 

(24) of section 306(a), the terms ‘rural’ and ‘rural area’

mean any area other than a city, town, or unincorporated 

area that has a population of greater than 20,000 inhabitants. 

‘‘(D) AREAS RURAL IN CHARACTER.—

‘‘(i) APPLICATION.—This subparagraph applies to—

‘‘(I) an urbanized area described in subparagraphs (A)(ii) and (F) that—

‘‘(aa) has 2 points on its boundary that 

are at least 40 miles apart; and 


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‘‘(bb) is not contiguous or adjacent to a 

city or town that has a population of greater 

than 150,000 inhabitants or an urbanized 

area of such city or town; and 

‘‘(II) an area within an urbanized area described in subparagraphs (A)(ii) and (F) that is 

within 1⁄4-mile of a rural area described in subparagraph (A). 

‘‘(ii) DETERMINATION.—Notwithstanding any other 

provision of this paragraph, on the petition of a unit of 

local government in an area described in clause (i) or 

on the initiative of the Under Secretary for Rural Development, the Under Secretary may determine that a 

part of an area described in clause (i) is a rural area 

for the purposes of this paragraph, if the Under Secretary finds that the part is rural in character, as determined by the Under Secretary. 

‘‘(iii) ADMINISTRATION.—In carrying out this subparagraph, the Under Secretary for Rural Development 

shall—

‘‘(I) not delegate the authority to carry out this 

subparagraph; 

‘‘(II) consult with the applicable rural development State or regional director of the Department 

of Agriculture and the governor of the respective 

State; 

‘‘(III) provide to the petitioner an opportunity 

to appeal to the Under Secretary a determination 

made under this subparagraph; 

‘‘(IV) release to the public notice of a petition 

filed or initiative of the Under Secretary under this 

subparagraph not later than 30 days after receipt 

of the petition or the commencement of the initiative, as appropriate; 

‘‘(V) make a determination under this subparagraph not less than 15 days, and not more 

than 60 days, after the release of the notice under 

subclause (IV); 

‘‘(VI) submit to the Committee on Agriculture 

of the House of Representatives and the Committee 

on Agriculture, Nutrition, and Forestry of the Senate an annual report on actions taken to carry out 

this subparagraph; and 

‘‘(VII) terminate a determination under this 

subparagraph that part of an area is a rural area 

on the date that data is available for the next decennial census conducted under section 141(a) of 

title 13, United States Code. 

‘‘(E) EXCLUSIONS.—Notwithstanding any other provision of this paragraph, in determining which census blocks 

in an urbanized area are not in a rural area (as defined 

in this paragraph), the Secretary shall exclude any cluster 

of census blocks that would otherwise be considered not in 

a rural area only because the cluster is adjacent to not 


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more than 2 census blocks that are otherwise considered 

not in a rural area under this paragraph. 

‘‘(F) URBAN AREA GROWTH.—

‘‘(i) APPLICATION.—This subparagraph applies to—

‘‘(I) any area that—

‘‘(aa) is a collection of census blocks that 

are contiguous to each other; 

‘‘(bb) has a housing density that the Secretary estimates is greater than 200 housing 

units per square mile; and 

‘‘(cc) is contiguous or adjacent to an existing boundary of a rural area; and 

‘‘(II) any urbanized area contiguous and adjacent to a city or town described in subparagraph 

(A)(i). 

‘‘(ii) ADJUSTMENTS.—The Secretary may, by regulation only, consider—

‘‘(I) an area described in clause (i)(I) not to be 

a rural area for purposes of subparagraphs (A) 

and (C); and 

‘‘(II) an area described in clause (i)(II) not to 

be a rural area for purposes of subparagraph (C). 

‘‘(iii) APPEALS.—A program applicant may appeal 

an estimate made under clause (i)(I) based on appropriate data for an area, as determined by the Secretary. 

‘‘(G) HAWAII AND PUERTO RICO.—Notwithstanding any 

other provision of this paragraph, within the areas of the 

County of Honolulu, Hawaii, and the Commonwealth of 

Puerto Rico, the Secretary may designate any part of the 

areas as a rural area if the Secretary determines that the 

part is not urban in character, other than any area included in the Honolulu Census Designated Place or the San 

Juan Census Designated Place.’’. 

(b) REPORT.—Not later than 2 years after the date of enactment 

of this Act, the Secretary shall prepare and submit to the Committee 

on Agriculture of the House of Representatives and the Committee 

on Agriculture, Nutrition, and Forestry of the Senate a report that—

(1) assesses the various definitions of the term ‘‘rural’’ and 

‘‘rural area’’ that are used with respect to programs administered by the Secretary; 

(2) describes the effects that the variations in those definitions have on those programs; 

(3) make recommendations for ways to better target funds 

provided through rural development programs; and 

(4) determines the effect of the amendment made by subsection (a) on the level of rural development funding and participation in those programs in each State. 

SEC. 6019. NATIONAL RURAL DEVELOPMENT PARTNERSHIP. 

Section 378 of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 2008m) is amended—

(1) in subsection (g)(1), by striking ‘‘2003 through 2007’’

and inserting ‘‘2008 through 2012’’; and 


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(2) in subsection (h), by striking ‘‘the date that is 5 years 

after the date of enactment of this section’’ and inserting ‘‘September 30, 2012’’. 

SEC. 6020. HISTORIC BARN PRESERVATION. 

(a) GRANT PRIORITY.—Section 379A(c) of the Consolidated 

Farm and Rural Development Act (7 U.S.C. 2008o(c)) is amended—

(1) in paragraph (2)—

(A) in subparagraphs (A) and (B), by striking ‘‘a historic barn’’ each place it appears and inserting ‘‘historic 

barns’’; and 

(B) in subparagraph (C), by striking ‘‘on a historic 

barn’’ and inserting ‘‘on historic barns (including surveys)’’; 

(2) by redesignating paragraphs (3) and (4) as paragraphs 

(4) and (5), respectively; and 

(3) by inserting after paragraph (2) the following: 

‘‘(3) PRIORITY.—In making grants under this subsection, 

the Secretary shall give the highest priority to funding projects 

described in paragraph (2)(C).’’. 

(b) AUTHORIZATION OF APPROPRIATIONS.—Section 379A(c)(5) of 

the Consolidated Farm and Rural Development Act (7 U.S.C. 

2008o(c)(5)) (as redesignated by subsection (a)(2)) is amended by 

striking ‘‘2002 through 2007’’ and inserting ‘‘2008 through 2012’’. 

SEC. 6021. GRANTS FOR NOAA WEATHER RADIO TRANSMITTERS. 

Section 379B(d) of the Consolidated Farm and Rural Development Act (7 U.S.C. 2008p(d)) is amended by striking ‘‘2002 through 

2007’’ and inserting ‘‘2008 through 2012’’. 

SEC. 6022. RURAL MICROENTREPRENEUR ASSISTANCE PROGRAM. 

Subtitle D of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1981 et seq.) is amended by adding at the end the following: 

‘‘SEC. 379E. RURAL MICROENTREPRENEUR ASSISTANCE PROGRAM. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning given the term in section 4 of the Indian Self-Determination 

and Education Assistance Act (25 U.S.C. 450b). 

‘‘(2) MICROENTREPRENEUR.—The term ‘microentrepreneur’

means an owner and operator, or prospective owner and operator, of a rural microenterprise who is unable to obtain sufficient training, technical assistance, or credit other than under 

this section, as determined by the Secretary. 

‘‘(3) MICROENTERPRISE DEVELOPMENT ORGANIZATION.—The 

term ‘microenterprise development organization’ means an organization that—

‘‘(A) is—

‘‘(i) a nonprofit entity; 

‘‘(ii) an Indian tribe, the tribal government of 

which certifies to the Secretary that— ‘‘(I) no microenterprise development organization serves the Indian tribe; and ‘‘(II) no rural microentrepreneur assistance 

program exists under the jurisdiction of the Indian 

tribe; or 

‘‘(iii) a public institution of higher education; 


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‘‘(B) provides training and technical assistance to rural 

microentrepreneurs; ‘‘(C) facilitates access to capital or another service described in subsection (b) for rural microenterprises; and ‘‘(D) has a demonstrated record of delivering services to 

rural microentrepreneurs, or an effective plan to develop a 

program to deliver services to rural microentrepreneurs, as 

determined by the Secretary. 

‘‘(4) MICROLOAN.—The term ‘microloan’ means a business 

loan of not more than $50,000 that is provided to a rural microenterprise. ‘‘(5) PROGRAM.—The term ‘program’ means the rural microentrepreneur assistance program established under subsection 

(b). 

‘‘(6) RURAL MICROENTERPRISE.—The term ‘rural microenterprise’ means—

‘‘(A) a sole proprietorship located in a rural area; or 

‘‘(B) a business entity with not more than 10 full-timeequivalent employees located in a rural area. 

‘‘(b) RURAL MICROENTREPRENEUR ASSISTANCE PROGRAM.—

‘‘(1) ESTABLISHMENT.—The Secretary shall establish a 

rural microentrepreneur assistance program to provide loans 

and grants to support microentrepreneurs in the development 

and ongoing success of rural microenterprises. ‘‘(2) PURPOSE.—The purpose of the program is to provide 

microentrepreneurs with— ‘‘(A) the skills necessary to establish new rural microenterprises; and ‘‘(B) continuing technical and financial assistance related to the successful operation of rural microenterprises. 

‘‘(3) LOANS.— ‘‘(A) IN GENERAL.—The Secretary shall make loans to 

microenterprise development organizations for the purpose 

of providing fixed interest rate microloans to microentrepreneurs for startup and growing rural microenterprises. ‘‘(B) LOAN TERMS.—A loan made by the Secretary to a 

microenterprise development organization under this paragraph shall— ‘‘(i) be for a term not to exceed 20 years; and 

‘‘(ii) bear an annual interest rate of at least 1 percent. 

‘‘(C) LOAN LOSS RESERVE FUND.—The Secretary shall 

require each microenterprise development organization that 

receives a loan under this paragraph to—

‘‘(i) establish a loan loss reserve fund; and 

‘‘(ii) maintain the reserve fund in an amount equal 

to at least 5 percent of the outstanding balance of such 

loans owed by the microenterprise development organization, until all obligations owed to the Secretary 

under this paragraph are repaid. 

‘‘(D) DEFERRAL OF INTEREST AND PRINCIPAL.—The Secretary may permit the deferral of payments on principal 

and interest due on a loan to a microenterprise development organization made under this paragraph for a 2-year 

period beginning on the date the loan is made. 


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‘‘(4) GRANTS.— ‘‘(A) GRANTS TO SUPPORT RURAL MICROENTERPRISE DE- VELOPMENT.— ‘‘(i) IN GENERAL.—The Secretary shall make grants 

to microenterprise development organizations to— ‘‘(I) provide training, operational support, 

business planning, and market development assistance, and other related services to rural microentrepreneurs; and ‘‘(II) carry out such other projects and activities as the Secretary determines appropriate to further the purposes of the program. 

‘‘(ii) SELECTION.—In making grants under clause 

(i), the Secretary shall—

‘‘(I) place an emphasis on microenterprise development organizations that serve microentrepreneurs that are located in rural areas that have 

suffered significant outward migration, as determined by the Secretary; and 

‘‘(II) ensure, to the maximum extent practicable, that grant recipients include microenterprise development organizations—

‘‘(aa) of varying sizes; and 

‘‘(bb) that serve racially and ethnically diverse populations. 

‘‘(B) GRANTS TO ASSIST MICROENTREPRENEURS.— ‘‘(i) IN GENERAL.—The Secretary shall make grants 

to microenterprise development organizations to provide marketing, management, and other technical assistance to microentrepreneurs that— ‘‘(I) received a loan from the microenterprise 

development organization under paragraph (3); or ‘‘(II) are seeking a loan from the microenterprise development organization under paragraph 

(3). 

‘‘(ii) MAXIMUM AMOUNT OF GRANT.—A microenterprise development organization shall be eligible to receive an annual grant under this subparagraph in an 

amount equal to not more than 25 percent of the total 

outstanding balance of microloans made by the microenterprise development organization under paragraph 

(3), as of the date the grant is awarded. 

‘‘(C) ADMINISTRATIVE EXPENSES.—Not more than 10 

percent of a grant received by a microenterprise development organization for a fiscal year under this paragraph 

may be used to pay administrative expenses. 

‘‘(c) ADMINISTRATION.—

‘‘(1) COST SHARE.—

‘‘(A) FEDERAL SHARE.—Subject to subparagraph (B), 

the Federal share of the cost of a project funded under this 

section shall not exceed 75 percent. ‘‘(B) MATCHING REQUIREMENT.—As a condition of any 

grant made under this subparagraph, the Secretary shall 

require the microenterprise development organization to 

match not less than 15 percent of the total amount of the 


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grant in the form of matching funds, indirect costs, or inkind goods or services. 

‘‘(C) FORM OF NON-FEDERAL SHARE.—The non-Federal 

share of the cost of a project funded under this section may 

be provided—

‘‘(i) in cash (including through fees, grants (including community development block grants), and gifts); 

or 

‘‘(ii) in the form of in-kind contributions. 

‘‘(2) OVERSIGHT.—At a minimum, not later than December 

1 of each fiscal year, a microenterprise development organization that receives a loan or grant under this section shall provide to the Secretary such information as the Secretary may require to ensure that assistance provided under this section is 

used for the purposes for which the loan or grant was made. 

‘‘(d) FUNDING.—

‘‘(1) MANDATORY FUNDING.—Of the funds of the Commodity 

Credit Corporation, the Secretary shall use to carry out this section, to remain available until expended—

‘‘(A) $4,000,000 for each of fiscal years 2009 through 

2011; and 

‘‘(B) $3,000,000 for fiscal year 2012. 

‘‘(2) DISCRETIONARY FUNDING.—In addition to amounts 

made available under paragraph (1), there are authorized to be 

appropriated to carry out this section $40,000,000 for each of 

fiscal years 2009 through 2012.’’. 

SEC. 6023. GRANTS FOR EXPANSION OF EMPLOYMENT OPPORTUNITIES FOR INDIVIDUALS WITH DISABILITIES IN RURAL 

AREAS. 

Subtitle D of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1981 et seq.) (as amended by section 6022) is amended 

by adding at the end the following: 

‘‘SEC. 379F. GRANTS FOR EXPANSION OF EMPLOYMENT OPPORTUNITIES FOR INDIVIDUALS WITH DISABILITIES IN RURAL 

AREAS. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) INDIVIDUAL WITH A DISABILITY.—The term ‘individual 

with a disability’ means an individual with a disability (as defined in section 3 of the Americans with Disabilities Act of 1990 

(42 U.S.C. 12102)). 

‘‘(2) INDIVIDUALS WITH DISABILITIES.—The term ‘individuals with disabilities’ means more than 1 individual with a 

disability. 

‘‘(b) GRANTS.—The Secretary shall make grants to nonprofit organizations, or to a consortium of nonprofit organizations, to expand and enhance employment opportunities for individuals with 

disabilities in rural areas. 

‘‘(c) ELIGIBILITY.—To be eligible to receive a grant under this 

section, a nonprofit organization or consortium of nonprofit organizations shall have—

‘‘(1) a significant focus on serving the needs of individuals 

with disabilities; 

‘‘(2) demonstrated knowledge and expertise in—

‘‘(A) employment of individuals with disabilities; and 


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‘‘(B) advising private entities on accessibility issues involving individuals with disabilities; 

‘‘(3) expertise in removing barriers to employment for individuals with disabilities, including access to transportation, assistive technology, and other accommodations; and 

‘‘(4) existing relationships with national organizations focused primarily on the needs of rural areas. 

‘‘(d) USES.—A grant received under this section may be used 

only to expand or enhance—

‘‘(1) employment opportunities for individuals with disabilities in rural areas by developing national technical assistance 

and education resources to assist small businesses in a rural 

area to recruit, hire, accommodate, and employ individuals 

with disabilities; and 

‘‘(2) self-employment and entrepreneurship opportunities for 

individuals with disabilities in a rural area. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $2,000,000 for each of 

fiscal years 2008 through 2012.’’. 

SEC. 6024. HEALTH CARE SERVICES. 

Subtitle D of the Consolidated Farm and Rural Development 

Act (7 U.S.C. 1981 et seq.) (as amended by section 6023) is amended 

by adding at the end the following: 

‘‘SEC. 379G. HEALTH CARE SERVICES. 

‘‘(a) PURPOSE.—The purpose of this section is to address the 

continued unmet health needs in the Delta region through cooperation among health care professionals, institutions of higher education, research institutions, and other individuals and entities in 

the region. 

‘‘(b) DEFINITION OF ELIGIBLE ENTITY.—In this section, the term 

‘eligible entity’ means a consortium of regional institutions of higher 

education, academic health and research institutes, and economic 

development entities located in the Delta region that have experience 

in addressing the health care issues in the region. 

‘‘(c) GRANTS.—To carry out the purpose described in subsection 

(a), the Secretary may award a grant to an eligible entity for—

‘‘(1) the development of—

‘‘(A) health care services; 

‘‘(B) health education programs; and 

‘‘(C) health care job training programs; and 

‘‘(2) the development and expansion of public health-related 

facilities in the Delta region to address longstanding and unmet 

health needs of the region. 

‘‘(d) USE.—As a condition of the receipt of the grant, the eligible 

entity shall use the grant to fund projects and activities described 

in subsection (c), based on input solicited from local governments, 

public health care providers, and other entities in the Delta region. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to the Secretary to carry out this section, 

$3,000,000 for each of fiscal years 2008 through 2012.’’. 

SEC. 6025. DELTA REGIONAL AUTHORITY. 

(a) AUTHORIZATION OF APPROPRIATIONS.—Section 382M(a) of 

the Consolidated Farm and Rural Development Act (7 U.S.C. 


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2009aa–12(a)) is amended by striking ‘‘2001 through 2007’’ and inserting ‘‘2008 through 2012’’. (b) TERMINATION OF AUTHORITY.—Section 382N of the Consolidated Farm and Rural Development Act (7 U.S.C. 2009aa–13) is 

amended by striking ‘‘2007’’ and inserting ‘‘2012’’. (c) EXPANSION.—Section 4(2) of the Delta Development Act (42 

U.S.C. 3121 note; Public Law 100–460) is amended— (1) in subparagraph (D), by inserting ‘‘Beauregard, 

Bienville, Cameron, Claiborne, DeSoto, Jefferson Davis, Red 

River, St. Mary, Vermillion, Webster,’’ after ‘‘St. James,’’; and 

(2) in subparagraph (E)— (A) by inserting ‘‘Jasper,’’ after ‘‘Copiah,’’; and 

(B) by inserting ‘‘Smith,’’ after ‘‘Simpson,’’. 

SEC. 6026. NORTHERN GREAT PLAINS REGIONAL AUTHORITY. 

(a) DEFINITION OF REGION.—Section 383A(4) of the Consolidated Farm and Rural Development Act (7 U.S.C. 2009bb(4)) is 

amended by inserting ‘‘Missouri (other than counties included in the 

Delta Regional Authority),’’ after ‘‘Minnesota,’’. (b) ESTABLISHMENT.—Section 383B of the Consolidated Farm 

and Rural Development Act (7 U.S.C. 2009bb–1) is amended— (1) in subsection (a), by adding at the end the following: 

‘‘(4) FAILURE TO CONFIRM.— ‘‘(A) FEDERAL MEMBER.—Notwithstanding any other 

provision of this section, if a Federal member described in 

paragraph (2)(A) has not been confirmed by the Senate by 

not later than 180 days after the date of enactment of this 

paragraph, the Authority may organize and operate without the Federal member. ‘‘(B) INDIAN CHAIRPERSON.—In the case of the Indian 

Chairperson, if no Indian Chairperson is confirmed by the 

Senate, the regional authority shall consult and coordinate 

with the leaders of Indian tribes in the region concerning 

the activities of the Authority, as appropriate.’’; 

(2) in subsection (d)— (A) in paragraph (1), by striking ‘‘to establish priorities 

and’’ and inserting ‘‘for multistate cooperation to advance 

the economic and social well-being of the region and to’’; 

(B) in paragraph (3), by striking ‘‘local development 

districts,’’ and inserting ‘‘regional and local development 

districts or organizations, regional boards established 

under subtitle I,’’; 

(C) in paragraph (4), by striking ‘‘cooperation;’’ and inserting ‘‘cooperation for—

‘‘(i) renewable energy development and transmission; ‘‘(ii) transportation planning and economic development; ‘‘(iii) information technology; 

‘‘(iv) movement of freight and individuals within 

the region; 

‘‘(v) federally-funded research at institutions of 

higher education; and 

‘‘(vi) conservation land management;’’; 

(D) by striking paragraph (6) and inserting the following: 


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‘‘(6) enhance the capacity of, and provide support for, 

multistate development and research organizations, local development organizations and districts, and resource conservation 

districts in the region;’’; and 

(E) in paragraph (7), by inserting ‘‘renewable energy,’’

after ‘‘commercial,’’. 

(3) in subsection (f)(2), by striking ‘‘the Federal cochairperson’’ and inserting ‘‘a cochairperson’’; 

(4) in subsection (g)(1), by striking subparagraphs (A) 

through (C) and inserting the following: 

‘‘(A) for each of fiscal years 2008 and 2009, 100 percent; 

‘‘(B) for fiscal year 2010, 75 percent; and 

‘‘(C) for fiscal year 2011 and each fiscal year thereafter, 

50 percent.’’. 

(c) INTERSTATE COOPERATION FOR ECONOMIC OPPORTUNITY AND

EFFICIENCY.—

(1) IN GENERAL.—Subtitle G of the Consolidated Farm and 

Rural Development Act is amended—

(A) by redesignating sections 383C through 383N (7 

U.S.C. 2009bb–2 through 2009bb–13) as sections 383D 

through 383O, respectively; and 

(B) by inserting after section 383B (7 U.S.C. 2009bb–

1) the following: 

‘‘SEC. 383C. INTERSTATE COOPERATION FOR ECONOMIC OPPORTUNITY AND EFFICIENCY. 

‘‘(a) IN GENERAL.—The Authority shall provide assistance to 

States in developing regional plans to address multistate economic 

issues, including plans—

‘‘(1) to develop a regional transmission system for movement of renewable energy to markets outside the region; 

‘‘(2) to address regional transportation concerns, including 

the establishment of a Northern Great Plains Regional Transportation Working Group; 

‘‘(3) to encourage and support interstate collaboration on 

federally-funded research that is in the national interest; and 

‘‘(4) to establish a Regional Working Group on Agriculture 

Development and Transportation. 

‘‘(b) ECONOMIC ISSUES.—The multistate economic issues referred to in subsection (a) shall include—

‘‘(1) renewable energy development and transmission; 

‘‘(2) transportation planning and economic development; 

‘‘(3) information technology; 

‘‘(4) movement of freight and individuals within the region; 

‘‘(5) federally-funded research at institutions of higher education; and 

‘‘(6) conservation land management.’’. 

(2) CONFORMING AMENDMENTS.—

(A) Section 383B(c)(3)(B) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 2009bb–1(c)(3)(B)) is 

amended by striking ‘‘383I’’ and inserting ‘‘383J’’. 

(B) Section 383D(a) of the Consolidated Farm and 

Rural Development Act (as redesignated by paragraph 

(1)(A)) is amended by striking ‘‘383I’’ and inserting ‘‘383J’’. 


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(C) Section 383E of the Consolidated Farm and Rural 

Development Act (as so redesignated) is amended— (i) in subsection (b)(1), by striking ‘‘383F(b)’’ and 

inserting ‘‘383G(b)’’; and 

(ii) in subsection (c)(2)(A), by striking ‘‘383I’’ and 

inserting ‘‘383J’’. (D) Section 383G of the Consolidated Farm and Rural 

Development Act (as so redesignated) is amended— (i) in subsection (b)— (I) in paragraph (1), by striking ‘‘383M’’ and 

inserting ‘‘383N’’; and 

(II) in paragraph (2), by striking ‘‘383D(b)’’ and inserting ‘‘383E(b)’’; 

(ii) in subsection (c)(2)(A), by striking ‘‘383E(b)’’ and inserting ‘‘383F(b)’’; and 

(iii) in subsection (d)— (I) by striking ‘‘383M’’ and inserting ‘‘383N’’; 

and 

(II) by striking ‘‘383C(a)’’ and inserting ‘‘383D(a)’’. (E) Section 383J(c)(2) of the Consolidated Farm and 

Rural Development Act (as so redesignated) is amended by 

striking ‘‘383H’’ and inserting ‘‘383I’’. (d) ECONOMIC AND COMMUNITY DEVELOPMENT GRANTS.—Section 383D of the Consolidated Farm and Rural Development Act (as 

redesignated by subsection (c)(1)(A)) is amended— (1) in subsection (a)— (A) in paragraph (1), by striking ‘‘transportation and 

telecommunication’’ and inserting ‘‘transportation, renewable energy transmission, and telecommunication’’; and 

(B) by redesignating paragraphs (1) and (2) as paragraphs (2) and (1), respectively, and moving those paragraphs so as to appear in numerical order; and 

(2) in subsection (b)(2), by striking ‘‘the activities in the following order or priority’’ and inserting ‘‘the following activities’’. 

(e) SUPPLEMENTS TO FEDERAL GRANT PROGRAMS.—Section 

383E(a) of the Consolidated Farm and Rural Development Act (as 

redesignated by subsection (c)(1)(A)) is amended by striking ‘‘, including local development districts,’’. (f) MULTISTATE AND LOCAL DEVELOPMENT DISTRICTS AND ORGANIZATIONS AND NORTHERN GREAT PLAINS INC.—Section 383F of 

the Consolidated Farm and Rural Development Act (as redesignated 

by subsection (c)(1)(A)) is amended—

(1) by striking the section heading and inserting 

‘‘MULTISTATE AND LOCAL DEVELOPMENT DISTRICTS AND ORGANIZATIONS AND NORTHERN 

GREAT PLAINS INC.’’; and 

(2) by striking subsections (a) through (c) and inserting the 

following: 

‘‘(a) DEFINITION OF MULTISTATE AND LOCAL DEVELOPMENT DIS- TRICT OR ORGANIZATION.—In this section, the term ‘multistate and 

local development district or organization’ means an entity— ‘‘(1) that— ‘‘(A) is a planning district in existence on the date of 

enactment of this subtitle that is recognized by the EcoVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00299 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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nomic Development Administration of the Department of 

Commerce; or 

‘‘(B) is—

‘‘(i) organized and operated in a manner that ensures broad-based community participation and an effective opportunity for other nonprofit groups to contribute to the development and implementation of programs in the region; 

‘‘(ii) a nonprofit incorporated body organized or 

chartered under the law of the State in which the entity is located; 

‘‘(iii) a nonprofit agency or instrumentality of a 

State or local government; 

‘‘(iv) a public organization established before the 

date of enactment of this subtitle under State law for 

creation of multijurisdictional, area-wide planning organizations; 

‘‘(v) a nonprofit agency or instrumentality of a 

State that was established for the purpose of assisting 

with multistate cooperation; or 

‘‘(vi) a nonprofit association or combination of bodies, agencies, and instrumentalities described in 

clauses (ii) through (v); and 

‘‘(2) that has not, as certified by the Authority (in consultation with the Federal cochairperson or Secretary, as appropriate)—

‘‘(A) inappropriately used Federal grant funds from 

any Federal source; or 

‘‘(B) appointed an officer who, during the period in 

which another entity inappropriately used Federal grant 

funds from any Federal source, was an officer of the other 

entity. 

‘‘(b) GRANTS TO MULTISTATE, LOCAL, OR REGIONAL DEVELOPMENT DISTRICTS AND ORGANIZATIONS.—

‘‘(1) IN GENERAL.—The Authority may make grants for administrative expenses under this section to multistate, local, 

and regional development districts and organizations. 

‘‘(2) CONDITIONS FOR GRANTS.—

‘‘(A) MAXIMUM AMOUNT.—The amount of any grant 

awarded under paragraph (1) shall not exceed 80 percent 

of the administrative expenses of the multistate, local, or regional development district or organization receiving the 

grant. 

‘‘(B) MAXIMUM PERIOD.—No grant described in paragraph (1) shall be awarded for a period greater than 3 

years. 

‘‘(3) LOCAL SHARE.—The contributions of a multistate, local, 

or regional development district or organization for administrative expenses may be in cash or in kind, fairly evaluated, including space, equipment, and services. 

‘‘(c) DUTIES.—

‘‘(1) IN GENERAL.—Except as provided in paragraph (2), a 

local development district shall operate as a lead organization 

serving multicounty areas in the region at the local level. 


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‘‘(2) DESIGNATION.—The Federal cochairperson may designate an Indian tribe or multijurisdictional organization to 

serve as a lead organization in such cases as the Federal cochairperson or Secretary, as appropriate, determines appropriate.’’. (g) DISTRESSED COUNTIES AND AREAS AND NONDISTRESSED

COUNTIES.—Section 383G of the Consolidated Farm and Rural Development Act (as redesignated by subsection (c)(1)(A)) is amended— (1) in subsection (b)(1), by striking ‘‘75’’ and inserting ‘‘50’’; 

(2) by striking subsection (c); 

(3) by redesignating subsection (d) as subsection (c); and 

(4) in subsection (c) (as so redesignated)— (A) in the subsection heading, by inserting ‘‘RENEW- ABLE ENERGY,’’ after ‘‘TELECOMMUNICATION’’; and 

(B) by inserting ‘‘, renewable energy,’’ after ‘‘telecommunication,’’. (h) DEVELOPMENT PLANNING PROCESS.—Section 383H of the 

Consolidated Farm and Rural Development Act (as redesignated by 

subsection (c)(1)(A)) is amended— (1) in subsection (c)(1), by striking subparagraph (A) and 

inserting the following: ‘‘(A) multistate, regional, and local development districts and organizations; and’’; and 

(2) in subsection (d)(1), by striking ‘‘State and local development districts’’ and inserting ‘‘multistate, regional, and local 

development districts and organizations’’. (i) PROGRAM DEVELOPMENT CRITERIA.—Section 383I(a)(1) of the 

Consolidated Farm and Rural Development Act (as redesignated by 

subsection (c)(1)(A)) is amended by inserting ‘‘multistate or’’ before ‘‘regional’’. (j) AUTHORIZATION OF APPROPRIATIONS.—Section 383N(a) of the 

Consolidated Farm and Rural Development Act (as redesignated by 

subsection (c)(1)(A)) is amended by striking ‘‘2002 through 2007’’ and inserting ‘‘2008 through 2012’’. (k) TERMINATION OF AUTHORITY.—Section 383O of the Consolidated Farm and Rural Development Act (as redesignated by subsection (c)(1)(A)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 6027. RURAL BUSINESS INVESTMENT PROGRAM. 

(a) ISSUANCE AND GUARANTEE OF TRUST CERTIFICATES.—Section 384F(b)(3)(A) of the Consolidated Farm and Rural Development Act (7 U.S.C. 2009cc–5(b)(3)(A)) is amended by striking ‘‘In the 

event’’ and inserting the following: 

‘‘(i) AUTHORITY TO PREPAY.—A debenture may be 

prepaid at any time without penalty. 

‘‘(ii) REDUCTION OF GUARANTEE.—Subject to clause 

(i), if’’. 

(b) FEES.—Section 384G of the Consolidated Farm and Rural 

Development Act (7 U.S.C. 2009cc–6) is amended—

(1) in subsection (a), by striking ‘‘such fees as the Secretary 

considers appropriate’’ and inserting ‘‘a fee that does not exceed 

$500’’; 

(2) in subsection (b), by striking ‘‘approved by the Secretary’’ and inserting ‘‘that does not exceed $500’’; and 

(3) in subsection (c)—


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(A) in paragraph (1), by striking ‘‘The’’ and inserting 

‘‘Except as provided in paragraph (3), the’’; 

(B) in paragraph (2)—

(i) in subparagraph (A), by striking ‘‘and’’ at the 

end; 

(ii) in subparagraph (B), by striking the period at 

the end and inserting ‘‘; and’’; and 

(iii) by adding at the end the following: 

‘‘(C) shall not exceed $500 for any fee collected under 

this subsection.’’; and 

(C) by adding at the end the following: 

‘‘(3) PROHIBITION ON COLLECTION OF CERTAIN FEES.—In the 

case of a license described in paragraph (1) that was approved 

before July 1, 2007, the Secretary shall not collect any fees due 

on or after the date of enactment of this paragraph.’’. 

(c) RURAL BUSINESS INVESTMENT COMPANIES.—Section 384I(c) 

of the Consolidated Farm and Rural Development Act (7 U.S.C. 

2009cc–8(c)) is amended—

(1) by redesignating paragraph (3) as paragraph (4); and 

(2) by inserting after paragraph (2) the following: 

‘‘(3) TIME FRAME.—Each rural business investment company shall have a period of 2 years to meet the capital requirements of this subsection.’’. 

(d) FINANCIAL INSTITUTION INVESTMENTS.—Section 384J of the 

Consolidated Farm and Rural Development Act (7 U.S.C. 2009cc–

9) is amended—

(1) in subsection (a)(1), by inserting ‘‘, including an investment pool created entirely by such bank or savings association’’

before the period at the end; and 

(2) in subsection (c), by striking ‘‘15’’ and inserting ‘‘25’’. 

(e) CONTRACTING OF FUNCTIONS.—Section 384Q of the Consolidated Farm and Rural Development Act (7 U.S.C. 2009cc–16) is repealed. 

(f) FUNDING.—The Consolidated Farm and Rural Development 

Act is amended by striking section 384S (7 U.S.C. 2009cc–18) and 

inserting the following: 

‘‘SEC. 384S. AUTHORIZATION OF APPROPRIATIONS. 

‘‘There is authorized to be appropriated to carry out this subtitle 

$50,000,000 for the period of fiscal years 2008 through 2012.’’. 

SEC. 6028. RURAL COLLABORATIVE INVESTMENT PROGRAM. 

Subtitle I of the Consolidated Farm and Rural Development Act 

(7 U.S.C. 2009dd et seq.) is amended to read as follows: 

‘‘Subtitle I—Rural Collaborative Investment Program 

‘‘SEC. 385A. PURPOSE. 

‘‘The purpose of this subtitle is to establish a regional rural collaborative investment program—

‘‘(1) to provide rural regions with a flexible investment vehicle, allowing for local control with Federal oversight, assistance, 

and accountability; 

‘‘(2) to provide rural regions with incentives and resources 

to develop and implement comprehensive strategies for achieving regional competitiveness, innovation, and prosperity; 


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‘‘(3) to foster multisector community and economic development collaborations that will optimize the asset-based competitive advantages of rural regions with particular emphasis on 

innovation, entrepreneurship, and the creation of quality jobs; 

‘‘(4) to foster collaborations necessary to provide the professional technical expertise, institutional capacity, and economies 

of scale that are essential for the long-term competitiveness of 

rural regions; and 

‘‘(5) to better use Department of Agriculture and other Federal, State, and local governmental resources, and to leverage 

those resources with private, nonprofit, and philanthropic investments, in order to achieve measurable community and economic prosperity, growth, and sustainability. 

‘‘SEC. 385B. DEFINITIONS. 

‘‘In this subtitle: 

‘‘(1) BENCHMARK.—The term ‘benchmark’ means an annual 

set of goals and performance measures established for the purpose of assessing performance in meeting a regional investment 

strategy of a Regional Board. 

‘‘(2) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning given the term in section 4 of the Indian Self-Determination 

and Education Assistance Act (25 U.S.C. 450b). 

‘‘(3) NATIONAL BOARD.—The term ‘National Board’ means 

the National Rural Investment Board established under section 

385C(c). 

‘‘(4) NATIONAL INSTITUTE.—The term ‘National Institute’

means the National Institute on Regional Rural Competitiveness and Entrepreneurship established under section 

385C(b)(2). 

‘‘(5) REGIONAL BOARD.—The term ‘Regional Board’ means a 

Regional Rural Investment Board described in section 385D(a). 

‘‘(6) REGIONAL INNOVATION GRANT.—The term ‘regional innovation grant’ means a grant made by the Secretary to a certified Regional Board under section 385F. 

‘‘(7) REGIONAL INVESTMENT STRATEGY GRANT.—The term 

‘regional investment strategy grant’ means a grant made by the 

Secretary to a certified Regional Board under section 385E. 

‘‘(8) RURAL HERITAGE.—

‘‘(A) IN GENERAL.—The term ‘rural heritage’ means historic sites, structures, and districts. 

‘‘(B) INCLUSIONS.—The term ‘rural heritage’ includes 

historic rural downtown areas and main streets, neighborhoods, farmsteads, scenic and historic trails, heritage 

areas, and historic landscapes. 

‘‘SEC. 385C. ESTABLISHMENT AND ADMINISTRATION OF RURAL COLLABORATIVE INVESTMENT PROGRAM. 

‘‘(a) ESTABLISHMENT.—The Secretary shall establish a Rural 

Collaborative Investment Program to support comprehensive regional investment strategies for achieving rural competitiveness. 

‘‘(b) DUTIES OF SECRETARY.—In carrying out this subtitle, the 

Secretary shall—

‘‘(1) appoint and provide administrative and program support to the National Board; 


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‘‘(2) establish a national institute, to be known as the ‘National Institute on Regional Rural Competitiveness and Entrepreneurship’, to provide technical assistance to the Secretary 

and the National Board regarding regional competitiveness and 

rural entrepreneurship, including technical assistance for— ‘‘(A) the development of rigorous analytic programs to 

assist Regional Boards in determining the challenges and 

opportunities that need to be addressed to receive the greatest regional competitive advantage; ‘‘(B) the provision of support for best practices developed by the Regional Boards; ‘‘(C) the establishment of programs to support the development of appropriate governance and leadership skills 

in the applicable regions; and ‘‘(D) the evaluation of the progress and performance of 

the Regional Boards in achieving benchmarks established 

in a regional investment strategy; 

‘‘(3) work with the National Board to develop a national 

rural investment plan that shall— ‘‘(A) create a framework to encourage and support a 

more collaborative and targeted rural investment portfolio 

in the United States; ‘‘(B) establish a Rural Philanthropic Initiative, to work 

with rural communities to create and enhance the pool of 

permanent philanthropic resources committed to rural community and economic development; ‘‘(C) cooperate with the Regional Boards and State and 

local governments, organizations, and entities to ensure investment strategies are developed that take into consideration existing rural assets; and ‘‘(D) encourage the organization of Regional Boards; ‘‘(4) certify the eligibility of Regional Boards to receive regional investment strategy grants and regional innovation 

grants; 

‘‘(5) provide grants for Regional Boards to develop and implement regional investment strategies; 

‘‘(6) provide technical assistance to Regional Boards on 

issues, best practices, and emerging trends relating to rural development, in cooperation with the National Rural Investment 

Board; and 

‘‘(7) provide analytic and programmatic support for regional rural competitiveness through the National Institute, including—

‘‘(A) programs to assist Regional Boards in determining the challenges and opportunities that must be addressed to receive the greatest regional competitive advantage; 

‘‘(B) support for best practices development by the regional investment boards; 

‘‘(C) programs to support the development of appropriate governance and leadership skills in the region; and 

‘‘(D) a review and evaluation of the performance of the 

Regional Boards (including progress in achieving benchmarks established in a regional investment strategy) in an 

annual report submitted to—


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‘‘(i) the Committee on Agriculture of the House of 

Representatives; and 

‘‘(ii) the Committee on Agriculture, Nutrition, and 

Forestry of the Senate. 

‘‘(c) NATIONAL RURAL INVESTMENT BOARD.—The Secretary shall 

establish within the Department of Agriculture a board to be known 

as the ‘National Rural Investment Board’. 

‘‘(d) DUTIES OF NATIONAL BOARD.—The National Board shall—

‘‘(1) not later than 180 days after the date of establishment 

of the National Board, develop rules relating to the operation 

of the National Board; and 

‘‘(2) provide advice to—

‘‘(A) the Secretary and subsequently review the design, 

development, and execution of the National Rural Investment Plan; 

‘‘(B) Regional Boards on issues, best practices, and 

emerging trends relating to rural development; and 

‘‘(C) the Secretary and the National Institute on the development and execution of the program under this subtitle. 

‘‘(e) MEMBERSHIP.—

‘‘(1) IN GENERAL.—The National Board shall consist of 14 

members appointed by the Secretary not later than 180 days 

after the date of enactment of the Food, Conservation, and Energy Act of 2008. 

‘‘(2) SUPERVISION.—The National Board shall be subject to 

the general supervision and direction of the Secretary. 

‘‘(3) SECTORS REPRESENTED.—The National Board shall 

consist of representatives from each of—

‘‘(A) nationally recognized entrepreneurship organizations; 

‘‘(B) regional strategy and development organizations; 

‘‘(C) community-based organizations; 

‘‘(D) elected members of local governments; 

‘‘(E) members of State legislatures; 

‘‘(F) primary, secondary, and higher education, job 

skills training, and workforce development institutions; 

‘‘(G) the rural philanthropic community; 

‘‘(H) financial, lending, venture capital, entrepreneurship, and other related institutions; 

‘‘(I) private sector business organizations, including 

chambers of commerce and other for-profit business interests; 

‘‘(J) Indian tribes; and 

‘‘(K) cooperative organizations. 

‘‘(4) SELECTION OF MEMBERS.—

‘‘(A) IN GENERAL.—In selecting members of the National Board, the Secretary shall consider recommendations 

made by—

‘‘(i) the chairman and ranking member of each of 

the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate; 

‘‘(ii) the Majority Leader and Minority Leader of 

the Senate; and 


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‘‘(iii) the Speaker and Minority Leader of the 

House of Representatives. 

‘‘(B) EX-OFFICIO MEMBERS.—In consultation with the 

chairman and ranking member of each of the Committee on 

Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate, the Secretary may appoint not more than 3 other officers or employees of the Executive Branch to serve as exofficio, nonvoting members of the National Board. 

‘‘(5) TERM OF OFFICE.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

term of office of a member of the National Board appointed 

under paragraph (1)(A) shall be for a period of not more 

than 4 years. ‘‘(B) STAGGERED TERMS.—The members of the National 

Board shall be appointed to serve staggered terms. 

‘‘(6) INITIAL APPOINTMENTS.—Not later than 1 year after the 

date of enactment of the Food, Conservation, and Energy Act of 

2008, the Secretary shall appoint the initial members of the National Board. ‘‘(7) VACANCIES.—A vacancy on the National Board shall be 

filled in the same manner as the original appointment. ‘‘(8) COMPENSATION.—A member of the National Board 

shall receive no compensation for service on the National 

Board, but shall be reimbursed for related travel and other expenses incurred in carrying out the duties of the member of the 

National Board in accordance with section 5702 and 5703 of 

title 5, United States Code. ‘‘(9) CHAIRPERSON.—The National Board shall select a 

chairperson from among the members of the National Board. ‘‘(10) FEDERAL STATUS.—For purposes of Federal law, a 

member of the National Board shall be considered a special 

Government employee (as defined in section 202(a) of title 18, 

United States Code). 

‘‘(f) ADMINISTRATIVE SUPPORT.—The Secretary, on a reimbursable basis from funds made available under section 385H, may provide such administrative support to the National Board as the Secretary determines is necessary. 

‘‘SEC. 385D. REGIONAL RURAL INVESTMENT BOARDS. 

‘‘(a) IN GENERAL.—A Regional Rural Investment Board shall be 

a multijurisdictional and multisectoral group that—

‘‘(1) represents the long-term economic, community, and cultural interests of a region; 

‘‘(2) is certified by the Secretary to establish a rural investment strategy and compete for regional innovation grants; 

‘‘(3) is composed of residents of a region that are broadly 

representative of diverse public, nonprofit, and private sector interests in investment in the region, including (to the maximum 

extent practicable) representatives of—

‘‘(A) units of local, multijurisdictional, or State government, including not more than 1 representative from each 

State in the region; 

‘‘(B) nonprofit community-based development organizations, including community development financial institutions and community development corporations; 


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‘‘(C) agricultural, natural resource, and other assetbased related industries; ‘‘(D) in the case of regions with federally recognized Indian tribes, Indian tribes; ‘‘(E) regional development organizations; 

‘‘(F) private business organizations, including chambers of commerce; ‘‘(G)(i) institutions of higher education (as defined in 

section 101(a) of the Higher Education Act of 1965 (20 

U.S.C. 1001(a))); ‘‘(ii) tribally controlled colleges or universities (as defined in section 2(a) of Tribally Controlled College or University Assistance Act of 1978 (25 U.S.C. 1801(a))); and ‘‘(iii) tribal technical institutions; 

‘‘(H) workforce and job training organizations; 

‘‘(I) other entities and organizations, as determined by 

the Regional Board; ‘‘(J) cooperatives; and 

‘‘(K) consortia of entities and organizations described 

in subparagraphs (A) through (J); 

‘‘(4) represents a region inhabited by— ‘‘(A) more than 25,000 individuals, as determined in 

the latest available decennial census conducted under section 141(a) of title 13, United States Code; or ‘‘(B) in the case of a region with a population density 

of less than 2 individuals per square mile, at least 10,000 

individuals, as determined in that latest available decennial census; 

‘‘(5) has a membership of which not less than 25 percent, 

nor more than 40 percent, represents— ‘‘(A) units of local government and Indian tribes described in subparagraphs (A) and (D) of paragraph (3); ‘‘(B) nonprofit community and economic development 

organizations and institutions of higher education described in subparagraphs (B) and (G) of paragraph (3); or 

‘‘(C) private business (including chambers of commerce 

and cooperatives) and agricultural, natural resource, and 

other asset-based related industries described in subparagraphs (C) and (F) of paragraph (3); 

‘‘(6) has a membership that may include an officer or employee of a Federal agency, serving as an ex-officio, nonvoting 

member of the Regional Board to represent the agency; and 

‘‘(7) has organizational documents that demonstrate that 

the Regional Board will—

‘‘(A) create a collaborative public-private strategy process; 

‘‘(B) develop, and submit to the Secretary for approval, 

a regional investment strategy that meets the requirements 

of section 385E, with benchmarks—

‘‘(i) to promote investment in rural areas through 

the use of grants made available under this subtitle; 

and 

‘‘(ii) to provide financial and technical assistance 

to promote a broad-based regional development program aimed at increasing and diversifying economic 


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growth, improved community facilities, and improved 

quality of life; 

‘‘(C) implement the approved regional investment strategy; ‘‘(D) provide annual reports to the Secretary and the 

National Board on progress made in achieving the benchmarks of the regional investment strategy, including an annual financial statement; and ‘‘(E) select a non-Federal organization (such as a regional development organization) in the local area served 

by the Regional Board that has previous experience in the 

management of Federal funds to serve as fiscal manager of 

any funds of the Regional Board. ‘‘(b) URBAN AREAS.—A resident of an urban area may serve as 

an ex-officio member of a Regional Board. ‘‘(c) DUTIES.—A Regional Board shall— ‘‘(1) create a collaborative planning process for public-private investment within a region; ‘‘(2) develop, and submit to the Secretary for approval, a regional investment strategy; ‘‘(3) develop approaches that will create permanent resources for philanthropic giving in the region, to the maximum 

extent practicable; ‘‘(4) implement an approved strategy; and 

‘‘(5) provide annual reports to the Secretary and the National Board on progress made in achieving the strategy, including an annual financial statement. 

‘‘SEC. 385E. REGIONAL INVESTMENT STRATEGY GRANTS. 

‘‘(a) IN GENERAL.—The Secretary shall make regional investment strategy grants available to Regional Boards for use in developing, implementing, and maintaining regional investment strategies. ‘‘(b) REGIONAL INVESTMENT STRATEGY.—A regional investment 

strategy shall provide— ‘‘(1) an assessment of the competitive advantage of a region, 

including—

‘‘(A) an analysis of the economic conditions of the region; ‘‘(B) an assessment of the current economic performance of the region; ‘‘(C) an overview of the population, geography, workforce, transportation system, resources, environment, and 

infrastructure needs of the region; and ‘‘(D) such other pertinent information as the Secretary 

may request; 

‘‘(2) an analysis of regional economic and community development challenges and opportunities, including— ‘‘(A) incorporation of relevant material from other government-sponsored or supported plans and consistency with 

applicable State, regional, and local workforce investment 

strategies or comprehensive economic development plans; 

and ‘‘(B) an identification of past, present, and projected 

Federal and State economic and community development 

investments in the region; 


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‘‘(3) a section describing goals and objectives necessary to 

solve regional competitiveness challenges and meet the potential 

of the region; ‘‘(4) an overview of resources available in the region for use 

in— ‘‘(A) establishing regional goals and objectives; 

‘‘(B) developing and implementing a regional action 

strategy; ‘‘(C) identifying investment priorities and funding 

sources; and ‘‘(D) identifying lead organizations to execute portions 

of the strategy; 

‘‘(5) an analysis of the current state of collaborative public, 

private, and nonprofit participation and investment, and of the 

strategic roles of public, private, and nonprofit entities in the 

development and implementation of the regional investment 

strategy; ‘‘(6) a section identifying and prioritizing vital projects, programs, and activities for consideration by the Secretary, including— ‘‘(A) other potential funding sources; and 

‘‘(B) recommendations for leveraging past and potential 

investments; 

‘‘(7) a plan of action to implement the goals and objectives 

of the regional investment strategy; ‘‘(8) a list of performance measures to be used to evaluate 

implementation of the regional investment strategy, including— ‘‘(A) the number and quality of jobs, including self-employment, created during implementation of the regional 

rural investment strategy; ‘‘(B) the number and types of investments made in the 

region; ‘‘(C) the growth in public, private, and nonprofit investment in the human, community, and economic assets of the 

region; 

‘‘(D) changes in per capita income and the rate of unemployment; and 

‘‘(E) other changes in the economic environment of the 

region; 

‘‘(9) a section outlining the methodology for use in integrating the regional investment strategy with the economic priorities of the State; and 

‘‘(10) such other information as the Secretary determines to 

be appropriate. 

‘‘(c) MAXIMUM AMOUNT OF GRANT.—A regional investment 

strategy grant shall not exceed $150,000. 

‘‘(d) COST SHARING.—

‘‘(1) IN GENERAL.—Subject to paragraph (2), of the share of 

the costs of developing, maintaining, evaluating, implementing, 

and reporting with respect to a regional investment strategy 

funded by a grant under this section—

‘‘(A) not more than 40 percent may be paid using funds 

from the grant; and 

‘‘(B) the remaining share shall be provided by the applicable Regional Board or other eligible grantee. 


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‘‘(2) FORM.—A Regional Board or other eligible grantee 

shall pay the share described in paragraph (1)(B) in the form 

of cash, services, materials, or other in-kind contributions, on 

the condition that not more than 50 percent of that share is provided in the form of services, materials, and other in-kind contributions. 

‘‘SEC. 385F. REGIONAL INNOVATION GRANTS PROGRAM. 

‘‘(a) GRANTS.—

‘‘(1) IN GENERAL.—The Secretary shall provide, on a competitive basis, regional innovation grants to Regional Boards for 

use in implementing projects and initiatives that are identified 

in a regional rural investment strategy approved under section 

385E. 

‘‘(2) TIMING.—After October 1, 2008, the Secretary shall 

provide awards under this section on a quarterly funding cycle. 

‘‘(b) ELIGIBILITY.—To be eligible to receive a regional innovation 

grant, a Regional Board shall demonstrate to the Secretary that—

‘‘(1) the regional rural investment strategy of a Regional 

Board has been reviewed by the National Board prior to approval by the Secretary; 

‘‘(2) the management and organizational structure of the 

Regional Board is sufficient to oversee grant projects, including 

management of Federal funds; and 

‘‘(3) the Regional Board has a plan to achieve, to the maximum extent practicable, the performance-based benchmarks of 

the project in the regional rural investment strategy. 

‘‘(c) LIMITATIONS.—

‘‘(1) AMOUNT RECEIVED.—A Regional Board may not receive 

more than $6,000,000 in regional innovation grants under this 

section during any 5-year period. 

‘‘(2) DETERMINATION OF AMOUNT.—The Secretary shall determine the amount of a regional innovation grant based on—

‘‘(A) the needs of the region being addressed by the applicable regional rural investment strategy consistent with 

the purposes described in subsection (f)(2); and 

‘‘(B) the size of the geographical area of the region. 

‘‘(3) GEOGRAPHIC DIVERSITY.—The Secretary shall ensure 

that not more than 10 percent of funding made available under 

this section is provided to Regional Boards in any State. 

‘‘(d) COST-SHARING.—

‘‘(1) LIMITATION.—Subject to paragraph (2), the amount of 

a grant made under this section shall not exceed 50 percent of 

the cost of the project. 

‘‘(2) WAIVER OF GRANTEE SHARE.—The Secretary may waive 

the limitation in paragraph (1) under special circumstances, as 

determined by the Secretary, including—

‘‘(A) a sudden or severe economic dislocation; 

‘‘(B) significant chronic unemployment or poverty; 

‘‘(C) a natural disaster; or 

‘‘(D) other severe economic, social, or cultural duress. 

‘‘(3) OTHER FEDERAL ASSISTANCE.—For the purpose of determining cost-share limitations for any other Federal program, 

funds provided under this section shall be considered to be nonFederal funds. 


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‘‘(e) PREFERENCES.—In providing regional innovation grants 

under this section, the Secretary shall give—

‘‘(1) a high priority to strategies that demonstrate significant leverage of capital and quality job creation; and 

‘‘(2) a preference to an application proposing projects and 

initiatives that would—

‘‘(A) advance the overall regional competitiveness of a 

region; 

‘‘(B) address the priorities of a regional rural investment strategy, including priorities that—

‘‘(i) promote cross-sector collaboration, public-private partnerships, or the provision of interim financing 

or seed capital for program implementation; 

‘‘(ii) exhibit collaborative innovation and entrepreneurship, particularly within a public-private partnership; and 

‘‘(iii) represent a broad coalition of interests described in section 385D(a); 

‘‘(C) include a strategy to leverage public non-Federal 

and private funds and existing assets, including agricultural, natural resource, and public infrastructure assets, 

with substantial emphasis placed on the existence of real financial commitments to leverage available funds; 

‘‘(D) create quality jobs; 

‘‘(E) enhance the role, relevance, and leveraging potential of community and regional foundations in support of 

regional investment strategies; 

‘‘(F) demonstrate a history, or involve organizations 

with a history, of successful leveraging of capital for economic development and public purposes; 

‘‘(G) address gaps in existing basic services, including 

technology, within a region; 

‘‘(H) address economic diversification, including agricultural and non-agriculturally based economies, within a 

regional framework; 

‘‘(I) improve the overall quality of life in the region; 

‘‘(J) enhance the potential to expand economic development successes across diverse stakeholder groups within the 

region; 

‘‘(K) include an effective working relationship with 1 or 

more institutions of higher education, tribally controlled 

colleges or universities, or tribal technical institutions; 

‘‘(L) help to meet the other regional competitiveness 

needs identified by a Regional Board; or 

‘‘(M) protect and promote rural heritage. 

‘‘(f) USES.—

‘‘(1) LEVERAGE.—A Regional Board shall prioritize projects 

and initiatives carried out using funds from a regional innovation grant provided under this section, based in part on the degree to which members of the Regional Board are able to leverage additional funds for the implementation of the projects. 

‘‘(2) PURPOSES.—A Regional Board may use a regional innovation grant—


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‘‘(A) to support the development of critical infrastructure (including technology deployment and services) necessary to facilitate the competitiveness of a region; ‘‘(B) to provide assistance to entities within the region 

that provide essential public and community services; ‘‘(C) to enhance the value-added production, marketing, 

and use of agricultural and natural resources within the 

region, including activities relating to renewable and alternative energy production and usage; ‘‘(D) to assist with entrepreneurship, job training, 

workforce development, housing, educational, or other quality of life services or needs, relating to the development and 

maintenance of strong local and regional economies; ‘‘(E) to assist in the development of unique new collaborations that link public, private, and philanthropic resources, including community foundations; ‘‘(F) to provide support for business and entrepreneurial investment, strategy, expansion, and development, 

including feasibility strategies, technical assistance, peer 

networks, business development funds, and other activities 

to strengthen the economic competitiveness of the region; ‘‘(G) to provide matching funds to enable community 

foundations located within the region to build endowments 

which provide permanent philanthropic resources to implement a regional investment strategy; and ‘‘(H) to preserve and promote rural heritage. ‘‘(3) AVAILABILITY OF FUNDS.—The funds made available to 

a Regional Board or any other eligible grantee through a regional innovation grant shall remain available for the 7-year 

period beginning on the date on which the award is provided, 

on the condition that the Regional Board or other grantee continues to be certified by the Secretary as making adequate 

progress toward achieving established benchmarks. 

‘‘(g) COST SHARING.—

‘‘(1) WAIVER OF GRANTEE SHARE.—The Secretary may waive 

the share of a grantee of the costs of a project funded by a regional innovation grant under this section if the Secretary determines that such a waiver is appropriate, including with respect to special circumstances within tribal regions, in the event 

an area experiences— ‘‘(A) a sudden or severe economic dislocation; 

‘‘(B) significant chronic unemployment or poverty; 

‘‘(C) a natural disaster; or 

‘‘(D) other severe economic, social, or cultural duress. ‘‘(2) OTHER FEDERAL PROGRAMS.—For the purpose of determining cost-sharing requirements for any other Federal program, funds provided as a regional innovation grant under this 

section shall be considered to be non-Federal funds. 

‘‘(h) NONCOMPLIANCE.—If a Regional Board or other eligible 

grantee fails to comply with any requirement relating to the use of 

funds provided under this section, the Secretary may— ‘‘(1) take such actions as are necessary to obtain reimbursement of unused grant funds; and ‘‘(2) reprogram the recaptured funds for purposes relating 

to implementation of this subtitle. 


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‘‘(i) PRIORITY TO AREAS WITH AWARDS AND APPROVED STRATE- GIES.— ‘‘(1) IN GENERAL.—Subject to paragraph (3), in providing 

rural development assistance under other programs, the Secretary shall give a high priority to areas that receive innovation 

grants under this section. ‘‘(2) CONSULTATION.—The Secretary shall consult with the 

heads of other Federal agencies to promote the development of 

priorities similar to those described in paragraph (1). ‘‘(3) EXCLUSION OF CERTAIN PROGRAMS.—Paragraph (1) 

shall not apply to the provision of rural development assistance 

under any program relating to basic health, safety, or infrastructure, including broadband deployment or minimum environmental needs. 

‘‘SEC. 385G. RURAL ENDOWMENT LOANS PROGRAM. 

‘‘(a) IN GENERAL.—The Secretary may provide long-term loans 

to eligible community foundations to assist in the implementation of 

regional investment strategies. 

‘‘(b) ELIGIBLE COMMUNITY FOUNDATIONS.—To be eligible to receive a loan under this section, a community foundation shall—

‘‘(1) be located in an area that is covered by a regional investment strategy; 

‘‘(2) match the amount of the loan with an amount that is 

at least 250 percent of the amount of the loan; and 

‘‘(3) use the loan and the matching amount to carry out the 

regional investment strategy in a manner that is targeted to 

community and economic development, including through the 

development of community foundation endowments. 

‘‘(c) TERMS.—A loan made under this section shall—

‘‘(1) have a term of not less than 10, nor more than 20, 

years; 

‘‘(2) bear an interest rate of 1 percent per annum; and 

‘‘(3) be subject to such other terms and conditions as are determined appropriate by the Secretary. 

‘‘SEC. 385H. AUTHORIZATION OF APPROPRIATIONS. 

‘‘There are authorized to be appropriated to carry out this subtitle $135,000,000 for the period of fiscal years 2009 through 2012.’’. 

SEC. 6029. FUNDING OF PENDING RURAL DEVELOPMENT LOAN AND 

GRANT APPLICATIONS. 

(a) DEFINITION OF APPLICATION.—In this section, the term ‘‘application’’ does not include an application for a loan or grant that, 

as of the date of enactment of this Act, is in the preapplication 

phase of consideration under regulations of the Secretary in effect 

on the date of enactment of this Act. 

(b) USE OF FUNDS.—Subject to subsection (c), the Secretary 

shall use funds made available under subsection (d) to provide 

funds for applications that are pending on the date of enactment of 

this Act for— (1) water or waste disposal grants or direct loans under 

paragraph (1) or (2) of section 306(a) of the Consolidated Farm 

and Rural Development Act (7 U.S.C. 1926(a)); and 

(2) emergency community water assistance grants under 

section 306A of that Act (7 U.S.C. 1926a). 

(c) LIMITATIONS.—


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(1) APPROPRIATED AMOUNTS.—Funds made available under 

this section shall be available to the Secretary to provide funds 

for applications for loans and grants described in subsection (b) 

that are pending on the date of enactment of this Act only to 

the extent that funds for the loans and grants appropriated in 

the annual appropriations Act for fiscal year 2007 have been exhausted. 

(2) PROGRAM REQUIREMENTS.—The Secretary may use 

funds made available under this section to provide funds for a 

pending application for a loan or grant described in subsection 

(b) only if the Secretary processes, reviews, and approves the application in accordance with regulations in effect on the date of 

enactment of this Act. 

(3) PRIORITY.—In providing funding under this section for 

pending applications for loans or grants described in subsection 

(b), the Secretary shall provide funding in the following order 

of priority (until funds made available under this section are 

exhausted): 

(A) Pending applications for water systems. 

(B) Pending applications for waste disposal systems. 

(d) FUNDING.—Notwithstanding any other provision of law, of 

the funds of the Commodity Credit Corporation, the Secretary shall 

use to carry out this section $120,000,000, to remain available until 

expended. 

Subtitle B—Rural Electrification Act of 1936 

SEC. 6101. ENERGY EFFICIENCY PROGRAMS. 

Sections 2(a) and 4 of the Rural Electrification Act of 1936 (7 

U.S.C. 902(a), 904) are amended by inserting ‘‘efficiency and’’ before 

‘‘conservation’’ each place it appears. 

SEC. 6102. REINSTATEMENT OF RURAL UTILITY SERVICES DIRECT 

LENDING. 

(a) IN GENERAL.—Section 4 of the Rural Electrification Act of 

1936 (7 U.S.C. 904) is amended—

(1) by designating the first, second, and third sentences as 

subsections (a), (b), and (d), respectively; and 

(2) by inserting after subsection (b) (as so designated) the 

following: 

‘‘(c) DIRECT LOANS.—

‘‘(1) DIRECT HARDSHIP LOANS.—Direct hardship loans 

under this section shall be for the same purposes and on the 

same terms and conditions as hardship loans made under section 305(c)(1). 

‘‘(2) OTHER DIRECT LOANS.—All other direct loans under 

this section shall bear interest at a rate equal to the then current cost of money to the Government of the United States for 

loans of similar maturity, plus 1⁄8 of 1 percent.’’. 

(b) ELIMINATION OF FEDERAL FINANCING BANK GUARANTEED

LOANS.—Section 306 of the Rural Electrification Act of 1936 (7 

U.S.C. 936) is amended—

(1) in the third sentence, by striking ‘‘guarantee, accommodation, or subordination’’ and inserting ‘‘accommodation or 

subordination’’; and 

(2) by striking the fourth sentence. 


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SEC. 6103. DEFERMENT OF PAYMENTS TO ALLOW LOANS FOR IMPROVED ENERGY EFFICIENCY AND DEMAND REDUCTION 

AND FOR ENERGY EFFICIENCY AND USE AUDITS. 

Section 12 of the Rural Electrification Act of 1936 (7 U.S.C. 

912) is amended by adding at the end the following: ‘‘(c) DEFERMENT OF PAYMENTS ON LOANS.— ‘‘(1) IN GENERAL.—The Secretary shall allow borrowers to 

defer payment of principal and interest on any direct loan made 

under this Act to enable the borrower to make loans to residential, commercial, and industrial consumers— ‘‘(A) to conduct energy efficiency and use audits; and 

‘‘(B) to install energy efficient measures or devices that 

reduce the demand on electric systems. 

‘‘(2) AMOUNT.—The total amount of a deferment under this 

subsection shall not exceed the sum of the principal and interest 

on the loans made to a customer of the borrower, as determined 

by the Secretary. 

‘‘(3) TERM.—The term of a deferment under this subsection 

shall not exceed 60 months.’’. 

SEC. 6104. RURAL ELECTRIFICATION ASSISTANCE. 

Section 13 of the Rural Electrification Act of 1936 (7 U.S.C. 

913) is amended to read as follows: 

‘‘SEC. 13. DEFINITIONS. 

‘‘In this Act: 

‘‘(1) FARM.—The term ‘farm’ means a farm, as defined by 

the Bureau of the Census. 

‘‘(2) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning given the term in section 4 of the Indian Self-Determination 

and Education Assistance Act (25 U.S.C. 450b). 

‘‘(3) RURAL AREA.—Except as provided otherwise in this 

Act, the term ‘rural area’ means the farm and nonfarm population of—

‘‘(A) any area described in section 343(a)(13)(C) of the 

Consolidated Farm and Rural Development Act (7 U.S.C. 

1991(a)(13)(C)); and 

‘‘(B) any area within a service area of a borrower for 

which a borrower has an outstanding loan made under titles I through V as of the date of enactment of this paragraph. 

‘‘(4) TERRITORY.—The term ‘territory’ includes any insular 

possession of the United States. 

‘‘(5) SECRETARY.—The term ‘Secretary’ means the Secretary 

of Agriculture.’’. 

SEC. 6105. SUBSTANTIALLY UNDERSERVED TRUST AREAS. 

The Rural Electrification Act of 1936 is amended by inserting 

after section 306E (7 U.S.C. 936e) the following: 

‘‘SEC. 306F. SUBSTANTIALLY UNDERSERVED TRUST AREAS. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) ELIGIBLE PROGRAM.—The term ‘eligible program’

means a program administered by the Rural Utilities Service 

and authorized in—

‘‘(A) this Act; or 

‘‘(B) paragraph (1), (2), (14), (22), or (24) of section 

306(a) or section 306A, 306C, 306D, or 306E of the ConsoliVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00315 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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dated Farm and Rural Development Act (7 U.S.C. 1926(a), 

1926a, 1926c, 1926d, 1926e). 

‘‘(2) SUBSTANTIALLY UNDERSERVED TRUST AREA.—The term ‘substantially underserved trust area’ means a community in ‘trust land’ (as defined in section 3765 of title 38, United States 

Code) with respect to which the Secretary determines has a high 

need for the benefits of an eligible program. 

‘‘(b) INITIATIVE.—The Secretary, in consultation with local governments and Federal agencies, may implement an initiative to 

identify and improve the availability of eligible programs in communities in substantially underserved trust areas. ‘‘(c) AUTHORITY OF SECRETARY.—In carrying out subsection (b), 

the Secretary— ‘‘(1) may make available from loan or loan guarantee programs administered by the Rural Utilities Service to qualified 

utilities or applicants financing with an interest rate as low as 

2 percent, and with extended repayment terms; ‘‘(2) may waive nonduplication restrictions, matching fund 

requirements, or credit support requirements from any loan or 

grant program administered by the Rural Utilities Service to 

facilitate the construction, acquisition, or improvement of infrastructure; 

‘‘(3) may give the highest funding priority to designated 

projects in substantially underserved trust areas; and 

‘‘(4) shall only make loans or loan guarantees that are 

found to be financially feasible and that provide eligible program benefits to substantially underserved trust areas. 

‘‘(d) REPORT.—Not later than 1 year after the date of enactment 

of this section and annually thereafter, the Secretary shall submit 

to Congress a report that describes—

‘‘(1) the progress of the initiative implemented under subsection (b); and 

‘‘(2) recommendations for any regulatory or legislative 

changes that would be appropriate to improve services to substantially underserved trust areas.’’. 

SEC. 6106. GUARANTEES FOR BONDS AND NOTES ISSUED FOR ELECTRIFICATION OR TELEPHONE PURPOSES. 

(a) IN GENERAL.—Section 313A of the Rural Electrification Act 

of 1936 (7 U.S.C. 940c–1) is amended—

(1) in subsection (b)—

(A) in paragraph (1), by striking ‘‘for electrification’’

and all that follows through the end and inserting ‘‘for eligible electrification or telephone purposes consistent with 

this Act.’’; and 

(B) by striking paragraph (4) and inserting the following: 

‘‘(4) ANNUAL AMOUNT.—The total amount of guarantees 

provided by the Secretary under this section during a fiscal 

year shall not exceed $1,000,000,000, subject to the availability 

of funds under subsection (e).’’; 

(2) in subsection (c), by striking paragraphs (2) and (3) and 

inserting the following: 

‘‘(2) AMOUNT.—

‘‘(A) IN GENERAL.—The amount of the annual fee paid 

for the guarantee of a bond or note under this section shall 


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be equal to 30 basis points of the amount of the unpaid 

principal of the bond or note guaranteed under this section. 

‘‘(B) PROHIBITION.—Except as otherwise provided in 

this subsection and subsection (e)(2), no other fees shall be 

assessed. 

‘‘(3) PAYMENT.—

‘‘(A) IN GENERAL.—A lender shall pay the fees required 

under this subsection on a semiannual basis. 

‘‘(B) STRUCTURED SCHEDULE.—The Secretary shall, 

with the consent of the lender, structure the schedule for 

payment of the fee to ensure that sufficient funds are available to pay the subsidy costs for note or bond guarantees 

as provided for in subsection (e)(2).’’; and 

(3) in subsection (f), by striking ‘‘2007’’ and inserting 

‘‘2012’’. 

(b) ADMINISTRATION.—The Secretary shall continue to carry out 

section 313A of the Rural Electrification Act of 1936 (7 U.S.C. 940c–

1) in the same manner as on the day before the date of enactment 

of this Act, except without regard to the limitations prescribed in 

subsection (b)(1) of that section, until such time as any regulations 

necessary to carry out the amendments made by this section are 

fully implemented. 

SEC. 6107. EXPANSION OF 911 ACCESS. 

Section 315 of the Rural Electrification Act of 1936 (7 U.S.C. 

940e) is amended to read as follows: 

‘‘SEC. 315. EXPANSION OF 911 ACCESS. 

‘‘(a) IN GENERAL.—Subject to subsection (c) and such terms and 

conditions as the Secretary may prescribe, the Secretary may make 

loans under this title to entities eligible to borrow from the Rural 

Utilities Service, State or local governments, Indian tribes (as defined in section 4 of the Indian Self-Determination and Education 

Assistance Act (25 U.S.C. 450b)), or other public entities for facilities and equipment to expand or improve in rural areas—

‘‘(1) 911 access; 

‘‘(2) integrated interoperable emergency communications, 

including multiuse networks that provide commercial or transportation information services in addition to emergency communications services; 

‘‘(3) homeland security communications; 

‘‘(4) transportation safety communications; or 

‘‘(5) location technologies used outside an urbanized area. 

‘‘(b) LOAN SECURITY.—Government-imposed fees related to 

emergency communications (including State or local 911 fees) may 

be considered to be security for a loan under this section. 

‘‘(c) EMERGENCY COMMUNICATIONS EQUIPMENT PROVIDERS.—

The Secretary may make a loan under this section to an emergency 

communication equipment provider to expand or improve 911 access 

or other communications or technologies described in subsection (a) 

if the local government that has jurisdiction over the project is not 

allowed to acquire the debt resulting from the loan. ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—The Secretary shall 

use to make loans under this section any funds otherwise made 

available for telephone loans for each of fiscal years 2008 through 

2012.’’. 


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SEC. 6108. ELECTRIC LOANS FOR RENEWABLE ENERGY. 

Title III of the Rural Electrification Act of 1936 is amended by 

inserting after section 316 (7 U.S.C. 940f) the following: 

‘‘SEC. 317. ELECTRIC LOANS FOR RENEWABLE ENERGY. 

‘‘(a) DEFINITION OF RENEWABLE ENERGY SOURCE.—In this section, the term ‘renewable energy source’ means an energy conversion 

system fueled from a solar, wind, hydropower, biomass, or geothermal source of energy. ‘‘(b) LOANS.—In addition to any other funds or authorities otherwise made available under this Act, the Secretary may make electric loans under this title for electric generation from renewable energy resources for resale to rural and nonrural residents. ‘‘(c) RATE.—The rate of a loan under this section shall be equal 

to the average tax-exempt municipal bond rate of similar maturities.’’. 

SEC. 6109. BONDING REQUIREMENTS. 

Title III of the Rural Electrification Act of 1936 is amended by 

inserting after section 317 (as added by section 6108) the following: 

‘‘SEC. 318. BONDING REQUIREMENTS. 

‘‘The Secretary shall review the bonding requirements for all 

programs administered by the Rural Utilities Service under this Act 

to ensure that bonds are not required if— ‘‘(1) the interests of the Secretary are adequately protected 

by product warranties; or ‘‘(2) the costs or conditions associated with a bond exceed 

the benefit of the bond.’’. 

SEC. 6110. ACCESS TO BROADBAND TELECOMMUNICATIONS SERVICES 

IN RURAL AREAS. 

(a) IN GENERAL.—Section 601 of the Rural Electrification Act 

of 1936 (7 U.S.C. 950bb) is amended to read as follows: 

‘‘SEC. 601. ACCESS TO BROADBAND TELECOMMUNICATIONS SERVICES 

IN RURAL AREAS. 

‘‘(a) PURPOSE.—The purpose of this section is to provide loans 

and loan guarantees to provide funds for the costs of the construction, improvement, and acquisition of facilities and equipment for 

broadband service in rural areas. ‘‘(b) DEFINITIONS.—In this section: ‘‘(1) BROADBAND SERVICE.—The term ‘broadband service’ means any technology identified by the Secretary as having the 

capacity to transmit data to enable a subscriber to the service 

to originate and receive high-quality voice, data, graphics, and 

video. ‘‘(2) INCUMBENT SERVICE PROVIDER.—The term ‘incumbent 

service provider’, with respect to an application submitted 

under this section, means an entity that, as of the date of submission of the application, is providing broadband service to 

not less than 5 percent of the households in the service territory 

proposed in the application. ‘‘(3) RURAL AREA.— ‘‘(A) IN GENERAL.—The term ‘rural area’ means any 

area other than—

‘‘(i) an area described in clause (i) or (ii) of section 

343(a)(13)(A) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1991(a)(13)(A)); and 


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‘‘(ii) a city, town, or incorporated area that has a 

population of greater than 20,000 inhabitants. 

‘‘(B) URBAN AREA GROWTH.—The Secretary may, by regulation only, consider an area described in section 

343(a)(13)(F)(i)(I) of that Act to not be a rural area for purposes of this section. ‘‘(c) LOANS AND LOAN GUARANTEES.— ‘‘(1) IN GENERAL.—The Secretary shall make or guarantee 

loans to eligible entities described in subsection (d) to provide 

funds for the construction, improvement, or acquisition of facilities and equipment for the provision of broadband service in 

rural areas. ‘‘(2) PRIORITY.—In making or guaranteeing loans under 

paragraph (1), the Secretary shall give the highest priority to 

applicants that offer to provide broadband service to the greatest proportion of households that, prior to the provision of the 

broadband service, had no incumbent service provider. 

‘‘(d) ELIGIBILITY.— ‘‘(1) ELIGIBLE ENTITIES.—

‘‘(A) IN GENERAL.—To be eligible to obtain a loan or 

loan guarantee under this section, an entity shall—

‘‘(i) demonstrate the ability to furnish, improve, or 

extend a broadband service to a rural area; 

‘‘(ii) submit to the Secretary a loan application at 

such time, in such manner, and containing such information as the Secretary may require; and 

‘‘(iii) agree to complete buildout of the broadband 

service described in the loan application by not later 

than 3 years after the initial date on which proceeds 

from the loan made or guaranteed under this section 

are made available. 

‘‘(B) LIMITATION.—An eligible entity that provides telecommunications or broadband service to at least 20 percent 

of the households in the United States may not receive an 

amount of funds under this section for a fiscal year in excess of 15 percent of the funds authorized and appropriated 

under subsection (k) for the fiscal year. 

‘‘(2) ELIGIBLE PROJECTS.— ‘‘(A) IN GENERAL.—Except as provided in subparagraphs (B) and (C), the proceeds of a loan made or guaranteed under this section may be used to carry out a project 

in a proposed service territory only if, as of the date on 

which the application for the loan or loan guarantee is submitted—‘‘(i) not less than 25 percent of the households in 

the proposed service territory is offered broadband service by not more than 1 incumbent service provider; and ‘‘(ii) broadband service is not provided in any part 

of the proposed service territory by 3 or more incumbent service providers. 

‘‘(B) EXCEPTION TO 25 PERCENT REQUIREMENT.—Subparagraph (A)(i) shall not apply to the proposed service territory of a project if a loan or loan guarantee has been 

made under this section to the applicant to provide 

broadband service in the proposed service territory. 


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‘‘(C) EXCEPTION TO 3 OR MORE INCUMBENT SERVICE

PROVIDER REQUIREMENT.—

‘‘(i) IN GENERAL.—Except as provided in clause (ii), 

subparagraph (A)(ii) shall not apply to an incumbent 

service provider that is upgrading broadband service to 

the existing territory of the incumbent service provider. 

‘‘(ii) EXCEPTION.—Clause (i) shall not apply if the 

applicant is eligible for funding under another title of 

this Act. 

‘‘(3) EQUITY AND MARKET SURVEY REQUIREMENTS.—

‘‘(A) IN GENERAL.—The Secretary may require an entity 

to provide a cost share in an amount not to exceed 10 percent of the amount of the loan or loan guarantee requested 

in the application of the entity, unless the Secretary determines that a higher percentage is required for financial feasibility. 

‘‘(B) MARKET SURVEY.—

‘‘(i) IN GENERAL.—The Secretary may require an 

entity that proposes to have a subscriber projection of 

more than 20 percent of the broadband service market 

in a rural area to submit to the Secretary a market 

survey. 

‘‘(ii) LESS THAN 20 PERCENT.—The Secretary may 

not require an entity that proposes to have a subscriber 

projection of less than 20 percent of the broadband 

service market in a rural area to submit to the Secretary a market survey. 

‘‘(4) STATE AND LOCAL GOVERNMENTS AND INDIAN TRIBES.—

Subject to paragraph (1), a State or local government (including any agency, subdivision, or instrumentality thereof (including consortia thereof)) and an Indian tribe shall be eligible for 

a loan or loan guarantee under this section to provide 

broadband services to a rural area. 

‘‘(5) NOTICE REQUIREMENT.—The Secretary shall publish a 

notice of each application for a loan or loan guarantee under 

this section describing the application, including—

‘‘(A) the identity of the applicant; 

‘‘(B) each area proposed to be served by the applicant; 

and 

‘‘(C) the estimated number of households without terrestrial-based broadband service in those areas. 

‘‘(6) PAPERWORK REDUCTION.—The Secretary shall take 

steps to reduce, to the maximum extent practicable, the cost and 

paperwork associated with applying for a loan or loan guarantee under this section by first-time applicants (particularly 

first-time applicants who are small and start-up broadband 

service providers), including by providing for a new application 

that maintains the ability of the Secretary to make an analysis 

of the risk associated with the loan involved. 

‘‘(7) PREAPPLICATION PROCESS.—The Secretary shall establish a process under which a prospective applicant may seek a 

determination of area eligibility prior to preparing a loan application under this section. 

‘‘(e) BROADBAND SERVICE.—


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‘‘(1) IN GENERAL.—The Secretary shall, from time to time as 

advances in technology warrant, review and recommend modifications of rate-of-data transmission criteria for purposes of the 

identification of broadband service technologies under subsection (b)(1). ‘‘(2) PROHIBITION.—The Secretary shall not establish requirements for bandwidth or speed that have the effect of precluding the use of evolving technologies appropriate for rural 

areas. 

‘‘(f) TECHNOLOGICAL NEUTRALITY.—For purposes of determining 

whether to make a loan or loan guarantee for a project under this 

section, the Secretary shall use criteria that are technologically neutral. ‘‘(g) TERMS AND CONDITIONS FOR LOANS AND LOAN GUARANTEES.—

‘‘(1) IN GENERAL.—Notwithstanding any other provision of 

law, a loan or loan guarantee under this section shall—

‘‘(A) bear interest at an annual rate of, as determined 

by the Secretary—

‘‘(i) in the case of a direct loan, a rate equivalent 

to—

‘‘(I) the cost of borrowing to the Department of 

the Treasury for obligations of comparable maturity; or 

‘‘(II) 4 percent; and 

‘‘(ii) in the case of a guaranteed loan, the current 

applicable market rate for a loan of comparable maturity; and 

‘‘(B) have a term of such length, not exceeding 35 years, 

as the borrower may request, if the Secretary determines 

that the loan is adequately secured. 

‘‘(2) TERM.—In determining the term of a loan or loan 

guarantee, the Secretary shall consider whether the recipient is 

or would be serving an area that is not receiving broadband 

services. ‘‘(3) RECURRING REVENUE.—The Secretary shall consider 

the existing recurring revenues of the entity at the time of application in determining an adequate level of credit support. 

‘‘(h) ADEQUACY OF SECURITY.— ‘‘(1) IN GENERAL.—The Secretary shall ensure that the type 

and amount of, and method of security used to secure, any loan 

or loan guarantee under this section is commensurate to the 

risk involved with the loan or loan guarantee, particularly in 

any case in which the loan or loan guarantee is issued to a financially strong and stable entity, as determined by the Secretary. 

‘‘(2) DETERMINATION OF AMOUNT AND METHOD OF SECU- RITY.—In determining the amount of, and method of security 

used to secure, a loan or loan guarantee under this section, the 

Secretary shall consider reducing the security in a rural area 

that does not have broadband service. 

‘‘(i) USE OF LOAN PROCEEDS TO REFINANCE LOANS FOR DE- PLOYMENT OF BROADBAND SERVICE.—Notwithstanding any other 

provision of this Act, the proceeds of any loan made or guaranteed 

by the Secretary under this Act may be used by the recipient of the 


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loan for the purpose of refinancing an outstanding obligation of the 

recipient on another telecommunications loan made under this Act 

if the use of the proceeds for that purpose will support the construction, improvement, or acquisition of facilities and equipment for the 

provision of broadband service in rural areas. ‘‘(j) REPORTS.—Not later than 1 year after the date of enactment 

of the Food, Conservation, and Energy Act of 2008, and annually 

thereafter, the Administrator shall submit to Congress a report that 

describes the extent of participation in the loan and loan guarantee 

program under this section for the preceding fiscal year, including 

a description of — ‘‘(1) the number of loans applied for and provided under 

this section; ‘‘(2)(A) the communities proposed to be served in each loan 

application submitted for the fiscal year; and ‘‘(B) the communities served by projects funded by loans 

and loan guarantees provided under this section; ‘‘(3) the period of time required to approve each loan application under this section; ‘‘(4) any outreach activities carried out by the Secretary to 

encourage entities in rural areas without broadband service to 

submit applications under this section; ‘‘(5) the method by which the Secretary determines that a 

service enables a subscriber to originate and receive high-quality voice, data, graphics, and video for purposes of subsection 

(b)(1); and ‘‘(6) each broadband service, including the type and speed 

of broadband service, for which assistance was sought, and 

each broadband service for which assistance was provided, 

under this section. 

‘‘(k) FUNDING.— ‘‘(1) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to the Secretary to carry out this section 

$25,000,000 for each of fiscal years 2008 through 2012, to remain available until expended. ‘‘(2) ALLOCATION OF FUNDS.— ‘‘(A) IN GENERAL.—From amounts made available for 

each fiscal year under this subsection, the Secretary shall— ‘‘(i) establish a national reserve for loans and loan 

guarantees to eligible entities in States under this section; and ‘‘(ii) allocate amounts in the reserve to each State 

for each fiscal year for loans and loan guarantees to eligible entities in the State. 

‘‘(B) AMOUNT.—The amount of an allocation made to a 

State for a fiscal year under subparagraph (A) shall bear 

the same ratio to the amount of allocations made for all 

States for the fiscal year as—

‘‘(i) the number of communities with a population 

of 2,500 inhabitants or less in the State; bears to ‘‘(ii) the number of communities with a population 

of 2,500 inhabitants or less in all States. 

‘‘(C) UNOBLIGATED AMOUNTS.—Any amounts in the reserve established for a State for a fiscal year under subparagraph (B) that are not obligated by April 1 of the fiscal 


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year shall be available to the Secretary to make loans and 

loan guarantees under this section to eligible entities in any 

State, as determined by the Secretary. ‘‘(l) TERMINATION OF AUTHORITY.—No loan or loan guarantee 

may be made under this section after September 30, 2012.’’. (b) REGULATIONS.—The Secretary may implement the amendment made by subsection (a) through the promulgation of an interim regulation. 

(c) APPLICATION.—The amendment made by subsection (a) shall 

not apply to— (1) an application submitted under section 601 of the Rural 

Electrification Act of 1936 (7 U.S.C. 950bb) (as it existed before 

the amendment made by subsection (a)) that— (A) was pending on the date that is 45 days prior to 

the date of enactment of this Act; and 

(B) is pending on the date of enactment of this Act; or 

(2) a petition for reconsideration of a decision on an application described in paragraph (1). 

SEC. 6111. NATIONAL CENTER FOR RURAL TELECOMMUNICATIONS ASSESSMENT. 

Title VI of the Rural Electrification Act of 1936 (7 U.S.C. 950bb 

et seq.) is amended by adding at the end the following: 

‘‘SEC. 602. NATIONAL CENTER FOR RURAL TELECOMMUNICATIONS ASSESSMENT. 

‘‘(a) DESIGNATION OF CENTER.—The Secretary shall designate 

an entity to serve as the National Center for Rural Telecommunications Assessment (referred to in this section as the ‘Center’). ‘‘(b) CRITERIA.—In designating the Center under subsection (a), 

the Secretary shall take into consideration the following criteria: ‘‘(1) The Center shall be an entity that demonstrates to the 

Secretary—

‘‘(A) a focus on rural policy research; and 

‘‘(B) a minimum of 5 years of experience relating to 

rural telecommunications research and assessment. 

‘‘(2) The Center shall be capable of assessing broadband 

services in rural areas. ‘‘(3) The Center shall have significant experience involving 

other rural economic development centers and organizations 

with respect to the assessment of rural policies and the formulation of policy solutions at the Federal, State, and local levels. 

‘‘(c) BOARD OF DIRECTORS.—The Center shall be managed by a 

board of directors, which shall be responsible for the duties of the 

Center described in subsection (d). 

‘‘(d) DUTIES.—The Center shall—

‘‘(1) assess the effectiveness of programs carried out under 

this title in increasing broadband penetration and purchase in 

rural areas, especially in rural communities identified by the 

Secretary as having no broadband service before the provision 

of a loan or loan guarantee under this title; 

‘‘(2) work with existing rural development centers selected 

by the Center to identify policies and initiatives at the Federal, 

State, and local levels that have increased broadband penetration and purchase in rural areas and provide recommendations 

to Federal, State, and local policymakers on effective strategies 

to bring affordable broadband services to residents of rural 


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areas, particularly residents located outside of the municipal 

boundaries of a rural city or town; and 

‘‘(3) develop and publish reports describing the activities 

carried out by the Center under this section. 

‘‘(e) REPORTING REQUIREMENTS.—Not later than December 1 of 

each applicable fiscal year, the board of directors of the Center shall 

submit to Congress and the Secretary a report describing the activities carried out by the Center during the preceding fiscal year and 

the results of any research conducted by the Center during that fiscal year, including—

‘‘(1) an assessment of each program carried out under this 

title; and 

‘‘(2) an assessment of the effects of the policy initiatives 

identified under subsection (d)(2). 

‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to the Secretary to carry out this section 

$1,000,000 for each of fiscal years 2008 through 2012.’’. 

SEC. 6112. COMPREHENSIVE RURAL BROADBAND STRATEGY. 

(a) IN GENERAL.—Not later than 1 year after the date of enactment of this Act, the Chairman of the Federal Communications 

Commission, in coordination with the Secretary, shall submit to 

Congress a report describing a comprehensive rural broadband 

strategy that includes—

(1) recommendations—

(A) to promote interagency coordination of Federal 

agencies in regards to policies, procedures, and targeted resources, and to streamline or otherwise improve and 

streamline the policies, programs, and services; 

(B) to coordinate existing Federal rural broadband or 

rural initiatives; 

(C) to address both short- and long-term needs assessments and solutions for a rapid build-out of rural 

broadband solutions and application of the recommendations for Federal, State, regional, and local government policymakers; and 

(D) to identify how specific Federal agency programs 

and resources can best respond to rural broadband requirements and overcome obstacles that currently impede rural 

broadband deployment; and 

(2) a description of goals and timeframes to achieve the 

purposes of the report. 

(b) UPDATES.—The Chairman of the Federal Communications 

Commission, in coordination with the Secretary, shall update and 

evaluate the report described in subsection (a) during the third year 

after the date of enactment of this Act. 

SEC. 6113. STUDY ON RURAL ELECTRIC POWER GENERATION. 

(a) IN GENERAL.—The Secretary shall conduct a study on the 

electric power generation needs in rural areas of the United States. 

(b) COMPONENTS.—The study shall include an examination of—

(1) generation in various areas in rural areas of the United 

States, particularly by rural electric cooperatives; 

(2) financing available for capacity, including financing 

available through programs authorized under the Rural Electrification Act of 1936 (7 U.S.C. 901 et seq.); 


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(3) the impact of electricity costs on consumers and local 

economic development; 

(4) the ability of fuel feedstock technology to meet regulatory requirements, such as carbon capture and sequestration; 

and 

(5) any other factors that the Secretary considers appropriate. 

(c) REPORT.—Not later than 60 days after the date of enactment 

of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report containing 

the findings of the study under this section. 

Subtitle C—Miscellaneous 

SEC. 6201. DISTANCE LEARNING AND TELEMEDICINE. 

(a) IN GENERAL.—Section 2333(c)(1) of the Food, Agriculture, 

Conservation and Trade Act of 1990 (7 U.S.C. Sec. 950aaa–2(a)(1)) 

is amended—

(1) in subparagraph (A), by striking ‘‘and’’ at the end; 

(2) in subparagraph (B), by striking the period at the end 

and inserting a semicolon; and 

(3) by adding at the end the following: 

‘‘(C) libraries.’’. 

(b) AUTHORIZATION OF APPROPRIATIONS.—Section 2335A of the 

Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 

950aaa–5) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

(c) CONFORMING AMENDMENT.—Section 1(b) of Public Law 102–

551 (7 U.S.C. 950aaa note; Public Law 102–551) is amended by 

striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 6202. VALUE-ADDED AGRICULTURAL MARKET DEVELOPMENT 

PROGRAM GRANTS. 

(a) DEFINITIONS.—Section 231 of the Agricultural Risk Protection Act of 2000 (7 U.S.C. 1621 note; Public Law 106–224) is 

amended by striking subsection (a) and inserting the following: 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) BEGINNING FARMER OR RANCHER.—The term ‘beginning 

farmer or rancher’ has the meaning given the term in section 

343(a) of the Consolidated Farm and Rural Development Act (7 

U.S.C. 1991(a)). 

‘‘(2) FAMILY FARM.—The term ‘family farm’ has the meaning given the term in section 761.2 of title 7, Code of Federal 

Regulations (as in effect on December 30, 2007). 

‘‘(3) MID-TIER VALUE CHAIN.—The term ‘mid-tier value 

chain’ means local and regional supply networks that link independent producers with businesses and cooperatives that market value-added agricultural products in a manner that—

‘‘(A) targets and strengthens the profitability and competitiveness of small and medium-sized farms and ranches 

that are structured as a family farm; and 

‘‘(B) obtains agreement from an eligible agricultural 

producer group, farmer or rancher cooperative, or majoritycontrolled producer-based business venture that is engaged 

in the value chain on a marketing strategy. 


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‘‘(4) SOCIALLY DISADVANTAGED FARMER OR RANCHER.—The 

term ‘socially disadvantaged farmer or rancher’ has the meaning given the term in section 355(e) of the Consolidated Farm 

and Rural Development Act (7 U.S.C. 2003(e)). 

‘‘(5) VALUE-ADDED AGRICULTURAL PRODUCT.—The term 

‘value-added agricultural product’ means any agricultural commodity or product that—

‘‘(A)(i) has undergone a change in physical state; 

‘‘(ii) was produced in a manner that enhances the value 

of the agricultural commodity or product, as demonstrated 

through a business plan that shows the enhanced value, as 

determined by the Secretary; 

‘‘(iii) is physically segregated in a manner that results 

in the enhancement of the value of the agricultural commodity or product; 

‘‘(iv) is a source of farm- or ranch-based renewable energy, including E–85 fuel; or 

‘‘(v) is aggregated and marketed as a locally-produced 

agricultural food product; and 

‘‘(B) as a result of the change in physical state or the manner in which the agricultural commodity or product was produced, marketed, or segregated—

‘‘(i) the customer base for the agricultural commodity 

or product is expanded; and 

‘‘(ii) a greater portion of the revenue derived from the 

marketing, processing, or physical segregation of the agricultural commodity or product is available to the producer 

of the commodity or product.’’. 

(b) GRANT PROGRAM.—Section 231(b) of the Agricultural Risk 

Protection Act of 2000 (7 U.S.C. 1621 note; Public Law 106–224) is 

amended—

(1) in paragraph (1), by striking ‘‘paragraph (4)’’ and inserting ‘‘paragraph (7)’’; and 

(2) by striking paragraph (4) and inserting the following: 

‘‘(4) TERM.—A grant under this subsection shall have a 

term that does not exceed 3 years. 

‘‘(5) SIMPLIFIED APPLICATION.—The Secretary shall offer a 

simplified application form and process for project proposals requesting less than $50,000. 

‘‘(6) PRIORITY.—In awarding grants under this subsection, 

the Secretary shall give priority to projects that contribute to increasing opportunities for—

‘‘(A) beginning farmers or ranchers; 

‘‘(B) socially disadvantaged farmers or ranchers; and 

‘‘(C) operators of small- and medium-sized farms and 

ranches that are structured as a family farm. 

‘‘(7) FUNDING.—

‘‘(A) MANDATORY FUNDING.—On October 1, 2008, of the 

funds of the Commodity Credit Corporation, the Secretary 

shall make available to carry out this subsection 

$15,000,000, to remain available until expended. 

‘‘(B) DISCRETIONARY FUNDING.—There is authorized to 

be appropriated to carry out this subsection $40,000,000 for 

each of fiscal years 2008 through 2012. 


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‘‘(C) RESERVATION OF FUNDS FOR PROJECTS TO BENEFIT

BEGINNING FARMERS OR RANCHERS, SOCIALLY DISADVANTAGED FARMERS OR RANCHERS, AND MID-TIER VALUE

CHAINS.—

‘‘(i) IN GENERAL.—The Secretary shall reserve 10 

percent of the amounts made available for each fiscal 

year under this paragraph to fund projects that benefit 

beginning farmers or ranchers or socially disadvantaged farmers or ranchers. 

‘‘(ii) MID-TIER VALUE CHAINS.—The Secretary shall 

reserve 10 percent of the amounts made available for 

each fiscal year under this paragraph to fund applications of eligible entities described in paragraph (1) that 

propose to develop mid-tier value chains. 

‘‘(iii) UNOBLIGATED AMOUNTS.—Any amounts in 

the reserves for a fiscal year established under clauses 

(i) and (ii) that are not obligated by June 30 of the fiscal year shall be available to the Secretary to make 

grants under this subsection to eligible entities in any 

State, as determined by the Secretary.’’. 

SEC. 6203. AGRICULTURE INNOVATION CENTER DEMONSTRATION 

PROGRAM. 

Section 6402 of the Farm Security and Rural Investment Act of 

2002 (7 U.S.C. 1621 note; Public Law 107–171) is amended by striking subsection (i) and inserting the following: 

‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to the Secretary to carry out this section 

$6,000,000 for each of fiscal years 2008 through 2012.’’. 

SEC. 6204. RURAL FIREFIGHTERS AND EMERGENCY MEDICAL SERVICE 

ASSISTANCE PROGRAM. 

Section 6405 of the Farm Security and Rural Investment Act of 

2002 (7 U.S.C. 2655) is amended to read as follows: 

‘‘SEC. 6405. RURAL FIREFIGHTERS AND EMERGENCY MEDICAL SERVICE ASSISTANCE PROGRAM. 

‘‘(a) DEFINITION OF EMERGENCY MEDICAL SERVICES.—In this 

section: 

‘‘(1) IN GENERAL.—The term ‘emergency medical services’

means resources used by a public or nonprofit entity to deliver 

medical care outside of a medical facility under emergency conditions that occur as a result of—

‘‘(A) the condition of a patient; or 

‘‘(B) a natural disaster or related condition. 

‘‘(2) INCLUSION.—The term ‘emergency medical services’ includes services (whether compensated or volunteer) delivered by 

an emergency medical services provider or other provider recognized by the State involved that is licensed or certified by the 

State as—

‘‘(A) an emergency medical technician or the equivalent 

(as determined by the State); 

‘‘(B) a registered nurse; 

‘‘(C) a physician assistant; or 

‘‘(D) a physician that provides services similar to services provided by such an emergency medical services provider. 


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‘‘(b) GRANTS.—The Secretary shall award grants to eligible entities—

‘‘(1) to enable the entities to provide for improved emergency 

medical services in rural areas; and 

‘‘(2) to pay the cost of training firefighters and emergency 

medical personnel in firefighting, emergency medical practices, 

and responding to hazardous materials and bioagents in rural 

areas. 

‘‘(c) ELIGIBILITY.—To be eligible to receive a grant under this 

section, an entity shall—

‘‘(1) be—

‘‘(A) a State emergency medical services office; 

‘‘(B) a State emergency medical services association; 

‘‘(C) a State office of rural health or an equivalent 

agency; 

‘‘(D) a local government entity; 

‘‘(E) an Indian tribe (as defined in section 4 of the Indian Self-Determination and Education Assistance Act (25 

U.S.C. 450b)); 

‘‘(F) a State or local ambulance provider; or 

‘‘(G) any other public or nonprofit entity determined 

appropriate by the Secretary; and 

‘‘(2) prepare and submit to the Secretary an application at 

such time, in such manner, and containing such information as 

the Secretary may require, that includes—

‘‘(A) a description of the activities to be carried out 

under the grant; and 

‘‘(B) an assurance that the applicant will comply with 

the matching requirement of subsection (f). 

‘‘(d) USE OF FUNDS.—An entity shall use amounts received 

under a grant made under subsection (b) only in a rural area—

‘‘(1) to hire or recruit emergency medical service personnel; 

‘‘(2) to recruit or retain volunteer emergency medical service 

personnel; 

‘‘(3) to train emergency medical service personnel in emergency response, injury prevention, safety awareness, or other 

topics relevant to the delivery of emergency medical services; 

‘‘(4) to fund training to meet State or Federal certification 

requirements; 

‘‘(5) to provide training for firefighters or emergency medical personnel for improvements to the training facility, equipment, curricula, or personnel; 

‘‘(6) to develop new ways to educate emergency health care 

providers through the use of technology-enhanced educational 

methods (such as distance learning); 

‘‘(7) to acquire emergency medical services vehicles, including ambulances; 

‘‘(8) to acquire emergency medical services equipment, including cardiac defibrillators; 

‘‘(9) to acquire personal protective equipment for emergency 

medical services personnel as required by the Occupational 

Safety and Health Administration; or 

‘‘(10) to educate the public concerning cardiopulmonary resuscitation (CPR), first aid, injury prevention, safety awareness, 


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illness prevention, or other related emergency preparedness topics. 

‘‘(e) PREFERENCE.—In awarding grants under this section, the 

Secretary shall give preference to—

‘‘(1) applications that reflect a collaborative effort by 2 or 

more of the entities described in subparagraphs (A) through (G) 

of subsection (c)(1); and 

‘‘(2) applications submitted by entities that intend to use 

amounts provided under the grant to fund activities described 

in any of paragraphs (1) through (5) of subsection (d). 

‘‘(f) MATCHING REQUIREMENT.—The Secretary may not make a 

grant under this section to an entity unless the entity makes available (directly or through contributions from other public or private 

entities) non-Federal contributions toward the activities to be carried out under the grant in an amount equal to at least 5 percent 

of the amount received under the grant. 

‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—

‘‘(1) IN GENERAL.—There is authorized to be appropriated to 

the Secretary to carry out this section not more than 

$30,000,000 for each of fiscal years 2008 through 2012. 

‘‘(2) ADMINISTRATIVE COSTS.—Not more than 5 percent of 

the amount appropriated under paragraph (1) for a fiscal year 

may be used for administrative expenses incurred in carrying 

out this section.’’. 

SEC. 6205. INSURANCE OF LOANS FOR HOUSING AND RELATED FACILITIES FOR DOMESTIC FARM LABOR. 

Section 514(f)(3) of the Housing Act of 1949 (42 U.S.C. 

1484(f)(3)) is amended by striking ‘‘or the handling of such commodities in the unprocessed stage’’ and inserting ‘‘, the handling of agricultural or aquacultural commodities in the unprocessed stage, or 

the processing of agricultural or aquacultural commodities’’. 

SEC. 6206. STUDY OF RURAL TRANSPORTATION ISSUES. 

(a) IN GENERAL.—The Secretary of Agriculture and the Secretary of Transportation shall jointly conduct a study of transportation issues regarding the movement of agricultural products, domestically produced renewable fuels, and domestically produced resources for the production of electricity for rural areas of the United 

States, and economic development in those areas. 

(b) INCLUSIONS.—The study shall include an examination of—

(1) the importance of freight transportation, including rail, 

truck, and barge, to—

(A) the delivery of equipment, seed, fertilizer, and other 

such products important to the development of agricultural 

commodities and products; 

(B) the movement of agricultural commodities and 

products to market; 

(C) the delivery of ethanol and other renewable fuels; 

(D) the delivery of domestically produced resources for 

use in the generation of electricity for rural areas; 

(E) the location of grain elevators, ethanol plants, and 

other facilities; 

(F) the development of manufacturing facilities in rural 

areas; and 


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(G) the vitality and economic development of rural 

communities; 

(2) the sufficiency in rural areas of transportation capacity, 

the sufficiency of competition in the transportation system, the 

reliability of transportation services, and the reasonableness of 

transportation rates; 

(3) the sufficiency of facility investment in rural areas necessary for efficient and cost-effective transportation; and 

(4) the accessibility to shippers in rural areas of Federal 

processes for the resolution of grievances arising within various 

transportation modes. 

(c) REPORT TO CONGRESS.—Not later than 1 year after the date 

of enactment of this Act, the Secretary and the Secretary of Transportation shall submit to Congress a report that contains the results 

of the study required by subsection (a). 

Subtitle D—Housing Assistance Council 

SEC. 6301. SHORT TITLE. 

This subtitle may be cited as the ‘‘Housing Assistance Council 

Authorization Act of 2008’’. 

SEC. 6302. ASSISTANCE TO HOUSING ASSISTANCE COUNCIL. 

(a) USE.—The Secretary of Housing and Urban Development 

may provide financial assistance to the Housing Assistance Council 

for use by the Council to develop the ability and capacity of community-based housing development organizations to undertake community development and affordable housing projects and programs in 

rural areas. Assistance provided by the Secretary under this section 

may be used by the Housing Assistance Council for—

(1) technical assistance, training, support, research, and 

advice to develop the business and administrative capabilities 

of rural community-based housing development organizations; 

(2) loans, grants, or other financial assistance to rural community-based housing development organizations to carry out 

community development and affordable housing activities for 

low- and moderate-income families; and 

(3) such other activities as may be determined by the Secretary of Housing and Urban Development and the Housing Assistance Council. 

(b) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated for financial assistance under this section for the 

Housing Assistance Council $10,000,000 for each of fiscal years 

2009 through 2011. 

SEC. 6303. AUDITS AND REPORTS. 

(a) AUDIT.—

(1) IN GENERAL.—The financial transactions and activities 

of the Housing Assistance Council shall be audited annually by 

an independent certified public accountant or an independent 

licensed public accountant certified or licensed by a regulatory 

authority of a State or other political subdivision of the United 

States. 

(2) REQUIREMENTS OF AUDITS.—The Comptroller General of 

the United States may rely on any audit completed under paragraph (1), if the audit complies with—


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(A) the annual programmatic and financial examination requirements established in OMB Circular A–133; and 

(B) generally accepted government auditing standards. 

(3) REPORT TO CONGRESS.—The Comptroller General shall 

submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of 

the House of Representatives a report detailing each audit completed under paragraph (1). 

(b) GAO REPORT.—The Comptroller General of the United 

States shall conduct a study and submit a report to the Committee 

on Banking, Housing, and Urban Affairs of the Senate and the 

Committee on Financial Services of the House of Representatives on 

the use of any funds appropriated to the Housing Assistance Council over the past 7 years. 

SEC. 6304. PERSONS NOT LAWFULLY PRESENT IN THE UNITED STATES. 

Aliens who are not lawfully present in the United States shall 

be ineligible for financial assistance under this subtitle, as provided 

and defined by section 214 of the Housing and Community Development Act of 1980 (42 U.S.C. 1436a). Nothing in this subtitle shall 

be construed to alter the restrictions or definitions in such section 

214. 

SEC. 6305. LIMITATION ON USE OF AUTHORIZED AMOUNTS. 

None of the amounts authorized by this subtitle may be used to 

lobby or retain a lobbyist for the purpose of influencing a Federal, 

State, or local governmental entity or officer. 

TITLE VII—RESEARCH AND RELATED MATTERS 

Subtitle A—National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 

SEC. 7101. DEFINITIONS. 

(a) IN GENERAL.—Section 1404 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103) 

is amended—

(1) in paragraph (4)—

(A) by redesignating subparagraphs (A) through (E) as 

clauses (i) through (v), respectively; 

(B) by striking ‘‘(4) The terms’’ and inserting the following: 

‘‘(4) COLLEGE AND UNIVERSITY.—

‘‘(A) IN GENERAL.—The terms’’; and 

(C) by adding at the end the following: 

‘‘(B) INCLUSIONS.—The terms ‘college’ and ‘university’

include a research foundation maintained by a college or 

university described in subparagraph (A).’’; 

(2) by redesignating paragraphs (5) through (8), (9) 

through (11), (12) through (14), (15), (16), (17), and (18) as 

paragraphs (6) through (9), (11) through (13), (15) through (17), 

(20), (5), (18), and (19), respectively, and moving the paragraphs so as to appear in alphabetical and numerical order; 

(3) in paragraph (9) (as redesignated by paragraph (2))—

(A) by striking ‘‘renewable natural resources’’ and inserting ‘‘renewable energy and natural resources’’; and 


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(B) by striking subparagraph (F) and inserting the following: 

‘‘(F) Soil, water, and related resource conservation and 

improvement.’’; 

(4) by inserting after paragraph (9) (as so redesignated) the 

following: 

‘‘(10) HISPANIC-SERVING AGRICULTURAL COLLEGES AND UNIVERSITIES.—

‘‘(A) IN GENERAL.—The term ‘Hispanic-serving agricultural colleges and universities’ means colleges or universities that—

‘‘(i) qualify as Hispanic-serving institutions; and 

‘‘(ii) offer associate, bachelors, or other accredited 

degree programs in agriculture-related fields. 

‘‘(B) EXCEPTION.—The term ‘Hispanic-serving agricultural colleges and universities’ does not include 1862 institutions (as defined in section 2 of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 

U.S.C. 7601)).’’; 

(5) by striking paragraph (11) (as so redesignated) and inserting the following: 

‘‘(11) HISPANIC-SERVING INSTITUTION.—The term ‘Hispanicserving institution’ has the meaning given the term in section 

502 of the Higher Education Act of 1965 (20 U.S.C. 1101a).’’; 

and 

(6) by inserting after paragraph (13) (as so redesignated) 

the following: 

‘‘(14) NLGCA INSTITUTION; NON-LAND-GRANT COLLEGE OF

AGRICULTURE.—

‘‘(A) IN GENERAL.—The terms ‘NLGCA Institution’ and 

‘non-land-grant college of agriculture’ mean a public college 

or university offering a baccalaureate or higher degree in 

the study of agriculture or forestry. 

‘‘(B) EXCLUSIONS.—The terms ‘NLGCA Institution’ and 

‘non-land-grant college of agriculture’ do not include—

‘‘(i) Hispanic-serving agricultural colleges and universities; or 

‘‘(ii) any institution designated under—

‘‘(I) the Act of July 2, 1862 (commonly known 

as the ‘First Morrill Act’; 7 U.S.C. 301 et seq.); 

‘‘(II) the Act of August 30, 1890 (commonly 

known as the ‘Second Morrill Act’) (7 U.S.C. 321 

et seq.); 

‘‘(III) the Equity in Educational Land-Grant 

Status Act of 1994 (Public Law 103–382; 7 U.S.C. 

301 note); or 

‘‘(IV) Public Law 87–788 (commonly known as 

the ‘McIntire-Stennis Cooperative Forestry Act’) (16 

U.S.C. 582a et seq.).’’. 

(b) CONFORMING AMENDMENTS.—

(1) Section 2(3) of the Research Facilities Act (7 U.S.C. 

390(3)) is amended by striking ‘‘section 1404(8) of the National 

Agricultural Research, Extension, and Teaching Policy Act of 

1977 (7 U.S.C. 3103(8))’’ and inserting ‘‘section 1404 of the NaVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00332 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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tional Agricultural Research, Extension, and Teaching Policy 

Act of 1977 (7 U.S.C. 3103)’’. 

(2) Section 2(k) of the Competitive, Special, and Facilities 

Research Grant Act (7 U.S.C. 450i(k)) is amended in the second 

sentence by striking ‘‘section 1404(17) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 

U.S.C. 3103(17))’’ and inserting ‘‘section 1404 of the National 

Agricultural Research, Extension, and Teaching Policy Act of 

1977 (7 U.S.C. 3103)’’. 

(3) Section 18(a)(3)(B) of the Food and Nutrition Act of 

2008 (7 U.S.C. 2027(a)(3)(B)) is amended by striking ‘‘section 

1404(5) of the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3103(5)))’’ and inserting 

‘‘section 1404 of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3103))’’. 

(4) Section 1473 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3319) is 

amended in the first sentence by striking ‘‘section 1404(16) of 

this title’’ and inserting ‘‘section 1404(18)’’. 

(5) Section 1619(b) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5801(b)) is amended—

(A) in paragraph (1), by striking ‘‘section 1404(17) of 

the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103(17))’’ and inserting 

‘‘section 1404 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103)’’; 

(B) in paragraph (5), by striking ‘‘section 1404(7) of the 

National Agricultural Research, Extension, and Teaching 

Policy Act of 1977 (7 U.S.C. 3103(7))’’ and inserting ‘‘section 1404 of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3103)’’; and 

(C) in paragraph (8), by striking ‘‘section 1404(13) of 

the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103(13))’’ and inserting 

‘‘section 1404 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103)’’. 

(6) Section 125(c)(1)(C) of Public Law 100–238 (5 U.S.C. 

8432 note) is amended by striking ‘‘section 1404(5) of the National Agricultural Research, Extension, and Teaching Policy 

Act of 1977 (7 U.S.C. 3103(5))’’ and inserting ‘‘section 1404 of 

the National Agricultural Research, Extension, and Teaching 

Policy Act of 1977 (7 U.S.C. 3103)’’. 

SEC. 7102. NATIONAL AGRICULTURAL RESEARCH, EXTENSION, EDUCATION, AND ECONOMICS ADVISORY BOARD. 

(a) IN GENERAL.—Section 1408 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3123) 

is amended—

(1) in subsection (b)—

(A) in paragraph (1), by striking ‘‘31’’ and inserting 

‘‘25’’; and 

(B) by striking paragraph (3) and inserting the following: 

‘‘(3) MEMBERSHIP CATEGORIES.—The Advisory Board shall 

consist of members from each of the following categories: 


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‘‘(A) 1 member representing a national farm organization. ‘‘(B) 1 member representing farm cooperatives. 

‘‘(C) 1 member actively engaged in the production of a 

food animal commodity, recommended by a coalition of national livestock organizations. ‘‘(D) 1 member actively engaged in the production of a 

plant commodity, recommended by a coalition of national 

crop organizations. ‘‘(E) 1 member actively engaged in aquaculture, recommended by a coalition of national aquacultural organizations. ‘‘(F) 1 member representing a national food animal 

science society. ‘‘(G) 1 member representing a national crop, soil, 

agronomy, horticulture, plant pathology, or weed science society. ‘‘(H) 1 member representing a national food science organization. ‘‘(I) 1 member representing a national human health 

association. ‘‘(J) 1 member representing a national nutritional 

science society. ‘‘(K) 1 member representing the land-grant colleges and 

universities eligible to receive funds under the Act of July 

2, 1862 (7 U.S.C. 301 et seq.). ‘‘(L) 1 member representing the land-grant colleges and 

universities eligible to receive funds under the Act of August 30, 1890 (7 U.S.C. 321 et seq.), including Tuskegee 

University. ‘‘(M) 1 member representing the 1994 Institutions (as 

defined in section 532 of the Equity in Educational LandGrant Status Act of 1994 (7 U.S.C. 301 note; Public Law 

103–382)). 

‘‘(N) 1 member representing NLGCA Institutions. 

‘‘(O) 1 member representing Hispanic-serving institutions. 

‘‘(P) 1 member representing the American Colleges of 

Veterinary Medicine. 

‘‘(Q) 1 member engaged in the transportation of food 

and agricultural products to domestic and foreign markets. 

‘‘(R) 1 member representing food retailing and marketing interests. 

‘‘(S) 1 member representing food and fiber processors. 

‘‘(T) 1 member actively engaged in rural economic development. 

‘‘(U) 1 member representing a national consumer interest group. 

‘‘(V) 1 member representing a national forestry group. 

‘‘(W) 1 member representing a national conservation or 

natural resource group. 

‘‘(X) 1 member representing private sector organizations involved in international development. 

‘‘(Y) 1 member representing a national social science 

association.’’; 


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(2) in subsection (g)(1), by striking ‘‘$350,000’’ and inserting ‘‘$500,000’’; and 

(3) in subsection (h), by striking ‘‘2007’’ and inserting ‘‘2012’’. (b) NO EFFECT ON TERMS.—Nothing in this section or any 

amendment made by this section affects the term of any member of 

the National Agricultural Research, Extension, Education, and Economics Advisory Board serving as of the date of enactment of this 

Act. 

SEC. 7103. SPECIALTY CROP COMMITTEE REPORT. 

Section 1408A(c) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3123a(c)) is amended by adding at the end the following: ‘‘(4) Analyses of changes in macroeconomic conditions, technologies, and policies on specialty crop production and consumption, with particular focus on the effect of those changes 

on the financial stability of producers. ‘‘(5) Development of data that provide applied information 

useful to specialty crop growers, their associations, and other 

interested beneficiaries in evaluating that industry from a regional and national perspective.’’. 

SEC. 7104. RENEWABLE ENERGY COMMITTEE. 

The National Agricultural Research, Extension, and Teaching 

Policy Act of 1977 is amended by inserting after section 1408A (7 

U.S.C. 3123a) the following: 

‘‘SEC. 1408B. RENEWABLE ENERGY COMMITTEE. 

‘‘(a) INITIAL MEMBERS.—Not later than 90 days after the date 

of enactment of this section, the executive committee of the Advisory 

Board shall establish and appoint the initial members of a permanent renewable energy committee. ‘‘(b) DUTIES.—The permanent renewable energy committee shall 

study the scope and effectiveness of research, extension, and economics programs affecting the renewable energy industry. 

‘‘(c) NONADVISORY BOARD MEMBERS.—

‘‘(1) IN GENERAL.—An individual who is not a member of 

the Advisory Board may be appointed as a member of the renewable energy committee. 

‘‘(2) SERVICE.—A member of the renewable energy committee shall serve at the discretion of the executive committee. 

‘‘(d) REPORT BY RENEWABLE ENERGY COMMITTEE.—Not later 

than 180 days after the date of establishment of the renewable energy committee, and annually thereafter, the renewable energy committee shall submit to the Advisory Board a report that contains the 

findings and any recommendations of the renewable energy committee with respect to the study conducted under subsection (b). 

‘‘(e) CONSULTATION.—In carrying out the duties described in 

subsection (b), the renewable energy committee shall consult with 

the Biomass Research and Development Technical Advisory Committee established under section 9008(d) of the Biomass Research 

and Development Act of 2000 (7 U.S.C. 8605). 

‘‘(f) MATTERS TO BE CONSIDERED IN BUDGET RECOMMENDATION.—In preparing the annual budget recommendations for the Department, the Secretary shall take into consideration those findings 

and recommendations contained in the most recent report of the reVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00335 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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newable energy committee under subsection (d) that are developed 

by the Advisory Committee. ‘‘(g) REPORT BY THE SECRETARY.—In the budget material submitted to Congress by the Secretary in connection with the budget 

submitted pursuant to section 1105 of title 31, United States Code, 

for a fiscal year, the Secretary shall include a report that describes 

the ways in which the Secretary addressed each recommendation of 

the renewable energy committee described in subsection (f).’’. 

SEC. 7105. VETERINARY MEDICINE LOAN REPAYMENT. 

(a) IN GENERAL.—Section 1415A of the National Agricultural 

Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

3151a) is amended— (1) by striking subsection (b) and inserting the following: ‘‘(b) DETERMINATION OF VETERINARIAN SHORTAGE SITUA- TIONS.—In determining ‘veterinarian shortage situations’, the Secretary may consider— ‘‘(1) geographical areas that the Secretary determines have 

a shortage of veterinarians; and ‘‘(2) areas of veterinary practice that the Secretary determines have a shortage of veterinarians, such as food animal 

medicine, public health, epidemiology, and food safety.’’; 

(2) in subsection (c), by adding at the end the following: 

‘‘(8) PRIORITY.—In administering the program, the Secretary shall give priority to agreements with veterinarians for 

the practice of food animal medicine in veterinarian shortage 

situations.’’; 

(3) by redesignating subsection (d) as subsection (f); and 

(4) by inserting after subsection (c) the following: ‘‘(d) USE OF FUNDS.—None of the funds appropriated to the 

Secretary under subsection (f) may be used to carry out section 5379 

of title 5, United States Code. ‘‘(e) REGULATIONS.—Notwithstanding subchapter II of chapter 5 

of title 5, United States Code, not later than 270 days after the date 

of enactment of this subsection, the Secretary shall promulgate regulations to carry out this section.’’. (b) DISAPPROVAL OF TRANSFER OF FUNDS.—Congress disapproves the transfer of funds from the Cooperative State Research, 

Education, and Extension Service to the Food Safety and Inspection 

Service described in the notice of use of funds for implementation 

of the veterinary medicine loan repayment program authorized by 

the National Veterinary Medical Service Act (72 Fed. Reg. 48609 

(August 24, 2007)), and such funds shall be rescinded on the date 

of enactment of this Act and made available to the Secretary, without further appropriation or fiscal year limitation, for use only in 

accordance with section 1415A of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3151a) 

(as amended by subsection (a)). 

SEC. 7106. ELIGIBILITY OF UNIVERSITY OF THE DISTRICT OF COLUMBIA FOR GRANTS AND FELLOWSHIPS FOR FOOD AND AGRICULTURAL SCIENCES EDUCATION. 

Section 1417 of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3152) is amended— (1) in the matter preceding paragraph (1) of subsection (b), 

by inserting ‘‘(including the University of the District of Columbia)’’ after ‘‘land-grant colleges and universities’’; and 


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(2) in subsection (d)(2), by inserting ‘‘(including the University of the District of Columbia)’’ after ‘‘universities’’. 

SEC. 7107. GRANTS TO 1890 SCHOOLS TO EXPAND EXTENSION CAPACITY. 

Section 1417(b)(4) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3152(b)(4)) is 

amended by striking ‘‘teaching and research’’ and inserting ‘‘teaching, research, and extension’’. 

SEC. 7108. EXPANSION OF FOOD AND AGRICULTURAL SCIENCES 

AWARDS. 

Section 1417(i) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3152(i)) is amended—

(1) in the subsection heading, by striking ‘‘Teaching 

Awards’’ and inserting ‘‘Teaching, Extension, and Research 

Awards’’; and 

(2) by striking paragraph (1) and inserting the following: 

‘‘(1) ESTABLISHMENT.—

‘‘(A) IN GENERAL.—The Secretary shall establish a National Food and Agricultural Sciences Teaching, Extension, 

and Research Awards program to recognize and promote 

excellence in teaching, extension, and research in the food 

and agricultural sciences at a college or university. 

‘‘(B) MINIMUM REQUIREMENT.—The Secretary shall 

make at least 1 cash award in each fiscal year to a nominee 

selected by the Secretary for excellence in each of the areas 

of teaching, extension, and research of food and agricultural science at a college or university.’’. 

SEC. 7109. GRANTS AND FELLOWSHIPS FOR FOOD AND AGRICULTURAL 

SCIENCES EDUCATION. 

(a) EDUCATION TEACHING PROGRAMS.—Section 1417(j) of the 

National Agricultural Research, Extension, and Teaching Policy Act 

of 1977 (7 U.S.C. 3152(j)) is amended—

(1) in the subsection heading, by striking ‘‘SECONDARY EDUCATION AND 2-YEAR POSTSECONDARY EDUCATION TEACHING

PROGRAMS’’ and inserting ‘‘SECONDARY EDUCATION, 2-YEAR

POSTSECONDARY EDUCATION, AND AGRICULTURE IN THE K–12 

CLASSROOM’’; and 

(2) in paragraph (3)—

(A) by striking ‘‘secondary schools, and institutions of 

higher education that award an associate’s degree’’ and inserting ‘‘secondary schools, institutions of higher education 

that award an associate’s degree, other institutions of higher education, and nonprofit organizations’’; 

(B) in subparagraph (E), by striking ‘‘and’’ at the end; 

(C) in subparagraph (F), by striking the period at the 

end and inserting ‘‘; and’’; and 

(D) by adding at the end the following: 

‘‘(G) to support current agriculture in the classroom 

programs for grades K–12.’’. 

(b) REPORT.—Section 1417 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3152) 

is amended—

(1) by redesignating subsection (l) as subsection (m); and 


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(2) by inserting after subsection (k) the following: 

‘‘(l) REPORT.—The Secretary shall submit to the Committee on 

Agriculture of the House of Representatives and the Committee on 

Agriculture, Nutrition, and Forestry of the Senate a biennial report 

detailing the distribution of funds used to implement the teaching 

programs under subsection (j).’’. 

(c) AUTHORIZATION OF APPROPRIATIONS.—Section 1417(m) of 

the National Agricultural Research, Extension, and Teaching Policy 

Act of 1977 (as redesignated by subsection (b)(1)) is amended by 

striking ‘‘2007’’ and inserting ‘‘2012’’. 

(d) EFFECTIVE DATE.—The amendments made by subsection (a) 

take effect on October 1, 2008. 

SEC. 7110. GRANTS FOR RESEARCH ON PRODUCTION AND MARKETING 

OF ALCOHOLS AND INDUSTRIAL HYDROCARBONS FROM 

AGRICULTURAL COMMODITIES AND FOREST PRODUCTS. 

(a) IN GENERAL.—Section 1419 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3154) 

is repealed. 

(b) CONFORMING AMENDMENT.—Section 1463(a) of the National 

Agricultural Research, Extension, and Teaching Policy Act of 1977 

(7 U.S.C. 3311(a)) is amended by striking ‘‘1419,’’. 

SEC. 7111. POLICY RESEARCH CENTERS. 

Section 1419A of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3155) is amended—

(1) in subsection (a)(1), by inserting ‘‘(including commodities, livestock, dairy, and specialty crops)’’ after ‘‘agricultural 

sectors’’; 

(2) in subsection (b), by inserting ‘‘(including the Food Agricultural Policy Research Institute, the Agricultural and Food 

Policy Center, the Rural Policy Research Institute, and the National Drought Mitigation Center)’’ after ‘‘research institutions 

and organizations’’; and 

(3) in subsection (d), by striking ‘‘2007’’ and inserting 

‘‘2012’’. 

SEC. 7112. EDUCATION GRANTS TO ALASKA NATIVE-SERVING INSTITUTIONS AND NATIVE HAWAIIAN-SERVING INSTITUTIONS. 

Section 759 of the Agriculture, Rural Development, Food and 

Drug Administration, and Related Agencies Appropriations Act, 

2000 (7 U.S.C. 3242)—

(1) is amended—

(A) in subsection (a)(3), by striking ‘‘2006’’ and inserting ‘‘2012’’; and 

(B) in subsection (b)—

(i) in paragraph (2)(A), by inserting before the 

semicolon at the end the following: ‘‘, including permitting consortia to designate fiscal agents for the members of the consortia and to allocate among the members funds made available under this section’’; and 

(ii) in paragraph (3), by striking ‘‘2006’’ and inserting ‘‘2012’’; 

(2) is redesignated as section 1419B of the National Agricultural Research, Extension, and Teaching Policy Act of 1977; 

and 


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(3) is moved so as to appear after section 1419A of that Act 

(7 U.S.C. 3155). 

SEC. 7113. EMPHASIS OF HUMAN NUTRITION INITIATIVE. 

Section 1424(b) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3174(b)) is amended—

(1) in paragraph (1), by striking ‘‘and,’’; 

(2) in paragraph (2), by striking the comma at the end and 

inserting ‘‘; and’’; and 

(3) by adding at the end the following: 

‘‘(3) proposals that examine the efficacy of current agriculture policies in promoting the health and welfare of economically disadvantaged populations;’’. 

SEC. 7114. HUMAN NUTRITION INTERVENTION AND HEALTH PROMOTION RESEARCH PROGRAM. 

Section 1424(d) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3174(d)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7115. PILOT RESEARCH PROGRAM TO COMBINE MEDICAL AND AGRICULTURAL RESEARCH. 

Section 1424A(d) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3174a(d)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7116. NUTRITION EDUCATION PROGRAM. 

(a) IN GENERAL.—Section 1425 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3175) 

is amended—

(1) by redesignating subsections (a) through (c) as subsections (b) through (d), respectively; 

(2) by striking the section heading and designation and inserting the following: 

‘‘SEC. 1425. NUTRITION EDUCATION PROGRAM. 

‘‘(a) DEFINITION OF 1862 INSTITUTION AND 1890 INSTITUTION.—

In this section, the terms ‘1862 Institution’ and ‘1890 Institution’

have the meaning given those terms in section 2 of the Agricultural 

Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 

7601).’’; 

(3) in subsection (b) (as redesignated by paragraph (1)), by 

striking ‘‘(b) The Secretary’’ and inserting the following: 

‘‘(b) ESTABLISHMENT.—The Secretary’’; 

(4) in subsection (c) (as so redesignated), by striking ‘‘(c) In 

order to enable’’ and inserting the following: 

‘‘(c) EMPLOYMENT AND TRAINING.—To enable’’; 

(5) in subsection (d) (as redesignated by paragraph (1))—

(A) by striking ‘‘(d) Beginning’’ and inserting the following: 

‘‘(d) ALLOCATION OF FUNDING.—Beginning’’; 

(B) in paragraph (2), by striking subparagraph (B) and 

inserting the following: 

‘‘(B) Notwithstanding section 3(d) of the Act of May 8, 

1914 (7 U.S.C. 343(d)), the remainder shall be allocated 

among the States as follows: 


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‘‘(i) $100,000 shall be distributed to each 1862 Institution and 1890 Institution. ‘‘(ii) Subject to clause (iii), the remainder shall be 

allocated to each State in an amount that bears the 

same ratio to the total amount to be allocated under 

this clause as— ‘‘(I) the population living at or below 125 percent of the income poverty guidelines (as prescribed 

by the Office of Management and Budget and as 

adjusted pursuant to section 673(2) of the Community Services Block Grant Act (42 U.S.C. 9902(2))) 

in the State; bears to ‘‘(II) the total population living at or below 

125 percent of those income poverty guidelines in 

all States; 

as determined by the most recent decennial census at 

the time at which each such additional amount is first 

appropriated. ‘‘(iii)(I) Before any allocation of funds under clause 

(ii), for any fiscal year for which the amount of funds 

appropriated for the conduct of the expanded food and 

nutrition education program exceeds the amount of 

funds appropriated for the program for fiscal year 

2007, the following percentage of such excess funds for 

the fiscal year shall be allocated to the 1890 Institutions in accordance with subclause (II): ‘‘(aa) 10 percent for fiscal year 2009. 

‘‘(bb) 11 percent for fiscal year 2010. 

‘‘(cc) 12 percent for fiscal year 2011. 

‘‘(dd) 13 percent for fiscal year 2012. 

‘‘(ee) 14 percent for fiscal year 2013. 

‘‘(ff) 15 percent for fiscal year 2014 and for 

each fiscal year thereafter. 

‘‘(II) Funds made available under subclause (I) 

shall be allocated to each 1890 Institution in an 

amount that bears the same ratio to the total amount 

to be allocated under this clause as—

‘‘(aa) the population living at or below 125 

percent of the income poverty guidelines (as prescribed by the Office of Management and Budget 

and as adjusted pursuant to section 673(2) of the 

Community Services Block Grant Act (42 U.S.C. 

9902(2))) in the State in which the 1890 Institution 

is located; bears to 

‘‘(bb) the total population living at or below 

125 percent of those income poverty guidelines in 

all States in which 1890 Institutions are located; 

as determined by the most recent decennial census at 

the time at which each such additional amount is first 

appropriated. 

‘‘(iv) Nothing in this subparagraph precludes the 

Secretary from developing educational materials and 

programs for persons in income ranges above the level 

designated in this subparagraph.’’; and 

(C) by striking paragraph (3); and 


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(6) by adding at the end the following: 

‘‘(e) COMPLEMENTARY ADMINISTRATION.—The Secretary shall 

ensure the complementary administration of the expanded food and 

nutrition education program by 1862 Institutions and 1890 Institutions in a State. 

‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out the expanded food and nutrition 

education program established under section 3(d) of the Act of May 

8, 1914 (7 U.S.C. 343(d)), and this section $90,000,000 for each of 

fiscal years 2009 through 2012.’’. 

(b) CONFORMING AMENDMENT.—Section 1588(b) of the Food Security Act of 1985 (7 U.S.C. 3175e(b)) is amended by striking ‘‘section 1425(c)(2)’’ and inserting ‘‘section 1425(d)(2)’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

take effect on October 1, 2008. 

SEC. 7117. CONTINUING ANIMAL HEALTH AND DISEASE RESEARCH 

PROGRAMS. 

Section 1433(a) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3195(a)) is amended in the first sentence by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7118. COOPERATION AMONG ELIGIBLE INSTITUTIONS. 

Section 1433 of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3195) is amended by 

adding at the end the following: 

‘‘(g) COOPERATION AMONG ELIGIBLE INSTITUTIONS.—The Secretary, to the maximum extent practicable, shall encourage eligible 

institutions to cooperate in setting research priorities under this section through the conduct of regular regional and national meetings.’’. 

SEC. 7119. APPROPRIATIONS FOR RESEARCH ON NATIONAL OR REGIONAL PROBLEMS. 

Section 1434(a) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3196(a)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7120. ANIMAL HEALTH AND DISEASE RESEARCH PROGRAM. 

Section 1434(b) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3196(b)) is amended by inserting after ‘‘universities’’ the following: ‘‘(including 1890 

Institutions (as defined in section 2 of the Agricultural Research, 

Extension, and Education Reform Act of 1998 (7 U.S.C. 7601)))’’. 

SEC. 7121. AUTHORIZATION LEVEL FOR EXTENSION AT 1890 LANDGRANT COLLEGES. 

Section 1444(a)(2) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3221(a)(2)) is 

amended by striking ‘‘15 percent’’ and inserting ‘‘20 percent’’. 

SEC. 7122. AUTHORIZATION LEVEL FOR AGRICULTURAL RESEARCH AT 

1890 LAND-GRANT COLLEGES. 

Section 1445(a)(2) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3222(a)(2)) is 

amended by striking ‘‘25 percent’’ and inserting ‘‘30 percent’’. 


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SEC. 7123. GRANTS TO UPGRADE AGRICULTURAL AND FOOD SCIENCES 

FACILITIES AT 1890 LAND-GRANT COLLEGES, INCLUDING 

TUSKEGEE UNIVERSITY. 

Section 1447(b) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3222b(b)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7124. GRANTS TO UPGRADE AGRICULTURE AND FOOD SCIENCES 

FACILITIES AT THE DISTRICT OF COLUMBIA LAND-GRANT 

UNIVERSITY. 

The National Agricultural Research, Extension, and Teaching 

Policy Act of 1977 is amended by inserting after section 1447 (7 

U.S.C. 3222b) the following: 

‘‘SEC. 1447A. GRANTS TO UPGRADE AGRICULTURE AND FOOD 

SCIENCES FACILITIES AT THE DISTRICT OF COLUMBIA 

LAND-GRANT UNIVERSITY. 

‘‘(a) PURPOSE.—It is the intent of Congress to assist the landgrant university in the District of Columbia established under section 208 of the District of Columbia Public Postsecondary Education 

Reorganization Act (Public Law 93–471; 88 Stat. 1428) in efforts to 

acquire, alter, or repair facilities or relevant equipment necessary 

for conducting agricultural research. 

‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section $750,000 for each of fiscal years 2008 through 2012.’’. 

SEC. 7125. GRANTS TO UPGRADE AGRICULTURE AND FOOD SCIENCES 

FACILITIES AND EQUIPMENT AT INSULAR AREA LANDGRANT INSTITUTIONS. 

The National Agricultural Research, Extension, and Teaching 

Policy Act of 1977 (7 U.S.C. 3101 et seq.) is amended by inserting 

after section 1447A (as added by section 7124) the following: 

‘‘SEC. 1447B. GRANTS TO UPGRADE AGRICULTURE AND FOOD 

SCIENCES FACILITIES AND EQUIPMENT AT INSULAR AREA 

LAND-GRANT INSTITUTIONS. 

‘‘(a) PURPOSE.—It is the intent of Congress to assist the landgrant institutions in the insular areas in efforts to acquire, alter, or 

repair facilities or relevant equipment necessary for conducting agricultural research. 

‘‘(b) METHOD OF AWARDING GRANTS.—Grants awarded pursuant to this section shall be made in such amounts and under such 

terms and conditions as the Secretary determines necessary to carry 

out the purposes of this section. 

‘‘(c) REGULATIONS.—The Secretary may promulgate such rules 

and regulations as the Secretary considers to be necessary to carry 

out this section. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $8,000,000 for each of 

fiscal years 2008 through 2012.’’. 

SEC. 7126. NATIONAL RESEARCH AND TRAINING VIRTUAL CENTERS. 

Section 1448 of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3222c) is amended by 

striking ‘‘2007’’ each place it appears in subsections (a)(1) and (f) 

and inserting ‘‘2012’’. 


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SEC. 7127. MATCHING FUNDS REQUIREMENT FOR RESEARCH AND EXTENSION ACTIVITIES OF 1890 INSTITUTIONS. 

Section 1449(c) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3222d(c)) is amended— (1) in the first sentence— (A) by striking ‘‘for each of fiscal years 2003 through 

2007,’’; and 

(B) by inserting ‘‘equal’’ before ‘‘matching’’; and 

(2) by striking the second sentence and all that follows 

through paragraph (5). 

SEC. 7128. HISPANIC-SERVING INSTITUTIONS. 

Section 1455 of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3241) is amended— (1) in subsection (a) by striking ‘‘(or grants without regard 

to any requirement for competition)’’; 

(2) in subsection (b)(1), by striking ‘‘of consortia’’; and 

(3) in subsection (c)— (A) by striking ‘‘$20,000,000’’ and inserting ‘‘$40,000,000’’; and 

(B) by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7129. HISPANIC-SERVING AGRICULTURAL COLLEGES AND UNIVERSITIES. 

(a) IN GENERAL.—The National Agricultural Research, Extension, and Teaching Policy Act of 1977 is amended by inserting after 

section 1455 (7 U.S.C. 3241) the following: 

‘‘SEC. 1456. HISPANIC-SERVING AGRICULTURAL COLLEGES AND UNIVERSITIES. 

‘‘(a) DEFINITION OF ENDOWMENT FUND.—In this section, the 

term ‘endowment fund’ means the Hispanic-Serving Agricultural 

Colleges and Universities Fund established under subsection (b). ‘‘(b) ENDOWMENT.— ‘‘(1) IN GENERAL.—The Secretary of the Treasury shall establish in accordance with this subsection a Hispanic-Serving 

Agricultural Colleges and Universities Fund. ‘‘(2) AGREEMENTS.—The Secretary of the Treasury may 

enter into such agreements as are necessary to carry out this 

subsection. ‘‘(3) DEPOSIT TO THE ENDOWMENT FUND.—The Secretary of 

the Treasury shall deposit in the endowment fund any— ‘‘(A) amounts made available through Acts of appropriations, which shall be the endowment fund corpus; and ‘‘(B) interest earned on the endowment fund corpus. ‘‘(4) INVESTMENTS.—The Secretary of the Treasury shall invest the endowment fund corpus and income in interest-bearing 

obligations of the United States. ‘‘(5) WITHDRAWALS AND EXPENDITURES.— ‘‘(A) CORPUS.—The Secretary of the Treasury may not 

make a withdrawal or expenditure from the endowment 

fund corpus. ‘‘(B) WITHDRAWALS.—On September 30, 2008, and each 

September 30 thereafter, the Secretary of the Treasury shall 

withdraw the amount of the income from the endowment 

fund for the fiscal year and warrant the funds to the Secretary of Agriculture who, after making adjustments for the 


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cost of administering the endowment fund, shall distribute 

the adjusted income as follows: ‘‘(i) 60 percent shall be distributed among the Hispanic-serving agricultural colleges and universities on 

a pro rata basis based on the Hispanic enrollment 

count of each institution. ‘‘(ii) 40 percent shall be distributed in equal shares 

to the Hispanic-serving agricultural colleges and universities. ‘‘(6) ENDOWMENTS.—Amounts made available under this 

subsection shall be held and considered to be granted to Hispanic-serving agricultural colleges and universities to establish 

an endowment in accordance with this subsection. ‘‘(7) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to the Secretary such sums as are 

necessary to carry out this subsection for fiscal year 2008 and 

each fiscal year thereafter. 

‘‘(c) AUTHORIZATION FOR ANNUAL PAYMENTS.— ‘‘(1) IN GENERAL.—For fiscal year 2008 and each fiscal year 

thereafter, there are authorized to be appropriated to the Department of Agriculture to carry out this subsection an amount 

equal to the product obtained by multiplying—

‘‘(A) $80,000; by 

‘‘(B) the number of Hispanic-serving agricultural colleges and universities. 

‘‘(2) PAYMENTS.—For fiscal year 2008 and each fiscal year 

thereafter, the Secretary of the Treasury shall pay to the treasurer of each Hispanic-serving agricultural college and university an amount equal to— ‘‘(A) the total amount made available by appropriations 

under paragraph (1); divided by ‘‘(B) the number of Hispanic-serving agricultural colleges and universities. 

‘‘(3) USE OF FUNDS.—

‘‘(A) IN GENERAL.—Amounts authorized to be appropriated under this subsection shall be used in the same 

manner as is prescribed for colleges under the Act of August 30, 1890 (commonly known as the ‘Second Morrill 

Act’) (7 U.S.C. 321 et seq.). 

‘‘(B) RELATIONSHIP TO OTHER LAW.—Except as otherwise provided in this subsection, the requirements of that 

Act shall apply to Hispanic-serving agricultural colleges 

and universities under this section. 

‘‘(d) INSTITUTIONAL CAPACITY-BUILDING GRANTS.—

‘‘(1) IN GENERAL.—For fiscal year 2008 and each fiscal year 

thereafter, the Secretary shall make grants to assist Hispanicserving agricultural colleges and universities in institutional 

capacity building (not including alteration, repair, renovation, 

or construction of buildings). ‘‘(2) CRITERIA FOR INSTITUTIONAL CAPACITY-BUILDING

GRANTS.—

‘‘(A) REQUIREMENTS FOR GRANTS.—The Secretary shall 

make grants under this subsection on the basis of a competitive application process under which Hispanic-serving 

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tions to the Secretary at such time, in such manner, and 

containing such information as the Secretary may require. 

‘‘(B) DEMONSTRATION OF NEED.—

‘‘(i) IN GENERAL.—As part of an application for a 

grant under this subsection, the Secretary shall require 

the applicant to demonstrate need for the grant, as determined by the Secretary. 

‘‘(ii) OTHER SOURCES OF FUNDING.—The Secretary 

may award a grant under this subsection only to an 

applicant that demonstrates a failure to obtain funding 

for a project after making a reasonable effort to otherwise obtain the funding. 

‘‘(C) PAYMENT OF NON-FEDERAL SHARE.—A grant 

awarded under this subsection shall be made only if the recipient of the grant pays a non-Federal share in an amount 

that is specified by the Secretary and based on assessed institutional needs. 

‘‘(3) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to the Secretary such sums as are 

necessary to carry out this subsection for fiscal year 2008 and 

each fiscal year thereafter. 

‘‘(e) COMPETITIVE GRANTS PROGRAM.—

‘‘(1) IN GENERAL.—The Secretary shall establish a competitive grants program to fund fundamental and applied research 

at Hispanic-serving agricultural colleges and universities in agriculture, human nutrition, food science, bioenergy, and environmental science. 

‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to the Secretary such sums as are 

necessary to carry out this subsection for fiscal year 2008 and 

each fiscal year thereafter.’’. 

(b) EXTENSION.—Section 3 of the Smith-Lever Act (7 U.S.C. 

343) is amended—

(1) in subsection (b), by adding at the end the following: 

‘‘(4) ANNUAL APPROPRIATION FOR HISPANIC-SERVING AGRICULTURAL COLLEGES AND UNIVERSITIES.—

‘‘(A) AUTHORIZATION OF APPROPRIATIONS.—There are 

authorized to be appropriated to the Secretary for payments 

to Hispanic-serving agricultural colleges and universities 

(as defined in section 1404 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 

U.S.C. 3103)) such sums as are necessary to carry out this 

paragraph for fiscal year 2008 and each fiscal year thereafter, to remain available until expended. 

‘‘(B) ADDITIONAL AMOUNT.—Amounts made available 

under this paragraph shall be in addition to any other 

amounts made available under this section to States, the 

Commonwealth of Puerto Rico, Guam, or the United States 

Virgin Islands. 

‘‘(C) ADMINISTRATION.—Amounts made available under 

this paragraph shall be—

‘‘(i) distributed on the basis of a competitive application process to be developed and implemented by the 

Secretary; 


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‘‘(ii) paid by the Secretary to the State institutions 

established in accordance with the Act of July 2, 1862 

(commonly known as the ‘First Morrill Act’) (7 U.S.C. 

301 et seq.); and 

‘‘(iii) administered by State institutions through 

cooperative agreements with the Hispanic-serving agricultural colleges and universities in the State in accordance with regulations promulgated by the Secretary.’’; and 

(2) in subsection (f)—

(A) in the subsection heading, by inserting ‘‘AND HISPANIC-SERVING AGRICULTURAL COLLEGES AND UNIVERSITIES’’ after ‘‘1994 INSTITUTIONS’’; and 

(B) by striking ‘‘pursuant to subsection (b)(3)’’ and inserting ‘‘or Hispanic-serving agricultural colleges and universities in accordance with paragraphs (3) and (4) of subsection (b)’’. 

(c) CONFORMING AMENDMENTS.—

(1) Section 2 of the Agricultural Research, Extension, and 

Education Reform Act of 1998 (7 U.S.C. 7601) is amended—

(A) by redesignating paragraph (6) as paragraph (7); 

and 

(B) by inserting after paragraph (5) the following: 

‘‘(6) HISPANIC-SERVING AGRICULTURAL COLLEGES AND UNIVERSITIES.—The term ‘Hispanic-serving agricultural colleges 

and universities’ has the meaning given the term in section 

1404 of the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3103).’’. 

(2) Section 102(c) of the Agricultural Research, Extension, 

and Education Reform Act of 1998 (7 U.S.C. 7612(c)) is amended—

(A) in the subsection heading, by inserting ‘‘AND HISPANIC-SERVING AGRICULTURAL COLLEGES AND UNIVERSITIES’’ after ‘‘INSTITUTIONS’’; and 

(B) in paragraph (1), by striking ‘‘and 1994 Institution’’

and inserting ‘‘1994 Institution, and Hispanic-serving agricultural college and university’’. 

(3) Section 103(e) of the Agricultural Research, Extension, 

and Education Reform Act of 1998 (7 U.S.C. 7613(e)) is amended by adding at the end the following: 

‘‘(3) HISPANIC-SERVING AGRICULTURAL COLLEGES AND UNIVERSITIES.—To be eligible to obtain agricultural extension 

funds from the Secretary for an activity, each Hispanic-serving 

agricultural college and university shall—

‘‘(A) establish a process for merit review of the activity; 

and 

‘‘(B) review the activity in accordance with such process.’’. 

(4) Section 406(b) of the Agricultural Research, Extension, 

and Education Reform Act of 1998 (7 U.S.C. 7626(b)) is amended by striking ‘‘and 1994 Institutions’’ and inserting ‘‘, 1994 Institutions, and Hispanic-serving agricultural colleges and universities’’. 


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SEC. 7130. INTERNATIONAL AGRICULTURAL RESEARCH, EXTENSION, 

AND EDUCATION. 

Section 1458(a) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3291(a)) is amended—

(1) in paragraph (1)—

(A) in subparagraph (A), by striking ‘‘and’’ after the 

semicolon; 

(B) in subparagraph (B), by adding ‘‘and’’ at the end; 

and 

(C) by adding at the end the following: 

‘‘(C) giving priority to those institutions with existing 

memoranda of understanding, agreements, or other formal 

ties to United States institutions, or Federal or State agencies;’’; 

(2) by striking paragraph (3) and inserting the following: 

‘‘(3) enter into agreements with land-grant colleges and universities, Hispanic-serving agricultural colleges and universities, the Agency for International Development, and international organizations (such as the United Nations, the World 

Bank, regional development banks, international agricultural 

research centers), or other organizations, institutions, or individuals with comparable goals, to promote and support—

‘‘(A) the development of a viable and sustainable global 

agricultural system; 

‘‘(B) antihunger and improved international nutrition 

efforts; and 

‘‘(C) increased quantity, quality, and availability of 

food;’’; 

(3) in paragraph (7)(A), by striking ‘‘and land-grant colleges and universities’’ and inserting ‘‘, land-grant colleges and 

universities, and Hispanic-serving agricultural colleges and 

universities’’; 

(4) in paragraph (9)—

(A) in subparagraph (A), by striking ‘‘or other colleges 

and universities’’ and inserting ‘‘, Hispanic-serving agricultural colleges and universities, or other colleges and universities’’; and 

(B) in subparagraph (D), by striking ‘‘and’’ at the end; 

(5) in paragraph (10), by striking the period at the end and 

inserting ‘‘; and’’; and 

(6) by adding at the end the following: 

‘‘(11) establish a program for the purpose of providing fellowships to United States or foreign students to study at foreign 

agricultural colleges and universities working under agreements provided for under paragraph (3).’’. 

SEC. 7131. COMPETITIVE GRANTS FOR INTERNATIONAL AGRICULTURAL SCIENCE AND EDUCATION PROGRAMS. 

Section 1459A(c) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3292b(c)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7132. ADMINISTRATION. 

(a) LIMITATION ON INDIRECT COSTS FOR AGRICULTURAL RESEARCH, EDUCATION, AND EXTENSION PROGRAMS.—Section 1462(a) 


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of the National Agriculture Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3310(a)) is amended—

(1) by striking ‘‘a competitive’’ and inserting ‘‘any’’; and 

(2) by striking ‘‘19 percent’’ and inserting ‘‘22 percent’’. 

(b) AUDITING, REPORTING, BOOKKEEPING, AND ADMINISTRATIVE

REQUIREMENTS.—Section 1469(a)(3) of the National Agricultural 

Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

3315(a)(3)) is amended by striking ‘‘appropriated’’ and inserting 

‘‘made available’’. 

SEC. 7133. RESEARCH EQUIPMENT GRANTS. 

Section 1462A(e) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3310a(e)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7134. UNIVERSITY RESEARCH. 

Section 1463 of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3311) is amended by 

striking ‘‘2007’’ each place it appears in subsections (a) and (b) and 

inserting ‘‘2012’’. 

SEC. 7135. EXTENSION SERVICE. 

Section 1464 of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3312) is amended by 

striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7136. SUPPLEMENTAL AND ALTERNATIVE CROPS. 

Section 1473D(a) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3319d(a)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7137. NEW ERA RURAL TECHNOLOGY PROGRAM. 

Subtitle K of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3310 et seq.) is amended 

by adding at the end the following: 

‘‘SEC. 1473E. NEW ERA RURAL TECHNOLOGY PROGRAM. 

‘‘(a) DEFINITION OF COMMUNITY COLLEGE.—In this section, the 

term ‘community college’ means an institution of higher education 

(as defined in section 101 of the Higher Education Act of 1965 (20 

U.S.C. 1001))—

‘‘(1) that admits as regular students individuals who—

‘‘(A) are beyond the age of compulsory school attendance in the State in which the institution is located; and 

‘‘(B) have the ability to benefit from the training offered 

by the institution; 

‘‘(2) that does not provide an educational program for 

which the institution awards a bachelor’s degree or an equivalent degree; and 

‘‘(3) that—

‘‘(A) provides an educational program of not less than 

2 years that is acceptable for full credit toward such a degree; or 

‘‘(B) offers a 2-year program in engineering, technology, 

mathematics, or the physical, chemical, or biological 

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standing and application of basic engineering, scientific, or 

mathematical principles of knowledge. 

‘‘(b) FUNCTIONS.—

‘‘(1) ESTABLISHMENT.—

‘‘(A) IN GENERAL.—The Secretary shall establish a program to be known as the ‘New Era Rural Technology Program’, to make grants available for technology development, applied research, and training to aid in the development of an agriculture-based renewable energy workforce. 

‘‘(B) SUPPORT.—The initiative under this section shall 

support the fields of—

‘‘(i) bioenergy; 

‘‘(ii) pulp and paper manufacturing; and 

‘‘(iii) agriculture-based renewable energy resources. 

‘‘(2) REQUIREMENTS FOR FUNDING.—To receive funding 

under this section, an entity shall—

‘‘(A) be a community college or advanced technological 

center, located in a rural area and in existence on the date 

of the enactment of this section, that participates in agricultural or bioenergy research and applied research; 

‘‘(B) have a proven record of development and implementation of programs to meet the needs of students, educators, and business and industry to supply the agriculture-based, renewable energy or pulp and paper manufacturing fields with certified technicians, as determined by 

the Secretary; and 

‘‘(C) have the ability to leverage existing partnerships 

and occupational outreach and training programs for secondary schools, 4-year institutions, and relevant nonprofit 

organizations. 

‘‘(c) GRANT PRIORITY.—In providing grants under this section, 

the Secretary shall give preference to eligible entities working in 

partnership—

‘‘(1) to improve information-sharing capacity; and 

‘‘(2) to maximize the ability to meet the requirements of this 

section. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this section such sums as are 

necessary for each of fiscal years 2008 through 2012.’’. 

SEC. 7138. CAPACITY BUILDING GRANTS FOR NLGCA INSTITUTIONS. 

Subtitle K of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3310 et seq.) (as amended by section 7137) is amended by adding at the end the following: 

‘‘SEC. 1473F. CAPACITY BUILDING GRANTS FOR NLGCA INSTITUTIONS. 

‘‘(a) GRANT PROGRAM.—

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

grants to NLGCA Institutions to assist the NLGCA Institutions 

in maintaining and expanding the capacity of the NLGCA Institutions to conduct education, research, and outreach activities relating to—

‘‘(A) agriculture; 

‘‘(B) renewable resources; and 

‘‘(C) other similar disciplines. 


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‘‘(2) USE OF FUNDS.—An NLGCA Institution that receives a 

grant under paragraph (1) may use the funds made available 

through the grant to maintain and expand the capacity of the 

NLGCA Institution—

‘‘(A) to successfully compete for funds from Federal 

grants and other sources to carry out educational, research, 

and outreach activities that address priority concerns of national, regional, State, and local interest; 

‘‘(B) to disseminate information relating to priority concerns to—

‘‘(i) interested members of the agriculture, renewable resources, and other relevant communities; 

‘‘(ii) the public; and 

‘‘(iii) any other interested entity; 

‘‘(C) to encourage members of the agriculture, renewable resources, and other relevant communities to participate in priority education, research, and outreach activities 

by providing matching funding to leverage grant funds; 

and 

‘‘(D) through—

‘‘(i) the purchase or other acquisition of equipment 

and other infrastructure (not including alteration, repair, renovation, or construction of buildings); 

‘‘(ii) the professional growth and development of 

the faculty of the NLGCA Institution; and 

‘‘(iii) the development of graduate assistantships. 

‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section such sums as are necessary for each of fiscal years 2008 through 2012.’’. 

SEC. 7139. BORLAUG INTERNATIONAL AGRICULTURAL SCIENCE AND 

TECHNOLOGY FELLOWSHIP PROGRAM. 

Subtitle K of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3310 et seq.) (as amended by section 7138) is amended by adding at the end the following: 

‘‘SEC. 1473G. BORLAUG INTERNATIONAL AGRICULTURAL SCIENCE AND 

TECHNOLOGY FELLOWSHIP PROGRAM. 

‘‘(a) FELLOWSHIP PROGRAM.—

‘‘(1) IN GENERAL.—The Secretary shall establish a fellowship program, to be known as the ‘Borlaug International Agricultural Science and Technology Fellowship Program,’ to provide fellowships for scientific training and study in the United 

States to individuals from eligible countries (as described in 

subsection (b)) who specialize in agricultural education, research, and extension. 

‘‘(2) PROGRAMS.—The Secretary shall carry out the fellowship program by implementing 3 programs designed to assist 

individual fellowship recipients, including—

‘‘(A) a graduate studies program in agriculture to assist individuals who participate in graduate agricultural 

degree training at a United States institution; 

‘‘(B) an individual career improvement program to assist agricultural scientists from developing countries in upgrading skills and understanding in agricultural science 

and technology; and 


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‘‘(C) a Borlaug agricultural policy executive leadership 

course to assist senior agricultural policy makers from eligible countries, with an initial focus on individuals from 

sub-Saharan Africa and the independent states of the 

former Soviet Union. ‘‘(b) ELIGIBLE COUNTRIES.—An eligible country is a developing 

country, as determined by the Secretary using a gross national income per capita test selected by the Secretary. ‘‘(c) PURPOSE OF FELLOWSHIPS.—A fellowship provided under 

this section shall— ‘‘(1) promote food security and economic growth in eligible 

countries by— ‘‘(A) educating a new generation of agricultural scientists; ‘‘(B) increasing scientific knowledge and collaborative 

research to improve agricultural productivity; and ‘‘(C) extending that knowledge to users and intermediaries in the marketplace; and 

‘‘(2) shall support— ‘‘(A) training and collaborative research opportunities 

through exchanges for entry level international agricultural 

research scientists, faculty, and policymakers from eligible 

countries; ‘‘(B) collaborative research to improve agricultural productivity; ‘‘(C) the transfer of new science and agricultural technologies to strengthen agricultural practice; and ‘‘(D) the reduction of barriers to technology adoption. ‘‘(d) FELLOWSHIP RECIPIENTS.—

‘‘(1) ELIGIBLE CANDIDATES.—The Secretary may provide fellowships under this section to individuals from eligible countries who specialize or have experience in agricultural education, research, extension, or related fields, including— ‘‘(A) individuals from the public and private sectors; 

and ‘‘(B) private agricultural producers. ‘‘(2) CANDIDATE IDENTIFICATION.—The Secretary shall use 

the expertise of United States land-grant colleges and universities and similar universities, international organizations 

working in agricultural research and outreach, and national 

agricultural research organizations to help identify program 

candidates for fellowships under this section from the public 

and private sectors of eligible countries. 

‘‘(e) USE OF FELLOWSHIPS.—A fellowship provided under this 

section shall be used—

‘‘(1) to promote collaborative programs among agricultural 

professionals of eligible countries, agricultural professionals of 

the United States, the international agricultural research system, and, as appropriate, United States entities conducting research; and ‘‘(2) to support fellowship recipients through programs described in subsection (a)(2). 

‘‘(f) PROGRAM IMPLEMENTATION.—The Secretary shall provide 

for the management, coordination, evaluation, and monitoring of 

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lowship Program and for the individual programs described in subsection (a)(2), except that the Secretary may contract out to 1 or 

more collaborating universities the management of 1 or more of the 

fellowship programs. ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this section, to remain available until expended.’’. 

SEC. 7140. AQUACULTURE ASSISTANCE PROGRAMS. 

Section 1477 of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3324) is amended by 

striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7141. RANGELAND RESEARCH GRANTS. 

Section 1483(a) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3336(a)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7142. SPECIAL AUTHORIZATION FOR BIOSECURITY PLANNING 

AND RESPONSE. 

Section 1484(a) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3351(a)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7143. RESIDENT INSTRUCTION AND DISTANCE EDUCATION 

GRANTS PROGRAM FOR INSULAR AREA INSTITUTIONS OF 

HIGHER EDUCATION. 

(a) DISTANCE EDUCATION GRANTS FOR INSULAR AREAS.—Section 1490(f) of the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3362(f)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. (b) RESIDENT INSTRUCTION GRANTS FOR INSULAR AREAS.—Section 1491 of the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3363) is amended— (1) by redesignating subsection (e) as subsection (c); and 

(2) in subsection (c) (as so redesignated), by striking ‘‘2007’’ and inserting ‘‘2012’’. 

Subtitle B—Food, Agriculture, Conservation, and Trade Act 

of 1990 

SEC. 7201. NATIONAL GENETICS RESOURCES PROGRAM. 

Section 1635(b) of the Food, Agriculture, Conservation, and 

Trade Act of 1990 (7 U.S.C. 5844(b)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7202. NATIONAL AGRICULTURAL WEATHER INFORMATION SYSTEM. 

Section 1641(c) of the Food, Agriculture, Conservation, and 

Trade Act of 1990 (7 U.S.C. 5855(c)) is amended by striking ‘‘1991 

through 1997’’ and inserting ‘‘2008 through 2012’’. 

SEC. 7203. PARTNERSHIPS. 

Section 1672(d) of the Food, Agriculture, Conservation, and 

Trade Act of 1990 (7 U.S.C. 5925(d)) is amended by striking ‘‘may’’ and inserting ‘‘shall’’. 

SEC. 7204. HIGH-PRIORITY RESEARCH AND EXTENSION AREAS. 

(a) IN GENERAL.—Section 1672 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5925) is amended—

(1) in subsection (e)—


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(A) in paragraph (3), by striking ‘‘and controlling 

aflatoxin in the food and feed chains.’’ and inserting ‘‘, improving, and eventually commercializing, alfatoxin controls 

in corn and other affected agricultural products and 

crops.’’; 

(B) by striking paragraphs (1), (4), (7), (8), (15), (17), 

(21), (23), (26), (27), (32), (34), (41), (42), (43), and (45); 

(C) by redesignating paragraphs (2), (3), (5), (6), (9) 

through (14), (16), (18) through (20), (22), (24), (25), (28) 

through (31), (33), (35) through (40), and (44) as paragraphs (1) through (29), respectively; and 

(D) by adding at the end the following: 

‘‘(30) AIR EMISSIONS FROM LIVESTOCK OPERATIONS.—Research and extension grants may be made under this section for 

the purpose of conducting field verification tests and developing 

mitigation options for air emissions from animal feeding operations. 

‘‘(31) SWINE GENOME PROJECT.—Research grants may be 

made under this section to conduct swine genome research, including the mapping of the swine genome. 

‘‘(32) CATTLE FEVER TICK PROGRAM.—Research and extension grants may be made under this section to study cattle fever 

ticks to facilitate understanding of the role of wildlife in the 

persistence and spread of cattle fever ticks, to develop advanced 

methods for eradication of cattle fever ticks, and to improve 

management of diseases relating to cattle fever ticks that are associated with wildlife, livestock, and human health. 

‘‘(33) SYNTHETIC GYPSUM.—Research and extension grants 

may be made under this section to study the uses of synthetic 

gypsum from electric power plants to remediate soil and nutrient losses. 

‘‘(34) CRANBERRY RESEARCH PROGRAM.—Research and extension grants may be made under this section to study new 

technologies to assist cranberry growers in complying with Federal and State environmental regulations, increase production, 

develop new growing techniques, establish more efficient growing methodologies, and educate cranberry producers about sustainable growth practices. 

‘‘(35) SORGHUM RESEARCH INITIATIVE.—Research and extension grants may be made under this section to study the use of 

sorghum as a bioenergy feedstock, promote diversification in, 

and the environmental benefits of sorghum production, and promote water conservation through the use of sorghum. 

‘‘(36) MARINE SHRIMP FARMING PROGRAM.—Research and 

extension grants may be made under this section to establish a 

research program to advance and maintain a domestic shrimp 

farming industry in the United States. 

‘‘(37) TURFGRASS RESEARCH INITIATIVE.—Research and extension grants may be made under this section to study the production of turfgrass (including the use of water, fertilizer, pesticides, fossil fuels, and machinery for turf establishment and 

maintenance) and environmental protection and enhancement 

relating to turfgrass production. 


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‘‘(38) AGRICULTURAL WORKER SAFETY RESEARCH INITIA- TIVE.—Research and extension grants may be made under this 

section—

‘‘(A) to study and demonstrate methods to minimize exposure of farm and ranch owners and operators, pesticide 

handlers, and agricultural workers to pesticides, including 

research addressing the unique concerns of farm workers 

resulting from long-term exposure to pesticides; and ‘‘(B) to develop rapid tests for on-farm use to better inform and educate farmers, ranchers, and farm and ranch 

workers regarding safe field re-entry intervals. 

‘‘(39) HIGH PLAINS AQUIFER REGION.—Research and extension grants may be made under this section to carry out interdisciplinary research relating to diminishing water levels and 

increased demand for water in the High Plains aquifer region. 

‘‘(40) DEER INITIATIVE.—Research and extension grants 

may be made under this section to support collaborative research focusing on the development of viable strategies for the 

prevention, diagnosis, and treatment of infectious, parasitic, 

and toxic diseases of farmed deer and the mapping of the deer 

genome. 

‘‘(41) PASTURE-BASED BEEF SYSTEMS RESEARCH INITIA- TIVE.—Research and extension grants may be made under this 

section to study the development of forage sequences and combinations for cow-calf, heifer development, stocker, and finishing systems, to deliver optimal nutritive value for efficient 

production of cattle for pasture finishing, to optimize forage systems to improve marketability of pasture-finished beef, and to 

assess the effect of forage quality on reproductive fitness. ‘‘(42) AGRICULTURAL PRACTICES RELATING TO CLIMATE

CHANGE.—Research and extension grants may be made under 

this section for field and laboratory studies that examine the 

ecosystem from gross to minute scales and for projects that explore the relationship of agricultural practices to climate 

change. 

‘‘(43) BRUCELLOSIS CONTROL AND ERADICATION.—Research 

and extension grants may be made under this section to conduct 

research relating to the development of vaccines and vaccine delivery systems to effectively control and eliminate brucellosis in 

wildlife, and to assist with the controlling of the spread of brucellosis from wildlife to domestic animals. ‘‘(44) BIGHORN AND DOMESTIC SHEEP DISEASE MECHANISMS.—Research and extension grants may be made under this 

section to conduct research relating to the health status of (including the presence of infectious diseases in) bighorn and domestic sheep under range conditions. 

‘‘(45) AGRICULTURAL DEVELOPMENT IN THE AMERICAN-PA- CIFIC REGION.—Research and extension grants may be made 

under this section to support food and agricultural science at 

a consortium of land-grant institutions in the American-Pacific 

region. 

‘‘(46) TROPICAL AND SUBTROPICAL AGRICULTURAL RE- SEARCH.—Research grants may be made under this section, in 

equal dollar amounts to the Caribbean and Pacific Basins, to 

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ing pest and disease research, at the land-grant institutions in 

the Caribbean and Pacific regions. 

‘‘(47) VIRAL HEMORRHAGIC SEPTICEMIA.—Research and extension grants may be made under this section to study—

‘‘(A) the effects of viral hemorrhagic septicemia (referred to in this paragraph as ‘VHS’) on freshwater fish 

throughout the natural and expanding range of VHS; and 

‘‘(B) methods for transmission and human-mediated 

transport of VHS among waterbodies. 

‘‘(48) FARM AND RANCH SAFETY.—Research and extension 

grants may be made under this section to carry out projects to 

decrease the incidence of injury and death on farms and 

ranches, including—

‘‘(A) on-site farm or ranch safety reviews; 

‘‘(B) outreach and dissemination of farm safety research and interventions to agricultural employers, employees, youth, farm and ranch families, seasonal workers, or 

other individuals; and 

‘‘(C) agricultural safety education and training. 

‘‘(49) WOMEN AND MINORITIES IN STEM FIELDS.—Research 

and extension grants may be made under this section to increase participation by women and underrepresented minorities 

from rural areas in the fields of science, technology, engineering, and mathematics, with priority given to eligible institutions that carry out continuing programs funded by the Secretary. 

‘‘(50) ALFALFA AND FORAGE RESEARCH PROGRAM.—Research 

and extension grants may be made under this section for the 

purpose of studying improvements in alfalfa and forage yields, 

biomass and persistence, pest pressures, the bioenergy potential 

of alfalfa and other forages, and systems to reduce losses during harvest and storage. 

‘‘(51) FOOD SYSTEMS VETERINARY MEDICINE.—Research 

grants may be made under this section to address health issues 

that affect food-producing animals, food safety, and the environment, and to improve information resources, curriculum, 

and clinical education of students with respect to food animal 

veterinary medicine and food safety. 

‘‘(52) BIOCHAR RESEARCH.—Grants may be made under this 

section for research, extension, and integrated activities relating 

to the study of biochar production and use, including considerations of agronomic and economic impacts, synergies of coproduction with bioenergy, and the value of soil enhancements 

and soil carbon sequestration.’’; 

(2) by redesignating subsection (h) as subsection (j); 

(3) by inserting after subsection (g) the following: 

‘‘(h) POLLINATOR PROTECTION.—

‘‘(1) RESEARCH AND EXTENSION.—

‘‘(A) GRANTS.—Research and extension grants may be 

made under this section—

‘‘(i) to survey and collect data on bee colony production and health; 

‘‘(ii) to investigate pollinator biology, immunology, 

ecology, genomics, and bioinformatics; 


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‘‘(iii) to conduct research on various factors that 

may be contributing to or associated with colony collapse disorder, and other serious threats to the health 

of honey bees and other pollinators, including— ‘‘(I) parasites and pathogens of pollinators; 

and ‘‘(II) the sublethal effects of insecticides, herbicides, and fungicides on honey bees and native and 

managed pollinators; 

‘‘(iv) to develop mitigative and preventative measures to improve native and managed pollinator health; 

and ‘‘(v) to promote the health of honey bees and native 

pollinators through habitat conservation and best management practices. 

‘‘(B) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this paragraph 

$10,000,000 for each of fiscal years 2008 through 2012. 

‘‘(2) DEPARTMENT OF AGRICULTURE CAPACITY AND INFRASTRUCTURE.—

‘‘(A) IN GENERAL.—The Secretary shall, to the maximum extent practicable, increase the capacity and infrastructure of the Department— ‘‘(i) to address colony collapse disorder and other 

long-term threats to pollinator health, including the 

hiring of additional personnel; and ‘‘(ii) to conduct research on colony collapse disorder 

and other pollinator issues at the facilities of the Department. 

‘‘(B) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this paragraph 

$7,250,000 for each of fiscal years 2008 through 2012. 

‘‘(3) HONEY BEE PEST AND PATHOGEN SURVEILLANCE.— There is authorized to be appropriated to conduct a nationwide 

honey bee pest and pathogen surveillance program $2,750,000 

for each of fiscal years 2008 through 2012. ‘‘(4) ANNUAL REPORT ON RESPONSE TO HONEY BEE COLONY

COLLAPSE DISORDER.—The Secretary shall submit to the Committee on Agriculture of the House of Representatives and the 

Committee on Agriculture, Nutrition, and Forestry of the Senate 

an annual report describing the progress made by the Department of Agriculture in— ‘‘(A) investigating the cause or causes of honey bee colony collapse; and ‘‘(B) finding appropriate strategies to reduce colony 

loss. ‘‘(i) REGIONAL CENTERS OF EXCELLENCE.—

‘‘(1) ESTABLISHMENT.—The Secretary shall prioritize regional centers of excellence established for specific agricultural 

commodities for the receipt of funding under this section. 

‘‘(2) COMPOSITION.—A regional center of excellence shall be 

composed of 1 or more colleges and universities (including landgrant institutions, schools of forestry, schools of veterinary medicine, or NLGCA Institutions (as defined in section 1404 of the 

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icy Act of 1977 (7 U.S.C. 3103))) that provide financial support 

to the regional center of excellence. ‘‘(3) CRITERIA FOR REGIONAL CENTERS OF EXCELLENCE.— The criteria for consideration to be a regional center of excellence shall include efforts— ‘‘(A) to ensure coordination and cost-effectiveness by reducing unnecessarily duplicative efforts regarding research, 

teaching, and extension; ‘‘(B) to leverage available resources by using public/ 

private partnerships among agricultural industry groups, 

institutions of higher education, and the Federal Government; ‘‘(C) to implement teaching initiatives to increase 

awareness and effectively disseminate solutions to target 

audiences through extension activities; ‘‘(D) to increase the economic returns to rural communities by identifying, attracting, and directing funds to 

high-priority agricultural issues; and ‘‘(E) to improve teaching capacity and infrastructure at 

colleges and universities (including land-grant institutions, 

schools of forestry, and schools of veterinary medicine).’’; 

and 

(4) in subsection (j) (as redesignated by paragraph (2)), by 

striking ‘‘2007’’ and inserting ‘‘2012’’. 

(b) CONFORMING AMENDMENTS.—Section 1672 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5925) is 

amended—

(1) in the first sentence of subsection (a), by striking ‘‘(e), (f), 

and (g)’’ and inserting ‘‘(e) through (i)’’; and 

(2) in subsection (b)—

(A) in paragraph (1), by striking ‘‘paragraphs (1), (6), 

(7), and (11)’’ and inserting ‘‘paragraphs (4), (7), (8), and 

(11)(B)’’; and 

(B) in paragraph (2), by striking ‘‘subsection (e)’’ and 

inserting ‘‘subsections (e) through (i)’’. 

SEC. 7205. NUTRIENT MANAGEMENT RESEARCH AND EXTENSION INITIATIVE. 

Section 1672A of the Food, Agriculture, Conservation, and 

Trade Act of 1990 (7 U.S.C. 5925a) is amended—

(1) in subsection (b), by striking paragraph (1) and inserting the following: 

‘‘(1) IN GENERAL.—Paragraphs (4), (7), (8), and (11)(B) of 

subsection (b) of the Competitive, Special, and Facilities Research Grant Act (7 U.S.C. 450i) shall apply with respect to the 

making of grants under this section.’’; 

(2) by striking subsection (d) and inserting the following: 

‘‘(d) PRIORITY.—Following the completion of a peer review process for grant proposals received under this section, the Secretary 

shall give priority to those grant proposals that involve—

‘‘(1) the cooperation of multiple entities; and 

‘‘(2) States or regions with a high concentration of livestock, 

dairy, or poultry operations.’’; 

(3) in subsection (e)—

(A) in paragraph (1)(B), by inserting ‘‘and dairy and 

beef cattle waste’’ after ‘‘swine waste’’; and 


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(B) by striking paragraph (5) and inserting the following: 

‘‘(5) ALTERNATIVE USES AND RENEWABLE ENERGY.—Research and extension grants may be made under this section for 

the purpose of finding innovative methods and technologies to 

allow agricultural operators to make use of animal waste, such 

as use as fertilizer, methane digestion, composting, and other 

useful byproducts.’’; 

(4) by redesignating subsection (g) as subsection (f); and 

(5) in subsection (f) (as so redesignated), by striking ‘‘2007’’

and inserting ‘‘2012’’. 

SEC. 7206. ORGANIC AGRICULTURE RESEARCH AND EXTENSION INITIATIVE. 

(a) IN GENERAL.—Section 1672B of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5925b) (commonly 

known as the ‘‘Organic Agriculture Research and Extension Initiative’’) is amended—

(1) in subsection (a)—

(A) in paragraph (5), by striking ‘‘and’’ after the semicolon; 

(B) in paragraph (6), by striking the period at the end 

and inserting a semicolon; and 

(C) by adding at the end the following: 

‘‘(7) examining optimal conservation and environmental 

outcomes relating to organically produced agricultural products; and 

‘‘(8) developing new and improved seed varieties that are 

particularly suited for organic agriculture.’’; and 

(2) by adding at the end the following: 

‘‘(f) FUNDING.—

‘‘(1) IN GENERAL.—Of the funds of the Commodity Credit 

Corporation, the Secretary shall make available to carry out 

this section—

‘‘(A) $18,000,000 for fiscal year 2009; and 

‘‘(B) $20,000,000 for each of fiscal years 2010 through 

2012. 

‘‘(2) ADDITIONAL FUNDING.—In addition to amounts made 

available under paragraph (1), there is authorized to be appropriated to carry out this section $25,000,000 for each of fiscal 

years 2009 through 2012.’’. 

(b) COORDINATION.—In carrying out the amendment made by 

this section, the Secretary shall ensure that the Division Chief of the 

applicable Research, Education, and Extension Office established 

under section 251 of the Department of Agriculture Reorganization 

Act of 1994 (7 U.S.C. 6971) coordinates projects and activities under 

this section to ensure, to the maximum extent practicable, that unnecessary duplication of effort is eliminated or minimized. 

SEC. 7207. AGRICULTURAL BIOENERGY FEEDSTOCK AND ENERGY EFFICIENCY RESEARCH AND EXTENSION INITIATIVE. 

Title XVI of the Food, Agriculture, Conservation, and Trade Act 

of 1990 (7 U.S.C. 5801 et seq.) is amended by inserting after section 

1672B (7 U.S.C. 5925b) the following: 


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‘‘SEC. 1672C. AGRICULTURAL BIOENERGY FEEDSTOCK AND ENERGY 

EFFICIENCY RESEARCH AND EXTENSION INITIATIVE. 

‘‘(a) ESTABLISHMENT AND PURPOSE.—There is established within the Department of Agriculture an agricultural bioenergy feedstock and energy efficiency research and extension initiative (referred to in this section as the ‘Initiative’) for the purpose of enhancing the production of biomass energy crops and the energy efficiency 

of agricultural operations. 

‘‘(b) COMPETITIVE RESEARCH AND EXTENSION GRANTS AUTHORIZED.—In carrying out this section, the Secretary shall make competitive grants to support research and extension activities specified 

in subsections (c) and (d). 

‘‘(c) AGRICULTURAL BIOENERGY FEEDSTOCK RESEARCH AND EXTENSION AREAS.—

‘‘(1) IN GENERAL.—Agricultural bioenergy feedstock research 

and extension activities funded under the Initiative shall focus 

on improving agricultural biomass production, biomass conversion in biorefineries, and biomass use by—

‘‘(A) supporting on-farm research on crop species, nutrient requirements, management practices, environmental 

impacts, and economics; 

‘‘(B) supporting the development and operation of onfarm, integrated biomass feedstock production systems; 

‘‘(C) leveraging the broad scientific capabilities of the 

Department of Agriculture and other entities in—

‘‘(i) plant genetics and breeding; 

‘‘(ii) crop production; 

‘‘(iii) soil and water science; 

‘‘(iv) use of agricultural waste; and 

‘‘(v) carbohydrate, lipid, protein, and lignin chemistry, enzyme development, and biochemistry; and 

‘‘(D) supporting the dissemination of any of the research conducted under this subsection that will assist in 

achieving the goals of this section. 

‘‘(2) SELECTION CRITERIA.—In selecting grant recipients for 

projects under paragraph (1), the Secretary shall consider—

‘‘(A) the capabilities and experiences of the applicant, 

including—

‘‘(i) research in actual field conditions; and 

‘‘(ii) engineering and research knowledge relating 

to biofuels or the production of inputs for biofuel production; 

‘‘(B) the range of species types and cropping practices 

proposed for study (including species types and practices 

studied using side-by-side comparisons of those types and 

practices); 

‘‘(C) the need for regional diversity among feedstocks; 

‘‘(D) the importance of developing multiyear data relevant to the production of biomass feedstock crops; 

‘‘(E) the extent to which the project involves direct participation of agricultural producers; 

‘‘(F) the extent to which the project proposal includes a 

plan or commitment to use the biomass produced as part 

of the project in commercial channels; and 

‘‘(G) such other factors as the Secretary may determine. 


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‘‘(d) ENERGY-EFFICIENCY RESEARCH AND EXTENSION AREAS.—

On-farm energy-efficiency research and extension activities funded 

under the Initiative shall focus on developing and demonstrating 

technologies and production practices relating to—

‘‘(1) improving on-farm renewable energy production; 

‘‘(2) encouraging efficient on-farm energy use; 

‘‘(3) promoting on-farm energy conservation; 

‘‘(4) making a farm or ranch energy-neutral; and 

‘‘(5) enhancing on-farm usage of advanced technologies to 

promote energy efficiency. 

‘‘(e) BEST PRACTICES DATABASE.—The Secretary shall develop a 

best-practices database that includes information, to be available to 

the public, on—

‘‘(1) the production potential of a variety of biomass crops; 

and 

‘‘(2) best practices for production, collection, harvesting, 

storage, and transportation of biomass crops to be used as a 

source of bioenergy. 

‘‘(f) ADMINISTRATION.—

‘‘(1) IN GENERAL.—Paragraphs (4), (7), (8), and (11)(B) of 

subsection (b) of the Competitive, Special, and Facilities Research Grant Act (7 U.S.C. 450i(b)) shall apply with respect to 

making grants under this section. 

‘‘(2) CONSULTATION AND COORDINATION.—The Secretary 

shall—

‘‘(A) make the grants in consultation with the National 

Agricultural Research, Extension, Education, and Economics Advisory Board; and 

‘‘(B) coordinate projects and activities carried out 

under the Initiative with projects and activities under section 9008 of the Farm Security and Rural Investment Act 

of 2002 to ensure, to the maximum extent practicable, 

that—

‘‘(i) unnecessary duplication of effort is eliminated 

or minimized; and 

‘‘(ii) the respective strengths of the Department of 

Agriculture and the Department of Energy are appropriately used. 

‘‘(3) GRANT PRIORITY.—The Secretary shall give priority to 

grant applications that integrate research and extension activities established under subsections (c) and (d), respectively. 

‘‘(4) MATCHING FUNDS REQUIRED.—As a condition of receiving a grant under this section, the Secretary shall require the 

recipient of the grant to provide funds or in-kind support from 

non-Federal sources in an amount that is at least equal to the 

amount provided by the Federal Government. 

‘‘(5) PARTNERSHIPS ENCOURAGED.—Following the completion of a peer review process for grant proposals received under 

this section, the Secretary may provide a priority to those grant 

proposals found as a result of the peer review process—

‘‘(A) to be scientifically meritorious; and 

‘‘(B) that involve cooperation—

‘‘(i) among multiple entities; and 

‘‘(ii) with agricultural producers. 


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‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $50,000,000 for each of 

fiscal years 2008 through 2012.’’. 

SEC. 7208. FARM BUSINESS MANAGEMENT AND BENCHMARKING. 

The Food, Agriculture, Conservation and Trade Act of 1990 is 

amended by inserting after section 1672C (as added by section 

7207) the following: 

‘‘SEC. 1672D. FARM BUSINESS MANAGEMENT. 

‘‘(a) IN GENERAL.—The Secretary may make competitive research and extension grants for the purpose of—

‘‘(1) improving the farm management knowledge and skills 

of agricultural producers; and 

‘‘(2) establishing and maintaining a national, publicly 

available farm financial management database to support improved farm management. 

‘‘(b) SELECTION CRITERIA.—In allocating funds made available 

to carry out this section, the Secretary may give priority to grants 

that—

‘‘(1) demonstrate an ability to work directly with agricultural producers; 

‘‘(2) collaborate with farm management and producer associations; 

‘‘(3) address the farm management needs of a variety of 

crops and regions of the United States; and 

‘‘(4) use and support the national farm financial management database. 

‘‘(c) ADMINISTRATION.—Paragraphs (4), (7), (8), and (11)(B) of 

subsection (b) of the Competitive, Special, and Facilities Research 

Grant Act (7 U.S.C. 450i(b)) shall apply with respect to the making 

of grants under this section. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated such sums as are necessary to carry out this 

section.’’. 

SEC. 7209. AGRICULTURAL TELECOMMUNICATIONS PROGRAM. 

Section 1673 of the Food, Agriculture, Conservation, and Trade 

Act of 1990 (7 U.S.C. 5926) is repealed. 

SEC. 7210. ASSISTIVE TECHNOLOGY PROGRAM FOR FARMERS WITH 

DISABILITIES. 

Section 1680(c)(1) of the Food, Agriculture, Conservation, and 

Trade Act of 1990 (7 U.S.C. 5933(c)(1)) is amended by striking 

‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7211. RESEARCH ON HONEY BEE DISEASES. 

Section 1681 of the Food, Agriculture, Conservation, and Trade 

Act of 1990 (7 U.S.C. 5934) is repealed. 

SEC. 7212. NATIONAL RURAL INFORMATION CENTER CLEARINGHOUSE. 

Section 2381(e) of the Food, Agriculture, Conservation, and 

Trade Act of 1990 (7 U.S.C. 3125b(e)) is amended by striking ‘‘2007’’

and inserting ‘‘2012’’. 


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Subtitle C—Agricultural Research, Extension, and Education 

Reform Act of 1998 

SEC. 7301. PEER AND MERIT REVIEW. 

Section 103(a) of the Agricultural Research, Extension, and 

Education Reform Act of 1998 (7 U.S.C. 7613(a)) is amended by 

adding at the end the following: ‘‘(3) CONSIDERATION.—Peer and merit review procedures established under paragraphs (1) and (2) shall not take the offer 

or availability of matching funds into consideration.’’. 

SEC. 7302. PARTNERSHIPS FOR HIGH-VALUE AGRICULTURAL PRODUCT 

QUALITY RESEARCH. 

Section 402 of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 7622) is repealed. 

SEC. 7303. PRECISION AGRICULTURE. 

Section 403 of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 7623) is repealed. 

SEC. 7304. BIOBASED PRODUCTS. 

(a) PILOT PROJECT.—Section 404(e)(2) of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 

7624(e)(2)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. (b) AUTHORIZATION OF APPROPRIATIONS.—Section 404(h) of the 

Agricultural Research, Extension, and Education Reform Act of 

1998 (7 U.S.C. 7624(h)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7305. THOMAS JEFFERSON INITIATIVE FOR CROP DIVERSIFICATION. 

Section 405 of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 7625) is repealed. 

SEC. 7306. INTEGRATED RESEARCH, EDUCATION, AND EXTENSION 

COMPETITIVE GRANTS PROGRAM. 

Section 406(f) of the Agricultural Research, Extension, and 

Education Reform Act of 1998 (7 U.S.C. 7626(f)) is amended by 

striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7307. FUSARIUM GRAMINEARUM GRANTS. 

Section 408 of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 7628) is amended—

(1) in subsection (a), in the subsection heading, by striking 

‘‘GRANT’’ and inserting ‘‘GRANTS’’; and 

(2) in subsection (e), by striking ‘‘2007’’ and inserting 

‘‘2012’’. 

SEC. 7308. BOVINE JOHNE’S DISEASE CONTROL PROGRAM. 

Section 409(b) of the Agricultural Research, Extension, and 

Education Reform Act of 1998 (7 U.S.C. 7629(b)) is amended by 

striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7309. GRANTS FOR YOUTH ORGANIZATIONS. 

Section 410 of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 7630) is amended by striking 

subsections (b) and (c) and inserting the following: 

‘‘(b) FLEXIBILITY.—The Secretary shall provide maximum flexibility in content delivery to each organization receiving funds under 

this section so as to ensure that the unique goals of each organization, as well as the local community needs, are fully met. 


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‘‘(c) REDISTRIBUTION OF FUNDING WITHIN ORGANIZATIONS AU- THORIZED.—Recipients of funds under this section may redistribute 

all or part of the funds received to individual councils or local chapters within the councils without further need of approval from the 

Secretary. ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this section such sums as are 

necessary for each of fiscal years 2008 through 2012.’’. 

SEC. 7310. AGRICULTURAL BIOTECHNOLOGY RESEARCH AND DEVELOPMENT FOR DEVELOPING COUNTRIES. 

Section 411(c) of the Agricultural Research, Extension, and 

Education Reform Act of 1998 (7 U.S.C. 7631(c)) is amended by 

striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7311. SPECIALTY CROP RESEARCH INITIATIVE. 

(a) IN GENERAL.—Title IV of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 7621 et seq.) is 

amended by adding at the end the following: 

‘‘SEC. 412. SPECIALTY CROP RESEARCH INITIATIVE. 

‘‘(a) DEFINITIONS.—In this section: ‘‘(1) INITIATIVE.—The term ‘Initiative’ means the specialty 

crop research and extension initiative established by subsection 

(b). ‘‘(2) SPECIALTY CROP.—The term ‘specialty crop’ has the 

meaning given that term in section 3 of the Specialty Crops 

Competitiveness Act of 2004 (7 U.S.C. 1621 note; Public Law 

108–465). ‘‘(b) ESTABLISHMENT.—There is established within the Department a specialty crop research and extension initiative to address 

the critical needs of the specialty crop industry by developing and 

disseminating science-based tools to address needs of specific crops 

and their regions, including— ‘‘(1) research in plant breeding, genetics, and genomics to 

improve crop characteristics, such as—

‘‘(A) product, taste, quality, and appearance; 

‘‘(B) environmental responses and tolerances; 

‘‘(C) nutrient management, including plant nutrient 

uptake efficiency; 

‘‘(D) pest and disease management, including resistance to pests and diseases resulting in reduced application 

management strategies; and 

‘‘(E) enhanced phytonutrient content; 

‘‘(2) efforts to identify and address threats from pests and 

diseases, including threats to specialty crop pollinators; 

‘‘(3) efforts to improve production efficiency, productivity, 

and profitability over the long term (including specialty crop 

policy and marketing); 

‘‘(4) new innovations and technology, including improved 

mechanization and technologies that delay or inhibit ripening; 

and 

‘‘(5) methods to prevent, detect, monitor, control, and respond to potential food safety hazards in the production and 

processing of specialty crops, including fresh produce. 

‘‘(c) ELIGIBLE ENTITIES.—The Secretary may carry out the Initiative through—


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‘‘(1) Federal agencies; 

‘‘(2) national laboratories; 

‘‘(3) colleges and universities; 

‘‘(4) research institutions and organizations; 

‘‘(5) private organizations or corporations; 

‘‘(6) State agricultural experiment stations; 

‘‘(7) individuals; or 

‘‘(8) groups consisting of 2 or more entities described in 

paragraphs (1) through (7). 

‘‘(d) RESEARCH PROJECTS.—In carrying out this section, the 

Secretary shall award grants on a competitive basis. ‘‘(e) ADMINISTRATION.—

‘‘(1) IN GENERAL.—With respect to grants awarded under 

subsection (d), the Secretary shall—

‘‘(A) seek and accept proposals for grants; 

‘‘(B) determine the relevance and merit of proposals 

through a system of peer and merit review in accordance 

with section 103; and 

‘‘(C) award grants on the basis of merit, quality, and 

relevance. 

‘‘(2) TERM.—The term of a grant under this section may not 

exceed 10 years. ‘‘(3) MATCHING FUNDS REQUIRED.—The Secretary shall require the recipient of a grant under this section to provide funds 

or in-kind support from non-Federal sources in an amount that 

is at least equal to the amount provided by the Federal Government. ‘‘(4) OTHER CONDITIONS.—The Secretary may set such other 

conditions on the award of a grant under this section as the 

Secretary determines to be appropriate. 

‘‘(f) PRIORITIES.—In making grants under this section, the Secretary shall provide a higher priority to projects that— ‘‘(1) are multistate, multi-institutional, or multidisciplinary; and 

‘‘(2) include explicit mechanisms to communicate results to 

producers and the public. 

‘‘(g) BUILDINGS AND FACILITIES.—Funds made available under 

this section shall not be used for the construction of a new building 

or facility or the acquisition, expansion, remodeling, or alteration of 

an existing building or facility (including site grading and improvement, and architect fees). ‘‘(h) FUNDING.—

‘‘(1) IN GENERAL.—Of the funds of the Commodity Credit 

Corporation, the Secretary shall make available to carry out 

this section $30,000,000 for fiscal year 2008 and $50,000,000 

for each of fiscal years 2009 through 2012, from which activities under each of paragraphs (1) through (5) of subsection (b) 

shall be allocated not less than 10 percent. 

‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—In addition to 

funds made available under paragraph (1), there is authorized 

to be appropriated to carry out this section $100,000,000 for 

each of fiscal years 2008 through 2012. ‘‘(3) TRANSFER.—Of the funds made available to the Secretary under paragraph (1) for fiscal year 2008 and authorized 

for use for payment of administrative expenses under section 


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1469(a)(3) of the National Agricultural Research, Extension, 

and Teaching Policy Act of 1977 (7 U.S.C. 3315(a)(3)), the Secretary shall transfer, upon the date of enactment of this section, 

$200,000 to the Office of Prevention, Pesticides, and Toxic Substances of the Environmental Protection Agency for use in conducting a meta-analysis relating to methyl bromide. ‘‘(4) AVAILABILITY.—Funds made available pursuant to this 

subsection for a fiscal year shall remain available until expended to pay for obligations incurred in that fiscal year.’’. (b) COORDINATION.—In carrying out the amendment made by 

this section, the Secretary shall ensure that the Division Chief of the 

applicable Research, Education, and Extension Office established 

under section 251 of the Department of Agriculture Reorganization 

Act of 1994 (7 U.S.C. 6971) coordinates projects and activities under 

this section to ensure, to the maximum extent practicable, that unnecessary duplication of effort is eliminated or minimized. 

SEC. 7312. FOOD ANIMAL RESIDUE AVOIDANCE DATABASE PROGRAM. 

Section 604 of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 7642) is amended by adding 

at the end the following: ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—In addition to any 

other funds available to carry out subsection (c), there is authorized 

to be appropriated to carry out this section $2,500,000 for each of 

fiscal years 2008 through 2012.’’. 

SEC. 7313. OFFICE OF PEST MANAGEMENT POLICY. 

Section 614(f) of the Agricultural Research, Extension, and 

Education Reform Act of 1998 (7 U.S.C. 7653(f)) is amended by 

striking ‘‘2007’’ and inserting ‘‘2012’’. 

Subtitle D—Other Laws 

SEC. 7401. CRITICAL AGRICULTURAL MATERIALS ACT. 

Section 16(a) of the Critical Agricultural Materials Act (7 

U.S.C. 178n(a)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7402. EQUITY IN EDUCATIONAL LAND-GRANT STATUS ACT OF 

1994. 

(a) DEFINITION OF 1994 INSTITUTIONS.—Section 532 of the Equity in Educational Land-Grant Status Act of 1994 (7 U.S.C. 301 

note; Public Law 103–382) is amended by adding at the end the following: ‘‘(34) Ilisagvik College.’’. (b) ENDOWMENT FOR 1994 INSTITUTIONS.—Section 533 of the 

Equity in Educational Land-Grant Status Act of 1994 (7 U.S.C. 301 

note; Public Law 103–382) is amended— (1) in subsection (a)(3), in the matter preceding subparagraph (A), by inserting ‘‘this section and’’ before ‘‘sections 534,’’; 

and 

(2) in the first sentence of subsection (b), by striking ‘‘2007’’ and inserting ‘‘2012’’. (c) REDISTRIBUTION.—Section 534(a)(3) of the Equity in Educational Land-Grant Status Act of 1994 (7 U.S.C. 301 note; Public 

Law 103–382) is amended— (1) by striking ‘‘The amounts’’ and inserting the following: 

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

(B), the amounts’’; and 


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(2) by adding at the end the following: 

‘‘(B) REDISTRIBUTION.—Funds that would be paid to a 

1994 Institution under paragraph (2) shall be withheld 

from that 1994 Institution and redistributed among the 

other 1994 Institutions if that 1994 Institution—

‘‘(i) declines to accept funds under paragraph (2); 

or 

‘‘(ii) fails to meet the accreditation requirements 

under section 533(a)(3).’’. 

(d) INSTITUTIONAL CAPACITY BUILDING GRANTS.—Section 535 

of the Equity in Educational Land-Grant Status Act of 1994 (7 

U.S.C. 301 note; Public Law 103–382) is amended by striking 

‘‘2007’’ each place it appears and inserting ‘‘2012’’. 

(e) RESEARCH GRANTS.—Section 536(c) of the Equity in Educational Land-Grant Status Act of 1994 (7 U.S.C. 301 note; Public 

Law 103–382) is amended in the first sentence by striking ‘‘2007’’

and inserting ‘‘2012’’. 

(f) EFFECTIVE DATE.—The amendment made by subsection (a) 

takes effect on October 1, 2008. 

SEC. 7403. SMITH-LEVER ACT. 

(a) PROGRAM.—Section 3(d) of the Smith-Lever Act (7 U.S.C. 

343(d)) is amended in the second sentence by striking ‘‘apply for and 

receive’’ and all that follows through paragraph (2) and inserting 

‘‘compete for and receive funds directly from the Secretary of Agriculture.’’. 

(b) ELIMINATION OF THE GOVERNOR’S REPORT REQUIREMENT

FOR EXTENSION ACTIVITIES.—Section 5 of the Smith-Lever Act (7 

U.S.C. 345) is amended by striking the third sentence. 

(c) CONFORMING AMENDMENT.—Section 1444(a)(2) of the National Agricultural Research, Extension, and Teaching Policy Act of 

1977 (7 U.S.C. 3221(a)(2)) is amended by striking ‘‘after September 

30, 1995, under section 3(d) of that Act (7 U.S.C. 343(d))’’ and all 

that follows through the end of the sentence and inserting ‘‘under 

section 3(d) of that Act (7 U.S.C. 343(d)).’’. 

SEC. 7404. HATCH ACT OF 1887. 

(a) DISTRICT OF COLUMBIA.—Section 3(d)(4) of the Hatch Act of 

1887 (7 U.S.C. 361c(d)(4)) is amended—

(1) in the paragraph heading, by inserting ‘‘AND THE DISTRICT OF COLUMBIA’’ after ‘‘AREAS’’; 

(2) in subparagraph (A)—

(A) by inserting ‘‘and the District of Columbia’’ after 

‘‘United States’’; and 

(B) by inserting ‘‘and the District of Columbia’’ after 

‘‘respectively,’’; and 

(3) in subparagraph (B), by inserting ‘‘or the District of Columbia’’ after ‘‘area’’. 

(b) ELIMINATION OF PENALTY MAIL AUTHORITIES.—

(1) IN GENERAL.—Section 6 of the Hatch Act of 1887 (7 

U.S.C. 361f) is amended in the first sentence by striking ‘‘under 

penalty indicia:’’ and all that follows through the end of the 

sentence and inserting a period. 

(2) CONFORMING AMENDMENTS IN OTHER LAWS.— (A) NATIONAL AGRICULTURAL RESEARCH, EXTENSION, AND TEACHING POLICY ACT OF 1977.—


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(i) Section 1444(f) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 

U.S.C. 3221(f)) is amended by striking ‘‘under penalty 

indicia:’’ and all that follows through the end of the 

sentence and inserting a period. 

(ii) Section 1445(e) of the National Agricultural 

Research, Extension, and Teaching Policy Act of 1977 

(7 U.S.C. 3222(e)) is amended by striking ‘‘under penalty indicia:’’ and all that follows through the end of 

the sentence and inserting a period. 

(B) OTHER PROVISIONS.—Section 3202(a) of title 39, 

United States Code, is amended—

(i) in paragraph (1)—

(I) in subparagraph (D), by adding ‘‘and’’ at 

the end; 

(II) in subparagraph (E), by striking ‘‘sections; 

and’’ and inserting ‘‘sections.’’; and 

(III) by striking subparagraph (F); 

(ii) in paragraph (2), by adding ‘‘and’’ at the end; 

(iii) in paragraph (3) by striking ‘‘thereof; and’’

and inserting ‘‘thereof.’’; and 

(iv) by striking paragraph (4). 

SEC. 7405. AGRICULTURAL EXPERIMENT STATION RESEARCH FACILITIES ACT. 

Section 6(a) of the Research Facilities Act (7 U.S.C. 390d(a)) is 

amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7406. AGRICULTURE AND FOOD RESEARCH INITIATIVE. 

(a) IN GENERAL.—Subsection (b) of the Competitive, Special, 

and Facilities Research Grant Act (7 U.S.C. 450i(b)) is amended to 

read as follows: 

‘‘(b) AGRICULTURE AND FOOD RESEARCH INITIATIVE.—

‘‘(1) ESTABLISHMENT.—There is established in the Department of Agriculture an Agriculture and Food Research Initiative under which the Secretary of Agriculture (referred to in this 

subsection as ‘the Secretary’) may make competitive grants for 

fundamental and applied research, extension, and education to 

address food and agricultural sciences (as defined under section 

1404 of the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3103)). 

‘‘(2) PRIORITY AREAS.—The competitive grants program established under this subsection shall address the following 

areas: 

‘‘(A) PLANT HEALTH AND PRODUCTION AND PLANT PROD- UCTS.—Plant systems, including—

‘‘(i) plant genome structure and function; 

‘‘(ii) molecular and cellular genetics and plant biotechnology; 

‘‘(iii) conventional breeding, including cultivar and 

breed development, selection theory, applied quantitative genetics, breeding for improved food quality, 

breeding for improved local adaptation to biotic stress 

and abiotic stress, and participatory breeding; ‘‘(iv) plant-pest interactions and biocontrol systems; 

‘‘(v) crop plant response to environmental stresses; 


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‘‘(vi) unproved nutrient qualities of plant products; 

and 

‘‘(vii) new food and industrial uses of plant products. 

‘‘(B) ANIMAL HEALTH AND PRODUCTION AND ANIMAL

PRODUCTS.—Animal systems, including—

‘‘(i) aquaculture; 

‘‘(ii) cellular and molecular basis of animal reproduction, growth, disease, and health; 

‘‘(iii) animal biotechnology; 

‘‘(iv) conventional breeding, including breed development, selection theory, applied quantitative genetics, 

breeding for improved food quality, breeding for improved local adaptation to biotic stress and abiotic 

stress, and participatory breeding; 

‘‘(v) identification of genes responsible for improved 

production traits and resistance to disease; 

‘‘(vi) improved nutritional performance of animals; 

‘‘(vii) improved nutrient qualities of animal products and uses; and 

‘‘(viii) the development of new and improved animal husbandry and production systems that take into 

account production efficiency, animal well-being, and 

animal systems applicable to aquaculture. 

‘‘(C) FOOD SAFETY, NUTRITION, AND HEALTH.—Nutrition, food safety and quality, and health, including—

‘‘(i) microbial contaminants and pesticides residue 

relating to human health; 

‘‘(ii) links between diet and health; 

‘‘(iii) bioavailability of nutrients; 

‘‘(iv) postharvest physiology and practices; and 

‘‘(v) improved processing technologies. 

‘‘(D) RENEWABLE ENERGY, NATURAL RESOURCES, AND

ENVIRONMENT.—Natural resources and the environment, 

including—

‘‘(i) fundamental structures and functions of ecosystems; 

‘‘(ii) biological and physical bases of sustainable 

production systems; 

‘‘(iii) minimizing soil and water losses and sustaining surface water and ground water quality; 

‘‘(iv) global climate effects on agriculture; 

‘‘(v) forestry; and 

‘‘(vi) biological diversity. 

‘‘(E) AGRICULTURE SYSTEMS AND TECHNOLOGY.—Engineering, products, and processes, including—

‘‘(i) new uses and new products from traditional 

and nontraditional crops, animals, byproducts, and 

natural resources; 

‘‘(ii) robotics, energy efficiency, computing, and expert systems; 

‘‘(iii) new hazard and risk assessment and mitigation measures; and 

‘‘(iv) water quality and management. 


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‘‘(F) AGRICULTURE ECONOMICS AND RURAL COMMU- NITIES.—Markets, trade, and policy, including— ‘‘(i) strategies for entering into and being competitive in domestic and overseas markets; ‘‘(ii) farm efficiency and profitability, including the 

viability and competitiveness of small and mediumsized dairy, livestock, crop and other commodity operations; ‘‘(iii) new decision tools for farm and market systems; ‘‘(iv) choices and applications of technology; 

‘‘(v) technology assessment; and 

‘‘(vi) new approaches to rural development, including rural entrepreneurship. ‘‘(3) TERM.—The term of a competitive grant made under 

this subsection may not exceed 10 years. 

‘‘(4) GENERAL ADMINISTRATION.—In making grants under 

this subsection, the Secretary shall—

‘‘(A) seek and accept proposals for grants; 

‘‘(B) determine the relevance and merit of proposals 

through a system of peer and merit review in accordance 

with section 103 of the Agricultural Research, Extension, 

and Education Reform Act of 1998 (7 U.S.C. 7613); 

‘‘(C) award grants on the basis of merit, quality, and 

relevance; 

‘‘(D) solicit and consider input from persons who conduct or use agricultural research, extension, or education in 

accordance with section 102(b) of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 

U.S.C. 7612(b)); and 

‘‘(E) in seeking proposals for grants under this subsection and in performing peer review evaluations of such 

proposals, seek the widest participation of qualified individuals in the Federal Government, colleges and universities, State agricultural experiment stations, and the private sector. 

‘‘(5) ALLOCATION OF FUNDS.—In making grants under this 

subsection, the Secretary shall allocate funds to the Agriculture 

and Food Research Initiative to ensure that, of funds allocated 

for research activities— ‘‘(A) not less than 60 percent is made available to make 

grants for fundamental research (as defined in subsection 

(f)(1) of section 251 of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6971)), of which— ‘‘(i) not less than 30 percent is made available to 

make grants for research to be conducted by multidisciplinary teams; and ‘‘(ii) not more than 2 percent is used for equipment 

grants under paragraph (6)(A); and 

‘‘(B) not less than 40 percent is made available to make 

grants for applied research (as defined in subsection (f)(1) 

of section 251 of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6971)). 

‘‘(6) SPECIAL CONSIDERATIONS.—In making grants under 

this subsection, the Secretary may assist in the development of 


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capabilities in the agricultural, food, and environmental 

sciences by providing grants— ‘‘(A) to an institution to allow for the improvement of 

the research, development, technology transfer, and education capacity of the institution through the acquisition of 

special research equipment and the improvement of agricultural education and teaching, except that the Secretary 

shall use not less than 25 percent of the funds made available for grants under this subparagraph to provide fellowships to outstanding pre- and post-doctoral students for research in the agricultural sciences; ‘‘(B) to a single investigator or coinvestigators who are 

beginning research careers and do not have an extensive research publication record, except that, to be eligible for a 

grant under this subparagraph, an individual shall be 

within 5 years of the beginning of the initial career track 

position of the individual; ‘‘(C) to ensure that the faculty of small, mid-sized, and 

minority-serving institutions who have not previously been 

successful in obtaining competitive grants under this subsection receive a portion of the grants; and ‘‘(D) to improve research, extension, and education capabilities in States (as defined in section 1404 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103)) in which institutions have 

been less successful in receiving funding under this subsection, based on a 3-year rolling average of funding levels. 

‘‘(7) ELIGIBLE ENTITIES.—The Secretary may make grants 

to carry out research, extension, and education under this subsection to—

‘‘(A) State agricultural experiment stations; 

‘‘(B) colleges and universities; 

‘‘(C) university research foundations; 

‘‘(D) other research institutions and organizations; 

‘‘(E) Federal agencies; 

‘‘(F) national laboratories; 

‘‘(G) private organizations or corporations; 

‘‘(H) individuals; or 

‘‘(I) any group consisting of 2 or more of the entities described in subparagraphs (A) through (H). 

‘‘(8) CONSTRUCTION PROHIBITED.—Funds made available 

for grants under this subsection shall not be used for the construction of a new building or facility or the acquisition, expansion, remodeling, or alteration of an existing building or facility 

(including site grading and improvement, and architect fees). 

‘‘(9) MATCHING FUNDS.—

‘‘(A) EQUIPMENT GRANTS.—

‘‘(i) IN GENERAL.—Except as provided in clause (ii), 

in the case of a grant made under paragraph (6)(A), 

the amount provided under this subsection may not exceed 50 percent of the cost of the special research equipment or other equipment acquired using funds from the 

grant. 

‘‘(ii) WAIVER.—The Secretary may waive all or part 

of the matching requirement under clause (i) in the 


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case of a college, university, or research foundation 

maintained by a college or university that ranks in the 

lowest 1⁄3 of such colleges, universities, and research 

foundations on the basis of Federal research funds received, if the equipment to be acquired using funds 

from the grant costs not more than $25,000 and has 

multiple uses within a single research project or is usable in more than 1 research project. 

‘‘(B) APPLIED RESEARCH.—As a condition of making a 

grant under paragraph (5)(B), the Secretary shall require 

the funding of the grant to be matched with equal matching funds from a non-Federal source if the grant is for applied research that is—

‘‘(i) commodity-specific; and 

‘‘(ii) not of national scope. 

‘‘(10) PROGRAM ADMINISTRATION.—To the maximum extent 

practicable, the Director of the National Institute of Food and 

Agriculture, in coordination with the Under Secretary for Research, Education, and Economics, shall allocate grants under 

this subsection to high-priority research, taking into consideration, when available, the determinations made by the National 

Agricultural Research, Extension, Education, and Economics 

Advisory Board (as established under section 1408 of the National Agricultural Research, Extension, and Teaching Policy 

Act of 1977 (7 U.S.C. 3123)). 

‘‘(11) AUTHORIZATION OF APPROPRIATIONS.—

‘‘(A) IN GENERAL.—There is authorized to be appropriated to carry out this subsection $700,000,000 for each 

of fiscal years 2008 through 2012, of which—

‘‘(i) not less than 30 percent shall be made available for integrated research pursuant to section 406 of 

the Agricultural Research, Extension, and Education 

Reform Act of 1998 (7 U.S.C. 7626); and 

‘‘(ii) not more than 4 percent may be retained by 

the Secretary to pay administrative costs incurred by 

the Secretary in carrying out this subsection. 

‘‘(B) AVAILABILITY.—Funds made available under this 

paragraph shall—

‘‘(i) be available for obligation for a 2-year period 

beginning on October 1 of the fiscal year for which the 

funds are first made available; and 

‘‘(ii) remain available until expended to pay for obligations incurred during that 2-year period.’’. 

(b) REPEALS.—

(1) Section 401 of the Agricultural Research, Extension, 

and Education Reform Act of 1998 (7 U.S.C. 7621) is repealed. 

(2) Subsection (d) of the Competitive, Special, and Facilities 

Research Grant Act (7 U.S.C. 450i(d)) is repealed. 

(c) EFFECT ON CURRENT SOLICITATIONS.—The amendments 

made by this section shall not apply to any solicitation for grant applications issued by the Cooperative State Research, Education, and 

Extension Service before the date of enactment of this Act. 

(d) CONFORMING AMENDMENTS.—


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(1) Section 1473 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3319) is 

amended in the first sentence by striking ‘‘and subsection (d)’’. 

(2) Section 1671(d) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5924(d)) is amended by striking ‘‘Paragraphs (1), (6), (7), and (11)’’ and inserting ‘‘Paragraphs (4), (7), (8), and (11)(B)’’. 

(3) Section 1672B(b) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5925b(b)) is amended by striking ‘‘Paragraphs (1), (6), (7), and (11)’’ and inserting ‘‘Paragraphs (4), (7), (8), and (11)(B)’’. 

SEC. 7407. AGRICULTURAL RISK PROTECTION ACT OF 2000. 

Section 221 of the Agricultural Risk Protection Act of 2000 (7 

U.S.C. 6711(g)) is amended by striking subsection (g) and inserting 

the following: 

‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $15,000,000 for each of 

fiscal years 2007 through 2012.’’. 

SEC. 7408. EXCHANGE OR SALE AUTHORITY. 

Title III of the Department of Agriculture Reorganization Act of 

1994 (Public Law 103–354; 108 Stat. 3238) is amended by adding 

at the end the following: 

‘‘SEC. 307. EXCHANGE OR SALE AUTHORITY. 

‘‘(a) DEFINITION OF QUALIFIED ITEM OF PERSONAL PROPERTY.—

In this section, the term ‘qualified item of personal property’

means—

‘‘(1) an animal; 

‘‘(2) an animal product; 

‘‘(3) a plant; or 

‘‘(4) a plant product. 

‘‘(b) GENERAL AUTHORITY.—Except as provided in subsection 

(c), notwithstanding chapter 5 of subtitle I of title 40, United States 

Code, the Secretary, acting through the Under Secretary for Research, Education, and Economics, in managing personal property 

for the purpose of carrying out the research functions of the Department, may exchange, sell, or otherwise dispose of any qualified item 

of personal property, including by way of public auction, and may 

retain and apply the sale or other proceeds, without further appropriation and without fiscal year limitation, in whole or in partial 

payment—

‘‘(1) to acquire any qualified item of personal property; or 

‘‘(2) to offset costs related to the maintenance, care, or feeding of any qualified item of personal property. 

‘‘(c) EXCEPTION.—Subsection (b) does not apply to the free dissemination of new varieties of seeds and germplasm in accordance 

with section 520 of the Revised Statutes (commonly known as the 

‘Department of Agriculture Organic Act’) (7 U.S.C. 2201).’’. 

SEC. 7409. ENHANCED USE LEASE AUTHORITY PILOT PROGRAM. 

Title III of the Department of Agriculture Reorganization Act of 

1994 (Public Law 103–354; 108 Stat. 3238) (as amended by section 

7408) is amended by adding at the end the following: 


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‘‘SEC. 308. ENHANCED USE LEASE AUTHORITY PILOT PROGRAM. 

‘‘(a) ESTABLISHMENT.—To enhance the use of real property administered by agencies of the Department, the Secretary may establish a pilot program, in accordance with this section, at the Beltsville Agricultural Research Center of the Agricultural Research 

Service and the National Agricultural Library to lease nonexcess 

property of the Center or the Library to any individual or entity, including agencies or instrumentalities of State or local governments. 

‘‘(b) REQUIREMENTS.—

‘‘(1) IN GENERAL.—Notwithstanding chapter 5 of subtitle I 

of title 40, United States Code, the Secretary may lease real 

property at the Beltsville Agricultural Research Center or the 

National Agricultural Library in accordance with such terms 

and conditions as the Secretary may prescribe, if the Secretary 

determines that the lease—

‘‘(A) is consistent with, and will not adversely affect, 

the mission of the Department agency administering the 

property; 

‘‘(B) will enhance the use of the property; 

‘‘(C) will not permit any portion of Department agency 

property or any facility of the Department to be used for the 

public retail or wholesale sale of merchandise or residential 

development; 

‘‘(D) will not permit the construction or modification of 

facilities financed by non-Federal sources to be used by an 

agency, except for incidental use; and 

‘‘(E) will not include any property or facility required 

for any Department agency purpose without prior consideration of the needs of the agency. 

‘‘(2) TERM.—The term of a lease under this section shall not 

exceed 30 years. 

‘‘(3) CONSIDERATION.—

‘‘(A) IN GENERAL.—Consideration provided for a lease 

under this section shall be—

‘‘(i) in an amount equal to fair market value, as 

determined by the Secretary; and 

‘‘(ii) in the form of cash. 

‘‘(B) USE OF FUNDS.—

‘‘(i) IN GENERAL.—Consideration provided for a 

lease under this section shall be—

‘‘(I) deposited in a capital asset account to be 

established by the Secretary; and 

‘‘(II) available until expended, without further 

appropriation, for maintenance, capital revitalization, and improvements of the Department properties and facilities at the Beltsville Agricultural 

Research Center and National Agricultural Library. 

‘‘(ii) BUDGETARY TREATMENT.—For purposes of the 

budget, the amounts described in clause (i) shall not be 

treated as a receipt of any Department agency or any 

other agency leasing property under this section. 

‘‘(4) COSTS.—The lessee shall cover all costs associated with 

a lease under this section, including the cost of—


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‘‘(A) the project to be carried out on property or at a facility covered by the lease; ‘‘(B) provision and administration of the lease; 

‘‘(C) construction of any needed facilities; 

‘‘(D) provision of applicable utilities; and 

‘‘(E) any other facility cost normally associated with the 

operation of a leased facility. 

‘‘(5) PROHIBITION OF USE OF APPROPRIATIONS.—The Secretary shall not use any funds made available to the Secretary 

in an appropriations Act for the construction or operating costs 

of any space covered by a lease under this section. ‘‘(6) TERMINATION OF AUTHORITY.—This section and the authority provided by this section terminate— ‘‘(A) on the date that is 5 years after the date of enactment of this section; or ‘‘(B) with respect to any particular leased property, on 

the date of termination of the lease. ‘‘(c) EFFECT OF OTHER LAWS.— ‘‘(1) UTILIZATION.—Property that is leased pursuant to this 

section shall not be considered to be unutilized or underutilized 

for purposes of section 501 of the Stewart B. McKinney Homeless Assistance Act (42 U.S.C. 11411). 

‘‘(2) DISPOSAL.—Property at the Beltsville Agricultural Research Center or the National Agricultural Library that is 

leased pursuant to this section shall not be considered to be disposed of by sale, lease, rental, excessing, or surplusing for purposes of section 523 of Public Law 100–202 (101 Stat. 1329–

417). 

‘‘(d) ADMINISTRATION.—

‘‘(1) IN GENERAL.—Not later than 90 days after the date of 

enactment of this section, the Secretary shall submit to the 

Committee on Agriculture of the House of Representatives and 

the Committee on Agriculture, Nutrition, and Forestry of the 

Senate a report that describes detailed management objectives 

and performance measurements by which the Secretary intends 

to evaluate the success of the program under this section. ‘‘(2) REPORTS.—Not later than 1, 3, and 5 years after the 

date of enactment of this section, the Secretary shall submit to 

the Committee on Agriculture of the House of Representatives 

and the Committee on Agriculture, Nutrition, and Forestry of 

the Senate a report describing the implementation of the program under this section, including— ‘‘(A) a copy of each lease entered into pursuant to this 

section; and ‘‘(B) an assessment by the Secretary of the success of 

the program using the management objectives and performance measurements developed by the Secretary.’’. 

SEC. 7410. BEGINNING FARMER AND RANCHER DEVELOPMENT PROGRAM. 

(a) GRANTS.—Section 7405(c) of the Farm Security and Rural 

Investment Act of 2002 (7 U.S.C. 3319f(c)) is amended—

(1) by striking paragraph (3) and inserting the following: 

‘‘(3) MAXIMUM TERM AND SIZE OF GRANT.—

‘‘(A) IN GENERAL.—A grant under this subsection 

shall—


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‘‘(i) have a term that is not more than 3 years; and 

‘‘(ii) be in an amount that is not more than 

$250,000 for each year. 

‘‘(B) CONSECUTIVE GRANTS.—An eligible recipient may 

receive consecutive grants under this subsection.’’; 

(2) by redesignating paragraphs (5) through (7) as paragraphs (8) through (10), respectively; 

(3) by inserting after paragraph (4) the following: 

‘‘(5) EVALUATION CRITERIA.—In making grants under this 

subsection, the Secretary shall evaluate—

‘‘(A) relevancy; 

‘‘(B) technical merit; 

‘‘(C) achievability; 

‘‘(D) the expertise and track record of 1 or more applicants; 

‘‘(E) the adequacy of plans for the participatory evaluation process, outcome-based reporting, and the communication of findings and results beyond the immediate target 

audience; and 

‘‘(F) other appropriate factors, as determined by the 

Secretary. 

‘‘(6) REGIONAL BALANCE.—In making grants under this subsection, the Secretary shall, to the maximum extent practicable, 

ensure geographical diversity. 

‘‘(7) PRIORITY.—In making grants under this subsection, 

the Secretary shall give priority to partnerships and collaborations that are led by or include nongovernmental and community-based organizations with expertise in new agricultural producer training and outreach.’’. 

(b) FUNDING.—Section 7405 of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 3319f) is amended by striking subsection (h) and inserting the following: 

‘‘(h) FUNDING.—

‘‘(1) IN GENERAL.—Of the funds of the Commodity Credit 

Corporation, the Secretary shall make available to carry out 

this section—

‘‘(A) $18,000,000 for fiscal year 2009; and 

‘‘(B) $19,000,000 for each of fiscal years 2010 through 

2012. 

‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—In addition to 

funds provided under paragraph (1), there is authorized to be 

appropriated to carry out this section $30,000,000 for each of 

fiscal years 2008 through 2012.’’. 

SEC. 7411. PUBLIC EDUCATION REGARDING USE OF BIOTECHNOLOGY 

IN PRODUCING FOOD FOR HUMAN CONSUMPTION. 

Section 10802 of the Farm Security and Rural Investment Act 

of 2002 (7 U.S.C. 5921a) is repealed. 

SEC. 7412. MCINTIRE-STENNIS COOPERATIVE FORESTRY ACT. 

(a) IN GENERAL.—Section 2 of Public Law 87–788 (commonly 

known as the ‘‘McIntire-Stennis Cooperative Forestry Act’’) (16 

U.S.C. 582a–1) is amended by inserting ‘‘and 1890 Institutions (as 

defined in section 2 of the Agricultural Research, Extension, and 

Education Reform Act of 1998 (7 U.S.C. 7601)),’’ before ‘‘and (b)’’. 


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(b) EFFECTIVE DATE.—The amendment made by subsection (a) 

takes effect on October 1, 2008. 

SEC. 7413. RENEWABLE RESOURCES EXTENSION ACT OF 1978. 

(a) AUTHORIZATION OF APPROPRIATIONS.—Section 6 of the Renewable Resources Extension Act of 1978 (16 U.S.C. 1675) is 

amended in the first sentence by striking ‘‘2007’’ and inserting 

‘‘2012’’. 

(b) TERMINATION DATE.—Section 8 of the Renewable Resources 

Extension Act of 1978 (16 U.S.C. 1671 note; Public Law 95–306) is 

amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7414. NATIONAL AQUACULTURE ACT OF 1980. 

Section 10 of the National Aquaculture Act of 1980 (16 U.S.C. 

2809) is amended by striking ‘‘2007’’ each place it appears and inserting ‘‘2012’’. 

SEC. 7415. CONSTRUCTION OF CHINESE GARDEN AT THE NATIONAL 

ARBORETUM. 

The Act of March 4, 1927 (20 U.S.C. 191 et seq.), is amended 

by adding at the end the following: 

‘‘SEC. 7. CONSTRUCTION OF CHINESE GARDEN AT THE NATIONAL ARBORETUM. 

‘‘A Chinese Garden may be constructed at the National Arboretum established under this Act with—

‘‘(1) funds accepted under section 5; 

‘‘(2) authorities provided to the Secretary of Agriculture 

under section 6; and 

‘‘(3) appropriations provided for this purpose.’’. 

SEC. 7416. NATIONAL AGRICULTURAL RESEARCH, EXTENSION, AND 

TEACHING POLICY ACT AMENDMENTS OF 1985. 

Section 1431 of the National Agricultural Research, Extension, 

and Teaching Policy Act Amendments of 1985 (Public Law 99–198; 

99 Stat. 1556) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 7417. ELIGIBILITY OF UNIVERSITY OF THE DISTRICT OF COLUMBIA FOR CERTAIN LAND-GRANT UNIVERSITY ASSISTANCE. 

(a) IN GENERAL.—Section 208 of the District of Columbia Public Postsecondary Education Reorganization Act (Public Law 93–

471; 88 Stat. 1428) is amended—

(1) in subsection (b)(2), by striking ‘‘, except’’ and all that 

follows through the period and inserting a period; and 

(2) in subsection (c)—

(A) by striking ‘‘section 3’’ each place it appears and inserting ‘‘section 3(c)’’; and 

(B) by striking ‘‘Such sums may be used to pay’’ and 

all that follows through ‘‘work.’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

take effect on October 1, 2008. 

Subtitle E—Miscellaneous 

PART I—GENERAL PROVISIONS 

SEC. 7501. DEFINITIONS. 

Except as otherwise provided in this subtitle, in this subtitle: 


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(1) CAPACITY AND INFRASTRUCTURE PROGRAM.—The term ‘‘capacity and infrastructure program’’ has the meaning given 

the term in subsection (f)(1) of section 251 of the Department of 

Agriculture Reorganization Act of 1994 (7 U.S.C. 6971) (as 

added by section 7511(a)(4)). 

(2) CAPACITY AND INFRASTRUCTURE PROGRAM CRITICAL

BASE FUNDING.—The term ‘‘capacity and infrastructure program critical base funding’’ means the aggregate amount of 

Federal funds made available for capacity and infrastructure 

programs for fiscal year 2006, as appropriate. 

(3) COMPETITIVE PROGRAM.—The term ‘‘competitive program’’ has the meaning given the term in subsection (f)(1) of 

section 251 of the Department of Agriculture Reorganization Act 

of 1994 (7 U.S.C. 6971) (as added by section 7511(a)(4)). 

(4) COMPETITIVE PROGRAM CRITICAL BASE FUNDING.—The 

term ‘‘competitive program critical base funding’’ means the aggregate amount of Federal funds made available for competitive 

programs for fiscal year 2006, as appropriate. 

(5) HISPANIC-SERVING AGRICULTURAL COLLEGES AND UNI- VERSITIES.—The term ‘‘Hispanic-serving agricultural colleges 

and universities’’ has the meaning given the term in section 

1404 of the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3103). 

(6) NLGCA INSTITUTION.—The term ‘‘NLGCA Institution’’

has the meaning given the term in section 1404 of the National 

Agricultural Research, Extension, and Teaching Policy Act of 

1977 (7 U.S.C. 3103). 

(7) 1862 INSTITUTION; 1890 INSTITUTION; 1994 INSTITUTION.—The terms ‘‘1862 Institution’’, ‘‘1890 Institution’’, and 

‘‘1994 Institution’’ have the meanings given the terms in section 

2 of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 7601). 

SEC. 7502. GRAZINGLANDS RESEARCH LABORATORY. 

Except as otherwise specifically authorized by law and notwithstanding any other provision of law, the Federal land and facilities 

at El Reno, Oklahoma, administered by the Secretary (as of the date 

of enactment of this Act) as the Grazinglands Research Laboratory, 

shall not at any time, in whole or in part, be declared to be excess 

or surplus Federal property under chapter 5 of subtitle I of title 40, 

United States Code, or otherwise be conveyed or transferred in 

whole or in part, for the 5-year period beginning on the date of enactment of this Act. 

SEC. 7503. FORT RENO SCIENCE PARK RESEARCH FACILITY. 

The Secretary may lease land to the University of Oklahoma at 

the Grazinglands Research Laboratory at El Reno, Oklahoma, on 

such terms and conditions as the University and the Secretary may 

agree in furtherance of cooperative research and existing easement 

arrangements. 

SEC. 7504. ROADMAP. 

(a) IN GENERAL.—Not later than 90 days after the date of enactment of this Act, the Secretary, acting through the Under Secretary of Research, Education, and Economics (referred to in this 

section as the ‘‘Under Secretary’’), shall commence preparation of a 

roadmap for agricultural research, education, and extension that—


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(1) identifies current trends and constraints; 

(2) identifies major opportunities and gaps that no single 

entity within the Department of Agriculture would be able to 

address individually; 

(3) involves—

(A) interested parties from the Federal Government and 

nongovernmental entities; and 

(B) the National Agricultural Research, Extension, 

Education, and Economics Advisory Board established 

under section 1408 of the National Agricultural Research, 

Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

3123); 

(4) incorporates roadmaps for agricultural research, education, and extension made publicly available by other Federal 

entities, agencies, or offices; and 

(5) describes recommended funding levels for areas of agricultural research, education, and extension, including—

(A) competitive programs; 

(B) capacity and infrastructure programs, with attention to the future growth needs of—

(i) small 1862 Institutions, 1890 Institutions, and 

1994 Institutions; 

(ii) Hispanic-serving agricultural colleges and universities; 

(iii) NLGCA Institutions; and 

(iv) colleges of veterinary medicine; and 

(C) intramural programs at agencies within the research, education, and economics mission area; and 

(6) describes how organizational changes enacted by this 

Act have impacted agricultural research, extension, and education across the Department of Agriculture, including minimization of unnecessary programmatic and administrative duplication. 

(b) REVIEWABILITY.—The roadmap described in this section 

shall not be subject to review by any officer or employee of the Federal Government other than the Secretary (or a designee of the Secretary). 

(c) ROADMAP IMPLEMENTATION AND REPORT.—Not later than 1 

year after the date on which the Secretary commences preparation 

of the roadmap under this section, the Secretary shall—

(1) implement and use the roadmap to set the research, 

education, and extension agenda of the Department of Agriculture; and 

(2) make the roadmap available to the public. 

SEC. 7505. REVIEW OF PLAN OF WORK REQUIREMENTS. 

(a) REVIEW.—The Secretary shall work with university partners 

in extension and research to review and identify measures to 

streamline the submission, reporting under, and implementation of 

plan of work requirements, including those requirements under—

(1) sections 1444(d) and 1445(c) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 

U.S.C. 3221(d) and 3222(c), respectively); 

(2) section 7 of the Hatch Act of 1887 (7 U.S.C. 361g); and 

(3) section 4 of the Smith-Lever Act (7 U.S.C. 344). 


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(b) CONSULTATION.—In carrying out the review and formulating and compiling the recommendations, the Secretary shall consult with the land-grant institutions. 

SEC. 7506. BUDGET SUBMISSION AND FUNDING. 

(a) DEFINITION OF COMPETITIVE PROGRAMS.—In this section, 

the term ‘‘competitive programs’’ includes only competitive programs 

for which annual appropriations are requested in the annual budget 

submission of the President. 

(b) BUDGET REQUEST.—The President shall submit to Congress, 

together with the annual budget submission of the President, a single budget line item reflecting the total amount requested by the 

President for funding for research, education, and extension activities of the Research, Education, and Economics mission area of the 

Department for that fiscal year and for the preceding 5 fiscal years. 

(c) CAPACITY AND INFRASTRUCTURE PROGRAM REQUEST.—Of the 

funds requested for capacity and infrastructure programs in excess 

of the capacity and infrastructure program critical base funding 

level, budgetary emphasis should be placed on enhancing funding 

for—

(1) 1890 Institutions; 

(2) 1994 Institutions; 

(3) NLGCA Institutions; 

(4) Hispanic-serving agricultural colleges and universities; 

and 

(5) small 1862 Institutions. 

(d) COMPETITIVE PROGRAM REQUEST.—Of the funds requested 

for competitive programs in excess of the competitive program critical base funding level, budgetary emphasis should be placed on—

(1) enhancing funding for emerging problems; and 

(2) finding solutions for those problems. 

PART II—RESEARCH, EDUCATION, AND 

ECONOMICS 

SEC. 7511. RESEARCH, EDUCATION, AND ECONOMICS. 

(a) IN GENERAL.—Section 251 of the Department of Agriculture 

Reorganization Act of 1994 (7 U.S.C. 6971) is amended—

(1) in subsection (a), by inserting ‘‘(referred to in this section as the ‘Under Secretary’)’’ before the period at the end; 

(2) by striking subsections (b) through (d); 

(3) by redesignating subsection (e) as subsection (g); and 

(4) by inserting after subsection (a) the following: 

‘‘(b) CONFIRMATION REQUIRED.—The Under Secretary shall be 

appointed by the President, by and with the advice and consent of 

the Senate, from among distinguished scientists with specialized 

training or significant experience in agricultural research, education, and economics. 

‘‘(c) CHIEF SCIENTIST.—The Under Secretary shall—

‘‘(1) hold the title of Chief Scientist of the Department; and 

‘‘(2) be responsible for the coordination of the research, education, and extension activities of the Department. 

‘‘(d) FUNCTIONS OF UNDER SECRETARY.—

‘‘(1) PRINCIPAL FUNCTION.—The Secretary shall delegate to 

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diction of the Department that relate to research, education, 

and economics. ‘‘(2) SPECIFIC FUNCTIONS AND DUTIES.—The Under Secretary shall— ‘‘(A) identify, address, and prioritize current and 

emerging agricultural research, education, and extension 

needs (including funding); ‘‘(B) ensure that agricultural research, education, and 

extension programs are effectively coordinated and integrated—‘‘(i) across disciplines, agencies, and institutions; 

and ‘‘(ii) among applicable participants, grantees, and 

beneficiaries; 

‘‘(C) promote the collaborative use of all agricultural 

research, education, and extension resources from the local, 

State, tribal, regional, national, and international levels to 

address priority needs; and ‘‘(D) foster communication among agricultural research, education, and extension beneficiaries, including 

the public, to ensure the delivery of agricultural research, 

education, and extension knowledge. 

‘‘(3) ADDITIONAL FUNCTIONS.—The Under Secretary shall 

perform such other functions and duties as may be required by 

law or prescribed by the Secretary. 

‘‘(e) RESEARCH, EDUCATION, AND EXTENSION OFFICE.— ‘‘(1) ESTABLISHMENT.—The Under Secretary shall organize 

within the office of the Under Secretary 6 Divisions, to be 

known collectively as the ‘Research, Education, and Extension 

Office’, which shall coordinate the research programs and activities of the Department. ‘‘(2) DIVISION DESIGNATIONS.—The Divisions within the Research, Education, and Extension Office shall be as follows: ‘‘(A) Renewable energy, natural resources, and environment. ‘‘(B) Food safety, nutrition, and health. 

‘‘(C) Plant health and production and plant products. 

‘‘(D) Animal health and production and animal products. ‘‘(E) Agricultural systems and technology. 

‘‘(F) Agricultural economics and rural communities. ‘‘(3) DIVISION CHIEFS.—

‘‘(A) SELECTION.—The Under Secretary shall select a 

Division Chief for each Division using available personnel 

authority under title 5, United States Code, including—

‘‘(i) by term, temporary, or other appointment, 

without regard to—

‘‘(I) the provisions of title 5, United States 

Code, governing appointments in the competitive 

service; ‘‘(II) the provisions of subchapter I of chapter 

35 of title 5, United States Code, relating to retention preference; and ‘‘(III) the provisions of chapter 51 and subchapter III of chapter 53 of title 5, United States 


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Code, relating to classification and General Schedule pay rates; 

‘‘(ii) by detail, notwithstanding any Act making 

appropriations for the Department of Agriculture, 

whether enacted before, on, or after the date of enactment of this paragraph, requiring reimbursement for 

those details unless the appropriation Act specifically 

refers to this subsection and specifically includes these 

details; ‘‘(iii) by reassignment or transfer from any other 

civil service position; and ‘‘(iv) by an assignment under subchapter VI of 

chapter 33 of title 5, United States Code. 

‘‘(B) SELECTION GUIDELINES.—To the maximum extent 

practicable, the Under Secretary shall select Division Chiefs 

under subparagraph (A) in a manner that—

‘‘(i) promotes leadership and professional development; 

‘‘(ii) enables personnel to interact with other agencies of the Department; and 

‘‘(iii) maximizes the ability of the Under Secretary 

to allow for rotations of Department personnel into the 

position of Division Chief. 

‘‘(C) TERM OF SERVICE.—Notwithstanding title 5, 

United States Code, the maximum length of service for an 

individual selected as a Division Chief under subparagraph (A) shall not exceed 4 years. ‘‘(D) QUALIFICATIONS.—To be eligible for selection as a 

Division Chief, an individual shall have— ‘‘(i) conducted exemplary research, education, or 

extension in the field of agriculture or forestry; and ‘‘(ii) earned an advanced degree at an institution of 

higher education (as defined in section 101 of the Higher Education Act of 1965 (20 U.S.C. 1001)). 

‘‘(E) DUTIES OF DIVISION CHIEFS.—Except as otherwise 

provided in this Act, each Division Chief shall— ‘‘(i) assist the Under Secretary in identifying and 

addressing emerging agricultural research, education, 

and extension needs; ‘‘(ii) assist the Under Secretary in identifying and 

prioritizing Department-wide agricultural research, 

education, and extension needs, including funding; ‘‘(iii) assess the strategic workforce needs of the research, education, and extension functions of the Department, and develop strategic workforce plans to ensure that existing and future workforce needs are met; ‘‘(iv) communicate with research, education, and 

extension beneficiaries, including the public, and representatives of the research, education, and extension 

system, including the National Agricultural Research, 

Extension, Education, and Economics Advisory Board, 

to promote the benefits of agricultural research, education, and extension; 

‘‘(v) assist the Under Secretary in preparing and 

implementing the roadmap for agricultural research, 


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education, and extension, as described in section 7504 

of the Food, Conservation, and Energy Act of 2008; and ‘‘(vi) perform such other duties as the Under Secretary may determine. ‘‘(4) GENERAL ADMINISTRATION.— ‘‘(A) FUNDING.—Notwithstanding any Act making appropriations for the Department of Agriculture, whether enacted before, on, or after the date of enactment of this paragraph unless the appropriation Act specifically refers to this 

subsection and specifically includes the administration of 

funds under this section, the Secretary may transfer funds 

made available to an agency in the research, education, 

and economics mission area to fund the costs of Division 

personnel. ‘‘(B) LIMITATION.—To the maximum extent practicable—

‘‘(i) the Under Secretary shall minimize the number of full-time equivalent positions in the Divisions; 

and 

‘‘(ii) at no time shall the aggregate number of staff 

for all Divisions exceed 30 full-time equivalent positions. 

‘‘(C) ROTATION OF PERSONNEL.—To the maximum extent practicable, and using the authority described in paragraph (3)(A), the Under Secretary shall rotate personnel 

among the Divisions, and between the Divisions and agencies of the Department, in a manner that— ‘‘(i) promotes leadership and professional development; and ‘‘(ii) enables personnel to interact with other agencies of the Department. ‘‘(5) ORGANIZATION.—The Under Secretary shall integrate 

leadership functions of the national program staff of the research agencies into the Research, Education and Extension Office in such form as is required to ensure that administrative 

duplication does not occur. 

‘‘(f) NATIONAL INSTITUTE OF FOOD AND AGRICULTURE.— ‘‘(1) DEFINITIONS.—In this subsection: ‘‘(A) ADVISORY BOARD.—The term ‘Advisory Board’ means the National Agricultural Research, Extension, Education, and Economics Advisory Board established under 

section 1408 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3123). ‘‘(B) APPLIED RESEARCH.—The term ‘applied research’

means research that includes expansion of the findings of 

fundamental research to uncover practical ways in which 

new knowledge can be advanced to benefit individuals and 

society. 

‘‘(C) CAPACITY AND INFRASTRUCTURE PROGRAM.—The 

term ‘capacity and infrastructure program’ means each of 

the following agricultural research, extension, education, 

and related programs for which the Secretary has administrative or other authority as of the day before the date of 

enactment of the Food, Conservation, and Energy Act of 

2008: 


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‘‘(i) Each program providing funding to any of the 

1994 Institutions under sections 533, 534(a), and 535 

of the Equity in Educational Land-Grant Status Act of 

1994 (7 U.S.C. 301 note; Public Law 103–382). 

‘‘(ii) The program established under section 536 of 

the Equity in Educational Land-Grant Status Act of 

1994 (7 U.S.C. 301 note; Public Law 103–382) providing research grants for 1994 Institutions. 

‘‘(iii) Each program established under subsections 

(b) and (c) of section 3 of the Smith-Lever Act (7 U.S.C. 

343). 

‘‘(iv) Each program established under the Hatch 

Act of 1887 (7 U.S.C. 361a et seq.). 

‘‘(v) Each program established under section 

1417(b) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

3152(b)). 

‘‘(vi) The animal health and disease research program established under subtitle E of the National Agricultural Research, Extension, and Teaching Policy Act 

of 1977 (7 U.S.C. 3191 et seq.). 

‘‘(vii) Each extension program available to 1890 Institutions established under section 1444 of the National Agricultural Research, Extension, and Teaching 

Policy Act of 1977 (7 U.S.C. 3221). 

‘‘(viii) The program established under section 1445 

of the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3222). 

‘‘(ix) The program providing grants to upgrade agricultural and food sciences facilities at 1890 Institutions established under section 1447 of the National 

Agricultural Research, Extension, and Teaching Policy 

Act of 1977 (7 U.S.C. 3222b). 

‘‘(x) The program providing distance education 

grants for insular areas established under section 1490 

of the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3362). 

‘‘(xi) The program providing resident instruction 

grants for insular areas established under section 1491 

of the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3363). 

‘‘(xii) Each research and development and related 

program established under Public Law 87–788 (commonly known as the ‘McIntire-Stennis Cooperative Forestry Act’) (16 U.S.C. 582a et seq.). 

‘‘(xiii) Each program established under the Renewable Resources Extension Act of 1978 (16 U.S.C. 1671 

et seq.). 

‘‘(xiv) Each program providing funding to Hispanic-serving agricultural colleges and universities 

under section 1456 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977. 

‘‘(xv) The program providing capacity grants to 

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tional Agricultural Research, Extension, and Teaching 

Policy Act of 1977. ‘‘(xvi) Other programs that are capacity and infrastructure programs, as determined by the Secretary. 

‘‘(D) COMPETITIVE PROGRAM.—The term ‘competitive 

program’ means each of the following agricultural research, 

extension, education, and related programs for which the 

Secretary has administrative or other authority as of the 

day before the date of enactment of the Food, Conservation, 

and Energy Act of 2008: ‘‘(i) The Agriculture and Food Research Initiative 

established under section 2(b) of the Competitive, Special, and Facilities Research Grant Act (7 U.S.C. 

450i(b)). ‘‘(ii) The program providing competitive grants for 

risk management education established under section 

524(a)(3) of the Federal Crop Insurance Act (7 U.S.C. 

1524(a)(3)). ‘‘(iii) The program providing community food 

project competitive grants established under section 25 

of the Food and Nutrition Act of 2008 (7 U.S.C. 2034). ‘‘(iv) The program providing grants for beginning 

farmer and rancher development established under section 7405 of the Farm Security and Rural Investment 

Act of 2002 (7 U.S.C. 3319f). ‘‘(v) The program providing grants under section 

1417(j) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

3152(j)). ‘‘(vi) The program providing grants for Hispanicserving institutions established under section 1455 of 

the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3241). ‘‘(vii) The program providing competitive grants 

for international agricultural science and education 

programs under section 1459A of the National Agricultural Research, Extension, and Teaching Policy Act of 

1977 (7 U.S.C. 3292b). 

‘‘(viii) The research and extension projects carried 

out under section 1621 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5811). 

‘‘(ix) The organic agriculture research and extension initiative established under section 1672B of the 

Food, Agriculture, Conservation, and Trade Act of 

1990 (7 U.S.C. 5925b). 

‘‘(x) The specialty crop research initiative under 

section 412 of the Agricultural Research, Extension, 

and Education Reform Act of 1998. 

‘‘(xi) The administration and management of the 

Agricultural Bioenergy Feedstock and Energy Efficiency Research and Extension Initiative carried out 

under section 1672C of the Food, Agriculture, Conservation, and Trade Act of 1990. 

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search, Extension, and Education Reform Act of 1998 

(7 U.S.C. 7627) relating to the competitiveness, viability and sustainability of small- and medium-sized 

dairy, livestock, and poultry operations. ‘‘(xiii) Other programs that are competitive programs, as determined by the Secretary. 

‘‘(E) DIRECTOR.—The term ‘Director’ means the Director 

of the Institute. ‘‘(F) FUNDAMENTAL RESEARCH.—The term ‘fundamental research’ means research that— ‘‘(i) increases knowledge or understanding of the 

fundamental aspects of phenomena and has the potential for broad application; and ‘‘(ii) has an effect on agriculture, food, nutrition, or 

the environment. 

‘‘(G) INSTITUTE.—The term ‘Institute’ means the National Institute of Food and Agriculture established by 

paragraph (2)(A). 

‘‘(2) ESTABLISHMENT OF NATIONAL INSTITUTE OF FOOD AND

AGRICULTURE.—

‘‘(A) ESTABLISHMENT.—The Secretary shall establish 

within the Department an agency to be known as the ‘National Institute of Food and Agriculture’. ‘‘(B) TRANSFER OF AUTHORITIES.—The Secretary shall 

transfer to the Institute, effective not later than October 1, 

2009, the authorities (including all budget authorities, 

available appropriations, and personnel), duties, obligations, and related legal and administrative functions prescribed by law or otherwise granted to the Secretary, the 

Department, or any other agency or official of the Department under— ‘‘(i) the capacity and infrastructure programs; 

‘‘(ii) the competitive programs; 

‘‘(iii) the research, education, economic, cooperative 

State research programs, cooperative extension and 

education programs, international programs, and other 

functions and authorities delegated by the Under Secretary to the Administrator of the Cooperative State Research, Education, and Extension Service pursuant to 

section 2.66 of title 7, Code of Federal Regulations (or 

successor regulations); and 

‘‘(iv) any and all other authorities administered by 

the Administrator of the Cooperative State Research, 

Education, and Extension Service. 

‘‘(3) DIRECTOR.—

‘‘(A) IN GENERAL.—The Institute shall be headed by a 

Director, who shall be an individual who is—

‘‘(i) a distinguished scientist; and 

‘‘(ii) appointed by the President. ‘‘(B) SUPERVISION.—The Director shall report directly 

to the Secretary, or the designee of the Secretary. ‘‘(C) FUNCTIONS OF THE DIRECTOR.—The Director 

shall— ‘‘(i) serve for a 6-year term, subject to reappointment for an additional 6-year term; 


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‘‘(ii) periodically report to the Secretary, or the designee of the Secretary, with respect to activities carried 

out by the Institute; and ‘‘(iii) consult regularly with the Secretary, or the 

designee of the Secretary, to ensure, to the maximum 

extent practicable, that— ‘‘(I) research of the Institute is relevant to agriculture in the United States and otherwise serves 

the national interest; and ‘‘(II) the research of the Institute supplements 

and enhances, and does not supplant, research 

conducted or funded by other Federal agencies. ‘‘(D) COMPENSATION.—The Director shall receive basic 

pay at a rate not to exceed the maximum amount of compensation payable to a member of the Senior Executive 

Service under subsection (b) of section 5382 of title 5, 

United States Code, except that the certification requirement in that subsection shall not apply to the compensation 

of the Director. 

‘‘(E) AUTHORITY AND RESPONSIBILITIES OF DIRECTOR.—

Except as otherwise specifically provided in this subsection, 

the Director shall—

‘‘(i) exercise all of the authority provided to the Institute by this subsection; 

‘‘(ii) formulate and administer programs in accordance with policies adopted by the Institute, in coordination with the Under Secretary; 

‘‘(iii) establish offices within the Institute; 

‘‘(iv) establish procedures for the provision and administration of grants by the Institute; and 

‘‘(v) consult regularly with the Advisory Board. 

‘‘(4) REGULATIONS.—The Institute shall have such authority 

as is necessary to carry out this subsection, including the authority to promulgate such regulations as the Institute considers 

to be necessary for governance of operations, organization, and 

personnel. ‘‘(5) ADMINISTRATION.— ‘‘(A) IN GENERAL.—The Director shall organize offices 

and functions within the Institute to administer fundamental and applied research and extension and education 

programs. ‘‘(B) RESEARCH PRIORITIES.—The Director shall ensure 

the research priorities established by the Under Secretary 

through the Research, Education and Extension Office are 

carried out by the offices and functions of the Institute, 

where applicable. 

‘‘(C) FUNDAMENTAL AND APPLIED RESEARCH.—The Director shall—

‘‘(i) determine an appropriate balance between fundamental and applied research programs and functions to ensure future research needs are met; and ‘‘(ii) designate staff, as appropriate, to assist in 

carrying out this subparagraph. 

‘‘(D) COMPETITIVELY FUNDED AWARDS.—The Director 

shall—


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‘‘(i) promote the use and growth of grants awarded 

through a competitive process; and ‘‘(ii) designate staff, as appropriate, to assist in 

carrying out this subparagraph. 

‘‘(E) COORDINATION.—The Director shall ensure that 

the offices and functions established under subparagraph 

(A) are effectively coordinated for maximum efficiency. 

‘‘(6) FUNDING.— ‘‘(A) IN GENERAL.—In addition to funds otherwise appropriated to carry out each program administered by the 

Institute, there are authorized to be appropriated such 

sums as are necessary to carry out this subsection for each 

fiscal year. ‘‘(B) ALLOCATION.—Funding made available under 

subparagraph (A) shall be allocated according to recommendations contained in the roadmap described in section 7504 of the Food, Conservation, and Energy Act of 

2008.’’. 

(b) FUNCTIONS.—Section 296(b) of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 7014(b)) is amended—

(1) in paragraph (4), by striking ‘‘or’’ at the end; 

(2) in paragraph (5), by striking the period at the end and 

inserting ‘‘; or’’; and 

(3) by adding at the end the following: 

‘‘(6) the authority of the Secretary to establish in the Department, under section 251—

‘‘(A) the position of Under Secretary of Agriculture for 

Research, Education, and Economics; 

‘‘(B) the Research, Education, and Extension Office; 

and 

‘‘(C) the National Institute of Food and Agriculture.’’. 

(c) CONFORMING AMENDMENTS.—The following conforming 

amendments shall take effect on October 1, 2009: 

(1) Section 522(d)(2) of the Federal Crop Insurance Act (7 

U.S.C. 1522(d)(2)) is amended by striking ‘‘the Cooperative 

State Research, Education, and Extension Service’’ and inserting ‘‘the National Institute of Food and Agriculture’’. (2) Section 524(a) of the Federal Crop Insurance Act (7 

U.S.C. 1524(a)) is amended in each of paragraphs (1)(B) and 

(3)(A) by striking ‘‘the Cooperative State Research, Education, 

and Extension Service’’ each place it appears and inserting ‘‘the 

National Institute of Food and Agriculture’’. (3) Section 306(a)(11)(C) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 1926(a)(11)(C)) is amended by 

striking ‘‘the Cooperative State Research, Education, and Extension Service’’ and inserting ‘‘the National Institute of Food and 

Agriculture’’. (4) Section 5(b)(2)(E) of the Agricultural Credit Improvement Act of 1992 (7 U.S.C. 1929 note; Public Law 102–554) is 

amended by striking ‘‘Cooperative Extension Service’’ and inserting ‘‘National Institute of Food and Agriculture’’. 

(5) Section 11(f)(1) of the Food and Nutrition Act of 2008 

(7 U.S.C. 2020(f)(1)) is amended by striking ‘‘Cooperative Extension Service’’ and inserting ‘‘National Institute of Food and Agriculture’’. 


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(6) Section 502(h) of the Rural Development Act of 1972 (7 

U.S.C. 2662(h)) is amended— (A) in paragraph (1), by striking ‘‘Extension Service’’ and inserting ‘‘National Institute of Food and Agriculture’’; 

and 

(B) in paragraph (4), by striking ‘‘Extension Service 

staff’’ and inserting ‘‘National Institute of Food and Agriculture staff’’. (7) Section 7404(b)(1)(B) of the Farm Security and Rural 

Investment Act of 2002 (7 U.S.C. 3101 note; Public Law 107– 171) is amended by striking clause (vi) and inserting the following: ‘‘(vi) the National Institute of Food and Agriculture.’’. (8) Section 1408(b)(4) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

3123(b)(4)) is amended by striking ‘‘the Administrator of the Cooperative State Research, Education, and Extension Service’’ and inserting ‘‘the Director of the National Institute of Food 

and Agriculture’’. (9) Section 2381(a) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 3125b(a)) is amended by striking ‘‘Extension Service’’ and inserting ‘‘National Institute of 

Food and Agriculture’’. (10) The National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 is amended— (A) in section 1424A(b) (7 U.S.C. 3174a(b)), by striking ‘‘the Cooperative State Research, Education, and Extension 

Service’’ and inserting ‘‘the National Institute of Food and 

Agriculture’’; and 

(B) in section 1458(a)(10) (7 U.S.C. 3291(a)(10)), by 

striking ‘‘the Cooperative State Research, Education, and 

Extension Service’’ and inserting ‘‘the National Institute of 

Food and Agriculture’’. 

(11) Section 1587(a) of the Food Security Act of 1985 (7 

U.S.C. 3175d(a)) is amended by striking ‘‘Extension Service’’

each place it appears and inserting ‘‘National Institute of Food 

and Agriculture’’. 

(12) Section 1444(b)(2)(A) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

3221(b)(2)(A)) is amended by striking ‘‘Extension Service’’ and 

inserting ‘‘National Institute of Food and Agriculture’’. 

(13) Section 1473D(d) of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

3319d(d)) is amended by striking ‘‘the Cooperative State Research Service, the Extension Service’’ and inserting ‘‘the National Institute of Food and Agriculture’’. 

(14) Section 1499(c) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5506(c)) is amended by striking ‘‘the Cooperative State Research Service’’ and all that follows through ‘‘extension services;’’ and inserting ‘‘the National 

Institute of Food and Agriculture, in conjunction with the system of State agricultural experiment stations and State and 

county cooperative extension services; the Economic Research 

Service;’’. 


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(15) Section 1622 of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5812) is amended— (A) in subsection (a)(1), by striking ‘‘the Cooperative 

State Research Service in close cooperation with the Extension Service’’ and inserting ‘‘the National Institute of Food 

and Agriculture’’; 

(B) in subsection (b)(1)— (i) by striking subparagraphs (B) and (C) and inserting the following: 

‘‘(B) the National Institute of Food and Agriculture;’’; 

and 

(ii) by redesignating subparagraphs (D) through 

(L) as subparagraphs (C) through (K), respectively. 

(16) Section 1627(d) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5821(d)) is amended by striking ‘‘Extension Service’’ and inserting ‘‘National Institute of 

Food and Agriculture’’. (17) Section 1629 of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5832) is amended— (A) in subsection (b), in the first sentence, by striking ‘‘the Extension Service’’ and inserting ‘‘the National Institute of Food and Agriculture’’; and 

(B) in subsection (h), by striking ‘‘Extension Service’’ and inserting ‘‘National Institute of Food and Agriculture’’. (18) Section 1638(b) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5852(b)) is amended— (A) in paragraph (3), by striking ‘‘Cooperative State Research Service’’ and inserting ‘‘National Institute of Food 

and Agriculture’’; and 

(B) in paragraph (5), by striking ‘‘Cooperative State Research Service’’ and inserting ‘‘National Institute of Food 

and Agriculture’’. (19) Section 1640(a)(2) of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5854(a)(2)) is amended 

by striking ‘‘the Administrator of the Extension Service, the Administrator of the Cooperative State Research Service’’ and inserting ‘‘the Director of the National Institute of Food and Agriculture’’. 

(20) Section 1641(a) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5855(a)) is amended—

(A) in paragraph (2), by striking ‘‘Cooperative State Research Service’’ and inserting ‘‘National Institute of Food 

and Agriculture’’; and 

(B) in paragraph (4,) by striking ‘‘Extension Service’’

and inserting ‘‘National Institute of Food and Agriculture’’. 

(21) Section 1668(b) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5921(b)) is amended by striking ‘‘Cooperative State Research, Education, and Extension 

Service’’ and inserting ‘‘National Institute of Food and Agriculture’’. 

(22) Section 1670(a)(4) of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5923(a)(4)) is amended 

by striking ‘‘the Administrator of the Cooperative State Research, Education, and Extension Service’’ and inserting ‘‘the 

Director of the National Institute of Food and Agriculture’’. 


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(23) Section 1677(a) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 5930(a)) is amended by striking ‘‘Extension Service’’ and inserting ‘‘National Institute of 

Food and Agriculture’’. (24) Section 2122(b)(1) of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 6521(b)(1)) is amended 

by striking ‘‘Extension Service’’ and inserting ‘‘National Institute of Food and Agriculture’’. (25) Section 2371 of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 6601) is amended— (A) in subsection (a), by striking ‘‘Extension Service’’ and inserting ‘‘National Institute of Food and Agriculture’’; 

and 

(B) in subsection (c)(3), by striking ‘‘Service’’ and inserting ‘‘System’’. (26) Section 2377(a) of the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 6615(a)) is amended by striking ‘‘Extension Service’’ and inserting ‘‘National Institute of 

Food and Agriculture’’. (27) Section 212(a)(2)(A) of the Department of Agriculture 

Reorganization Act of 1994 (7 U.S.C. 6912(a)(2)(A)) is amended 

by striking ‘‘251(d),’’ and inserting ‘‘251(f),’’. (28) Section 537 of the Federal Agriculture Improvement 

and Reform Act of 1996 (7 U.S.C. 7446) is amended in each of 

subsections (a)(2) and (b)(3)(B)(i) by striking ‘‘Cooperative State 

Research, Education, and Extension Service’’ and inserting ‘‘cooperative extension’’. (29) Section 101(b)(2) of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 U.S.C. 7611(b)(2)) 

is amended by striking ‘‘Cooperative State Research, Education, 

and Extension Service’’ and inserting ‘‘National Institute of 

Food and Agriculture’’. (30) Section 103(a) of the Agricultural Research, Extension, 

and Education Reform Act of 1998 (7 U.S.C. 7613(a)) is amended—

(A) in the subsection heading, by striking ‘‘Cooperative 

State Research, Education, and Extension Service’’ and inserting ‘‘National Institute of Food and Agriculture’’; and 

(B) in each of paragraphs (1) and (2)(A), by striking 

‘‘the Cooperative State Research, Education, and Extension 

Service’’ and inserting ‘‘the National Institute of Food and 

Agriculture’’. 

(31) Section 407(c) of the Agricultural Research, Extension, 

and Education Reform Act of 1998 (7 U.S.C. 7627(c)) is amended by striking ‘‘the Cooperative State Research, Education, and 

Extension Service’’ and inserting ‘‘the National Institute of Food 

and Agriculture’’. 

(32) Section 410(a) of the Agricultural Research, Extension, 

and Education Reform Act of 1998 (7 U.S.C. 7630(a)) is amended by striking ‘‘the Administrator of the Cooperative State Research, Education, and Extension Service’’ and inserting ‘‘the 

Director of the National Institute of Food and Agriculture’’. 

(33) Section 307(g)(5) of the Agricultural Risk Protection 

Act of 2000 (7 U.S.C. 8606(g)(5)) is amended by striking ‘‘Administrator of the Cooperative State Research, Education, and 


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Extension Service’’ and inserting ‘‘Director of the National Institute of Food and Agriculture’’. 

(34) Section 5(a) of the Renewable Resources Extension Act 

of 1978 (16 U.S.C. 1674a(a)) is amended by striking ‘‘Extension 

Service’’ and inserting ‘‘National Institute of Food and Agriculture’’. 

(35) Section 6(b) of the Cooperative Forestry Assistance Act 

of 1978 (16 U.S.C. 2103b(b)) is amended by striking ‘‘the Cooperative State Research, Education, and Extension Service, may 

provide technical, financial, and related assistance to State foresters, equivalent State officials, or Cooperative Extension officials’’ and inserting ‘‘the National Institute of Food and Agriculture, may provide technical, financial, and related assistance 

to State foresters, equivalent State officials, or cooperative extension officials’’. 

(36) Section 9(g)(2)(A)(viii) of the Cooperative Forestry Assistance Act of 1978 (16 U.S.C. 2105(g)(2)(A)(viii)) is amended 

by striking ‘‘Extension Service’’ and inserting ‘‘National Institute of Food and Agriculture’’. 

(37) Section 19(b)(1)(B)(i) of the Cooperative Forestry Assistance Act of 1978 (16 U.S.C. 2113(b)(1)(B)(i)) is amended by 

striking ‘‘Extension Service’’ and inserting ‘‘National Institute of 

Food and Agriculture’’. 

(38) Section 1261(c)(4) of the Food Security Act of 1985 (16 

U.S.C. 3861(c)(4)) is amended by striking ‘‘Extension Service’’

and inserting ‘‘National Institute of Food and Agriculture’’. 

(39) Section 105(a) of the Africa: Seeds of Hope Act of 1998 

(22 U.S.C. 2293 note; Public Law 105–385) is amended by striking ‘‘the Cooperative State, Research, Education, and Extension 

Service (CSREES)’’ and inserting ‘‘the National Institute of 

Food and Agriculture’’. 

(40) Section 307(a)(4) of the National Aeronautic and Space 

Administration Authorization Act of 2005 (42 U.S.C. 

16657(a)(4)) is amended by striking subparagraph (B) and inserting the following: 

‘‘(B) the program and structure of, peer review process 

of, management of conflicts of interest by, compensation of 

reviewers of, and the effects of compensation on reviewer efficiency and quality within, the National Institute of Food 

and Agriculture of the Department of Agriculture;’’. 

PART III—NEW GRANT AND RESEARCH 

PROGRAMS 

SEC. 7521. RESEARCH AND EDUCATION GRANTS FOR THE STUDY OF 

ANTIBIOTIC-RESISTANT BACTERIA. 

(a) IN GENERAL.—The Secretary shall provide research and 

education grants, on a competitive basis—

(1) to study the development of antibiotic-resistant bacteria, 

including—

(A) movement of antibiotic-resistant bacteria into 

groundwater and surface water; and 

(B) the effect on antibiotic resistance from various drug 

use regimens; and 


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(2) to study and ensure the judicious use of antibiotics in 

veterinary and human medicine, including—

(A) methods and practices of animal husbandry; 

(B) safe and effective alternatives to antibiotics; 

(C) the development of better veterinary diagnostics to 

improve decisionmaking; and 

(D) the identification of conditions or factors that affect 

antibiotic use on farms. 

(b) ADMINISTRATION.—Paragraphs (4), (7), (8), and (11)(B) of 

subsection (b) of the Competitive, Special, and Facilities Research 

Grant Act (7 U.S.C. 450i) shall apply with respect to the making of 

grants under this section. 

(c) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this section for each of fiscal years 2008 through 2012. 

SEC. 7522. FARM AND RANCH STRESS ASSISTANCE NETWORK. 

(a) IN GENERAL.—The Secretary, in coordination with the Secretary of Health and Human Services, shall make competitive 

grants to support cooperative programs between State cooperative 

extension services and nonprofit organizations to establish a Farm 

and Ranch Stress Assistance Network that provides stress assistance programs to individuals who are engaged in farming, ranching, and other agriculture-related occupations. 

(b) ELIGIBLE PROGRAMS.—Grants awarded under subsection (a) 

may be used to initiate, expand, or sustain programs that provide 

professional agricultural behavioral health counseling and referral 

for other forms of assistance as necessary through—

(1) farm telephone helplines and websites; 

(2) community education; 

(3) support groups; 

(4) outreach services and activities; and 

(5) home delivery of assistance, in a case in which a farm 

resident is homebound. 

(c) EXTENSION SERVICES.—Grants shall be awarded under this 

subsection directly to State cooperative extension services to enable 

the State cooperative extension services to enter into contracts, on a 

multiyear basis, with nonprofit, community-based, direct-service organizations to initiate, expand, or sustain cooperative programs described in subsections (a) and (b). 

(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this section for each of fiscal years 2008 through 2012. 

SEC. 7523. SEED DISTRIBUTION. 

(a) IN GENERAL.—The Secretary shall make competitive grants 

to eligible entities to carry out a seed distribution program to administer and maintain the distribution of vegetable seeds donated 

by commercial seed companies. 

(b) PURPOSES.—The purposes of this program include—

(1) the distribution of seeds donated by commercial seed 

companies free-of-charge to appropriate—

(A) individuals; 

(B) groups; 

(C) institutions; 


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(D) governmental and nongovernmental organizations; 

and 

(E) such other entities as the Secretary may designate; 

(2) distribution of seeds to underserved communities, such 

as communities that experience—

(A) limited access to affordable fresh vegetables; 

(B) a high rate of hunger or food insecurity; or 

(C) severe or persistent poverty. 

(c) ADMINISTRATION.—Paragraphs (4), (7), (8), and (11)(B) of 

subsection (b) of the Competitive, Special, and Facilities Research 

Grant Act (7 U.S.C. 450i) shall apply with respect to the making of 

grants under this section. 

(d) SELECTION.—An eligible entity selected to receive a grant 

under subsection (a) shall have—

(1) expertise regarding the distribution of vegetable seeds 

donated by commercial seed companies; and 

(2) the ability to achieve the purpose of the seed distribution 

program. 

(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this section for each of fiscal years 2008 through 2012. 

SEC. 7524. LIVE VIRUS FOOT AND MOUTH DISEASE RESEARCH. 

(a) IN GENERAL.—The Secretary shall issue a permit required 

under section 12 of the Act of May 29, 1884 (21 U.S.C. 113a), to the 

Secretary of Homeland Security for work on the live virus of foot 

and mouth disease at any facility that is a successor to the Plum 

Island Animal Disease Center and charged with researching highconsequence biological threats involving zoonotic and foreign animal diseases (referred to in this section as the ‘‘successor facility’’). 

(b) LIMITATION TO SINGLE FACILITY.—Not more than 1 facility 

shall be issued a permit under subsection (a). 

(c) LIMITATION ON VALIDITY.—The permit issued under this section shall be valid unless the Secretary determines that the study 

of live foot and mouth disease virus at the successor facility is not 

being carried out in accordance with the regulations promulgated 

by the Secretary pursuant to the Agricultural Bioterrorism Protection Act of 2002 (7 U.S.C. 8401 et seq.). 

(d) AUTHORITY.—The suspension, revocation, or other impairment of the permit issued under this section—

(1) shall be made by the Secretary; and 

(2) is a nondelegable function. 

SEC. 7525. NATURAL PRODUCTS RESEARCH PROGRAM. 

(a) IN GENERAL.—The Secretary shall establish within the Department a natural products research program. 

(b) DUTIES.—In carrying out the program established under 

subsection (a), the Secretary shall coordinate research relating to 

natural products, including—

(1) research to improve human health and agricultural productivity through the discovery, development, and commercialization of products and agrichemicals from bioactive natural products, including products from plant, marine, and microbial sources; 


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(2) research to characterize the botanical sources, production, chemistry, and biological properties of plant-derived natural products; and 

(3) other research priorities identified by the Secretary. 

(c) PEER AND MERIT REVIEW.—The Secretary shall— (1) determine the relevance and merit of research under 

this section through a system of peer review established by the 

Secretary pursuant to section 103 of the Agricultural Research, 

Extension, and Education Reform Act of 1998 (7 U.S.C. 7613); 

and 

(2) approve funding for research on the basis of merit, quality, and relevance to advancing the purposes of this section. 

(d) BUILDINGS AND FACILITIES.—Funds made available under 

this section shall not be used for the construction of a new building 

or facility or the acquisition, expansion, remodeling, or alteration of 

an existing building or facility (including site grading and improvement and architect fees). 

(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section such sums as are necessary for each of fiscal years 2008 through 2012. 

SEC. 7526. SUN GRANT PROGRAM. 

(a) ESTABLISHMENT.—The Secretary shall establish and carry 

out a program to provide grants to the sun grant centers and subcenter specified in subsection (b)— (1) to enhance national energy security through the development, distribution, and implementation of biobased energy technologies; 

(2) to promote diversification in, and the environmental 

sustainability of, agricultural production in the United States 

through biobased energy and product technologies; 

(3) to promote economic diversification in rural areas of the 

United States through biobased energy and product technologies; and 

(4) to enhance the efficiency of bioenergy and biomass research and development programs through improved coordination and collaboration among— (A) the Department of Agriculture; 

(B) the Department of Energy; and 

(C) land-grant colleges and universities. 

(b) GRANTS.— (1) IN GENERAL.—The Secretary shall use amounts made 

available under subsection (g) to provide grants to each of the 

following: 

(A) NORTH-CENTRAL CENTER.—A north-central sun 

grant center at South Dakota State University for the region composed of the States of Illinois, Indiana, Iowa, Minnesota, Montana, Nebraska, North Dakota, South Dakota, 

Wisconsin, and Wyoming. 

(B) SOUTHEASTERN CENTER.—A southeastern sun grant 

center at the University of Tennessee at Knoxville for the region composed of—

(i) the States of Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina, 

Tennessee, and Virginia; 

(ii) the Commonwealth of Puerto Rico; and 


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(iii) the United States Virgin Islands. 

(C) SOUTH-CENTRAL CENTER.—A south-central sun 

grant center at Oklahoma State University for the region 

composed of the States of Arkansas, Colorado, Kansas, 

Louisiana, Missouri, New Mexico, Oklahoma, and Texas. 

(D) WESTERN CENTER.—A western sun grant center at 

Oregon State University for the region composed of— (i) the States of Alaska, Arizona, California, Hawaii, Idaho, Nevada, Oregon, Utah, and Washington; 

and 

(ii) insular areas (as defined in section 1404 of the 

National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103 (other than the 

insular areas referred to in clauses (ii) and (iii) of subparagraph (B))). 

(E) NORTHEASTERN CENTER.—A northeastern sun 

grant center at Cornell University for the region composed 

of the States of Connecticut, Delaware, Massachusetts, 

Maryland, Maine, Michigan, New Hampshire, New Jersey, 

New York, Ohio, Pennsylvania, Rhode Island, Vermont, 

and West Virginia. 

(F) WESTERN INSULAR PACIFIC SUBCENTER.—A western 

insular Pacific sun grant subcenter at the University of Hawaii for the region of Alaska, Hawaii, Guam, American 

Samoa, the Commonwealth of the Northern Mariana Islands, the Federated States of Micronesia, the Republic of 

the Marshall Islands, and the Republic of Palau. 

(2) MANNER OF DISTRIBUTION.— (A) CENTERS.—In providing any funds made available 

under subsection (g), the Secretary shall distribute the 

grants in equal amounts to the sun grant centers described 

in subparagraphs (A) through (E) of paragraph (1). 

(B) SUBCENTER.—The sun grant center described in 

paragraph (1)(D) shall allocate a portion of the funds received under paragraph (1) to the subcenter described in 

paragraph (1)(F) pursuant to guidance issued by the Secretary. 

(3) FAILURE TO COMPLY WITH REQUIREMENTS.—If the Secretary finds on the basis of a review of the annual report required under subsection (f) or on the basis of an audit of a sun 

grant center or subcenter conducted by the Secretary that the 

center or subcenter has not complied with the requirements of 

this section, the sun grant center or subcenter shall be ineligible 

to receive further grants under this section for such period of 

time as may be prescribed by the Secretary. 

(c) USE OF FUNDS.—

(1) COMPETITIVE GRANTS.—

(A) IN GENERAL.—A sun grant center or subcenter shall 

use 75 percent of the funds described in subsection (b) to 

provide competitive grants to entities that are—

(i) eligible to receive grants under subsection (b)(7) 

of the Competitive, Special, and Facilities Research 

Grant Act (7 U.S.C. 450i(b)(7)); and 

(ii) located in the region covered by the sun grant 

center or subcenter. 


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(B) ACTIVITIES.—Grants described in subparagraph (A) 

shall be used by the grant recipient to conduct, in a manner 

consistent with the purposes described in subsection (a), 

multi-institutional and multistate— (i) research, extension, and education programs on 

technology development; and 

(ii) integrated research, extension, and education 

programs on technology implementation. 

(C) FUNDING ALLOCATION.—Of the amount of funds 

that is used to provide grants under subparagraph (A), the 

sun grant center or subcenter shall use— (i) not less than 30 percent of the funds to carry 

out the programs described in subparagraph (B)(i); 

and 

(ii) not less than 30 percent of the funds to carry 

out the programs described in subparagraph (B)(ii). 

(D) ADMINISTRATION.—

(i) PEER AND MERIT REVIEW.—In making grants 

under this paragraph, a sun grant center or subcenter 

shall— (I) seek and accept proposals for grants; 

(II) determine the relevance and merit of proposals through a system of peer review similar to 

that established by the Secretary pursuant to section 103 of the Agricultural Research, Extension, 

and Education Reform Act of 1998 (7 U.S.C. 

7613); and 

(III) award grants on the basis of merit, quality, and relevance to advancing the purposes of 

this section. 

(ii) PRIORITY.—A sun grant center or subcenter 

shall give a higher priority to programs that are consistent with the plan approved by the Secretary under 

subsection (d). 

(iii) TERM.—A grant awarded by a sun grant center or subcenter shall have a term that does not exceed 

5 years. 

(iv) MATCHING FUNDS REQUIRED.— (I) IN GENERAL.—Except as provided in subclauses (II) and (III), as a condition of receiving a 

grant under this paragraph, the sun grant center 

or subcenter shall require that not less than 20 

percent of the cost of an activity described in subparagraph (B) be matched with funds, including 

in-kind contributions, from a non-Federal source. 

(II) EXCLUSION.—Subclause (I) shall not apply 

to fundamental research (as defined in subsection 

(f)(1) of section 251 of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6971) 

(as added by section 7511(a)(4)). 

(III) REDUCTION.—The sun grant center or 

subcenter may reduce or eliminate the requirement 

for non-Federal funds under subclause (I) for applied research (as defined in subsection (f)(1) of 

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ganization Act of 1994 (7 U.S.C. 6971) (as added 

by section 7511(a)(4)) if the sun grant center or 

subcenter determines that the reduction is necessary and appropriate pursuant to guidance 

issued by the Secretary. 

(v) BUILDINGS AND FACILITIES.—Funds made 

available for grants shall not be used for the construction of a new building or facility or the acquisition, expansion, remodeling, or alteration of an existing building or facility (including site grading and improvement 

and architect fees). 

(vi) LIMITATION ON INDIRECT COSTS.—A sun grant 

center or subcenter may not recover the indirect costs 

of making grants under subparagraph (A). 

(2) ADMINISTRATIVE EXPENSES.—A sun grant center or subcenter may use up to 4 percent of the funds described in subsection (b) to pay administrative expenses incurred in carrying 

out paragraph (1). 

(3) RESEARCH, EXTENSION AND EDUCATIONAL ACTIVITIES.—

The sun grant centers and subcenter shall use the remainder of 

the funds described in subsection (b) to conduct, in a manner 

consistent with the purposes described in subsection (a), multiinstitutional and multistate—

(A) research, extension, and educational programs on 

technology development; and 

(B) integrated research, extension, and educational programs on technology implementation. 

(d) PLAN FOR RESEARCH ACTIVITIES TO BE FUNDED.— (1) IN GENERAL.—Subject to the availability of funds under 

subsection (g), and in cooperation with land-grant colleges and 

universities and private industry in accordance with paragraph 

(2), the sun grant centers and subcenter shall jointly develop 

and submit to the Secretary for approval a plan for addressing 

the bioenergy, biomass, and gasification research priorities of 

the Department of Agriculture and the Department of Energy at 

the State and regional levels. 

(2) GASIFICATION COORDINATION.—With respect to gasification research activity, the sun grant centers and subcenter 

shall coordinate planning with land-grant colleges and universities in their respective regions that have ongoing research activities in that area. 

(3) FUNDING.—Funds described in subsection (c)(2) shall be 

available to carry out planning coordination under paragraph 

(1). 

(4) USE OF PLAN.—The sun grant centers and subcenter 

shall use the plan described in paragraph (1) in making grants 

under subsection (c)(1). 

(e) GRANT INFORMATION ANALYSIS CENTER.—The sun grant 

centers and subcenter shall maintain a Sun Grant Information 

Analysis Center at the sun grant center specified in subsection 

(b)(1)(A) to provide the sun grant centers and subcenter with analysis and data management support. 

(f) ANNUAL REPORTS.—Not later than 90 days after the end of 

each fiscal year, a sun grant center or subcenter receiving a grant 

under this section shall submit to the Secretary a report that deVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00397 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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scribes the policies, priorities, and operations of the program carried 

out by the center or subcenter during the fiscal year, including—

(1) the results of all peer and merit review procedures conducted pursuant to subsection (c)(1)(D)(i); and 

(2) a description of progress made in facilitating the priorities described in subsection (d)(1). 

(g) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $75,000,000 for each of 

fiscal years 2008 through 2012, of which not more than $4,000,000 

for each fiscal year shall be made available to carry out subsection 

(e). 

SEC. 7527. STUDY AND REPORT ON FOOD DESERTS. 

(a) DEFINITION OF FOOD DESERT.—In this section, the term 

‘‘food desert’’ means an area in the United States with limited access to affordable and nutritious food, particularly such an area 

composed of predominantly lower-income neighborhoods and communities. 

(b) STUDY AND REPORT.—The Secretary shall carry out a study 

of, and prepare a report on, food deserts. 

(c) CONTENTS.—The study and report shall—

(1) assess the incidence and prevalence of food deserts; 

(2) identify—

(A) characteristics and factors causing and influencing 

food deserts; and 

(B) the effect on local populations of limited access to 

affordable and nutritious food; and 

(3) provide recommendations for addressing the causes and 

effects of food deserts through measures that include—

(A) community and economic development initiatives; 

(B) incentives for retail food market development, including supermarkets, small grocery stores, and farmers’

markets; and 

(C) improvements to Federal food assistance and nutrition education programs. 

(d) COORDINATION WITH OTHER AGENCIES AND ORGANIZATIONS.—The Secretary shall conduct the study under this section in 

coordination and consultation with—

(1) the Secretary of Health and Human Services; 

(2) the Administrator of the Small Business Administration; 

(3) the Institute of Medicine; and 

(4) representatives of appropriate businesses, academic institutions, and nonprofit and faith-based organizations. 

(e) SUBMISSION TO CONGRESS.—Not later than 1 year after the 

date of enactment of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate the report prepared under this section, including the findings and recommendations described in subsection (c). 

(f) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to 

be appropriated to carry out this section $500,000. 


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SEC. 7528. DEMONSTRATION PROJECT AUTHORITY FOR TEMPORARY 

POSITIONS. 

Notwithstanding section 4703(d)(1) of title 5, United States 

Code, the amendment to the personnel management demonstration 

project established in the Department of Agriculture (67 Fed. Reg. 

70776 (2002)), shall become effective upon the date of enactment of 

this Act and shall remain in effect unless modified by law. 

SEC. 7529. AGRICULTURAL AND RURAL TRANSPORTATION RESEARCH 

AND EDUCATION. 

(a) IN GENERAL.—The Secretary, in consultation with the Secretary of Transportation, shall make competitive grants to institutions of higher education to carry out agricultural and rural transportation research and education activities. 

(b) ACTIVITIES.—Research and education grants made under 

this section shall be used to address rural transportation and logistics needs of agricultural producers and related rural businesses, including—

(1) the transportation of biofuels; and 

(2) the export of agricultural products. 

(c) SELECTION CRITERIA.—

(1) IN GENERAL.—The Secretary shall award grants under 

this section on the basis of the transportation research, education, and outreach expertise of the applicant, as determined 

by the Secretary. 

(2) PRIORITY.—In awarding grants under this section, the 

Secretary shall give priority to institutions of higher education 

for use in coordinating research and education activities with 

other institutions of higher education with similar agricultural 

and rural transportation research and education programs. 

(d) DIVERSIFICATION OF RESEARCH.—The Secretary shall award 

grants under this section in areas that are regionally diverse and 

broadly representative of the diversity of agricultural production 

and related transportation needs in the rural areas of the United 

States. 

(e) MATCHING FUNDS REQUIREMENT.—The Secretary shall require each recipient of a grant under this section to provide, from 

non-Federal sources, in cash or in kind, 50 percent of the cost of carrying out activities under the grant. 

(f) GRANT REVIEW.—A grant shall be awarded under this section on a competitive, peer- and merit-reviewed basis in accordance 

with section 103(a) of the Agricultural Research, Extension, and 

Education Reform Act of 1998 (7 U.S.C. 7613(a)). 

(g) NO DUPLICATION.—In awarding grants under this section, 

the Secretary shall ensure that activities funded under this section 

do not duplicate the efforts of the University Transportation Centers 

described in sections 5505 and 5506 of title 49, United States Code. 

(h) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $5,000,000 for each of 

fiscal years 2008 through 2012. 


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TITLE VIII—FORESTRY 

Subtitle A—Amendments to Cooperative Forestry Assistance 

Act of 1978 

SEC. 8001. NATIONAL PRIORITIES FOR PRIVATE FOREST CONSERVATION. 

Section 2 of the Cooperative Forestry Assistance Act of 1978 (16 

U.S.C. 2101) is amended—

(1) by redesignating subsections (c) and (d) as subsections 

(e) and (f), respectively; and 

(2) by inserting after subsection (b) the following new subsections: 

‘‘(c) PRIORITIES.—In allocating funds appropriated or otherwise 

made available under this Act, the Secretary shall focus on the following national private forest conservation priorities, notwithstanding other priorities specified elsewhere in this Act: 

‘‘(1) Conserving and managing working forest landscapes 

for multiple values and uses. 

‘‘(2) Protecting forests from threats, including catastrophic 

wildfires, hurricanes, tornados, windstorms, snow or ice storms, 

flooding, drought, invasive species, insect or disease outbreak, 

or development, and restoring appropriate forest types in response to such threats. 

‘‘(3) Enhancing public benefits from private forests, including air and water quality, soil conservation, biological diversity, 

carbon storage, forest products, forestry-related jobs, production 

of renewable energy, wildlife, wildlife corridors and wildlife 

habitat, and recreation. 

‘‘(d) REPORTING REQUIREMENT.—Not later than September 30, 

2011, the Secretary shall submit to Congress a report describing 

how funds were used under this Act, and through other programs 

administered by the Secretary, to address the national priorities 

specified in subsection (c) and the outcomes achieved in meeting the 

national priorities.’’. 

SEC. 8002. LONG-TERM STATE-WIDE ASSESSMENTS AND STRATEGIES 

FOR FOREST RESOURCES. 

The Cooperative Forestry Assistance Act of 1978 is amended by 

inserting after section 2 (16 U.S.C. 2101) the following new section: 

‘‘SEC. 2A. STATE-WIDE ASSESSMENT AND STRATEGIES FOR FOREST 

RESOURCES. 

‘‘(a) ASSESSMENT AND STRATEGIES FOR FOREST RESOURCES.—

For a State to be eligible to receive funds under the authorities of 

this Act, the State forester of that State or equivalent State official 

shall develop and submit to the Secretary, not later than two years 

after the date of enactment of the Food, Conservation, and Energy 

Act of 2008, the following: 

‘‘(1) A State-wide assessment of forest resource conditions, 

including—

‘‘(A) the conditions and trends of forest resources in 

that State; 

‘‘(B) the threats to forest lands and resources in that 

State consistent with the national priorities specified in section 2(c); 


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‘‘(C) any areas or regions of that State that are a priority; and 

‘‘(D) any multi-State areas that are a regional priority. 

‘‘(2) A long-term State-wide forest resource strategy, including—

‘‘(A) strategies for addressing threats to forest resources 

in the State outlined in the assessment required by paragraph (1); and 

‘‘(B) a description of the resources necessary for the 

State forester or equivalent State official from all sources to 

address the State-wide strategy. 

‘‘(b) UPDATING.—At such times as the Secretary determines to be 

necessary, the State forester or equivalent State official shall update 

and resubmit to the Secretary the State-wide assessment and Statewide strategy required by subsection (a). 

‘‘(c) COORDINATION.—In developing or updating the State-wide 

assessment and State-wide strategy required by subsection (a), the 

State Forester or equivalent State official shall coordinate with—

‘‘(1) the State Forest Stewardship Coordinating Committee 

established for the State under section 19(b); 

‘‘(2) the State wildlife agency, with respect to strategies contained in the State wildlife action plans; 

‘‘(3) the State Technical Committee; 

‘‘(4) applicable Federal land management agencies; and 

‘‘(5) for purposes of the Forest Legacy Program under section 7, the State lead agency designated by the Governor. 

‘‘(d) INCORPORATION OF OTHER PLANS.—In developing or updating the State-wide assessment and State-wide strategy required by 

subsection (a), the State forester or equivalent State official shall incorporate any forest management plan of the State, including community wildfire protection plans and State wildlife action plans. 

‘‘(e) SUFFICIENCY.—Once approved by the Secretary, a Statewide assessment and State-wide strategy developed under subsection (a) shall be deemed to be sufficient to satisfy all relevant 

State planning and assessment requirements under this Act. 

‘‘(f) FUNDING.—

‘‘(1) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this section up to 

$10,000,000 for each of fiscal years 2008 through 2012. 

‘‘(2) ADDITIONAL FUNDING SOURCES.—In addition to the 

funds appropriated for a fiscal year pursuant to the authorization of appropriations in paragraph (1) to carry out this section, 

the Secretary may use any other funds made available for planning under this Act to carry out this section, except that the 

total amount of combined funding used to carry out this section 

may not exceed $10,000,000 in any fiscal year. 

‘‘(g) ANNUAL REPORT ON USE OF FUNDS.—The State forester or 

equivalent State official shall submit to the Secretary an annual report detailing how funds made available to the State under this Act 

are being used.’’. 

SEC. 8003. COMMUNITY FOREST AND OPEN SPACE CONSERVATION 

PROGRAM. 

(a) FINDINGS.—Congress finds that—


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(1) the Forest Service projects that, by calendar year 2030, 

approximately 44,000,000 acres of privately-owned forest land 

will be developed throughout the United States; 

(2) public access to parcels of privately-owned forest land 

for outdoor recreational activities, including hunting, fishing, 

and trapping, has declined and, as a result, participation in 

those activities has also declined in cases in which public access 

is not secured; 

(3) rising rates of obesity and other public health problems 

relating to the inactivity of the citizens of the United States 

have been shown to be ameliorated by improving public access 

to safe and attractive areas for outdoor recreation; 

(4) in rapidly-growing communities of all sizes throughout 

the United States, remaining parcels of forest land play an essential role in protecting public water supplies; 

(5) forest parcels owned by local governmental entities and 

nonprofit organizations are providing important demonstration 

sites for private landowners to learn forest management techniques; 

(6) throughout the United States, communities of diverse 

types and sizes are deriving significant financial and community benefits from managing forest land owned by local governmental entities for timber and other forest products; and 

(7) there is an urgent need for local governmental entities 

to be able to leverage financial resources in order to purchase 

important parcels of privately-owned forest land as the parcels 

are offered for sale. 

(b) COMMUNITY FOREST AND OPEN SPACE CONSERVATION PROGRAM.—The Cooperative Forestry Assistance Act of 1978 is amended 

by inserting after section 7 (16 U.S.C. 2103c) the following new section: 

‘‘SEC. 7A. COMMUNITY FOREST AND OPEN SPACE CONSERVATION PROGRAM. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible entity’ means a 

local governmental entity, Indian tribe, or nonprofit organization that owns or acquires a parcel under the program. 

‘‘(2) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning given the term in section 4 of the Indian Self-Determination 

and Education Assistance Act (25 U.S.C. 450b). 

‘‘(3) LOCAL GOVERNMENTAL ENTITY.—The term ‘local governmental entity’ includes any municipal government, county 

government, or other local government body with jurisdiction 

over local land use decisions. 

‘‘(4) NONPROFIT ORGANIZATION.—The term ‘nonprofit organization’ means any organization that—

‘‘(A) is described in section 170(h)(3) of the Internal 

Revenue Code of 1986; and 

‘‘(B) operates in accordance with 1 or more of the purposes specified in section 170(h)(4)(A) of that Code. 

‘‘(5) PROGRAM.—The term ‘Program’ means the community 

forest and open space conservation program established under 

subsection (b). 

‘‘(6) SECRETARY.—The term ‘Secretary’ means the Secretary 

of Agriculture, acting through the Chief of the Forest Service. 


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‘‘(b) ESTABLISHMENT.—The Secretary shall establish a program, 

to be known as the ‘community forest and open space conservation 

program’. ‘‘(c) GRANT PROGRAM.— ‘‘(1) IN GENERAL.—The Secretary may award grants to eligible entities to acquire private forest land, to be owned in fee 

simple, that— ‘‘(A) are threatened by conversion to nonforest uses; and 

‘‘(B) provide public benefits to communities, including— ‘‘(i) economic benefits through sustainable forest 

management; ‘‘(ii) environmental benefits, including clean water 

and wildlife habitat; ‘‘(iii) benefits from forest-based educational programs, including vocational education programs in forestry; ‘‘(iv) benefits from serving as models of effective 

forest stewardship for private landowners; and ‘‘(v) recreational benefits, including hunting and 

fishing. ‘‘(2) FEDERAL COST SHARE.—An eligible entity may receive 

a grant under the Program in an amount equal to not more 

than 50 percent of the cost of acquiring 1 or more parcels, as 

determined by the Secretary. ‘‘(3) NON-FEDERAL SHARE.—As a condition of receipt of the 

grant, an eligible entity that receives a grant under the Program shall provide, in cash, donation, or in kind, a non-Federal matching share in an amount that is at least equal to the 

amount of the grant received. ‘‘(4) APPRAISAL OF PARCELS.—To determine the non-Federal 

share of the cost of a parcel of privately-owned forest land 

under paragraph (2), an eligible entity shall require appraisals 

of the land that comply with the Uniform Appraisal Standards 

for Federal Land Acquisitions developed by the Interagency 

Land Acquisition Conference. 

‘‘(5) APPLICATION.—An eligible entity that seeks to receive a 

grant under the Program shall submit to the State forester or 

equivalent official (or in the case of an Indian tribe, an equivalent official of the Indian tribe) an application that includes— ‘‘(A) a description of the land to be acquired; 

‘‘(B) a forest plan that provides— ‘‘(i) a description of community benefits to be 

achieved from the acquisition of the private forest land; 

and ‘‘(ii) an explanation of the manner in which any 

private forest land to be acquired using funds from the 

grant will be managed; and 

‘‘(C) such other relevant information as the Secretary 

may require. 

‘‘(6) EFFECT ON TRUST LAND.— ‘‘(A) INELIGIBILITY.—The Secretary shall not provide a 

grant under the Program for any project on land held in 

trust by the United States (including Indian reservations 

and allotment land). 


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‘‘(B) ACQUIRED LAND.—No land acquired using a grant 

provided under the Program shall be converted to land 

held in trust by the United States on behalf of any Indian 

tribe. 

‘‘(7) APPLICATIONS TO SECRETARY.—The State forester or 

equivalent official (or in the case of an Indian tribe, an equivalent official of the Indian tribe) shall submit to the Secretary a 

list that includes a description of each project submitted by an 

eligible entity at such times and in such form as the Secretary 

shall prescribe. 

‘‘(d) DUTIES OF ELIGIBLE ENTITY.—An eligible entity shall provide public access to, and manage, forest land acquired with a 

grant under this section in a manner that is consistent with the purposes for which the land was acquired under the Program. ‘‘(e) PROHIBITED USES.— ‘‘(1) IN GENERAL.—Subject to paragraphs (2) and (3), an eligible entity that acquires a parcel under the Program shall not 

sell the parcel or convert the parcel to nonforest use. ‘‘(2) REIMBURSEMENT OF FUNDS.—An eligible entity that 

sells or converts to nonforest use a parcel acquired under the 

Program shall pay to the Federal Government an amount equal 

to the greater of the current sale price, or current appraised 

value, of the parcel. 

‘‘(3) LOSS OF ELIGIBILITY.—An eligible entity that sells or 

converts a parcel acquired under the Program shall not be eligible for additional grants under the Program. 

‘‘(f) STATE ADMINISTRATION AND TECHNICAL ASSISTANCE.—The 

Secretary may allocate not more than 10 percent of all funds made 

available to carry out the Program for each fiscal year to State foresters or equivalent officials (including equivalent officials of Indian 

tribes) for Program administration and technical assistance. 

‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this section.’’. 

SEC. 8004. ASSISTANCE TO THE FEDERATED STATES OF MICRONESIA, 

THE REPUBLIC OF THE MARSHALL ISLANDS, AND THE REPUBLIC OF PALAU. 

Section 13(d)(1) of the Cooperative Forestry Act of 1978 (16 

U.S.C. 2109(d)(1)) is amended by striking ‘‘the Trust Territory of the 

Pacific Islands,’’ and inserting ‘‘the Federated States of Micronesia, 

the Republic of the Marshall Islands, the Republic of Palau,’’. 

SEC. 8005. CHANGES TO FOREST RESOURCE COORDINATING COMMITTEE. 

Section 19 of the Cooperative Forestry Assistance Act of 1978 

(16 U.S.C. 2113) is amended by striking subsection (a) and inserting the following new subsection: 

‘‘(a) FOREST RESOURCE COORDINATING COMMITTEE.—

‘‘(1) ESTABLISHMENT.—The Secretary shall establish a committee, to be known as the ‘Forest Resource Coordinating Committee’ (in this section referred to as the ‘Coordinating Committee’), to coordinate nonindustrial private forestry activities 

within the Department of Agriculture and with the private sector. 

‘‘(2) COMPOSITION.—The Coordinating Committee shall be 

composed of the following: 


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‘‘(A) The Chief of the Forest Service. 

‘‘(B) The Chief of the Natural Resources Conservation 

Service. ‘‘(C) The Director of the Farm Service Agency. 

‘‘(D) The Director of the National Institute of Food and 

Agriculture. ‘‘(E) Non-Federal representatives appointed by the Secretary to 3 year terms, although initial appointees shall 

have staggered terms, including the following persons: ‘‘(i) At least three State foresters or equivalent 

State officials from geographically diverse regions of 

the United States. ‘‘(ii) A representative of a State fish and wildlife 

agency. ‘‘(iii) An owner of nonindustrial private forest 

land. ‘‘(iv) A forest industry representative. 

‘‘(v) A conservation organization representative. 

‘‘(vi) A land-grant university or college representative. ‘‘(vii) A private forestry consultant. 

‘‘(viii) A representative from a State Technical 

Committee established under section 1261 of the Food 

Security Act of 1985 (16 U.S.C. 3861). 

‘‘(F) Such other persons as determined by the Secretary 

to be appropriate. 

‘‘(3) CHAIRPERSON.—The Chief of the Forest Service shall 

serve as chairperson of the Coordinating Committee. ‘‘(4) DUTIES.—The Coordinating Committee shall—

‘‘(A) provide direction and coordination of actions within the Department of Agriculture, and coordination with 

State agencies and the private sector, to effectively address 

the national priorities specified in section 2(c), with specific 

focus owners of nonindustrial private forest land; ‘‘(B) clarify individual agency responsibilities of each 

agency represented on the Coordinating Committee concerning the national priorities specified in section 2(c), with 

specific focus on nonindustrial private forest land; ‘‘(C) provide advice on the allocation of funds, including the competitive funds set-aside by sections 13A and 

13B; and ‘‘(D) assist the Secretary in developing and reviewing 

the report required by section 2(d). 

‘‘(5) MEETING.—The Coordinating Committee shall meet 

annually to discuss progress in addressing the national priorities specified in section 2(c) and issues regarding nonindustrial 

private forest land. 

‘‘(6) COMPENSATION.—

‘‘(A) FEDERAL MEMBERS.—Members of the Coordinating 

Committee who are full-time officers or employees of the 

United States shall receive no additional pay, allowances, 

or benefits by reason of their service on the Coordinating 

Committee. ‘‘(B) NON-FEDERAL MEMBERS.—Non-federal members of 

the Coordinating Committee shall serve without pay, but 


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may be reimbursed for reasonable costs incurred while performing their duties on behalf of the Coordinating Committee.’’. 

SEC. 8006. CHANGES TO STATE FOREST STEWARDSHIP COORDINATING 

COMMITTEES. 

Section 19(b) of the Cooperative Forestry Assistance Act of 1978 

(16 U.S.C. 2113(b)) is amended—

(1) in paragraph (1)(B)(ii)—

(A) by striking ‘‘and’’ at the end of subclause (VII); and 

(B) by adding at the end the following new subclause: 

‘‘(IX) the State Technical Committee.’’. 

(2) in paragraph (2)(C), by striking ‘‘a Forest Stewardship 

Plan under paragraph (3)’’ and inserting ‘‘the State-wide assessment and strategy regarding forest resource conditions 

under section 2A’’; 

(3) by striking paragraphs (3) and (4); and 

(4) by redesignating paragraphs (5) and (6) as paragraphs 

(3) and (4), respectively. 

SEC. 8007. COMPETITION IN PROGRAMS UNDER COOPERATIVE FORESTRY ASSISTANCE ACT OF 1978. 

The Cooperative Forestry Assistance Act of 1978 is amended by 

inserting after section 13 (16 U.S.C. 2109) the following new section: 

‘‘SEC. 13A. COMPETITIVE ALLOCATION OF FUNDS TO STATE FORESTERS OR EQUIVALENT STATE OFFICIALS. 

‘‘(a) COMPETITION.—Beginning not later than 3 years after the 

date of the enactment of the Food, Conservation, and Energy Act of 

2008, the Secretary shall competitively allocate a portion, to be determined by the Secretary, of the funds available under this Act to 

State foresters or equivalent State officials. 

‘‘(b) DETERMINATION.—In determining the competitive allocation of funds under subsection (a), the Secretary shall consult with 

the Forest Resource Coordinating Committee established by section 

19(a). 

‘‘(c) PRIORITY.—The Secretary shall give priority for funding to 

States for which the long-term State-wide forest resource strategies 

submitted under section 2A(a)(2) will best promote the national priorities specified in section 2(c).’’. 

SEC. 8008. COMPETITIVE ALLOCATION OF FUNDS FOR COOPERATIVE 

FOREST INNOVATION PARTNERSHIP PROJECTS. 

The Cooperative Forestry Assistance Act of 1978 is amended by 

inserting after section 13A, as added by section 8006, the following 

new section: 

‘‘SEC. 13B. COMPETITIVE ALLOCATION OF FUNDS FOR COOPERATIVE 

FOREST INNOVATION PARTNERSHIP PROJECTS. 

‘‘(a) COOPERATIVE FOREST INNOVATION PARTNERSHIP

PROJECTS.—The Secretary may competitively allocate not more than 

5 percent of the funds made available under this Act to support innovative national, regional, or local education, outreach, or technology transfer projects that the Secretary determines would substantially increase the ability of the Department of Agriculture to 

address the national priorities specified in section 2(c). 

‘‘(b) ELIGIBILITY.—Notwithstanding the eligibility limitations 

contained in this Act, any State or local government, Indian tribe, 


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land-grant college or university, or private entity shall be eligible to 

compete for funds to be competitively allocated under subsection (a). 

‘‘(c) COST-SHARE REQUIREMENT.—In carrying out subsection 

(a), the Secretary shall not cover more than 50 percent of the total 

cost of a project under such subsection. In calculating the total cost 

of a project and contributions made with regard to the project, the 

Secretary shall include in-kind contributions.’’. 

Subtitle B—Cultural and Heritage Cooperation Authority 

SEC. 8101. PURPOSES. 

The purposes of this subtitle are—

(1) to authorize the reburial of human remains and cultural items on National Forest System land, including human 

remains and cultural items repatriated under the Native American Graves Protection and Repatriation Act (25 U.S.C. 3001 et 

seq.); 

(2) to prevent the unauthorized disclosure of information 

regarding reburial sites, including the quantity and identity of 

human remains and cultural items on sites and the location of 

sites; 

(3) to authorize the Secretary of Agriculture to ensure access to National Forest System land, to the maximum extent 

practicable, by Indians and Indian tribes for traditional and 

cultural purposes; 

(4) to authorize the Secretary to provide forest products, 

without consideration, to Indian tribes for traditional and cultural purposes; 

(5) to authorize the Secretary to protect the confidentiality 

of certain information, including information that is culturally 

sensitive to Indian tribes; 

(6) to increase the availability of Forest Service programs 

and resources to Indian tribes in support of the policy of the 

United States to promote tribal sovereignty and self-determination; and 

(7) to strengthen support for the policy of the United States 

of protecting and preserving the traditional, cultural, and ceremonial rites and practices of Indian tribes, in accordance with 

Public Law 95–341 (commonly known as the American Indian 

Religious Freedom Act; 42 U.S.C. 1996). 

SEC. 8102. DEFINITIONS. 

In this subtitle: 

(1) ADJACENT SITE.—The term ‘‘adjacent site’’ means a site 

that borders a boundary line of National Forest System land. 

(2) CULTURAL ITEMS.—The term ‘‘cultural items’’ has the 

meaning given the term in section 2 of the Native American 

Graves Protection and Repatriation Act (25 U.S.C. 3001), except 

that the term does not include human remains. 

(3) HUMAN REMAINS.—The term ‘‘human remains’’ means 

the physical remains of the body of a person of Indian ancestry. 

(4) INDIAN.—The term ‘‘Indian’’ means an individual who 

is a member of an Indian tribe. 

(5) INDIAN TRIBE.—The term ‘‘Indian tribe’’ means any Indian or Alaska Native tribe, band, nation, pueblo, village, or 

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lished by the Secretary of the Interior pursuant to section 104 

of the Federally Recognized Indian Tribe List Act of 1994 (25 

U.S.C. 479a–1). 

(6) LINEAL DESCENDANT.—The term ‘‘lineal descendant’’

means an individual that can trace, directly and without interruption, the ancestry of the individual through the traditional 

kinship system of an Indian tribe, or through the common law 

system of descent, to a known Indian, the human remains, funerary objects, or other sacred objects of whom are claimed by 

the individual. 

(7) NATIONAL FOREST SYSTEM.—The term ‘‘National Forest 

System’’ has the meaning given the term in section 11(a) of the 

Forest and Rangeland Renewable Resources Planning Act of 

1974 (16 U.S.C. 1609(a)). 

(8) REBURIAL SITE.—The term ‘‘reburial site’’ means a specific physical location at which cultural items or human remains are reburied. 

(9) TRADITIONAL AND CULTURAL PURPOSE.—The term ‘‘traditional and cultural purpose’’, with respect to a definable use, 

area, or practice, means that the use, area, or practice is identified by an Indian tribe as traditional or cultural because of the 

long-established significance or ceremonial nature of the use, 

area, or practice to the Indian tribe. 

SEC. 8103. REBURIAL OF HUMAN REMAINS AND CULTURAL ITEMS. 

(a) REBURIAL SITES.—In consultation with an affected Indian 

tribe or lineal descendant, the Secretary may authorize the use of 

National Forest System land by the Indian tribe or lineal descendant for the reburial of human remains or cultural items in the possession of the Indian tribe or lineal descendant that have been 

disinterred from National Forest System land or an adjacent site. 

(b) REBURIAL.—With the consent of the affected Indian tribe or 

lineal descendent, the Secretary may recover and rebury, at Federal 

expense or using other available funds, human remains and cultural items described in subsection (a) at the National Forest System land identified under that subsection. 

(c) AUTHORIZATION OF USE.—

(1) IN GENERAL.—Subject to paragraph (2), the Secretary 

may authorize such uses of reburial sites on National Forest 

System land, or on the National Forest System land immediately surrounding a reburial site, as the Secretary determines 

to be necessary for management of the National Forest System. 

(2) AVOIDANCE OF ADVERSE IMPACTS.—In carrying out 

paragraph (1), the Secretary shall avoid adverse impacts to cultural items and human remains, to the maximum extent practicable. 

SEC. 8104. TEMPORARY CLOSURE FOR TRADITIONAL AND CULTURAL 

PURPOSES. 

(a) RECOGNITION OF HISTORIC USE.—To the maximum extent 

practicable, the Secretary shall ensure access to National Forest 

System land by Indians for traditional and cultural purposes, in accordance with subsection (b), in recognition of the historic use by Indians of National Forest System land. 

(b) CLOSING LAND FROM PUBLIC ACCESS.—


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(1) AUTHORITY TO CLOSE.—Upon the approval by the Secretary of a request from an Indian tribe, the Secretary may temporarily close from public access specifically identified National 

Forest System land to protect the privacy of tribal activities for 

traditional and cultural purposes. 

(2) LIMITATION.—A closure of National Forest System land 

under paragraph (1) shall affect the smallest practicable area 

for the minimum period necessary for activities of the applicable Indian tribe. 

(3) CONSISTENCY.—Access by Indian tribes to National Forest System land under this subsection shall be consistent with 

the purposes of Public Law 95–341 (commonly known as the 

American Indian Religious Freedom Act; 42 U.S.C. 1996). 

SEC. 8105. FOREST PRODUCTS FOR TRADITIONAL AND CULTURAL 

PURPOSES. 

(a) IN GENERAL.—Notwithstanding section 14 of the National 

Forest Management Act of 1976 (16 U.S.C. 472a), the Secretary may 

provide free of charge to Indian tribes any trees, portions of trees, 

or forest products from National Forest System land for traditional 

and cultural purposes. 

(b) PROHIBITION.—Trees, portions of trees, or forest products 

provided under subsection (a) may not be used for commercial purposes. 

SEC. 8106. PROHIBITION ON DISCLOSURE. 

(a) NONDISCLOSURE OF INFORMATION.—

(1) IN GENERAL.—The Secretary shall not disclose under 

section 552 of title 5, United States Code (commonly known as 

the ‘‘Freedom of Information Act’’), information relating to—

(A) subject to subsection (b)(l), human remains or cultural items reburied on National Forest System land under 

section 8103; or 

(B) subject to subsection (b)(2), resources, cultural 

items, uses, or activities that—

(i) have a traditional and cultural purpose; and 

(ii) are provided to the Secretary by an Indian or 

Indian tribe under an express expectation of confidentiality in the context of forest and rangeland research 

activities carried out under the authority of the Forest 

Service. 

(2) LIMITATIONS ON DISCLOSURE.—Subject to subsection 

(b)(2), the Secretary shall not be required to disclose information under section 552 of title 5, United States Code (commonly 

known as the ‘‘Freedom of Information Act’’), concerning the 

identity, use, or specific location in the National Forest System 

of—

(A) a site or resource used for traditional and cultural 

purposes by an Indian tribe; or 

(B) any cultural items not covered under section 8103. 

(b) LIMITED RELEASE OF INFORMATION.—

(1) REBURIAL.—The Secretary may disclose information described in subsection (a)(l)(A) if, before the disclosure, the Secretary—

(A) consults with an affected Indian tribe or lineal descendent; 


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(B) determines that disclosure of the information— (i) would advance the purposes of this subtitle; and 

(ii) is necessary to protect the human remains or 

cultural items from harm, theft, or destruction; and 

(C) attempts to mitigate any adverse impacts identified 

by an Indian tribe or lineal descendant that reasonably 

could be expected to result from disclosure of the information. 

(2) OTHER INFORMATION.—The Secretary, in consultation 

with appropriate Indian tribes, may disclose information described under paragraph (1)(B) or (2) of subsection (a) if the 

Secretary determines that disclosure of the information to the 

public—

(A) would advance the purposes of this subtitle; 

(B) would not create an unreasonable risk of harm, 

theft, or destruction of the resource, site, or object, including individual organic or inorganic specimens; and 

(C) would be consistent with other applicable laws. 

SEC. 8107. SEVERABILITY AND SAVINGS PROVISIONS. 

(a) SEVERABILITY.—If any provision of this subtitle, or the application of any provision of this subtitle to any person or circumstance is held invalid, the application of such provision or circumstance and the remainder of this subtitle shall not be affected 

thereby. 

(b) SAVINGS.—Nothing in this subtitle—

(1) diminishes or expands the trust responsibility of the 

United States to Indian tribes, or any legal obligation or remedy resulting from that responsibility; 

(2) alters, abridges, repeals, or affects any valid agreement 

between the Forest Service and an Indian tribe; 

(3) alters, abridges, diminishes, repeals, or affects any reserved or other right of an Indian tribe; or 

(4) alters, abridges, diminishes, repeals, or affects any other 

valid existing right relating to National Forest System land or 

other public land. 

Subtitle C—Amendments to Other Forestry-Related Laws 

SEC. 8201. RURAL REVITALIZATION TECHNOLOGIES. 

Section 2371(d)(2) of the Food, Agriculture, Conservation, and 

Trade Act of 1990 (7 U.S.C. 6601(d)(2)) is amended by striking 

‘‘2004 through 2008’’ and inserting ‘‘2008 through 2012’’. 

SEC. 8202. OFFICE OF INTERNATIONAL FORESTRY. 

Section 2405(d) of the Global Climate Change Prevention Act of 

1990 (7 U.S.C. 6704(d)) is amended by striking ‘‘2007’’ and inserting ‘‘2012’’. 

SEC. 8203. EMERGENCY FOREST RESTORATION PROGRAM. 

(a) ESTABLISHMENT.—Title IV of the Agricultural Credit Act of 

1978 (16 U.S.C. 2201 et seq.) is amended by adding at the end the 

following new section: 

‘‘SEC. 407. EMERGENCY FOREST RESTORATION PROGRAM. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) EMERGENCY MEASURES.—The term ‘emergency measures’ means those measures that—


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‘‘(A) are necessary to address damage caused by a natural disaster to natural resources on nonindustrial private 

forest land, and the damage, if not treated—

‘‘(i) would impair or endanger the natural resources on the land; and 

‘‘(ii) would materially affect future use of the land; 

and 

‘‘(B) would restore forest health and forest-related resources on the land. 

‘‘(2) NATURAL DISASTER.—The term ‘natural disaster’ includes wildfires, hurricanes or excessive winds, drought, ice 

storms or blizzards, floods, or other resource-impacting events, 

as determined by the Secretary. 

‘‘(3) NONINDUSTRIAL PRIVATE FOREST LAND.—The term 

‘nonindustrial private forest land’ means rural land, as determined by the Secretary, that—

‘‘(A) has existing tree cover (or had tree cover immediately before the natural disaster and is suitable for growing trees); and 

‘‘(B) is owned by any nonindustrial private individual, 

group, association, corporation, or other private legal entity, that has definitive decision-making authority over the 

land. 

‘‘(4) SECRETARY.—The term ‘Secretary’ means the Secretary 

of Agriculture. 

‘‘(b) AVAILABILITY OF ASSISTANCE.—The Secretary may make 

payments to an owner of nonindustrial private forest land who carries out emergency measures to restore the land after the land is 

damaged by a natural disaster. 

‘‘(c) ELIGIBILITY.—To be eligible to receive a payment under subsection (b), an owner must demonstrate to the satisfaction of the 

Secretary that the nonindustrial private forest land on which the 

emergency measures are carried out had tree cover immediately before the natural disaster. 

‘‘(d) COST SHARE REQUIREMENT.—Payments made under subsection (b) shall not exceed 75 percent of the total cost of the emergency measures carried out by an owner of nonindustrial private 

forest land. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to the Secretary such funds as may be necessary 

to carry out this section. Amounts so appropriated shall remain 

available until expended.’’. 

(b) REGULATIONS.—Not later than one year after the date of the 

enactment of this Act, the Secretary of Agriculture shall issue regulations to carry out section 407 of the Agricultural Credit Act of 

1978, as added by subsection (a). 

SEC. 8204. PREVENTION OF ILLEGAL LOGGING PRACTICES. 

(a) DEFINITIONS.—

(1) PLANT.—Subsection (f) of section 2 of the Lacey Act 

Amendments of 1981 (16 U.S.C. 3371) is amended to read as 

follows: 

‘‘(f) PLANT.—

‘‘(1) IN GENERAL.—The terms ‘plant’ and ‘plants’ mean any 

wild member of the plant kingdom, including roots, seeds, 


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parts, or products thereof, and including trees from either natural or planted forest stands. ‘‘(2) EXCLUSIONS.—The terms ‘plant’ and ‘plants’ exclude— ‘‘(A) common cultivars, except trees, and common food 

crops (including roots, seeds, parts, or products thereof); ‘‘(B) a scientific specimen of plant genetic material (including roots, seeds, germplasm, parts, or products thereof) 

that is to be used only for laboratory or field research; and ‘‘(C) any plant that is to remain planted or to be planted or replanted. 

‘‘(3) EXCEPTIONS TO APPLICATION OF EXCLUSIONS.—The exclusions made by subparagraphs (B) and (C) of paragraph (2) 

do not apply if the plant is listed— ‘‘(A) in an appendix to the Convention on International 

Trade in Endangered Species of Wild Fauna and Flora (27 

UST 1087; TIAS 8249); ‘‘(B) as an endangered or threatened species under the 

Endangered Species Act of 1973 (16 U.S.C. 1531 et seq.); or ‘‘(C) pursuant to any State law that provides for the 

conservation of species that are indigenous to the State and 

are threatened with extinction.’’. (2) INCLUSION OF SECRETARY OF AGRICULTURE.—Section 

2(h) of the Lacey Act Amendments of 1981 (16 U.S.C. 3371(h)) 

is amended by striking ‘‘plants the term means’’ and inserting ‘‘plants, the term also means’’. (3) TAKEN AND TAKING.—Subsection (j) of section 2 of the 

Lacey Act Amendments of 1981 (16 U.S.C. 3371) is amended to 

read as follows: 

‘‘(j) TAKEN AND TAKING.—

‘‘(1) TAKEN.—The term ‘taken’ means captured, killed, or 

collected and, with respect to a plant, also means harvested, 

cut, logged, or removed. 

‘‘(2) TAKING.—The term ‘taking’ means the act by which 

fish, wildlife, or plants are taken.’’. (b) PROHIBITED ACTS.— (1) OFFENSES OTHER THAN MARKING.—Section 3(a) of the 

Lacey Act Amendments of 1981 (16 U.S.C. 3372(a)) is amended— (A) in paragraph (2), by striking subparagraph (B) and 

inserting the following new subparagraph: ‘‘(B) any plant— ‘‘(i) taken, possessed, transported, or sold in violation of any law or regulation of any State, or any foreign law, that protects plants or that regulates— ‘‘(I) the theft of plants; 

‘‘(II) the taking of plants from a park, forest 

reserve, or other officially protected area; ‘‘(III) the taking of plants from an officially 

designated area; or ‘‘(IV) the taking of plants without, or contrary 

to, required authorization; 

‘‘(ii) taken, possessed, transported, or sold without 

the payment of appropriate royalties, taxes, or stumpage fees required for the plant by any law or regulation 

of any State or any foreign law; or 


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‘‘(iii) taken, possessed, transported, or sold in violation of any limitation under any law or regulation of 

any State, or under any foreign law, governing the export or transshipment of plants; or’’; and 

(B) in paragraph (3), by striking subparagraph (B) and 

inserting the following subparagraph: ‘‘(B) to possess any plant— ‘‘(i) taken, possessed, transported, or sold in violation of any law or regulation of any State, or any foreign law, that protects plants or that regulates— ‘‘(I) the theft of plants; 

‘‘(II) the taking of plants from a park, forest 

reserve, or other officially protected area; ‘‘(III) the taking of plants from an officially 

designated area; or ‘‘(IV) the taking of plants without, or contrary 

to, required authorization; 

‘‘(ii) taken, possessed, transported, or sold without 

the payment of appropriate royalties, taxes, or stumpage fees required for the plant by any law or regulation 

of any State or any foreign law; or ‘‘(iii) taken, possessed, transported, or sold in violation of any limitation under any law or regulation of 

any State, or under any foreign law, governing the export or transshipment of plants; or’’. (2) PLANT DECLARATIONS.—Section 3 of the Lacey Act 

Amendments of 1981 (16 U.S.C. 3372) is amended by adding 

at the end the following new subsection: 

‘‘(f) PLANT DECLARATIONS.—

‘‘(1) IMPORT DECLARATION.—Effective 180 days from the 

date of enactment of this subsection, and except as provided in 

paragraph (3), it shall be unlawful for any person to import 

any plant unless the person files upon importation a declaration that contains— ‘‘(A) the scientific name of any plant (including the 

genus and species of the plant) contained in the importation; ‘‘(B) a description of— ‘‘(i) the value of the importation; and 

‘‘(ii) the quantity, including the unit of measure, of 

the plant; and 

‘‘(C) the name of the country from which the plant was 

taken. 

‘‘(2) DECLARATION RELATING TO PLANT PRODUCTS.—Until 

the date on which the Secretary promulgates a regulation under 

paragraph (6), a declaration relating to a plant product shall—

‘‘(A) in the case in which the species of plant used to 

produce the plant product that is the subject of the importation varies, and the species used to produce the plant product is unknown, contain the name of each species of plant 

that may have been used to produce the plant product; ‘‘(B) in the case in which the species of plant used to 

produce the plant product that is the subject of the importation is commonly taken from more than one country, and 

the country from which the plant was taken and used to 


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produce the plant product is unknown, contain the name of 

each country from which the plant may have been taken; 

and 

‘‘(C) in the case in which a paper or paperboard plant 

product includes recycled plant product, contain the average percent recycled content without regard for the species 

or country of origin of the recycled plant product, in addition to the information for the non-recycled plant content 

otherwise required by this subsection. 

‘‘(3) EXCLUSIONS.—Paragraphs (1) and (2) shall not apply 

to plants used exclusively as packaging material to support, 

protect, or carry another item, unless the packaging material 

itself is the item being imported. 

‘‘(4) REVIEW.—Not later than two years after the date of enactment of this subsection, the Secretary shall review the implementation of each requirement imposed by paragraphs (1) and 

(2) and the effect of the exclusion provided by paragraph (3). In 

conducting the review, the Secretary shall provide public notice 

and an opportunity for comment. 

‘‘(5) REPORT.—Not later than 180 days after the date on 

which the Secretary completes the review under paragraph (4), 

the Secretary shall submit to the appropriate committees of 

Congress a report containing—

‘‘(A) an evaluation of—

‘‘(i) the effectiveness of each type of information required under paragraphs (1) and (2) in assisting enforcement of this section; and 

‘‘(ii) the potential to harmonize each requirement 

imposed by paragraphs (1) and (2) with other applicable import regulations in existence as of the date of the 

report; 

‘‘(B) recommendations for such legislation as the Secretary determines to be appropriate to assist in the identification of plants that are imported into the United States 

in violation of this section; and 

‘‘(C) an analysis of the effect of subsection (a) and this 

subsection on—

‘‘(i) the cost of legal plant imports; and 

‘‘(ii) the extent and methodology of illegal logging 

practices and trafficking. 

‘‘(6) PROMULGATION OF REGULATIONS.—Not later than 180 

days after the date on which the Secretary completes the review 

under paragraph (4), the Secretary may promulgate regulations—

‘‘(A) to limit the applicability of any requirement imposed by paragraph (2) to specific plant products; 

‘‘(B) to make any other necessary modification to any 

requirement imposed by paragraph (2), as determined by 

the Secretary based on the review; and 

‘‘(C) to limit the scope of the exclusion provided by 

paragraph (3), if the limitations in scope are warranted as 

a result of the review.’’. 

(c) CROSS-REFERENCES TO NEW REQUIREMENT.—Section 4 of 

the Lacey Act Amendments of 1981 (16 U.S.C. 3373) is amended—


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(1) by striking ‘‘subsections (b) and (d)’’ each place it appears and inserting ‘‘subsections (b), (d), and (f)’’; 

(2) by striking ‘‘section 3(d)’’ each place it appears and inserting ‘‘subsection (d) or (f) of section 3’’; and 

(3) in subsection (a)(2), by striking ‘‘subsection 3(b)’’ and inserting ‘‘subsection (b) or (f) of section 3, except as provided in 

paragraph (1),’’. 

(d) CIVIL FORFEITURES.—Section 5 of the Lacey Act Amendments of 1981 (16 U.S.C. 3374) is amended by adding at the end 

the following new subsection: 

‘‘(d) CIVIL FORFEITURES.—Civil forfeitures under this section 

shall be governed by the provisions of chapter 46 of title 18, United 

States Code.’’. 

(e) ADMINISTRATION.—Section 7 of the Lacey Act Amendments 

of 1981 (16 U.S.C. 3376) is amended—

(1) in subsection (a)(1), by striking ‘‘section 4 and section’’

and inserting ‘‘sections 3(f), 4, and’’; and 

(2) by adding at the end the following new subsection: 

‘‘(c) CLARIFICATION OF EXCLUSIONS FROM DEFINITION OF

PLANT.—The Secretary of Agriculture and the Secretary of the Interior, after consultation with the appropriate agencies, shall jointly 

promulgate regulations to define the terms used in section 2(f)(2)(A) 

for the purposes of enforcement under this Act.’’. 

(f) TECHNICAL CORRECTION.—Effective as of November 14, 

1988, and as if included therein as enacted, section 102(c) of Public 

Law 100–653 (102 Stat. 3825) is amended—

(1) by inserting ‘‘of the Lacey Act Amendments of 1981’’

after ‘‘Section 4’’; and 

(2) by striking ‘‘(other than section 3(b))’’ and inserting 

‘‘(other than subsection 3(b))’’. 

SEC. 8205. HEALTHY FORESTS RESERVE PROGRAM. 

(a) ENROLLMENT.—Section 502 of the Healthy Forests Restoration Act of 2003 (16 U.S.C. 6572(f)(1)) is amended—

(1) by striking subsections (e) and (f); 

(2) by redesignating subsection (g) as subsection (f); and 

(3) by inserting after subsection (d) the following new subsection: 

‘‘(e) METHODS OF ENROLLMENT.—

‘‘(1) AUTHORIZED METHODS.—Land may be enrolled in the 

healthy forests reserve program in accordance with—

‘‘(A) a 10-year cost-share agreement; 

‘‘(B) a 30-year easement; or 

‘‘(C)(i) a permanent easement; or 

‘‘(ii) in a State that imposes a maximum duration for 

easements, an easement for the maximum duration allowed 

under State law. 

‘‘(2) LIMITATION ON USE OF COST-SHARE AGREEMENTS AND

EASEMENTS.—

‘‘(A) IN GENERAL.—Of the total amount of funds expended under the program for a fiscal year to acquire easements and enter into cost-share agreements described in 

paragraph (1)—

‘‘(i) not more than 40 percent shall be used for costshare agreements described in paragraph (1)(A); and 


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‘‘(ii) not more than 60 percent shall be used for 

easements described in subparagraphs (B) and (C) of 

paragraph (1). 

‘‘(B) REPOOLING.—The Secretary may use any funds allocated under clause (i) or (ii) of subparagraph (A) that are 

not obligated by April 1 of the fiscal year for which the 

funds are made available to carry out a different method 

of enrollment during that fiscal year. 

‘‘(3) ACREAGE OWNED BY INDIAN TRIBES.—In the case of 

acreage owned by an Indian tribe, the Secretary may enroll 

acreage into the healthy forests reserve program through the use 

of—

‘‘(A) a 30-year contract (the value of which shall be 

equivalent to the value of a 30-year easement); 

‘‘(B) a 10-year cost-share agreement; or 

‘‘(C) any combination of the options described in subparagraphs (A) and (B).’’. 

(b) FINANCIAL ASSISTANCE.—Section 504(a) of the Healthy Forests Restoration Act of 2003 (16 U.S.C. 6574(a)) is amended by 

striking ‘‘(a) EASEMENTS OF NOT MORE THAN 99 YEARS’’ and all 

that follows through ‘‘502(f)(1)(C)’’ and inserting the following: 

‘‘(a) PERMANENT EASEMENTS.—In the case of land enrolled in 

the healthy forests reserve program using a permanent easement (or 

an easement described in section 502(f)(1)(C)(ii))’’. 

(c) FUNDING.—Section 508 of the Healthy Forests Restoration 

Act of 2003 (16 U.S.C. 6578) is amended to read as follows: 

‘‘SEC. 508. FUNDING. 

‘‘(a) IN GENERAL.—Of the funds of the Commodity Credit Corporation, the Secretary of Agriculture shall make available 

$9,750,000 for each of fiscal years 2009 through 2012 to carry out 

this title. 

‘‘(b) DURATION OF AVAILABILITY.—The funds made available 

under subsection (a) shall remain available until expended.’’. 

Subtitle D—Boundary Adjustments and Land Conveyance 

Provisions 

SEC. 8301. GREEN MOUNTAIN NATIONAL FOREST BOUNDARY ADJUSTMENT. 

(a) IN GENERAL.—The boundary of the Green Mountain National Forest is modified to include the 13 designated expansion 

units as generally depicted on the forest maps entitled ‘‘Green 

Mountain Expansion Area Map I’’ and ‘‘Green Mountain Expansion 

Area Map II’’ and dated February 20, 2002 (copies of which shall 

be on file and available for public inspection in the Office of the 

Chief of the Forest Service, Washington, District of Columbia), and 

more particularly described according to the site specific maps and 

legal descriptions on file in the office of the Forest Supervisor, Green 

Mountain National Forest. 

(b) MANAGEMENT.—Federally owned land delineated on the 

maps acquired for National Forest purposes shall continue to be 

managed in accordance with the laws (including regulations) applicable to the National Forest System. 

(c) LAND AND WATER CONSERVATION FUND.—For the purposes 

of section 7 of the Land and Water Conservation Fund Act of 1965 


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(16 U.S.C. 460 l–9), the boundaries of the Green Mountain National 

Forest, as adjusted by this section, shall be considered to be the 

boundaries of the national forest as of January 1, 1965. 

SEC. 8302. LAND CONVEYANCES, CHIHUAHUAN DESERT NATURE PARK, 

NEW MEXICO, AND GEORGE WASHINGTON NATIONAL FOREST, VIRGINIA. 

(a) CHIHUAHUAN DESERT NATURE PARK CONVEYANCE.— (1) IN GENERAL.—As soon as practicable after the date of 

enactment of this Act, subject to valid existing rights and subsection (b), the Secretary of Agriculture shall convey to the 

Chihuahuan Desert Nature Park, Inc., a nonprofit corporation 

in the State of New Mexico (in this section referred to as the 

‘‘Nature Park’’), by quitclaim deed and for no consideration, all 

right, title, and interest of the United States in and to the land 

described in paragraph (2) 

(2) DESCRIPTION OF LAND.— (A) IN GENERAL.—The parcel of land referred to in 

paragraph (1) consists of the approximately 935.62 acres of 

land in Dona Ana County, New Mexico, which is more particularly described— (i) as sections 17, 20, and 21 of T. 21 S., R. 2 E., 

N.M.P.M.; and 

(ii) in an easement deed dated May 14, 1998, from 

the Department of Agriculture to the Nature Park. 

(B) MODIFICATIONS.—The Secretary may modify the 

description of the land under subparagraph (A) to—

(i) correct errors in the description; or 

(ii) facilitate management of the land. 

(b) CONDITIONS.—The conveyance of land under subsection (a) 

shall be subject to—

(1) the reservation by the United States of all mineral and 

subsurface rights to the land, including any geothermal resources; 

(2) the condition that the Chihuahuan Desert Nature Park 

Board pay any costs relating to the conveyance; 

(3) any rights-of-way reserved by the Secretary; 

(4) a covenant or restriction in the deed to the land requiring that—

(A) the land may be used only for educational or scientific purposes; and 

(B) if the land is no longer used for the purposes described in subparagraph (A), the land may, at the discretion of the Secretary, revert to the United States in accordance with subsection (c); and 

(5) any other terms and conditions that the Secretary determines to be appropriate. 

(c) REVERSION.—If the land conveyed under subsection (a) is no 

longer used for the purposes described in subsection (b)(4)(A), the 

land may, at the discretion of the Secretary, revert to the United 

States. If the Secretary chooses to have the land revert to the United 

States, the Secretary shall—

(1) determine whether the land is environmentally contaminated, including contamination from hazardous wastes, hazardous substances, pollutants, contaminants, petroleum, or petroleum by-products; and 


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(2) if the Secretary determines that the land is environmentally contaminated, the Nature Park, the successor to the 

Nature Park, or any other person responsible for the contamination shall be required to remediate the contamination. 

(d) WITHDRAWAL.—All federally owned mineral and subsurface 

rights to the land to be conveyed under subsection (a) are withdrawn from— (1) location, entry, and patent under the mining laws; and 

(2) the operation of the mineral leasing laws, including the 

geothermal leasing laws. 

(e) WATER RIGHTS.—Nothing in subsection (a) authorizes the 

conveyance of water rights to the Nature Park. 

(f) GEORGE WASHINGTON NATIONAL FOREST CONVEYANCE, VIR- GINIA.— (1) CONVEYANCE REQUIRED.—The Secretary of Agriculture 

shall convey, without consideration, to the Central Advent 

Christian Church of Alleghany County, Virginia (in this subsection referred to as the ‘‘recipient’’), all right, title, and interest of the United States in and to a parcel of real property in 

the George Washington National Forest, Alleghany County, Virginia, consisting of not more than 8 acres, including a cemetery 

encompassing approximately 6 acres designated as an area of 

special use for the recipient, and depicted on the Forest Service 

map showing tract G–2032c and dated August 20, 2002, and 

the Forest Service map showing the area of special use and 

dated March 14, 2001. 

(2) CONDITION OF CONVEYANCE.—The conveyance under 

this subsection shall be subject to the condition that the recipient accept the real property described in paragraph (1) in its 

condition at the time of the conveyance, commonly known as 

conveyance ‘‘as is’’. 

(3) DESCRIPTION OF PROPERTY.—The exact acreage and 

legal description of the real property to be conveyed under this 

subsection shall be determined by a survey satisfactory to the 

Secretary. The cost of the survey shall be borne by the recipient. 

(4) ADDITIONAL TERMS AND CONDITIONS.—The Secretary 

may require such additional terms and conditions in connection 

with the conveyance under this subsection as the Secretary considers appropriate to protect the interests of the United States. 

SEC. 8303. SALE AND EXCHANGE OF NATIONAL FOREST SYSTEM LAND, 

VERMONT. 

(a) DEFINITIONS.—In this section: 

(1) BROMLEY.—The term ‘‘Bromley’’ means Bromley Mountain Ski Resort, Inc. 

(2) MAP.—The term ‘‘map’’ means the map entitled ‘‘Proposed Bromley Land Sale or Exchange’’ and dated April 7, 

2004. 

(3) STATE.—The term ‘‘State’’ means the State of Vermont. 

(b) SALE OR EXCHANGE OF GREEN MOUNTAIN NATIONAL FOREST LAND.—

(1) IN GENERAL.—The Secretary of Agriculture may, under 

any terms and conditions that the Secretary may prescribe, sell 

or exchange any right, title, and interest of the United States 

in and to the parcels of National Forest System land described 

in paragraph (2). 


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(2) DESCRIPTION OF LAND.—The parcels of National Forest 

System land referred to in paragraph (1) are the 5 parcels of 

land in Bennington County in the State, as generally depicted 

on the map. 

(3) MAP AND LEGAL DESCRIPTIONS.—

(A) IN GENERAL.—The map shall be on file and available for public inspection in—

(i) the office of the Chief of the Forest Service; and 

(ii) the office of the Supervisor of the Green Mountain National Forest. 

(B) MODIFICATIONS.—The Secretary may modify the 

map and legal descriptions to—

(i) correct technical errors; or 

(ii) facilitate the conveyance under paragraph (1). 

(4) CONSIDERATION.—Consideration for the sale or exchange of land described in paragraph (2)—

(A) shall be equal to an amount that is not less than 

the fair market value of the land sold or exchanged; and 

(B) may be in the form of cash, land, or a combination 

of cash and land. 

(5) APPRAISALS.—Any appraisal carried out to facilitate the 

sale or exchange of land under paragraph (1) shall conform 

with the Uniform Appraisal Standards for Federal Land Acquisitions. 

(6) METHODS OF SALE.—

(A) CONVEYANCE TO BROMLEY.—

(i) IN GENERAL.—Before soliciting offers under subparagraph (B), the Secretary shall offer to convey to 

Bromley the land described in paragraph (2). 

(ii) CONTRACT DEADLINE.—If Bromley accepts the 

offer under clause (i), the Secretary and Bromley shall 

have not more than 180 days after the date on which 

any environmental analyses with respect to the land 

are completed to enter into a contract for the sale or exchange of the land. 

(B) PUBLIC OR PRIVATE SALE.—If the Secretary and 

Bromley do not enter into a contract for the sale or exchange of the land by the date specified in subparagraph 

(A)(ii), the Secretary may sell or exchange the land at public or private sale (including auction), in accordance with 

such terms, conditions, and procedures as the Secretary determines to be in the public interest. 

(C) REJECTION OF OFFERS.—The Secretary may reject 

any offer received under this paragraph if the Secretary determines that the offer is not adequate or is not in the public interest. 

(D) BROKERS.—In any sale or exchange of land under 

this subsection, the Secretary may—

(i) use a real estate broker or other third party; 

and 

(ii) pay the real estate broker or third party a commission in an amount comparable to the amounts of 

commission generally paid for real estate transactions 

in the area. 


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(7) CASH EQUALIZATION.—Notwithstanding section 206(b) 

of the Federal Land Policy and Management Act of 1976 (43 

U.S.C. 1716(b)), the Secretary may accept a cash equalization 

payment in excess of 25 percent of the value of any Federal land 

exchanged under this section. 

(c) DISPOSITION OF PROCEEDS.— (1) IN GENERAL.—The Secretary shall deposit the net proceeds from a sale or exchange under this section in the fund established under Public Law 90–171 (16 U.S.C. 484a) (commonly known as the ‘‘Sisk Act’’). 

(2) USE.—Amounts deposited under paragraph (1) shall be 

available to the Secretary until expended, without further appropriation, for— (A) the location and relocation of the Appalachian National Scenic Trail and the Long National Recreation Trail 

in the State; 

(B) the acquisition of land and interests in land by the 

Secretary for National Forest System purposes within the 

boundary of the Green Mountain National Forest, including land for and adjacent to the Appalachian National Scenic Trail and the Long National Recreation Trail; 

(C) the acquisition of wetland or an interest in wetland 

within the boundary of the Green Mountain National Forest to offset the loss of wetland from the parcels sold or exchanged; and 

(D) the payment of direct administrative costs incurred 

in carrying out this section. 

(3) LIMITATION.—Amounts deposited under paragraph (1) 

shall not—

(A) be paid or distributed to the State or counties or 

towns in the State under any provision of law; or 

(B) be considered to be money received from units of 

the National Forest System for purposes of— (i) the Act of May 23, 1908 (16 U.S.C. 500); or 

(ii) the Act of March 4, 1913 (16 U.S.C. 501). 

(4) PROHIBITION OF TRANSFER OR REPROGRAMMING.— Amounts deposited under paragraph (1) shall not be subject to 

transfer or reprogramming for wildfire management or any 

other emergency purposes. 

(d) ACQUISITION OF LAND.—The Secretary may acquire, using 

funds made available under subsection (c) or otherwise made available for acquisition, land or an interest in land for National Forest 

System purposes within the boundary of the Green Mountain National Forest. 

(e) EXEMPTION FROM CERTAIN LAWS.—Subtitle I of title 40, 

United States Code, shall not apply to any sale or exchange of National Forest System land under this section. 

Subtitle E—Miscellaneous Provisions 

SEC. 8401. QUALIFYING TIMBER CONTRACT OPTIONS. 

(a) DEFINITIONS.—In this section: 

(1) AUTHORIZED PRODUCER PRICE INDEX.—The term ‘‘authorized Producer Price Index’’ includes—

(A) the softwood commodity index (code number WPU 

0811); 


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(B) the hardwood commodity index (code number WPU 

0812); 

(C) the wood chip index (code number PCU 

3211133211135); and 

(D) any other subsequent comparable index, as established by the Bureau of Labor Statistics of the Department 

of Labor and utilized by the Secretary of Agriculture. 

(2) QUALIFYING CONTRACT.—The term ‘‘qualifying contract’’

means a contract for the sale of timber on National Forest System land—

(A) that was awarded during the period beginning on 

July 1, 2004, and ending on December 31, 2006; 

(B) for which there is unharvested volume remaining; 

(C) for which, not later than 90 days after the date of 

enactment of this Act, the timber purchaser makes a written request to the Secretary for one or more of the options 

described in subsection (b); 

(D) that is not a salvage sale; 

(E) for which the Secretary determines there is not an 

urgent need to harvest due to deteriorating timber conditions that developed after the award of the contract; and 

(F) that is not in breach or in default. 

(3) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of Agriculture, acting through the Chief of the Forest Service. 

(b) OPTIONS FOR QUALIFYING CONTRACTS.—

(1) CANCELLATION OR RATE REDETERMINATION.—Notwithstanding any other provision of law, if the rate at which a 

qualifying contract would be advertised as of the date of enactment of this Act is at least 50 percent less than the sum of the 

original bid rates for all of the species of timber that are the 

subject of the qualifying contract, the Secretary may, at the sole 

discretion of the Secretary—

(A) cancel the qualifying contract if the timber purchaser—

(i) pays 30 percent of the total value of the timber 

remaining in the qualifying contract based on bid 

rates; 

(ii) completes each contractual obligation (including the removal of downed timber, the completion of 

road work, and the completion of erosion control work) 

of the timber purchaser with respect to each unit on 

which harvest has begun to a logical stopping point, as 

determined by the Secretary after consultation with the 

timber purchaser; and 

(iii) terminates its rights under the qualifying contract; or 

(B) modify the qualifying contract to redetermine the 

current contract rate of the qualifying contract to equal the 

sum obtained by adding—

(i) 25 percent of the bid premium on the qualifying 

contract; and 

(ii) the rate at which the qualifying contract would 

be advertised as of the date of enactment of this Act. 

(2) SUBSTITUTION OF INDEX.—


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(A) SUBSTITUTION.—Notwithstanding any other provision of law, the Secretary may, at the sole discretion of the 

Secretary, substitute the Producer Price Index specified in 

the qualifying contract of a timber purchaser if the timber 

purchaser identifies— (i) the products the timber purchaser intends to 

produce from the timber harvested under the qualifying contract; and 

(ii) a substitute index from an authorized Producer 

Price Index that more accurately represents the predominant product identified in clause (i) for which 

there is an index. 

(B) RATE REDETERMINATION FOLLOWING SUBSTITUTION

OF INDEX.—If the Secretary substitutes the Producer Price 

Index of a qualifying contract under subparagraph (A), the 

Secretary may, at the sole discretion of the Secretary, modify the qualifying contract to provide for—

(i) an emergency rate redetermination under the 

terms of the contract; or 

(ii) a rate redetermination under paragraph (1)(B). 

(C) LIMITATION ON MARKET-RELATED CONTRACT TERM

ADDITION; PERIODIC PAYMENTS.—Notwithstanding any 

other provision of law, if the Secretary substitutes the Producer Price Index of a qualifying contract under subparagraph (A), the Secretary may, at the sole discretion of the 

Secretary, modify the qualifying contract— (i) to adjust the term in accordance with the market-related contract term addition provision in the 

qualifying contract and section 223.52 of title 36, Code 

of Federal Regulations, as in effect on the date of the 

adjustment, but only if the drastic reduction criteria in 

such section are met for 2 or more consecutive calendar 

year quarters beginning with the calendar quarter in 

which the Secretary substitutes the Producer Price 

Index under subparagraph (A); and 

(ii) to adjust the periodic payments required under 

the contract in accordance with applicable law and 

policies. 

(3) CONTRACTS USING HARDWOOD LUMBER INDEX.—With respect to a qualifying contract using the hardwood commodity 

index referred to in subsection (a)(1)(B) for which the Secretary 

does not substitute the Producer Price Index under paragraph 

(2), the Secretary may, at the sole discretion of the Secretary— (A) extend the contract term for a 1-year period beginning on the current contract termination date; and 

(B) adjust the periodic payments required under the 

contract in accordance with applicable law and policies. 

(c) EXTENSION OF MARKET-RELATED CONTRACT TERM ADDITION

TIME LIMIT FOR CERTAIN CONTRACTS.—Notwithstanding any other 

provision of law, upon the written request of a timber purchaser, the 

Secretary may, at the sole discretion of the Secretary, modify a timber sale contract (including a qualifying contract) awarded to the 

purchaser before January 1, 2007, to adjust the term of the contract 

in accordance with the market-related contract term addition provision in the contract and section 223.52 of title 36, Code of Federal 


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Regulations, as in effect on the date of the modification, except that 

the Secretary may add no more than 4 years to the original contract 

length. 

(d) EFFECT OF OPTIONS.—

(1) NO SURRENDER OF CLAIMS.—Operation of this section 

shall not have the effect of surrendering any claim by the 

United States against any timber purchaser that arose—

(A) under a qualifying contract before the date on 

which the Secretary cancels the contract or redetermines 

the rate under subsection (b)(1), substitutes a Producer 

Price Index under subsection (b)(2), or modifies the contract 

under subsection (b)(3); or 

(B) under a timber sale contract, including a qualifying contract, before the date on which the Secretary adjusts the contract term under subsection (c). 

(2) RELEASE OF LIABILITY.—In the written request for any 

option provided under subsections (b) and (c), a timber purchaser shall release the United States from all liability, including further consideration or compensation, resulting from—

(A) the cancellation of a qualifying contract of the purchaser or rate redetermination under subsection (b)(1), the 

substitution of a Producer Price Index under subsection 

(b)(2), the modification of the contract under subsection 

(b)(3) or a determination by the Secretary not to provide the 

cancellation, redetermination, substitution, or modification; 

or 

(B) the modification of the term of a timber sale contract (including a qualifying contract) of the purchaser 

under subsection (c) or a determination by the Secretary not 

to provide the modification. 

(3) LIMITATION.—Subject to subsection (b)(1)(A), the cancellation of a qualifying contract by the Secretary under subsection (b)(1) shall release the timber purchaser from further obligation under the canceled contract. 

SEC. 8402. HISPANIC-SERVING INSTITUTION AGRICULTURAL LAND NATIONAL RESOURCES LEADERSHIP PROGRAM. 

(a) DEFINITION OF HISPANIC-SERVING INSTITUTION.—In this 

section, the term ‘‘Hispanic-serving institution’’ has the meaning 

given that term in section 502(a)(5) of the Higher Education Act of 

1965 (20 U.S.C. 1101a(a)(5)). 

(b) GRANT AUTHORITY.—The Secretary of Agriculture may make 

grants, on a competitive basis, to Hispanic-serving institutions for 

the purpose of establishing an undergraduate scholarship program 

to assist in the recruitment, retention, and training of Hispanics 

and other under-represented groups in forestry and related fields. 

(c) USE OF GRANT FUNDS.—Grants made under this section 

shall be used to recruit, retain, train, and develop professionals to 

work in forestry and related fields with Federal agencies, such as 

the Forest Service, State agencies, and private-sector entities. 

(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to the Secretary for each of fiscal years 2008 

through 2012 such sums as may be necessary to carry out this section. 


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TITLE IX—ENERGY 

SEC. 9001. ENERGY. 

(a) IN GENERAL.—Title IX of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 8101 et seq.) is amended to read as 

follows: 

‘‘TITLE IX—ENERGY 

‘‘SEC. 9001. DEFINITIONS. 

‘‘Except as otherwise provided, in this title: ‘‘(1) ADMINISTRATOR.—The term ‘Administrator’ means the 

Administrator of the Environmental Protection Agency. ‘‘(2) ADVISORY COMMITTEE.—The term ‘Advisory Committee’ means the Biomass Research and Development Technical Advisory Committee established by section 9008(d)(1). ‘‘(3) ADVANCED BIOFUEL.— ‘‘(A) IN GENERAL.—The term ‘advanced biofuel’ means 

fuel derived from renewable biomass other than corn kernel 

starch. ‘‘(B) INCLUSIONS.—Subject to subparagraph (A), the 

term ‘advanced biofuel’ includes— ‘‘(i) biofuel derived from cellulose, hemicellulose, or 

lignin; ‘‘(ii) biofuel derived from sugar and starch (other 

than ethanol derived from corn kernel starch); ‘‘(iii) biofuel derived from waste material, including crop residue, other vegetative waste material, animal waste, food waste, and yard waste; ‘‘(iv) diesel-equivalent fuel derived from renewable 

biomass, including vegetable oil and animal fat; ‘‘(v) biogas (including landfill gas and sewage 

waste treatment gas) produced through the conversion 

of organic matter from renewable biomass; ‘‘(vi) butanol or other alcohols produced through 

the conversion of organic matter from renewable biomass; and 

‘‘(vii) other fuel derived from cellulosic biomass. 

‘‘(4) BIOBASED PRODUCT.—The term ‘biobased product’

means a product determined by the Secretary to be a commercial or industrial product (other than food or feed) that is—

‘‘(A) composed, in whole or in significant part, of biological products, including renewable domestic agricultural 

materials and forestry materials; or 

‘‘(B) an intermediate ingredient or feedstock. 

‘‘(5) BIOFUEL.—The term ‘biofuel’ means a fuel derived from 

renewable biomass. 

‘‘(6) BIOMASS CONVERSION FACILITY.—The term ‘biomass 

conversion facility’ means a facility that converts or proposes to 

convert renewable biomass into—

‘‘(A) heat; 

‘‘(B) power; 

‘‘(C) biobased products; or 

‘‘(D) advanced biofuels. 

‘‘(7) BIOREFINERY.—The term ‘biorefinery’ means a facility 

(including equipment and processes) that—


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‘‘(A) converts renewable biomass into biofuels and 

biobased products; and ‘‘(B) may produce electricity. ‘‘(8) BOARD.—The term ‘Board’ means the Biomass Research and Development Board established by section 9008(c). ‘‘(9) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning given the term in section 4 of the Indian Self-Determination 

and Education Assistance Act (25 U.S.C. 450b). ‘‘(10) INSTITUTION OF HIGHER EDUCATION.—The term ‘institution of higher education’ has the meaning given the term in 

section 102(a) of the Higher Education Act of 1965 (20 U.S.C. 

1002(a)). ‘‘(11) INTERMEDIATE INGREDIENT OR FEEDSTOCK.—The term 

‘intermediate ingredient or feedstock’ means a material or compound made in whole or in significant part from biological 

products, including renewable agricultural materials (including 

plant, animal, and marine materials) or forestry materials, that 

are subsequently used to make a more complex compound or 

product. 

‘‘(12) RENEWABLE BIOMASS.—The term ‘renewable biomass’

means—

‘‘(A) materials, pre-commercial thinnings, or invasive 

species from National Forest System land and public lands 

(as defined in section 103 of the Federal Land Policy and 

Management Act of 1976 (43 U.S.C. 1702)) that—

‘‘(i) are byproducts of preventive treatments that 

are removed—

‘‘(I) to reduce hazardous fuels; 

‘‘(II) to reduce or contain disease or insect infestation; or 

‘‘(III) to restore ecosystem health; 

‘‘(ii) would not otherwise be used for higher-value 

products; and ‘‘(iii) are harvested in accordance with— ‘‘(I) applicable law and land management 

plans; and ‘‘(II) the requirements for— ‘‘(aa) old-growth maintenance, restoration, 

and management direction of paragraphs (2), 

(3), and (4) of subsection (e) of section 102 of 

the Healthy Forests Restoration Act of 2003 

(16 U.S.C. 6512); and ‘‘(bb) large-tree retention of subsection (f) 

of that section; or ‘‘(B) any organic matter that is available on a renewable or recurring basis from non-Federal land or land belonging to an Indian or Indian tribe that is held in trust 

by the United States or subject to a restriction against 

alienation imposed by the United States, including— ‘‘(i) renewable plant material, including—

‘‘(I) feed grains; 

‘‘(II) other agricultural commodities; 

‘‘(III) other plants and trees; and 

‘‘(IV) algae; and 

‘‘(ii) waste material, including—


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‘‘(I) crop residue; 

‘‘(II) other vegetative waste material (including 

wood waste and wood residues); ‘‘(III) animal waste and byproducts (including 

fats, oils, greases, and manure); and ‘‘(IV) food waste and yard waste. ‘‘(13) RENEWABLE ENERGY.—The term ‘renewable energy’ means energy derived from— ‘‘(A) a wind, solar, renewable biomass, ocean (including tidal, wave, current, and thermal), geothermal, or hydroelectric source; or ‘‘(B) hydrogen derived from renewable biomass or 

water using an energy source described in subparagraph 

(A). 

‘‘(14) SECRETARY.—The term ‘Secretary’ means the Secretary of Agriculture. 

‘‘SEC. 9002. BIOBASED MARKETS PROGRAM. 

‘‘(a) FEDERAL PROCUREMENT OF BIOBASED PRODUCTS.— ‘‘(1) DEFINITION OF PROCURING AGENCY.—In this subsection, the term ‘procuring agency’ means— ‘‘(A) any Federal agency that is using Federal funds for 

procurement; or ‘‘(B) a person that is a party to a contract with any 

Federal agency, with respect to work performed under such 

a contract. 

‘‘(2) PROCUREMENT PREFERENCE.— ‘‘(A) IN GENERAL.— ‘‘(i) PROCURING AGENCY DUTIES.—Except as provided in clause (ii) and subparagraph (B), after the 

date specified in applicable guidelines prepared pursuant to paragraph (3), each procuring agency shall— ‘‘(I) establish a procurement program, develop 

procurement specifications, and procure biobased 

products identified under the guidelines described 

in paragraph (3) in accordance with this section; 

and ‘‘(II) with respect to items described in the 

guidelines, give a procurement preference to those 

items that—

‘‘(aa) are composed of the highest percentage of biobased products practicable; or ‘‘(bb) comply with the regulations issued 

under section 103 of Public Law 100–556 (42 

U.S.C. 6914b–1). ‘‘(ii) EXCEPTION.—The requirements of clause (i)(I) 

to establish a procurement program and develop procurement specifications shall not apply to a person described in paragraph (1)(B). 

‘‘(B) FLEXIBILITY.—Notwithstanding subparagraph (A), 

a procuring agency may decide not to procure items described in that subparagraph if the procuring agency determines that the items—

‘‘(i) are not reasonably available within a reasonable period of time; 

‘‘(ii) fail to meet—


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‘‘(I) the performance standards set forth in the 

applicable specifications; or ‘‘(II) the reasonable performance standards of 

the procuring agencies; or 

‘‘(iii) are available only at an unreasonable price. ‘‘(C) MINIMUM REQUIREMENTS.—Each procurement program required under this subsection shall, at a minimum— ‘‘(i) be consistent with applicable provisions of Federal procurement law; ‘‘(ii) ensure that items composed of biobased products will be purchased to the maximum extent practicable; ‘‘(iii) include a component to promote the procurement program; ‘‘(iv) provide for an annual review and monitoring 

of the effectiveness of the procurement program; and ‘‘(v) adopt 1 of the 2 polices described in subparagraph (D) or (E), or a policy substantially equivalent to 

either of those policies. 

‘‘(D) CASE-BY-CASE POLICY.—

‘‘(i) IN GENERAL.—Subject to subparagraph (B) and 

except as provided in clause (ii), a procuring agency 

adopting the case-by-case policy shall award a contract 

to the vendor offering an item composed of the highest 

percentage of biobased products practicable. ‘‘(ii) EXCEPTION.—Subject to subparagraph (B), an 

agency adopting the policy described in clause (i) may 

make an award to a vendor offering items with less 

than the maximum biobased products content. 

‘‘(E) MINIMUM CONTENT STANDARDS.—Subject to subparagraph (B), a procuring agency adopting the minimum 

content standards policy shall establish minimum biobased 

products content specifications for awarding contracts in a 

manner that ensures that the biobased products content required is consistent with this subsection. ‘‘(F) CERTIFICATION.—After the date specified in any 

applicable guidelines prepared pursuant to paragraph (3), 

contracting offices shall require that vendors certify that 

the biobased products to be used in the performance of the 

contract will comply with the applicable specifications or 

other contractual requirements. 

‘‘(3) GUIDELINES.—

‘‘(A) IN GENERAL.—The Secretary, after consultation 

with the Administrator, the Administrator of General Services, and the Secretary of Commerce (acting through the Director of the National Institute of Standards and Technology), shall prepare, and from time to time revise, guidelines for the use of procuring agencies in complying with 

the requirements of this subsection. ‘‘(B) REQUIREMENTS.—The guidelines under this paragraph shall— ‘‘(i) designate those items (including finished products) that are or can be produced with biobased products (including biobased products for which there is 

only a single product or manufacturer in the category) 


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that will be subject to the preference described in paragraph (2); 

‘‘(ii) designate those intermediate ingredients and 

feedstocks that are or can be used to produce items that 

will be subject to the preference described in paragraph 

(2); 

‘‘(iii) automatically designate items composed of intermediate ingredients and feedstocks designated under 

clause (ii), if the content of the designated intermediate 

ingredients and feedstocks exceeds 50 percent of the 

item (unless the Secretary determines a different composition percentage is appropriate); 

‘‘(iv) set forth recommended practices with respect 

to the procurement of biobased products and items containing such materials; 

‘‘(v) provide information as to the availability, relative price, performance, and environmental and public health benefits of such materials and items; and 

‘‘(vi) take effect on the date established in the 

guidelines, which may not exceed 1 year after publication. 

‘‘(C) INFORMATION PROVIDED.—Information provided 

pursuant to subparagraph (B)(v) with respect to a material 

or item shall be considered to be provided for another item 

made with the same material or item. 

‘‘(D) PROHIBITION.—Guidelines issued under this paragraph may not require a manufacturer or vendor of 

biobased products, as a condition of the purchase of 

biobased products from the manufacturer or vendor, to provide to procuring agencies more data than would be required to be provided by other manufacturers or vendors offering products for sale to a procuring agency, other than 

data confirming the biobased content of a product. 

‘‘(E) QUALIFYING PURCHASES.—The guidelines shall 

apply with respect to any purchase or acquisition of a procurement item for which—

‘‘(i) the purchase price of the item exceeds $10,000; 

or 

‘‘(ii) the quantity of the items or of functionallyequivalent items purchased or acquired during the preceding fiscal year was at least $10,000. 

‘‘(4) ADMINISTRATION.—

‘‘(A) OFFICE OF FEDERAL PROCUREMENT POLICY.—The 

Office of Federal Procurement Policy, in cooperation with 

the Secretary, shall—

‘‘(i) coordinate the implementation of this subsection with other policies for Federal procurement; 

‘‘(ii) annually collect the information required to be 

reported under subparagraph (B) and make the information publicly available; 

‘‘(iii) take a leading role in informing Federal 

agencies concerning, and promoting the adoption of 

and compliance with, procurement requirements for 

biobased products by Federal agencies; and 


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‘‘(iv) not less than once every 2 years, submit to 

Congress a report that— ‘‘(I) describes the progress made in carrying 

out this subsection; and ‘‘(II) contains a summary of the information 

reported pursuant to subparagraph (B). ‘‘(B) OTHER AGENCIES.—To assist the Office of Federal 

Procurement Policy in carrying out subparagraph (A)— ‘‘(i) each procuring agency shall submit each year 

to the Office of Federal Procurement Policy, to the maximum extent practicable, information concerning— ‘‘(I) actions taken to implement paragraph (2); 

‘‘(II) the results of the annual review and monitoring program established under paragraph 

(2)(C)(iv); ‘‘(III) the number and dollar value of contracts 

entered into during the year that include the direct 

procurement of biobased products; ‘‘(IV) the number of service and construction 

(including renovations) contracts entered into during the year that include language on the use of 

biobased products; and ‘‘(V) the types and dollar value of biobased 

products actually used by contractors in carrying 

out service and construction (including renovations) contracts during the previous year; and 

‘‘(ii) the General Services Administration and the 

Defense Logistics Agency shall submit each year to the 

Office of Federal Procurement Policy information concerning, to the maximum extent practicable, the types 

and dollar value of biobased products purchased by 

procuring agencies. 

‘‘(C) PROCUREMENT SUBJECT TO OTHER LAW.—Any procurement by any Federal agency that is subject to regulations of the Administrator under section 6002 of the Solid 

Waste Disposal Act (42 U.S.C. 6962) shall not be subject to 

the requirements of this section to the extent that the requirements are inconsistent with the regulations. ‘‘(b) LABELING.— ‘‘(1) IN GENERAL.—The Secretary, in consultation with the 

Administrator, shall establish a voluntary program under 

which the Secretary authorizes producers of biobased products 

to use the label ‘USDA Certified Biobased Product’. 

‘‘(2) ELIGIBILITY CRITERIA.—

‘‘(A) CRITERIA.—

‘‘(i) IN GENERAL.—Not later than 90 days after the 

date of the enactment of the Food, Conservation, and 

Energy Act of 2008 and except as provided in clause 

(ii), the Secretary, in consultation with the Administrator and representatives from small and large businesses, academia, other Federal agencies, and such 

other persons as the Secretary considers appropriate, 

shall issue criteria (as of the date of enactment of that 

Act) for determining which products may qualify to receive the label under paragraph (1). 


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‘‘(ii) EXCEPTION.—Clause (i) shall not apply to 

final criteria that have been issued (as of the date of 

enactment of that Act) by the Secretary. 

‘‘(B) REQUIREMENTS.—Criteria issued under subparagraph (A) shall—

‘‘(i) encourage the purchase of products with the 

maximum biobased content; 

‘‘(ii) provide that the Secretary may designate as 

biobased for the purposes of the voluntary program established under this subsection finished products that 

contain significant portions of biobased materials or 

components; and 

‘‘(iii) to the maximum extent practicable, be consistent with the guidelines issued under subsection 

(a)(3). 

‘‘(3) USE OF LABEL.—The Secretary shall ensure that the 

label referred to in paragraph (1) is used only on products that 

meet the criteria issued pursuant to paragraph (2). 

‘‘(c) RECOGNITION.—The Secretary shall—

‘‘(1) establish a program to recognize Federal agencies and 

private entities that use a substantial amount of biobased products; and 

‘‘(2) encourage Federal agencies to establish incentives programs to recognize Federal employees or contractors that make 

exceptional contributions to the expanded use of biobased products. 

‘‘(d) LIMITATION.—Nothing in this section shall apply to the procurement of motor vehicle fuels, heating oil, or electricity. 

‘‘(e) INCLUSION.—Effective beginning on the date that is 90 days 

after the date of enactment of the Food, Conservation, and Energy 

Act of 2008, the Architect of the Capitol, the Sergeant at Arms of 

the Senate, and the Chief Administrative Officer of the House of 

Representatives shall consider the biobased product designations 

made under this section in making procurement decisions for the 

Capitol Complex. 

‘‘(f) NATIONAL TESTING CENTER REGISTRY.—The Secretary shall 

establish a national registry of testing centers for biobased products 

that will serve biobased product manufacturers. 

‘‘(g) REPORTS.—

‘‘(1) IN GENERAL.—Not later than 180 days after the date 

of enactment of the Food, Conservation, and Energy Act of 2008 

and each year thereafter, the Secretary shall submit to Congress 

a report on the implementation of this section. 

‘‘(2) CONTENTS.—The report shall include—

‘‘(A) a comprehensive management plan that establishes tasks, milestones, and timelines, organizational roles 

and responsibilities, and funding allocations for fully implementing this section; and 

‘‘(B) information on the status of implementation of—

‘‘(i) item designations (including designation of intermediate ingredients and feedstocks); and 

‘‘(ii) the voluntary labeling program established 

under subsection (b). 

‘‘(h) FUNDING.—


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‘‘(1) MANDATORY FUNDING.—Of the funds of the Commodity 

Credit Corporation, the Secretary shall use to provide mandatory funding for biobased products testing and labeling as required to carry out this section— ‘‘(A) $1,000,000 for fiscal year 2008; and 

‘‘(B) $2,000,000 for each of fiscal years 2009 through 

2012. 

‘‘(2) DISCRETIONARY FUNDING.—In addition to any other 

funds made available to carry out this section, there is authorized to be appropriated to carry out this section $2,000,000 for 

each of fiscal years 2009 through 2012. 

‘‘SEC. 9003. BIOREFINERY ASSISTANCE. 

‘‘(a) PURPOSE.—The purpose of this section is to assist in the development of new and emerging technologies for the development of 

advanced biofuels, so as to— ‘‘(1) increase the energy independence of the United States; 

‘‘(2) promote resource conservation, public health, and the 

environment; ‘‘(3) diversify markets for agricultural and forestry products 

and agriculture waste material; and ‘‘(4) create jobs and enhance the economic development of 

the rural economy. 

‘‘(b) DEFINITIONS.—In this section: ‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible entity’ means an 

individual, entity, Indian tribe, or unit of State or local government, including a corporation, farm cooperative, farmer cooperative organization, association of agricultural producers, National Laboratory, institution of higher education, rural electric 

cooperative, public power entity, or consortium of any of those 

entities. ‘‘(2) ELIGIBLE TECHNOLOGY.—The term ‘eligible technology’ means, as determined by the Secretary— ‘‘(A) a technology that is being adopted in a viable commercial-scale operation of a biorefinery that produces an 

advanced biofuel; and ‘‘(B) a technology not described in subparagraph (A) 

that has been demonstrated to have technical and economic 

potential for commercial application in a biorefinery that 

produces an advanced biofuel. ‘‘(c) ASSISTANCE.—The Secretary shall make available to eligible entities—

‘‘(1) grants to assist in paying the costs of the development 

and construction of demonstration-scale biorefineries to demonstrate the commercial viability of 1 or more processes for converting renewable biomass to advanced biofuels; and 

‘‘(2) guarantees for loans made to fund the development, 

construction, and retrofitting of commercial-scale biorefineries 

using eligible technology. 

‘‘(d) GRANTS.—

‘‘(1) COMPETITIVE BASIS.—The Secretary shall award 

grants under subsection (c)(1) on a competitive basis. 

‘‘(2) SELECTION CRITERIA.—

‘‘(A) IN GENERAL.—In approving grant applications, the 

Secretary shall establish a priority scoring system that assigns priority scores to each application and only approve 


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applications that exceed a specified minimum, as determined by the Secretary. 

‘‘(B) FEASIBILITY.—In approving a grant application, 

the Secretary shall determine the technical and economic 

feasibility of the project based on a feasibility study of the 

project described in the application conducted by an independent third party. 

‘‘(C) SCORING SYSTEM.—In determining the priority 

scoring system, the Secretary shall consider—

‘‘(i) the potential market for the advanced biofuel 

and the byproducts produced; 

‘‘(ii) the level of financial participation by the applicant, including support from non-Federal and private sources; 

‘‘(iii) whether the applicant is proposing to use a 

feedstock not previously used in the production of advanced biofuels; 

‘‘(iv) whether the applicant is proposing to work 

with producer associations or cooperatives; 

‘‘(v) whether the applicant has established that the 

adoption of the process proposed in the application will 

have a positive impact on resource conservation, public 

health, and the environment; 

‘‘(vi) the potential for rural economic development; 

‘‘(vii) whether the area in which the applicant proposes to locate the biorefinery has other similar facilities; 

‘‘(viii) whether the project can be replicated; and 

‘‘(ix) scalability for commercial use. 

‘‘(3) COST SHARING.—

‘‘(A) LIMITS.—The amount of a grant awarded for development and construction of a biorefinery under subsection (c)(1) shall not exceed an amount equal to 30 percent of the cost of the project. 

‘‘(B) FORM OF GRANTEE SHARE.—

‘‘(i) IN GENERAL.—The grantee share of the cost of 

a project may be made in the form of cash or material. 

‘‘(ii) LIMITATION.—The amount of the grantee share 

that is made in the form of material shall not exceed 

15 percent of the amount of the grantee share determined under subparagraph (A). 

‘‘(e) LOAN GUARANTEES.—

‘‘(1) SELECTION CRITERIA.—

‘‘(A) IN GENERAL.—In approving loan guarantee applications, the Secretary shall establish a priority scoring system that assigns priority scores to each application and 

only approve applications that exceed a specified minimum, 

as determined by the Secretary. 

‘‘(B) FEASIBILITY.—In approving a loan guarantee application, the Secretary shall determine the technical and 

economic feasibility of the project based on a feasibility 

study of the project described in the application conducted 

by an independent third party. 


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‘‘(C) SCORING SYSTEM.—In determining the priority 

scoring system for loan guarantees under subsection (c)(2), 

the Secretary shall consider— ‘‘(i) whether the applicant has established a market 

for the advanced biofuel and the byproducts produced; ‘‘(ii) whether the area in which the applicant proposes to place the biorefinery has other similar facilities; ‘‘(iii) whether the applicant is proposing to use a 

feedstock not previously used in the production of advanced biofuels; ‘‘(iv) whether the applicant is proposing to work 

with producer associations or cooperatives; ‘‘(v) the level of financial participation by the applicant, including support from non-Federal and private sources; ‘‘(vi) whether the applicant has established that the 

adoption of the process proposed in the application will 

have a positive impact on resource conservation, public 

health, and the environment; ‘‘(vii) whether the applicant can establish that if 

adopted, the biofuels production technology proposed in 

the application will not have any significant negative 

impacts on existing manufacturing plants or other facilities that use similar feedstocks; ‘‘(viii) the potential for rural economic development; ‘‘(ix) the level of local ownership proposed in the 

application; and ‘‘(x) whether the project can be replicated. ‘‘(2) LIMITATIONS.— ‘‘(A) MAXIMUM AMOUNT OF LOAN GUARANTEED.—The 

principal amount of a loan guaranteed under subsection 

(c)(2) may not exceed $250,000,000. ‘‘(B) MAXIMUM PERCENTAGE OF LOAN GUARANTEED.— ‘‘(i) IN GENERAL.—Except as otherwise provided in 

this subparagraph, a loan guaranteed under subsection 

(c)(2) shall be in an amount not to exceed 80 percent 

of the project costs, as determined by the Secretary. ‘‘(ii) OTHER DIRECT FEDERAL FUNDING.—The 

amount of a loan guaranteed for a project under subsection (c)(2) shall be reduced by the amount of other 

direct Federal funding that the eligible entity receives 

for the same project. 

‘‘(iii) AUTHORITY TO GUARANTEE THE LOAN.—The 

Secretary may guarantee up to 90 percent of the principal and interest due on a loan guaranteed under subsection (c)(2). 

‘‘(C) LOAN GUARANTEE FUND DISTRIBUTION.—Of the 

funds made available for loan guarantees for a fiscal year 

under subsection (h), 50 percent of the funds shall be reserved for obligation during the second half of the fiscal 

year. ‘‘(f) CONSULTATION.—In carrying out this section, the Secretary 

shall consult with the Secretary of Energy. 


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‘‘(g) CONDITION ON PROVISION OF ASSISTANCE.— ‘‘(1) IN GENERAL.—As a condition of receiving a grant or 

loan guarantee under this section, an eligible entity shall ensure that all laborers and mechanics employed by contractors 

or subcontractors in the performance of construction work financed, in whole or in part, with the grant or loan guarantee, 

as the case may be, shall be paid wages at rates not less than 

those prevailing on similar construction in the locality, as determined by the Secretary of Labor in accordance with sections 

3141 through 3144, 3146, and 3147 of title 40, United States 

Code. ‘‘(2) AUTHORITY AND FUNCTIONS.—The Secretary of Labor 

shall have, with respect to the labor standards described in 

paragraph (1), the authority and functions set forth in Reorganization Plan Numbered 14 of 1950 (5 U.S.C. App) and section 

3145 of title 40, United States Code. 

‘‘(h) FUNDING.— ‘‘(1) MANDATORY FUNDING.—Of the funds of the Commodity 

Credit Corporation, the Secretary shall use for the cost of loan 

guarantees under this section, to remain available until expended—

‘‘(A) $75,000,000 for fiscal year 2009; and 

‘‘(B) $245,000,000 for fiscal year 2010. ‘‘(2) DISCRETIONARY FUNDING.—In addition to any other 

funds made available to carry out this section, there is authorized to be appropriated to carry out this section $150,000,000 

for each of fiscal years 2009 through 2012. 

‘‘SEC. 9004. REPOWERING ASSISTANCE. 

‘‘(a) IN GENERAL.—The Secretary shall carry out a program to 

encourage biorefineries in existence on the date of enactment of the 

Food, Conservation, and Energy Act of 2008 to replace fossil fuels 

used to produce heat or power to operate the biorefineries by making 

payments for— ‘‘(1) the installation of new systems that use renewable biomass; or ‘‘(2) the new production of energy from renewable biomass. ‘‘(b) PAYMENTS.— ‘‘(1) IN GENERAL.—The Secretary may make payments 

under this section to any biorefinery that meets the requirements of this section for a period determined by the Secretary. ‘‘(2) AMOUNT.—The Secretary shall determine the amount 

of payments to be made under this section to a biorefinery after 

considering—

‘‘(A) the quantity of fossil fuels a renewable biomass 

system is replacing; 

‘‘(B) the percentage reduction in fossil fuel used by the 

biorefinery that will result from the installation of the renewable biomass system; and 

‘‘(C) the cost and cost effectiveness of the renewable biomass system. 

‘‘(c) ELIGIBILITY.—To be eligible to receive a payment under this 

section, a biorefinery shall demonstrate to the Secretary that the renewable biomass system of the biorefinery is feasible based on an 

independent feasibility study that takes into account the economic, 

technical and environmental aspects of the system. 


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‘‘(d) FUNDING.—

‘‘(1) MANDATORY FUNDING.—Of the funds of the Commodity 

Credit Corporation, the Secretary shall use to make payments 

under this section $35,000,000 for fiscal year 2009, to remain 

available until expended. 

‘‘(2) DISCRETIONARY FUNDING.—In addition to any other 

funds made available to carry out this section, there is authorized to be appropriated to carry out this section $15,000,000 for 

each of fiscal years 2009 through 2012. 

‘‘SEC. 9005. BIOENERGY PROGRAM FOR ADVANCED BIOFUELS. 

‘‘(a) DEFINITION OF ELIGIBLE PRODUCER.—In this section, the 

term ‘eligible producer’ means a producer of advanced biofuels. 

‘‘(b) PAYMENTS.—The Secretary shall make payments to eligible 

producers to support and ensure an expanding production of advanced biofuels. 

‘‘(c) CONTRACTS.—To receive a payment, an eligible producer 

shall—

‘‘(1) enter into a contract with the Secretary for production 

of advanced biofuels; and 

‘‘(2) submit to the Secretary such records as the Secretary 

may require as evidence of the production of advanced biofuels. 

‘‘(d) BASIS FOR PAYMENTS.—The Secretary shall make payments 

under this section to eligible producers based on—

‘‘(1) the quantity and duration of production by the eligible 

producer of an advanced biofuel; 

‘‘(2) the net nonrenewable energy content of the advanced 

biofuel, if sufficient data is available, as determined by the Secretary; and 

‘‘(3) other appropriate factors, as determined by the Secretary. 

‘‘(e) EQUITABLE DISTRIBUTION.—The Secretary may limit the 

amount of payments that may be received by a single eligible producer under this section in order to distribute the total amount of 

funding available in an equitable manner. 

‘‘(f) OTHER REQUIREMENTS.—To receive a payment under this 

section, an eligible producer shall meet any other requirements of 

Federal and State law (including regulations) applicable to the production of advanced biofuels. 

‘‘(g) FUNDING.—

‘‘(1) MANDATORY FUNDING.—Of the funds of the Commodity 

Credit Corporation, the Secretary shall use to carry out this section, to remain available until expended—

‘‘(A) $55,000,000 for fiscal year 2009; 

‘‘(B) $55,000,000 for fiscal year 2010; 

‘‘(C) $85,000,000 for fiscal year 2011; and 

‘‘(D) $105,000,000 for fiscal year 2012. 

‘‘(2) DISCRETIONARY FUNDING.—In addition to any other 

funds made available to carry out this section, there is authorized to be appropriated to carry out this section $25,000,000 for 

each of fiscal years 2009 through 2012. 

‘‘(3) LIMITATION.—Of the funds provided for each fiscal 

year, not more than 5 percent of the funds shall be made available to eligible producers for production at facilities with a total 

refining capacity exceeding 150,000,000 gallons per year. 


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‘‘SEC. 9006. BIODIESEL FUEL EDUCATION PROGRAM. 

‘‘(a) ESTABLISHMENT.—The Secretary shall, under such terms 

and conditions as the Secretary determines to be appropriate, make 

competitive grants to eligible entities to educate governmental and 

private entities that operate vehicle fleets, other interested entities 

(as determined by the Secretary), and the public about the benefits 

of biodiesel fuel use. ‘‘(b) ELIGIBLE ENTITIES.—To receive a grant under subsection 

(b), an entity shall— ‘‘(1) be a nonprofit organization or institution of higher 

education; ‘‘(2) have demonstrated knowledge of biodiesel fuel production, use, or distribution; and ‘‘(3) have demonstrated the ability to conduct educational 

and technical support programs. 

‘‘(c) CONSULTATION.—In carrying out this section, the Secretary 

shall consult with the Secretary of Energy. ‘‘(d) FUNDING.—Of the funds of the Commodity Credit Corpora- tion, the Secretary shall use to carry out this section $1,000,000 for 

each of fiscal years 2008 through 2012. 

‘‘SEC. 9007. RURAL ENERGY FOR AMERICA PROGRAM. 

‘‘(a) ESTABLISHMENT.—The Secretary, in consultation with the 

Secretary of Energy, shall establish a Rural Energy for America 

Program to promote energy efficiency and renewable energy development for agricultural producers and rural small businesses 

through—

‘‘(1) grants for energy audits and renewable energy development assistance; and ‘‘(2) financial assistance for energy efficiency improvements 

and renewable energy systems. 

‘‘(b) ENERGY AUDITS AND RENEWABLE ENERGY DEVELOPMENT

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

grants to eligible entities to provide assistance to agricultural 

producers and rural small businesses—

‘‘(A) to become more energy efficient; and 

‘‘(B) to use renewable energy technologies and resources. 

‘‘(2) ELIGIBLE ENTITIES.—An eligible entity under this subsection is—

‘‘(A) a unit of State, tribal, or local government; 

‘‘(B) a land-grant college or university or other institution of higher education; 

‘‘(C) a rural electric cooperative or public power entity; 

and 

‘‘(D) any other similar entity, as determined by the Secretary. 

‘‘(3) SELECTION CRITERIA.—In reviewing applications of eligible entities to receive grants under paragraph (1), the Secretary shall consider—

‘‘(A) the ability and expertise of the eligible entity in 

providing professional energy audits and renewable energy 

assessments; 

‘‘(B) the geographic scope of the program proposed by 

the eligible entity in relation to the identified need; 


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‘‘(C) the number of agricultural producers and rural 

small businesses to be assisted by the program; ‘‘(D) the potential of the proposed program to produce 

energy savings and environmental benefits; ‘‘(E) the plan of the eligible entity for performing outreach and providing information and assistance to agricultural producers and rural small businesses on the benefits 

of energy efficiency and renewable energy development; and ‘‘(F) the ability of the eligible entity to leverage other 

sources of funding. 

‘‘(4) USE OF GRANT FUNDS.—A recipient of a grant under 

paragraph (1) shall use the grant funds to assist agricultural 

producers and rural small businesses by— ‘‘(A) conducting and promoting energy audits; and 

‘‘(B) providing recommendations and information on 

how— ‘‘(i) to improve the energy efficiency of the operations of the agricultural producers and rural small 

businesses; and ‘‘(ii) to use renewable energy technologies and resources in the operations. ‘‘(5) LIMITATION.—Grant recipients may not use more than 

5 percent of a grant for administrative expenses. ‘‘(6) COST SHARING.—A recipient of a grant under paragraph (1) that conducts an energy audit for an agricultural producer or rural small business under paragraph (4) shall require 

that, as a condition of the energy audit, the agricultural producer or rural small business pay at least 25 percent of the cost 

of the energy audit, which shall be retained by the eligible entity for the cost of the energy audit. 

‘‘(c) FINANCIAL ASSISTANCE FOR ENERGY EFFICIENCY IMPROVEMENTS AND RENEWABLE ENERGY SYSTEMS.—

‘‘(1) IN GENERAL.—In addition to any similar authority, the 

Secretary shall provide loan guarantees and grants to agricultural producers and rural small businesses— ‘‘(A) to purchase renewable energy systems, including 

systems that may be used to produce and sell electricity; 

and ‘‘(B) to make energy efficiency improvements. ‘‘(2) AWARD CONSIDERATIONS.—In determining the amount 

of a loan guarantee or grant provided under this section, the 

Secretary shall take into consideration, as applicable—

‘‘(A) the type of renewable energy system to be purchased; 

‘‘(B) the estimated quantity of energy to be generated by 

the renewable energy system; 

‘‘(C) the expected environmental benefits of the renewable energy system; 

‘‘(D) the quantity of energy savings expected to be derived from the activity, as demonstrated by an energy 

audit; ‘‘(E) the estimated period of time for the energy savings 

generated by the activity to equal the cost of the activity; ‘‘(F) the expected energy efficiency of the renewable energy system; and 


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‘‘(G) other appropriate factors. ‘‘(3) FEASIBILITY STUDIES.— ‘‘(A) IN GENERAL.—The Secretary may provide assistance in the form of grants to an agricultural producer or 

rural small business to conduct a feasibility study for a 

project for which assistance may be provided under this 

subsection. ‘‘(B) LIMITATION.—The Secretary shall use not more 

than 10 percent of the funds made available to carry out 

this subsection to provide assistance described in subparagraph (A). ‘‘(C) AVOIDANCE OF DUPLICATIVE ASSISTANCE.—An entity shall be ineligible to receive assistance to carry out a feasibility study for a project under this paragraph if the entity has received other Federal or State assistance for a feasibility study for the project. 

‘‘(4) LIMITS.—

‘‘(A) GRANTS.—The amount of a grant under this subsection shall not exceed 25 percent of the cost of the activity 

carried out using funds from the grant. ‘‘(B) MAXIMUM AMOUNT OF LOAN GUARANTEES.—The 

amount of a loan guaranteed under this subsection shall 

not exceed $25,000,000. ‘‘(C) MAXIMUM AMOUNT OF COMBINED GRANT AND LOAN

GUARANTEE.—The combined amount of a grant and loan 

guaranteed under this subsection shall not exceed 75 percent of the cost of the activity funded under this subsection. ‘‘(d) OUTREACH.—The Secretary shall ensure, to the maximum 

extent practicable, that adequate outreach relating to this section is 

being conducted at the State and local levels. ‘‘(e) LOWER-COST ACTIVITIES.— ‘‘(1) LIMITATION ON USE OF FUNDS.—Except as provided in 

paragraph (2), the Secretary shall use not less than 20 percent 

of the funds made available under subsection (g) to provide 

grants of $20,000 or less. ‘‘(2) EXCEPTION.—Effective beginning on June 30 of each 

fiscal year, paragraph (1) shall not apply to funds made available under subsection (g) for the fiscal year. 

‘‘(f) REPORT.—Not later than 4 years after the date of enactment 

of the Food, Conservation, and Energy Act of 2008, the Secretary 

shall submit to Congress a report on the implementation of this section, including the outcomes achieved by projects funded under this 

section. ‘‘(g) FUNDING.—

‘‘(1) MANDATORY FUNDING.—Of the funds of the Commodity 

Credit Corporation, the Secretary shall use to carry out this section, to remain available until expended—

‘‘(A) $55,000,000 for fiscal year 2009; 

‘‘(B) $60,000,000 for fiscal year 2010; 

‘‘(C) $70,000,000 for fiscal year 2011; and 

‘‘(D) $70,000,000 for fiscal year 2012. ‘‘(2) AUDIT AND TECHNICAL ASSISTANCE FUNDING.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), of the 

funds made available for each fiscal year under paragraph 

(1), 4 percent shall be available to carry out subsection (b). 


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‘‘(B) OTHER USE.—Funds not obligated under subparagraph (A) by April 1 of each fiscal year to carry out subsection (b) shall become available to carry out subsection 

(c). 

‘‘(3) DISCRETIONARY FUNDING.—In addition to any other 

funds made available to carry out this section, there is authorized to be appropriated to carry out this section $25,000,000 for 

each of fiscal years 2009 through 2012. 

‘‘SEC. 9008. BIOMASS RESEARCH AND DEVELOPMENT. 

‘‘(a) DEFINITIONS.—In this section: ‘‘(1) BIOBASED PRODUCT.—The term ‘biobased product’ means—‘‘(A) an industrial product (including chemicals, materials, and polymers) produced from biomass; or ‘‘(B) a commercial or industrial product (including animal feed and electric power) derived in connection with the 

conversion of biomass to fuel. 

‘‘(2) DEMONSTRATION.—The term ‘demonstration’ means 

demonstration of technology in a pilot plant or semi-works scale 

facility, including a plant or facility located on a farm. ‘‘(3) INITIATIVE.—The term ‘Initiative’ means the Biomass 

Research and Development Initiative established under subsection (e). 

‘‘(b) COOPERATION AND COORDINATION IN BIOMASS RESEARCH

AND DEVELOPMENT.— ‘‘(1) IN GENERAL.—The Secretary of Agriculture and the 

Secretary of Energy shall coordinate policies and procedures 

that promote research and development regarding the production of biofuels and biobased products. ‘‘(2) POINTS OF CONTACT.—To coordinate research and development programs and activities relating to biofuels and 

biobased products that are carried out by their respective departments—

‘‘(A) the Secretary of Agriculture shall designate, as the 

point of contact for the Department of Agriculture, an officer of the Department of Agriculture appointed by the President to a position in the Department before the date of the 

designation, by and with the advice and consent of the Senate; and ‘‘(B) the Secretary of Energy shall designate, as the 

point of contact for the Department of Energy, an officer of 

the Department of Energy appointed by the President to a 

position in the Department before the date of the designation, by and with the advice and consent of the Senate. 

‘‘(c) BIOMASS RESEARCH AND DEVELOPMENT BOARD.—

‘‘(1) ESTABLISHMENT.—There is established the Biomass 

Research and Development Board to carry out the duties described in paragraph (3). 

‘‘(2) MEMBERSHIP.—The Board shall consist of—

‘‘(A) the point of contacts of the Department of Energy 

and the Department of Agriculture, who shall serve as cochairpersons of the Board; 

‘‘(B) a senior officer of each of the Department of the Interior, the Environmental Protection Agency, the National 

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nology Policy, each of whom shall have a rank that is 

equivalent to the rank of the points of contact; and 

‘‘(C) at the option of the Secretary of Agriculture and 

the Secretary of Energy, other members appointed by the 

Secretaries (after consultation with the Board). 

‘‘(3) DUTIES.—The Board shall—

‘‘(A) coordinate research and development activities relating to biofuels and biobased products—

‘‘(i) between the Department of Agriculture and the 

Department of Energy; and 

‘‘(ii) with other departments and agencies of the 

Federal Government; 

‘‘(B) provide recommendations to the points of contact 

concerning administration of this title; 

‘‘(C) ensure that—

‘‘(i) solicitations are open and competitive with 

awards made annually; and 

‘‘(ii) objectives and evaluation criteria of the solicitations are clearly stated and minimally prescriptive, 

with no areas of special interest; and 

‘‘(D) ensure that the panel of scientific and technical 

peers assembled under subsection (e) to review proposals is 

composed predominantly of independent experts selected 

from outside the Departments of Agriculture and Energy. 

‘‘(4) FUNDING.—Each agency represented on the Board is 

encouraged to provide funds for any purpose under this section. 

‘‘(5) MEETINGS.—The Board shall meet at least quarterly. 

‘‘(d) BIOMASS RESEARCH AND DEVELOPMENT TECHNICAL ADVISORY COMMITTEE.—

‘‘(1) ESTABLISHMENT.—There is established the Biomass 

Research and Development Technical Advisory Committee to 

carry out the duties described in paragraph (3). 

‘‘(2) MEMBERSHIP.—

‘‘(A) IN GENERAL.—The Advisory Committee shall consist of—

‘‘(i) an individual affiliated with the biofuels industry; 

‘‘(ii) an individual affiliated with the biobased industrial and commercial products industry; 

‘‘(iii) an individual affiliated with an institution of 

higher education who has expertise in biofuels and 

biobased products; 

‘‘(iv) 2 prominent engineers or scientists from government or academia who have expertise in biofuels 

and biobased products; 

‘‘(v) an individual affiliated with a commodity 

trade association; 

‘‘(vi) 2 individuals affiliated with environmental or 

conservation organizations; 

‘‘(vii) an individual associated with State government who has expertise in biofuels and biobased products; 

‘‘(viii) an individual with expertise in energy and 

environmental analysis; 


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‘‘(ix) an individual with expertise in the economics 

of biofuels and biobased products; 

‘‘(x) an individual with expertise in agricultural economics; 

‘‘(xi) an individual with expertise in plant biology 

and biomass feedstock development; 

‘‘(xii) an individual with expertise in agronomy, 

crop science, or soil science; and 

‘‘(xiii) at the option of the points of contact, other 

members. 

‘‘(B) APPOINTMENT.—The members of the Advisory 

Committee shall be appointed by the points of contact. 

‘‘(3) DUTIES.—The Advisory Committee shall—

‘‘(A) advise the points of contact with respect to the Initiative; and 

‘‘(B) evaluate and make recommendations in writing to 

the Board regarding whether—

‘‘(i) funds authorized for the Initiative are distributed and used in a manner that is consistent with the 

objectives, purposes, and considerations of the Initiative; 

‘‘(ii) solicitations are open and competitive with 

awards made annually; 

‘‘(iii) objectives and evaluation criteria of the solicitations are clearly stated and minimally prescriptive, 

with no areas of special interest; 

‘‘(iv) the points of contact are funding proposals 

under this title that are selected on the basis of merit, 

as determined by an independent panel of scientific 

and technical peers predominantly from outside the Departments of Agriculture and Energy; and 

‘‘(v) activities under this title are carried out in accordance with this title. 

‘‘(4) COORDINATION.—To avoid duplication of effort, the Advisory Committee shall coordinate its activities with those of 

other Federal advisory committees working in related areas. 

‘‘(5) MEETINGS.—The Advisory Committee shall meet at 

least quarterly. 

‘‘(6) TERMS.—Members of the Advisory Committee shall be 

appointed for a term of 3 years. 

‘‘(e) BIOMASS RESEARCH AND DEVELOPMENT INITIATIVE.—

‘‘(1) IN GENERAL.—The Secretary of Agriculture and the 

Secretary of Energy, acting through their respective points of 

contact and in consultation with the Board, shall establish and 

carry out a Biomass Research and Development Initiative under 

which competitively awarded grants, contracts, and financial 

assistance are provided to, or entered into with, eligible entities 

to carry out research on and development and demonstration 

of—

‘‘(A) biofuels and biobased products; and 

‘‘(B) the methods, practices, and technologies, for the 

production of biofuels and biobased products. 

‘‘(2) OBJECTIVES.—The objectives of the Initiative are to develop—


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‘‘(A) technologies and processes necessary for abundant 

commercial production of biofuels at prices competitive 

with fossil fuels; ‘‘(B) high-value biobased products— ‘‘(i) to enhance the economic viability of biofuels 

and power; ‘‘(ii) to serve as substitutes for petroleum-based 

feedstocks and products; and ‘‘(iii) to enhance the value of coproducts produced 

using the technologies and processes; and 

‘‘(C) a diversity of economically and environmentally 

sustainable domestic sources of renewable biomass for conversion to biofuels, bioenergy, and biobased products. 

‘‘(3) TECHNICAL AREAS.—The Secretary of Agriculture and 

the Secretary of Energy, in consultation with the Administrator 

of the Environmental Protection Agency and heads of other appropriate departments and agencies (referred to in this subsection as the ‘Secretaries’), shall direct the Initiative in the 3 

following areas: 

‘‘(A) FEEDSTOCKS DEVELOPMENT.—Research, development, and demonstration activities regarding feedstocks 

and feedstock logistics (including the harvest, handling, 

transport, preprocessing, and storage) relevant to production of raw materials for conversion to biofuels and 

biobased products. 

‘‘(B) BIOFUELS AND BIOBASED PRODUCTS DEVELOP- MENT.—Research, development, and demonstration activities to support— ‘‘(i) the development of diverse cost-effective technologies for the use of cellulosic biomass in the production of biofuels and biobased products; and ‘‘(ii) product diversification through technologies 

relevant to production of a range of biobased products 

(including chemicals, animal feeds, and cogenerated 

power) that potentially can increase the feasibility of 

fuel production in a biorefinery. 

‘‘(C) BIOFUELS DEVELOPMENT ANALYSIS.— ‘‘(i) STRATEGIC GUIDANCE.—The development of 

analysis that provides strategic guidance for the application of renewable biomass technologies to improve 

sustainability and environmental quality, cost effectiveness, security, and rural economic development. ‘‘(ii) ENERGY AND ENVIRONMENTAL IMPACT.—Development of systematic evaluations of the impact of expanded biofuel production on the environment (including forest land) and on the food supply for humans 

and animals, including the improvement and development of tools for life cycle analysis of current and potential biofuels. ‘‘(iii) ASSESSMENT OF FEDERAL LAND.—Assessments of the potential of Federal land resources to increase the production of feedstocks for biofuels and 

biobased products, consistent with the integrity of soil 

and water resources and with other environmental considerations. 


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‘‘(4) ADDITIONAL CONSIDERATIONS.—Within the technical 

areas described in paragraph (3), the Secretaries shall support 

research and development— ‘‘(A) to create continuously expanding opportunities for 

participants in existing biofuels production by seeking 

synergies and continuity with current technologies and 

practices; ‘‘(B) to maximize the environmental, economic, and social benefits of production of biofuels and derived biobased 

products on a large scale; and ‘‘(C) to facilitate small-scale production and local and 

on-farm use of biofuels, including the development of smallscale gasification technologies for production of biofuel 

from cellulosic feedstocks. 

‘‘(5) ELIGIBILITY.—To be eligible for a grant, contract, or assistance under this section, an applicant shall be—

‘‘(A) an institution of higher education; 

‘‘(B) a National Laboratory; 

‘‘(C) a Federal research agency; 

‘‘(D) a State research agency; 

‘‘(E) a private sector entity; 

‘‘(F) a nonprofit organization; or 

‘‘(G) a consortium of 2 or more entities described in 

subparagraphs (A) through (F). 

‘‘(6) ADMINISTRATION.— ‘‘(A) IN GENERAL.—After consultation with the Board, 

the points of contact shall— ‘‘(i) publish annually 1 or more joint requests for 

proposals for grants, contracts, and assistance under 

this subsection; ‘‘(ii) require that grants, contracts, and assistance 

under this section be awarded based on a scientific 

peer review by an independent panel of scientific and 

technical peers; 

‘‘(iii) give special consideration to applications 

that—

‘‘(I) involve a consortia of experts from multiple institutions; 

‘‘(II) encourage the integration of disciplines 

and application of the best technical resources; and 

‘‘(III) increase the geographic diversity of demonstration projects; and 

‘‘(iv) require that the technical areas described in 

each of subparagraphs (A), (B), and (C) of paragraph 

(3) receive not less than 15 percent of funds made 

available to carry out this section. 

‘‘(B) COST SHARE.—

‘‘(i) RESEARCH AND DEVELOPMENT PROJECTS.—

‘‘(I) IN GENERAL.—Except as provided in subclause (II), the non-Federal share of the cost of a 

research or development project under this section 

shall be not less than 20 percent. ‘‘(II) REDUCTION.—The Secretary of Agriculture or the Secretary of Energy, as appropriate, 

may reduce the non-Federal share required under 


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subclause (I) if the appropriate Secretary determines the reduction to be necessary and appropriate. 

‘‘(ii) DEMONSTRATION AND COMMERCIAL

PROJECTS.—The non-Federal share of the cost of a 

demonstration or commercial project under this section 

shall be not less than 50 percent. 

‘‘(C) TECHNOLOGY AND INFORMATION TRANSFER.—The 

Secretary of Agriculture and the Secretary of Energy shall 

ensure that applicable research results and technologies 

from the Initiative are—

‘‘(i) adapted, made available, and disseminated, as 

appropriate; and 

‘‘(ii) included in the best practices database established under section 1672C(e) of the Food, Agriculture, 

Conservation, and Trade Act of 1990. 

‘‘(f) ADMINISTRATIVE SUPPORT AND FUNDS.—

‘‘(1) IN GENERAL.—The Secretary of Energy and the Secretary of Agriculture may provide such administrative support 

and funds of the Department of Energy and the Department of 

Agriculture to the Board and the Advisory Committee as are 

necessary to enable the Board and the Advisory Committee to 

carry out their duties under this section. 

‘‘(2) OTHER AGENCIES.—The heads of the agencies referred 

to in subsection (c)(2)(B), and the other members of the Board 

appointed under subsection (c)(2)(C), are encouraged to provide 

administrative support and funds of their respective agencies to 

the Board and the Advisory Committee. 

‘‘(3) LIMITATION.—Not more than 4 percent of the amount 

made available for each fiscal year under subsection (h) may be 

used to pay the administrative costs of carrying out this section. 

‘‘(g) REPORTS.—For each fiscal year for which funds are made 

available to carry out this section, the Secretary of Energy and the 

Secretary of Agriculture shall jointly submit to Congress a detailed 

report on—

‘‘(1) the status and progress of the Initiative, including a report from the Advisory Committee on whether funds appropriated for the Initiative have been distributed and used in a 

manner that is consistent with the objectives and requirements 

of this section; 

‘‘(2) the general status of cooperation and research and development efforts carried out at each agency with respect to 

biofuels and biobased products; and 

‘‘(3) the plans of the Secretary of Energy and the Secretary 

of Agriculture for addressing concerns raised in the report, including concerns raised by the Advisory Committee. 

‘‘(h) FUNDING.—

‘‘(1) MANDATORY FUNDING.—Of the funds of the Commodity 

Credit Corporation, the Secretary of Agriculture shall use to 

carry out this section, to remain available until expended—

‘‘(A) $20,000,000 for fiscal year 2009; 

‘‘(B) $28,000,000 for fiscal year 2010; 

‘‘(C) $30,000,000 for fiscal year 2011; and 

‘‘(D) $40,000,000 for fiscal year 2012. 


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‘‘(2) DISCRETIONARY FUNDING.—In addition to any other 

funds made available to carry out this section, there is authorized to be appropriated to carry out this section $35,000,000 for 

each of fiscal years 2009 through 2012. 

‘‘SEC. 9009. RURAL ENERGY SELF-SUFFICIENCY INITIATIVE. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) ELIGIBLE RURAL COMMUNITY.—The term ‘eligible rural 

community’ means a community located in a rural area (as defined in section 343(a)(13)(A) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 1991(a)(13)(A))). 

‘‘(2) INITIATIVE.—The term ‘Initiative’ means the Rural Energy Self-Sufficiency Initiative established under this section. 

‘‘(3) INTEGRATED RENEWABLE ENERGY SYSTEM.—The term 

‘integrated renewable energy system’ means a community-wide 

energy system that—

‘‘(A) reduces conventional energy use; and 

‘‘(B) increases the use of energy from renewable sources. 

‘‘(b) ESTABLISHMENT.—The Secretary shall establish a Rural 

Energy Self-Sufficiency Initiative to provide financial assistance for 

the purpose of enabling eligible rural communities to substantially 

increase the energy self-sufficiency of the eligible rural communities. 

‘‘(c) GRANT ASSISTANCE.—

‘‘(1) IN GENERAL.—The Secretary shall make grants available under the Initiative to eligible rural communities to carry 

out an activity described in paragraph (2). 

‘‘(2) USE OF GRANT FUNDS.—An eligible rural community 

may use a grant—

‘‘(A) to conduct an energy assessment that assesses the 

total energy use of all energy users in the eligible rural 

community; 

‘‘(B) to formulate and analyze ideas for reducing energy 

usage by the eligible rural community from conventional 

sources; and 

‘‘(C) to develop and install an integrated renewable energy system. 

‘‘(3) GRANT SELECTION.—

‘‘(A) APPLICATION.—To be considered for a grant, an eligible rural community shall submit an application to the 

Secretary that describes the ways in which the community 

would use the grant to carry out an activity described in 

paragraph (2). 

‘‘(B) PREFERENCE.—The Secretary shall give preference 

to those applications that propose to carry out an activity 

in coordination with—

‘‘(i) institutions of higher education or nonprofit 

foundations of institutions of higher education; 

‘‘(ii) Federal, State, or local government agencies; 

‘‘(iii) public or private power generation entities; or 

‘‘(iv) government entities with responsibility for 

water or natural resources. 

‘‘(4) REPORT.—An eligible rural community receiving a 

grant under the Initiative shall submit to the Secretary a report 

on the project of the eligible rural community. 


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‘‘(5) COST-SHARING.—The amount of a grant under the Initiative shall not exceed 50 percent of the cost of the activities described in the application. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $5,000,000 for each of 

fiscal years 2009 through 2012. 

‘‘SEC. 9010. FEEDSTOCK FLEXIBILITY PROGRAM FOR BIOENERGY PRODUCERS. 

‘‘(a) DEFINITIONS.—In this section: ‘‘(1) BIOENERGY.—The term ‘bioenergy’ means fuel grade 

ethanol and other biofuel. ‘‘(2) BIOENERGY PRODUCER.—The term ‘bioenergy producer’ means a producer of bioenergy that uses an eligible commodity 

to produce bioenergy under this section. ‘‘(3) ELIGIBLE COMMODITY.—The term ‘eligible commodity’ means a form of raw or refined sugar or in-process sugar that 

is eligible to be marketed in the United States for human consumption or to be used for the extraction of sugar for human 

consumption. ‘‘(4) ELIGIBLE ENTITY.—The term ‘eligible entity’ means an 

entity located in the United States that markets an eligible commodity in the United States. 

‘‘(b) FEEDSTOCK FLEXIBILITY PROGRAM.— ‘‘(1) IN GENERAL.— ‘‘(A) PURCHASES AND SALES.—For each of the 2008 

through 2012 crops, the Secretary shall purchase eligible 

commodities from eligible entities and sell such commodities to bioenergy producers for the purpose of producing 

bioenergy in a manner that ensures that section 156 of the 

Federal Agriculture Improvement and Reform Act (7 U.S.C. 

7272) is operated at no cost to the Federal Government by 

avoiding forfeitures to the Commodity Credit Corporation. ‘‘(B) COMPETITIVE PROCEDURES.—In carrying out the 

purchases and sales required under subparagraph (A), the 

Secretary shall, to the maximum extent practicable, use 

competitive procedures, including the receiving, offering, 

and accepting of bids, when entering into contracts with eligible entities and bioenergy producers, provided that such 

procedures are consistent with the purposes of subparagraph (A). 

‘‘(C) LIMITATION.—The purchase and sale of eligible 

commodities under subparagraph (A) shall only be made in 

crop years in which such purchases and sales are necessary 

to ensure that the program authorized under section 156 of 

the Federal Agriculture Improvement and Reform Act (7 

U.S.C. 7272) is operated at no cost to the Federal Government by avoiding forfeitures to the Commodity Credit Corporation. 

‘‘(2) NOTICE.—

‘‘(A) IN GENERAL.—As soon as practicable after the date 

of enactment of the Food, Conservation, and Energy Act of 

2008 and each September 1 thereafter through September 

1, 2012, the Secretary shall provide notice to eligible entities and bioenergy producers of the quantity of eligible commodities that shall be made available for purchase and 


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sale for the crop year following the date of the notice under 

this section. ‘‘(B) REESTIMATES.—Not later than the January 1, 

April 1, and July 1 of the calendar year following the date 

of a notice under subparagraph (A), the Secretary shall reestimate the quantity of eligible commodities determined 

under subparagraph (A), and provide notice and make purchases and sales based on such reestimates. 

‘‘(3) COMMODITY CREDIT CORPORATION INVENTORY.— ‘‘(A) DISPOSITIONS.— ‘‘(i) BIOENERGY AND GENERALLY.—Except as provided in clause (ii), to the extent that an eligible commodity is owned and held in inventory by the Commodity Credit Corporation (accumulated pursuant to 

the program authorized under section 156 of the Federal Agriculture Improvement and Reform Act (7 

U.S.C. 7272)), the Secretary shall— ‘‘(I) sell the eligible commodity to bioenergy 

producers under this section consistent with paragraph (1)(C); ‘‘(II) dispose of the eligible commodity in accordance with section 156(f)(2) of that Act; or ‘‘(III) otherwise dispose of the eligible commodity through the buyback of certificates of quota 

entry. 

‘‘(ii) PRESERVATION OF OTHER AUTHORITIES.— Nothing in this section limits the use of other authorities for the disposition of an eligible commodity held in 

the inventory of the Commodity Credit Corporation for 

nonfood use or otherwise in a manner that does not increase the net quantity of sugar available for human 

consumption in the United States market, consistent 

with section 156(f)(1) of the Federal Agriculture Improvement and Reform Act (7 U.S.C. 7272(f)(1)). 

‘‘(B) EMERGENCY SHORTAGES.—Notwithstanding subparagraph (A), if there is an emergency shortage of sugar 

for human consumption in the United States market that 

is caused by a war, flood, hurricane, or other natural disaster, or other similar event, the Secretary may dispose of 

an eligible commodity that is owned and held in inventory 

by the Commodity Credit Corporation (accumulated pursuant to the program authorized under section 156 of the 

Federal Agriculture Improvement and Reform Act (7 U.S.C. 

7272)) through disposition as authorized under section 

156(f) of that Act or through the use of any other authority 

of the Commodity Credit Corporation. 

‘‘(4) TRANSFER RULE; STORAGE FEES.—

‘‘(A) GENERAL TRANSFER RULE.—Except with regard to 

emergency dispositions under paragraph (3)(B) and as provided in subparagraph (C), the Secretary shall ensure that 

bioenergy producers that purchase eligible commodities 

pursuant to this section take possession of the eligible commodities within 30 calendar days of the date of such purchase from the Commodity Credit Corporation. 

‘‘(B) PAYMENT OF STORAGE FEES PROHIBITED.—


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‘‘(i) IN GENERAL.—The Secretary shall, to the maximum extent practicable, carry out this section in a 

manner that ensures no storage fees are paid by the 

Commodity Credit Corporation in the administration 

of this section. ‘‘(ii) EXCEPTION.—Clause (i) shall not apply with 

respect to any commodities owned and held in inventory by the Commodity Credit Corporation (accumulated pursuant to the program authorized under section 156 of the Federal Agriculture Improvement and 

Reform Act (7 U.S.C. 7272)). 

‘‘(C) OPTION TO PREVENT STORAGE FEES.— ‘‘(i) IN GENERAL.—The Secretary may enter into 

contracts with bioenergy producers to sell eligible commodities to such producers prior in time to entering 

into contracts with eligible entities to purchase the eligible commodities to be used to satisfy the contracts entered into with the bioenergy producers. ‘‘(ii) SPECIAL TRANSFER RULE.—If the Secretary 

makes a sale and purchase referred to in clause (i), the 

Secretary shall ensure that the bioenergy producer that 

purchased eligible commodities takes possession of 

such commodities within 30 calendar days of the date 

the Commodity Credit Corporation purchases the eligible commodities. ‘‘(5) RELATION TO OTHER LAWS.—If sugar that is subject to 

a marketing allotment under part VII of subtitle B of title III 

of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359aa et 

seq.) is the subject of a payment under this section, the sugar 

shall be considered marketed and shall count against a processor’s allocation of an allotment under such part, as applicable. ‘‘(6) FUNDING.—The Secretary shall use the funds, facilities, 

and authorities of the Commodity Credit Corporation, including 

the use of such sums as are necessary, to carry out this section. 

‘‘SEC. 9011. BIOMASS CROP ASSISTANCE PROGRAM. 

‘‘(a) DEFINITIONS.—In this section: ‘‘(1) BCAP.—The term ‘BCAP’ means the Biomass Crop Assistance Program established under this section. ‘‘(2) BCAP PROJECT AREA.—The term ‘BCAP project area’ means an area that—

‘‘(A) has specified boundaries that are submitted to the 

Secretary by the project sponsor and subsequently approved 

by the Secretary; 

‘‘(B) includes producers with contract acreage that will 

supply a portion of the renewable biomass needed by a biomass conversion facility; and 

‘‘(C) is physically located within an economically practicable distance from the biomass conversion facility. 

‘‘(3) CONTRACT ACREAGE.—The term ‘contract acreage’

means eligible land that is covered by a BCAP contract entered 

into with the Secretary. 

‘‘(4) ELIGIBLE CROP.—

‘‘(A) IN GENERAL.—The term ‘eligible crop’ means a 

crop of renewable biomass. 


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‘‘(B) EXCLUSIONS.—The term ‘eligible crop’ does not include— ‘‘(i) any crop that is eligible to receive payments 

under title I of the Food, Conservation, and Energy Act 

of 2008 or an amendment made by that title; or ‘‘(ii) any plant that is invasive or noxious or has 

the potential to become invasive or noxious, as determined by the Secretary, in consultation with other appropriate Federal or State departments and agencies. ‘‘(5) ELIGIBLE LAND.— ‘‘(A) IN GENERAL.—The term ‘eligible land’ includes agricultural and nonindustrial private forest lands (as defined in section 5(c) of the Cooperative Forestry Assistance 

Act of 1978 (16 U.S.C. 2103a(c))). ‘‘(B) EXCLUSIONS.—The term ‘eligible land’ does not include—

‘‘(i) Federal- or State-owned land; 

‘‘(ii) land that is native sod, as of the date of enactment of the Food, Conservation, and Energy Act of 

2008; 

‘‘(iii) land enrolled in the conservation reserve program established under subchapter B of chapter 1 of 

subtitle D of title XII of the Food Security Act of 1985 

(16 U.S.C. 3831 et seq.); 

‘‘(iv) land enrolled in the wetlands reserve program 

established under subchapter C of chapter 1 of subtitle 

D of title XII of that Act (16 U.S.C. 3837 et seq.); or 

‘‘(v) land enrolled in the grassland reserve program established under subchapter D of chapter 2 of 

subtitle D of title XII of that Act (16 U.S.C. 3838n et 

seq.). 

‘‘(6) ELIGIBLE MATERIAL.—

‘‘(A) IN GENERAL.—The term ‘eligible material’ means 

renewable biomass. ‘‘(B) EXCLUSIONS.—The term ‘eligible material’ does not 

include—

‘‘(i) any crop that is eligible to receive payments 

under title I of the Food, Conservation, and Energy Act 

of 2008 or an amendment made by that title; ‘‘(ii) animal waste and byproducts (including fats, 

oils, greases, and manure); ‘‘(iii) food waste and yard waste; or 

‘‘(iv) algae. ‘‘(7) PRODUCER.—The term ‘producer’ means an owner or 

operator of contract acreage that is physically located within a 

BCAP project area. 

‘‘(8) PROJECT SPONSOR.—The term ‘project sponsor’

means—

‘‘(A) a group of producers; or 

‘‘(B) a biomass conversion facility. ‘‘(b) ESTABLISHMENT AND PURPOSE.—The Secretary shall establish and administer a Biomass Crop Assistance Program to— ‘‘(1) support the establishment and production of eligible 

crops for conversion to bioenergy in selected BCAP project 

areas; and 


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‘‘(2) assist agricultural and forest land owners and operators with collection, harvest, storage, and transportation of eligible material for use in a biomass conversion facility. 

‘‘(c) BCAP PROJECT AREA.— ‘‘(1) IN GENERAL.—The Secretary shall provide financial assistance to producers of eligible crops in a BCAP project area. ‘‘(2) SELECTION OF PROJECT AREAS.— ‘‘(A) IN GENERAL.—To be considered for selection as a 

BCAP project area, a project sponsor shall submit to the 

Secretary a proposal that includes, at a minimum— ‘‘(i) a description of the eligible land and eligible 

crops of each producer that will participate in the proposed BCAP project area; ‘‘(ii) a letter of commitment from a biomass conversion facility that the facility will use the eligible crops 

intended to be produced in the proposed BCAP project 

area; ‘‘(iii) evidence that the biomass conversion facility 

has sufficient equity available, as determined by the 

Secretary, if the biomass conversion facility is not operational at the time the proposal is submitted to the Secretary; and ‘‘(iv) any other appropriate information about the 

biomass conversion facility or proposed biomass conversion facility that gives the Secretary a reasonable 

assurance that the plant will be in operation by the 

time that the eligible crops are ready for harvest. 

‘‘(B) BCAP PROJECT AREA SELECTION CRITERIA.—In selecting BCAP project areas, the Secretary shall consider— ‘‘(i) the volume of the eligible crops proposed to be 

produced in the proposed BCAP project area and the 

probability that such crops will be used for the purposes of the BCAP; ‘‘(ii) the volume of renewable biomass projected to 

be available from sources other than the eligible crops 

grown on contract acres; 

‘‘(iii) the anticipated economic impact in the proposed BCAP project area; 

‘‘(iv) the opportunity for producers and local investors to participate in the ownership of the biomass conversion facility in the proposed BCAP project area; 

‘‘(v) the participation rate by—

‘‘(I) beginning farmers or ranchers (as defined 

in accordance with section 343(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 

1991(a))); or 

‘‘(II) socially disadvantaged farmers or ranchers (as defined in section 2501(e) of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 

U.S.C. 2279(e))); 

‘‘(vi) the impact on soil, water, and related resources; 

‘‘(vii) the variety in biomass production approaches 

within a project area, including (as appropriate)—

‘‘(I) agronomic conditions; 


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‘‘(II) harvest and postharvest practices; and 

‘‘(III) monoculture and polyculture crop mixes; 

‘‘(viii) the range of eligible crops among project 

areas; and 

‘‘(ix) any additional information, as determined by 

the Secretary. 

‘‘(3) CONTRACT.—

‘‘(A) IN GENERAL.—On approval of a BCAP project area 

by the Secretary, each producer in the BCAP project area 

shall enter into a contract directly with the Secretary. 

‘‘(B) MINIMUM TERMS.—At a minimum, contracts shall 

include terms that cover—

‘‘(i) an agreement to make available to the Secretary, or to an institution of higher education or other 

entity designated by the Secretary, such information as 

the Secretary considers to be appropriate to promote 

the production of eligible crops and the development of 

biomass conversion technology; 

‘‘(ii) compliance with the highly erodible land conservation requirements of subtitle B of title XII of the 

Food Security Act of 1985 (16 U.S.C. 3811 et seq.) and 

the wetland conservation requirements of subtitle C of 

title XII of that Act (16 U.S.C. 3821 et seq.); 

‘‘(iii) the implementation of (as determined by the 

Secretary)—

‘‘(I) a conservation plan; or 

‘‘(II) a forest stewardship plan or an equivalent plan; and 

‘‘(iv) any additional requirements the Secretary 

considers appropriate. 

‘‘(C) DURATION.—A contract under this subsection shall 

have a term of up to—

‘‘(i) 5 years for annual and perennial crops; or 

‘‘(ii) 15 years for woody biomass. 

‘‘(4) RELATIONSHIP TO OTHER PROGRAMS.—In carrying out 

this subsection, the Secretary shall provide for the preservation 

of cropland base and yield history applicable to the land enrolled in a BCAP contract. 

‘‘(5) PAYMENTS.—

‘‘(A) IN GENERAL.—The Secretary shall make establishment and annual payments directly to producers to support 

the establishment and production of eligible crops on contract acreage. 

‘‘(B) AMOUNT OF ESTABLISHMENT PAYMENTS.—The 

amount of an establishment payment under this subsection 

shall be up to 75 percent of the costs of establishing an eligible perennial crop covered by the contract, including—

‘‘(i) the cost of seeds and stock for perennials; 

‘‘(ii) the cost of planting the perennial crop, as determined by the Secretary; and 

‘‘(iii) in the case of nonindustrial private 

forestland, the costs of site preparation and tree planting. 

‘‘(C) AMOUNT OF ANNUAL PAYMENTS.—


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‘‘(i) IN GENERAL.—Subject to clause (ii), the 

amount of an annual payment under this subsection 

shall be determined by the Secretary. 

‘‘(ii) REDUCTION.—The Secretary shall reduce an 

annual payment by an amount determined to be appropriate by the Secretary, if—

‘‘(I) an eligible crop is used for purposes other 

than the production of energy at the biomass conversion facility; 

‘‘(II) an eligible crop is delivered to the biomass conversion facility; 

‘‘(III) the producer receives a payment under 

subsection (d); 

‘‘(IV) the producer violates a term of the contract; or 

‘‘(V) there are such other circumstances, as determined by the Secretary to be necessary to carry 

out this section. 

‘‘(d) ASSISTANCE WITH COLLECTION, HARVEST, STORAGE, AND

TRANSPORTATION.—

‘‘(1) IN GENERAL.—The Secretary shall make a payment for 

the delivery of eligible material to a biomass conversion facility 

to—

‘‘(A) a producer of an eligible crop that is produced on 

BCAP contract acreage; or 

‘‘(B) a person with the right to collect or harvest eligible 

material. 

‘‘(2) PAYMENTS.—

‘‘(A) COSTS COVERED.—A payment under this subsection shall be in an amount described in subparagraph 

(B) for—

‘‘(i) collection; 

‘‘(ii) harvest; 

‘‘(iii) storage; and 

‘‘(iv) transportation to a biomass conversion facility. 

‘‘(B) AMOUNT.—Subject to paragraph (3), the Secretary 

may provide matching payments at a rate of $1 for each $1 

per ton provided by the biomass conversion facility, in an 

amount equal to not more than $45 per ton for a period of 

2 years. 

‘‘(3) LIMITATION ON ASSISTANCE FOR BCAP CONTRACT ACREAGE.—As a condition of the receipt of annual payment under 

subsection (c), a producer receiving a payment under this subsection for collection, harvest, storage or transportation of an eligible crop produced on BCAP acreage shall agree to a reduction in the annual payment. 

‘‘(e) REPORT.—Not later than 4 years after the date of enactment 

of the Food, Conservation, and Energy Act of 2008, the Secretary 

shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report on the dissemination by the Secretary 

of the best practice data and information gathered from participants 

receiving assistance under this section. 


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‘‘(f) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary shall use to carry out this section such sums as 

are necessary for each of fiscal years 2008 through 2012. 

‘‘SEC. 9012. FOREST BIOMASS FOR ENERGY. 

‘‘(a) IN GENERAL.—The Secretary, acting through the Forest 

Service, shall conduct a competitive research and development program to encourage use of forest biomass for energy. 

‘‘(b) ELIGIBLE ENTITIES.—Entities eligible to compete under the 

program under this section include—

‘‘(1) the Forest Service (acting through Research and Development); 

‘‘(2) other Federal agencies; 

‘‘(3) State and local governments; 

‘‘(4) Indian tribes; 

‘‘(5) land-grant colleges and universities; and 

‘‘(6) private entities. 

‘‘(c) PRIORITY FOR PROJECT SELECTION.—In carrying out this 

section, the Secretary shall give priority to projects that—

‘‘(1) develop technology and techniques to use low-value forest biomass, such as byproducts of forest health treatments and 

hazardous fuels reduction, for the production of energy; 

‘‘(2) develop processes that integrate production of energy 

from forest biomass into biorefineries or other existing manufacturing streams; 

‘‘(3) develop new transportation fuels from forest biomass; 

and 

‘‘(4) improve the growth and yield of trees intended for renewable energy production. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $15,000,000 for each of 

fiscal years 2009 through 2012. 

‘‘SEC. 9013. COMMUNITY WOOD ENERGY PROGRAM. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) COMMUNITY WOOD ENERGY PLAN.—The term ‘community wood energy plan’ means an assessment of—

‘‘(A) available feedstocks necessary to supply a community wood energy system; and 

‘‘(B) the long-term feasibility of supplying and operating a community wood energy system. 

‘‘(2) COMMUNITY WOOD ENERGY SYSTEM.—

‘‘(A) IN GENERAL.—The term ‘community wood energy 

system’ means an energy system that—

‘‘(i) primarily services public facilities owned or operated by State or local governments, including schools, 

town halls, libraries, and other public buildings; and 

‘‘(ii) uses woody biomass as the primary fuel. 

‘‘(B) INCLUSIONS.—The term ‘community wood energy 

system’ includes single facility central heating, district 

heating, combined heat and energy systems, and other related biomass energy systems. ‘‘(b) GRANT PROGRAM.— ‘‘(1) IN GENERAL.—The Secretary, acting through the Chief 

of the Forest Service, shall establish a program to be known as 

the ‘Community Wood Energy Program’ to provide—


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‘‘(A) grants of up to $50,000 to State and local governments (or designees) to develop community wood energy 

plans; and ‘‘(B) competitive grants to State and local governments 

to acquire or upgrade community wood energy systems. 

‘‘(2) CONSIDERATIONS.—In selecting applicants for grants 

under paragraph (1)(B), the Secretary shall consider— ‘‘(A) the energy efficiency of the proposed system; 

‘‘(B) the cost effectiveness of the proposed system; and 

‘‘(C) other conservation and environmental criteria that 

the Secretary considers appropriate. 

‘‘(3) USE OF PLAN.—A State or local government applying 

to receive a competitive grant described in paragraph (1)(B) 

shall submit to the Secretary as part of the grant application 

the applicable community wood energy plan. 

‘‘(c) LIMITATION.—A community wood energy system acquired 

with grant funds provided under subsection (b)(1)(B) shall not exceed an output of— ‘‘(1) 50,000,000 Btu per hour for heating; and 

‘‘(2) 2 megawatts for electric power production. ‘‘(d) MATCHING FUNDS.—A State or local government that receives a grant under subsection (b) shall contribute an amount of 

non-Federal funds towards the development of the community wood 

energy plan, or acquisition of the community wood energy systems 

that is at least equal to the amount of grant funds received by the 

State or local government under that subsection. ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $5,000,000 for each of 

fiscal years 2009 through 2012.’’. (b) CONFORMING AMENDMENT.—The Biomass Research and Development Act of 2000 (7 U.S.C. 8601 et seq.) is repealed. 

SEC. 9002. BIOFUELS INFRASTRUCTURE STUDY. 

(a) IN GENERAL.—The Secretary of Agriculture, the Secretary of 

Energy, the Administrator of the Environmental Protection Agency, 

and the Secretary of Transportation (referred to in this section as 

the ‘‘Secretaries’’), shall jointly conduct a study that includes— (1) an assessment of the infrastructure needs for expanding 

the domestic production, transport, and distribution of biofuels 

given current and likely future market trends; 

(2) recommendations for infrastructure needs and development approaches, taking into account cost and other associated 

factors; and 

(3) a report that includes— (A) a summary of infrastructure needs; 

(B) an analysis of alternative development approaches 

to meeting the needs described in subparagraph (A), including cost, siting, and other regulatory issues; and 

(C) recommendations for specific infrastructure development actions to be taken. 

(b) SCOPE OF STUDY.—

(1) IN GENERAL.—In conducting the study described in subsection (a), the Secretaries shall address—

(A) current and likely future market trends for biofuels 

through calendar year 2025; 

(B) current and future availability of feedstocks; 


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(C) water resource needs, including water requirements 

for biorefineries; 

(D) shipping and storage needs for biomass feedstock 

and biofuels, including the adequacy of rural roads; and 

(E) modes of transportation and delivery for biofuels 

(including shipment by rail, truck, pipeline or barge) and 

associated infrastructure issues. 

(2) CONSIDERATIONS.—In addressing the issues described 

in paragraph (1), the Secretaries shall consider—

(A) the effects of increased tank truck, rail, and barge 

transport on existing infrastructure and safety; 

(B) the feasibility of shipping biofuels through pipelines 

in existence as of the date of enactment of this Act; 

(C) the development of new biofuels pipelines, including siting, financing, timing, and other economic issues; 

(D) the implications of various biofuel blend levels on 

infrastructure needs; 

(E) the implications of various approaches to infrastructure development on resource use and conservation; 

(F) regional differences in biofuels infrastructure needs; 

and 

(G) other infrastructure issues, as determined by the 

Secretaries. 

(c) IMPLEMENTATION.—In carrying out this section, the Secretaries —

(1) shall—

(A) consult with individuals and entities with interest 

or expertise in the areas described in subsection (b); 

(B) to the extent available, use the information developed and results of the related studies authorized under 

sections 243 and 245 of the Energy Independence and Security Act of 2007 (Public Law 110–140; 121 Stat. 1540, 

1546)); and 

(C) submit to Congress the report required under subsection (a)(3), including—

(i) in the Senate—

(I) the Committee on Agriculture, Nutrition, 

and Forestry ; 

(II) the Committee on Commerce, Science, and 

Transportation; 

(III) the Committee on Energy and Natural 

Resources; and 

(IV) the Committee on Environment and Public Works; and 

(ii) in the House of Representatives—

(I) the Committee on Agriculture; 

(II) the Committee on Energy and Commerce; 

(III) the Committee on Transportation and Infrastructure; and 

(IV) the Committee on Science and Technology; and 

(2) may issue a solicitation for a competition to select a contractor to support the Secretaries. 


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SEC. 9003. RENEWABLE FERTILIZER STUDY. 

(a) IN GENERAL.—Not later than 1 year after the date of receipt 

of appropriations to carry out this section, the Secretary shall— (1) conduct a study to assess the current state of knowledge 

regarding the potential for the production of fertilizer from renewable energy sources in rural areas, including— (A) identification of the critical challenges to commercialization of rural production of nitrogen and phosphorusbased fertilizer from renewables; 

(B) the most promising processes and technologies for 

renewable fertilizer production; 

(C) the potential cost-competitiveness of renewable fertilizer; and 

(D) the potential impacts of renewable fertilizer on fossil fuel use and the environment; and 

(2) submit to the Committee on Agriculture of the House of 

Representatives and the Committee on Agriculture, Nutrition, 

and Forestry of the Senate a report describing the results of the 

study. 

(b) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $1,000,000 for fiscal year 

2009. 

TITLE X—HORTICULTURE AND ORGANIC AGRICULTURE 

SEC. 10001. DEFINITIONS. 

In this title: 

(1) SPECIALTY CROP.—The term ‘‘specialty crop’’ has the 

meaning given the term in section 3 of the Specialty Crops 

Competitiveness Act of 2004 (7 U.S.C. 1621 note; Public Law 

108–465). 

(2) STATE DEPARTMENT OF AGRICULTURE.—The term ‘‘State 

department of agriculture’’ means the agency, commission, or 

department of a State government responsible for protecting 

and promoting agriculture in the State. 

Subtitle A—Horticulture Marketing and Information 

SEC. 10101. INDEPENDENT EVALUATION OF DEPARTMENT OF AGRICULTURE COMMODITY PURCHASE PROCESS. 

(a) EVALUATION REQUIRED.—The Secretary shall arrange to 

have performed an independent evaluation of the purchasing processes (including the budgetary, statutory, and regulatory authority 

underlying the processes) used by the Department of Agriculture to 

implement the requirement that funds available under section 32 of 

the Act of August 24, 1935 (7 U.S.C. 612c), shall be principally devoted to perishable agricultural commodities. 

(b) SUBMISSION OF RESULTS.—Not later than 18 months after 

the date of the enactment of this Act, the Secretary shall submit to 

the Committee on Agriculture of the House of Representatives and 

the Committee on Agriculture, Nutrition, and Forestry of the Senate 

a report on the results of the evaluation. 

SEC. 10102. QUALITY REQUIREMENTS FOR CLEMENTINES. 

Section 8e(a) of the Agricultural Adjustment Act (7 U.S.C. 

608e–1(a)), reenacted with amendments by the Agricultural Marketing Agreement Act of 1937, is amended in the matter preceding 


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the first proviso in the first sentence by inserting ‘‘clementines,’’ after 

‘‘nectarines,’’. 

SEC. 10103. INCLUSION OF SPECIALTY CROPS IN CENSUS OF AGRICULTURE. 

Section 2(a) of the Census of Agriculture Act of 1997 (7 U.S.C. 

2204g(a)) is amended—

(1) by striking ‘‘In 1998’’ and inserting the following: 

‘‘(1) IN GENERAL.—In 1998’’; and 

(2) by adding at the end the following: 

‘‘(2) INCLUSION OF SPECIALTY CROPS.—Effective beginning 

with the census of agriculture required to be conducted in 2008, 

the Secretary shall conduct as part of each census of agriculture 

a census of specialty crops (as that term is defined in section 

3 of the Specialty Crops Competitiveness Act of 2004 (7 U.S.C. 

1621 note; Public Law 108-465)).’’. 

SEC. 10104. MUSHROOM PROMOTION, RESEARCH, AND CONSUMER INFORMATION. 

(a) REGIONS AND MEMBERS.—Section 1925(b)(2) of the Mushroom Promotion, Research, and Consumer Information Act of 1990 

(7 U.S.C. 6104(b)(2)) is amended—

(1) in subparagraph (B), by striking ‘‘4 regions’’ and inserting ‘‘3 regions’’; 

(2) in subparagraph (D), by striking ‘‘35,000,000 pounds’’

and inserting ‘‘50,000,000 pounds’’; and 

(3) by striking subparagraph (E) and inserting the following: 

‘‘(E) ADDITIONAL MEMBERS.—In addition to the members appointed pursuant to paragraph (1), and subject to 

the 9-member limit of members on the Council provided in 

that paragraph, the Secretary shall appoint additional 

members to the council from a region that attains additional pounds of production as follows: 

‘‘(i) If the annual production of a region is greater 

than 110,000,000 pounds, but less than or equal to 

180,000,000 pounds, the region shall be represented by 

1 additional member. 

‘‘(ii) If the annual production of a region is greater 

than 180,000,000 pounds, but less than or equal to 

260,000,000 pounds, the region shall be represented by 

2 additional members. 

‘‘(iii) If the annual production of a region is greater 

than 260,000,000 pounds, the region shall be represented by 3 additional members.’’. 

(b) POWERS AND DUTIES OF COUNCIL.—Section 1925(c) of the 

Mushroom Promotion, Research, and Consumer Information Act of 

1990 (7 U.S.C. 6104(c)) is amended—

(1) by redesignating paragraphs (6), (7), and (8) as paragraphs (7), (8), and (9), respectively; and 

(2) by inserting after paragraph (5) the following: 

‘‘(6) to develop and propose to the Secretary programs for 

good agricultural and good handling practices and related activities for mushrooms;’’. 


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SEC. 10105. FOOD SAFETY EDUCATION INITIATIVES. 

(a) INITIATIVE AUTHORIZED.—The Secretary may carry out a 

food safety education program to educate the public and persons in 

the fresh produce industry about—

(1) scientifically proven practices for reducing microbial 

pathogens on fresh produce; and 

(2) methods of reducing the threat of cross-contamination of 

fresh produce through sanitary handling practices. 

(b) COOPERATION.—The Secretary may carry out the education 

program in cooperation with public and private partners. 

(c) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to 

be appropriated to the Secretary to carry out this section $1,000,000 

for each of fiscal years 2008 through 2012, to remain available until 

expended. 

SEC. 10106. FARMERS’ MARKET PROMOTION PROGRAM. 

Section 6 of the Farmer-to-Consumer Direct Marketing Act of 

1976 (7 U.S.C. 3005) is amended—

(1) in subsection (a), by inserting ‘‘and to promote direct 

producer-to-consumer marketing’’ before the period at the end; 

(2) in subsection (b)(1)—

(A) in subparagraph (A), by inserting ‘‘agri-tourism activities,’’ after ‘‘programs,’’; and 

(B) in subparagraph (B)—

(i) by inserting ‘‘agri-tourism activities,’’ after ‘‘programs,’’ and 

(ii) by striking ‘‘infrastructure’’ and inserting ‘‘marketing opportunities’’; 

(3) in subsection (c)(1), by inserting ‘‘or a producer network 

or association’’ after ‘‘cooperative’’; and 

(4) by striking subsection (e) and inserting the following: 

‘‘(e) FUNDING.—

‘‘(1) IN GENERAL.—Of the funds of the Commodity Credit 

Corporation, the Secretary shall use to carry out this section—

‘‘(A) $3,000,000 for fiscal year 2008; 

‘‘(B) $5,000,000 for each of fiscal years 2009 through 

2010; and 

‘‘(C) $10,000,000 for each of fiscal years 2011 and 

2012. 

‘‘(2) USE OF FUNDS.—Not less than 10 percent of the funds 

used to carry out this section in a fiscal year under paragraph 

(1) shall be used to support the use of electronic benefits transfers for Federal nutrition programs at farmers’ markets. ‘‘(3) INTERDEPARTMENTAL COORDINATION.—In carrying out 

this subsection, the Secretary shall ensure coordination between 

the various agencies to the maximum extent practicable. ‘‘(4) LIMITATION.—Funds described in paragraph (2)— ‘‘(A) may not be used for the ongoing cost of carrying 

out any project; and ‘‘(B) shall only be provided to eligible entities that demonstrate a plan to continue to provide EBT card access at 

1 or more farmers’ markets following the receipt of the 

grant.’’. 

SEC. 10107. SPECIALTY CROPS MARKET NEWS ALLOCATION. 

(a) IN GENERAL.—The Secretary shall—


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(1) carry out market news activities to provide timely price 

and shipment information of specialty crops in the United 

States; and 

(2) use funds made available under subsection (b) to increase the reporting levels for specialty crops in effect on the 

date of enactment of this Act. 

(b) AUTHORIZATION OF APPROPRIATIONS.—In addition to any 

other funds made available through annual appropriations for market news services, there is authorized to be appropriated to carry out 

this section $9,000,000 for each of fiscal years 2008 through 2012, 

to remain available until expended. 

SEC. 10108. EXPEDITED MARKETING ORDER FOR HASS AVOCADOS FOR 

GRADES AND STANDARDS AND OTHER PURPOSES. 

(a) IN GENERAL.—The Secretary shall initiate procedures under 

the Agricultural Adjustment Act (7 U.S.C. 601 et seq.), reenacted 

with amendments by the Agricultural Marketing Agreement Act of 

1937, to determine whether it would be appropriate to establish a 

Federal marketing order for Hass avocados relating to grades and 

standards and for other purposes under that Act. 

(b) EXPEDITED PROCEDURES.—

(1) PROPOSAL FOR AN ORDER.—An organization of domestic 

avocado producers in existence on the date of enactment of this 

Act may request the issuance of, and submit to the Secretary a 

proposal for, an order described in subsection (a). 

(2) PUBLICATION OF PROPOSAL.—Not later than 60 days 

after the date on which the Secretary receives a proposed order 

under paragraph (1), the Secretary shall initiate procedures described in subsection (a) to determine whether the proposed 

order should proceed. 

(c) EFFECTIVE DATE.—Any order issued under this section shall 

become effective not later than 15 months after the date on which 

the Secretary initiates procedures under the Agricultural Adjustment Act (7 U.S.C. 601 et seq.), reenacted with amendments by the 

Agricultural Marketing Agreement Act of 1937. 

SEC. 10109. SPECIALTY CROP BLOCK GRANTS. 

(a) DEFINITION OF SPECIALTY CROP.—Section 3(1) of the Specialty Crops Competitiveness Act of 2004 (Public Law 108–465; 7 

U.S.C. 1621 note) is amended by inserting ‘‘horticulture and’’ before 

‘‘nursery’’. 

(b) DEFINITION OF STATE.—Section 3(2) of the Specialty Crops 

Competitiveness Act of 2004 (Public Law 108–465; 7 U.S.C. 1621 

note) is amended by striking ‘‘and the Commonwealth of Puerto 

Rico’’ and inserting ‘‘the Commonwealth of Puerto Rico, Guam, 

American Samoa, the United States Virgin Islands, and the Commonwealth of the Northern Mariana Islands’’. 

(c) SPECIALTY CROP BLOCK GRANTS.—Section 101 of the Specialty Crops Competitiveness Act of 2004 (Public Law 108–465; 7 

U.S.C. 1621 note) is amended—

(1) in subsection (a)—

(A) by striking ‘‘Subject to the appropriation of funds 

to carry out this section’’ and inserting ‘‘Using the funds 

made available under subsection (j)’’; and 

(B) by striking ‘‘2009’’ and inserting ‘‘2012’’; 


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(2) in subsection (b), by striking ‘‘appropriated pursuant to 

the authorization of appropriations in subsection (i)’’ and inserting ‘‘made available under subsection (j)’’; 

(3) by striking subsection (c) and inserting the following: ‘‘(c) MINIMUM GRANT AMOUNT.—Notwithstanding subsection 

(b), each State shall receive a grant under this section for each fiscal 

year in an amount that is at least equal to the higher of— ‘‘(1) $100,000; or 

‘‘(2) 1⁄3 of 1 percent of the total amount of funding made 

available to carry out this section for the fiscal year.’’; and 

(4) by striking subsection (i) and inserting the following: ‘‘(i) REALLOCATION.— ‘‘(1) IN GENERAL.—The Secretary shall reallocate to other 

States in accordance with paragraph (2) any amounts made 

available for a fiscal year under this section that are not obligated or expended by a date during that fiscal year determined 

by the Secretary. ‘‘(2) PRO RATA ALLOCATION.—The Secretary shall allocate 

funds described in paragraph (1) pro rata to the remaining 

States that applied during the specified grant application period. ‘‘(3) USE OF REALLOCATED FUNDS.—Funds allocated to a 

State under this subsection shall be used by the State only to 

carry out projects that were previously approved in the State 

plan of the State. 

‘‘(j) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary of Agriculture shall make grants under this section, using—

‘‘(1) $10,000,000 for fiscal year 2008; 

‘‘(2) $49,000,000 for fiscal year 2009; and 

‘‘(3) $55,000,000 for each of fiscal years 2010 through 

2012.’’. 

Subtitle B—Pest and Disease Management 

SEC. 10201. PLANT PEST AND DISEASE MANAGEMENT AND DISASTER 

PREVENTION. 

(a) IN GENERAL.—Subtitle A of the Plant Protection Act (7 

U.S.C. 7711 et seq.) is amended by adding at the end the following: 

‘‘SEC. 420. PLANT PEST AND DISEASE MANAGEMENT AND DISASTER 

PREVENTION. 

‘‘(a) DEFINITIONS.—In this section: ‘‘(1) EARLY PLANT PEST DETECTION AND SURVEILLANCE.— The term ‘early plant pest detection and surveillance’ means the 

full range of activities undertaken to find newly introduced 

plant pests, whether the plant pests are new to the United 

States or new to certain areas of the United States, before— ‘‘(A) the plant pests become established; or 

‘‘(B) the plant pest infestations become too large and 

costly to eradicate or control. 

‘‘(2) SPECIALTY CROP.—The term ‘specialty crop’ has the 

meaning given the term in section 3 of the Specialty Crops 

Competitiveness Act of 2004 (7 U.S.C. 1621 note; Public Law 

108–465). 

‘‘(3) STATE DEPARTMENT OF AGRICULTURE.—The term ‘State 

department of agriculture’ means an agency of a State that has 


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a legal responsibility to perform early plant pest detection and 

surveillance activities. 

‘‘(b) EARLY PLANT PEST DETECTION AND SURVEILLANCE IMPROVEMENT PROGRAM.—

‘‘(1) COOPERATIVE AGREEMENTS.—The Secretary shall enter 

into a cooperative agreement with each State department of agriculture that agrees to conduct early plant pest detection and 

surveillance activities. 

‘‘(2) CONSULTATION.—In carrying out this subsection, the 

Secretary shall consult with—

‘‘(A) the National Plant Board; and 

‘‘(B) other interested parties. 

‘‘(3) FEDERAL ADVISORY COMMITTEE ACT.—The Federal Advisory Committee Act (5 U.S.C. App.) shall not apply to consultations under this subsection. 

‘‘(4) APPLICATION.—

‘‘(A) IN GENERAL.—A State department of agriculture 

seeking to enter into a cooperative agreement under this 

subsection shall submit to the Secretary an application containing such information as the Secretary may require. 

‘‘(B) NOTIFICATION.—The Secretary shall notify applicants of—

‘‘(i) the requirements to be imposed on a State department of agriculture for auditing of, and reporting 

on, the use of any funds provided by the Secretary 

under the cooperative agreement; 

‘‘(ii) the criteria to be used to ensure that early pest 

detection and surveillance activities supported under 

the cooperative agreement are based on sound scientific 

data or thorough risk assessments; and 

‘‘(iii) the means of identifying pathways of pest introductions. 

‘‘(5) USE OF FUNDS.—

‘‘(A) PLANT PEST DETECTION AND SURVEILLANCE ACTIVITIES.—A State department of agriculture that receives 

funds under this subsection shall use the funds to carry out 

early plant pest detection and surveillance activities approved by the Secretary to prevent the introduction or 

spread of a plant pest. 

‘‘(B) SUBAGREEMENTS.—Nothing in this subsection prevents a State department of agriculture from using funds 

received under paragraph (4) to enter into subagreements 

with political subdivisions of the State that have legal responsibilities relating to agricultural plant pest and disease 

surveillance. 

‘‘(C) NON-FEDERAL SHARE.—The non-Federal share of 

the cost of carrying out a cooperative agreement under this 

section may be provided in-kind, including through provision of such indirect costs of the cooperative agreement as 

the Secretary considers to be appropriate. 

‘‘(D) ABILITY TO PROVIDE FUNDS.—The Secretary shall 

not take the ability to provide non-Federal costs to carry 

out a cooperative agreement entered into under subparagraph (A) into consideration when deciding whether to 


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enter into a cooperative agreement with a State department 

of agriculture. 

‘‘(6) SPECIAL FUNDING CONSIDERATIONS.—The Secretary 

shall provide funds to a State department of agriculture if the 

Secretary determines that—

‘‘(A) the State department of agriculture is in a State 

that has a high risk of being affected by 1 or more plant 

pests or diseases, taking into consideration—

‘‘(i) the number of international ports of entry in 

the State; 

‘‘(ii) the volume of international passenger and 

cargo entry into the State; 

‘‘(iii) the geographic location of the State and if the 

location or types of agricultural commodities produced 

in the State are conducive to agricultural pest and disease establishment due to the climate, crop diversity, or 

natural resources (including unique plant species) of 

the State; and 

‘‘(iv) whether the Secretary has determined that an 

agricultural pest or disease in the State is a Federal 

concern; and 

‘‘(B) the early plant pest detection and surveillance activities supported with the funds will likely—

‘‘(i) prevent the introduction and establishment of 

plant pests; and 

‘‘(ii) provide a comprehensive approach to compliment Federal detection efforts. 

‘‘(7) REPORTING REQUIREMENT.—Not later than 90 days 

after the date of completion of an early plant pest detection and 

surveillance activity conducted by a State department of agriculture using funds provided under this section, the State department of agriculture shall submit to the Secretary a report 

that describes the purposes and results of the activities. 

‘‘(c) THREAT IDENTIFICATION AND MITIGATION PROGRAM.—

‘‘(1) ESTABLISHMENT.—The Secretary shall establish a 

threat identification and mitigation program to determine and 

address threats to the domestic production of crops. 

‘‘(2) REQUIREMENTS.—In conducting the program established under paragraph (1), the Secretary shall—

‘‘(A) develop risk assessments of the potential threat to 

the agricultural industry of the United States from foreign 

sources; 

‘‘(B) collaborate with the National Plant Board; and 

‘‘(C) implement action plans for high consequence plant 

pest and diseases to assist in preventing the introduction 

and widespread dissemination of new plant pest and disease threats in the United States. 

‘‘(3) REPORTS.—Not later than 1 year after the date of enactment of this paragraph, and annually thereafter, the Secretary shall submit to the Committee on Agriculture of the 

House of Representatives and the Committee on Agriculture, 

Nutrition, and Forestry of the Senate a report on the action 

plans described in paragraph (2), including an accounting of 

funds expended on the action plans. 


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‘‘(d) SPECIALTY CROP CERTIFICATION AND RISK MANAGEMENT

SYSTEMS.—The Secretary shall provide funds and technical assistance to specialty crop growers, organizations representing specialty 

crop growers, and State and local agencies working with specialty 

crop growers and organizations for the development and implementation of—

‘‘(1) audit-based certification systems, such as best management practices—

‘‘(A) to address plant pests; and 

‘‘(B) to mitigate the risk of plant pests in the movement 

of plants and plant products; and 

‘‘(2) nursery plant pest risk management systems, in collaboration with the nursery industry, research institutions, and 

other appropriate entities—

‘‘(A) to enable growers to identify and prioritize nursery 

plant pests and diseases of regulatory significance; 

‘‘(B) to prevent the introduction, establishment, and 

spread of those plant pests and diseases; and 

‘‘(C) to reduce the risk of and mitigate those plant pests 

and diseases. 

‘‘(e) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary shall make available to carry out this section—

‘‘(1) $12,000,000 for fiscal year 2009; 

‘‘(2) $45,000,000 for fiscal year 2010; 

‘‘(3) $50,000,000 for fiscal year 2011; and 

‘‘(4) $50,000,000 for fiscal year 2012 and each fiscal year 

thereafter.’’. 

(b) CONGRESSIONAL DISAPPROVAL.—Congress disapproves the 

rule submitted by the Secretary of Agriculture relating to cost-sharing for animal and plant health emergency programs (68 Fed. Reg. 

40541 (2003)), and such rule shall have no force or effect. 

SEC. 10202. NATIONAL CLEAN PLANT NETWORK. 

(a) IN GENERAL.—The Secretary shall establish a program to be 

known as the ‘‘National Clean Plant Network’’ (referred to in this 

section as the ‘‘Program’’). 

(b) REQUIREMENTS.—Under the Program, the Secretary shall 

establish a network of clean plant centers for diagnostic and pathogen elimination services to—

(1) produce clean propagative plant material; and 

(2) maintain blocks of pathogen-tested plant material in 

sites located throughout the United States. 

(c) AVAILABILITY OF CLEAN PLANT SOURCE MATERIAL.—Clean 

plant source material may be made available to—

(1) a State for a certified plant program of the State; and 

(2) private nurseries and producers. 

(d) CONSULTATION AND COLLABORATION.—In carrying out the 

Program, the Secretary shall—

(1) consult with State departments of agriculture, land 

grant universities, and NLGCA Institutions (as defined in section 1404 of the National Agricultural Research, Extension, and 

Teaching Policy Act of 1977 (7 U.S.C. 3103)); and 

(2) to the extent practicable and with input from the appropriate State officials and industry representatives, use existing 

Federal or State facilities to serve as clean plant centers. 


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(e) FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary shall use to carry out the Program $5,000,000 for 

each of fiscal years 2009 through 2012, to remain available until expended. 

SEC. 10203. PLANT PROTECTION. 

(a) REVIEW OF PAYMENT OF COMPENSATION.—Section 415(e) of 

the Plant Protection Act (7 U.S.C. 7715(e)) is amended in the second 

sentence by striking ‘‘of longer than 60 days’’. 

(b) SECRETARIAL DISCRETION.—Section 442(c) of the Plant Protection Act (7 U.S.C. 7772(c)) is amended by striking ‘‘of longer than 

60 days’’. 

(c) SUBPOENA AUTHORITY.—Section 423 of the Plant Protection 

Act (7 U.S.C. 7733) is amended—

(1) by striking subsection (a) and inserting the following: 

‘‘(a) AUTHORITY TO ISSUE.—The Secretary shall have the power 

to subpoena the attendance and testimony of any witness, the production of all evidence (including books, papers, documents, electronically stored information, and other tangible things that constitute or contain evidence), or to require the person to whom the 

subpoena is directed to permit the inspection of premises relating to 

the administration or enforcement of this title or any matter under 

investigation in connection with this title.’’; 

(2) in subsection (b), by striking ‘‘documentary’’; and 

(3) in subsection (c)—

(A) in the first sentence, by striking ‘‘testimony of any 

witness and the production of documentary evidence’’ and 

inserting ‘‘testimony of any witness, the production of evidence, or the inspection of premises’’; and 

(B) in the second sentence, by striking ‘‘question or to 

produce documentary evidence’’ and inserting ‘‘question, 

produce evidence, or permit the inspection of premises’’. 

(d) WILLFUL VIOLATIONS.—Section 424(b)(1)(A) of the Plant 

Protection Act (7 U.S.C. 7734(b)(1)(A)) is amended by striking ‘‘and 

$500,000 for all violations adjudicated in a single proceeding’’ and 

inserting ‘‘$500,000 for all violations adjudicated in a single proceeding if the violations do not include a willful violation, and 

$1,000,000 for all violations adjudicated in a single proceeding if 

the violations include a willful violation’’. 

SEC. 10204. REGULATIONS TO IMPROVE MANAGEMENT AND OVERSIGHT OF CERTAIN REGULATED ARTICLES. 

(a) IN GENERAL.—Not later than 18 months after the date of enactment of this Act, the Secretary shall—

(1) take action on each issue identified in the document entitled ‘‘Lessons Learned and Revisions under Consideration for 

APHIS’ Biotechnology Framework’’, dated October 4, 2007; and 

(2) as the Secretary considers appropriate, promulgate regulations to improve the management and oversight of articles 

regulated under the Plant Protection Act (7 U.S.C. 7701 et seq.). 

(b) INCLUSIONS.—In carrying out subsection (a), the Secretary 

shall take actions that are designed to enhance—

(1) the quality and completeness of records; 

(2) the availability of representative samples; 

(3) the maintenance of identity and control in the event of 

an unauthorized release; 


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(4) corrective actions in the event of an unauthorized release; 

(5) protocols for conducting molecular forensics; 

(6) clarity in contractual agreements; 

(7) the use of the latest scientific techniques for isolation 

and confinement distances; 

(8) standards for quality management systems and effective 

research; and 

(9) the design of electronic permits to store documents and 

other information relating to the permit and notification processes. 

(c) CONSIDERATION.—In carrying out subsection (a), the Secretary shall consider—

(1) establishing—

(A) a system of risk-based categories to classify each 

regulated article; 

(B) a means to identify regulated articles (including 

the retention of seed samples); and 

(C) standards for isolation and containment distances; 

and 

(2) requiring permit holders—

(A) to maintain a positive chain of custody; 

(B) to provide for the maintenance of records; 

(C) to provide for the accounting of material; 

(D) to conduct periodic audits; 

(E) to establish an appropriate training program; 

(F) to provide contingency and corrective action plans; 

and 

(G) to submit reports as the Secretary considers to be 

appropriate. 

SEC. 10205. PEST AND DISEASE REVOLVING LOAN FUND. 

(a) DEFINITIONS.—In this section: 

(1) AUTHORIZED EQUIPMENT.—

(A) IN GENERAL.—The term ‘‘authorized equipment’’

means any equipment necessary for the management of forest land. 

(B) INCLUSIONS.—The term ‘‘authorized equipment’’ includes—

(i) cherry pickers; 

(ii) equipment necessary for—

(I) the construction of staging and marshalling areas; 

(II) the planting of trees; and 

(III) the surveying of forest land; 

(iii) vehicles capable of transporting harvested 

trees; 

(iv) wood chippers; and 

(v) any other appropriate equipment, as determined by the Secretary. 

(2) FUND.—The term ‘‘Fund’’ means the Pest and Disease 

Revolving Loan Fund established by subsection (b). 

(3) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of Agriculture, acting through the Deputy Chief of the State and 

Private Forestry organization. 


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(b) ESTABLISHMENT OF FUND.—There is established in the 

Treasury of the United States a revolving fund, to be known as the 

‘‘Pest and Disease Revolving Loan Fund’’, consisting of such 

amounts as are appropriated to the Fund under subsection (f). 

(c) EXPENDITURES FROM FUND.— (1) IN GENERAL.—Subject to paragraph (2), on request by 

the Secretary, the Secretary of the Treasury shall transfer from 

the Fund to the Secretary such amounts as the Secretary determines are necessary to provide loans under subsection (e). 

(2) ADMINISTRATIVE EXPENSES.—An amount not exceeding 

10 percent of the amounts in the Fund shall be available for 

each fiscal year to pay the administrative expenses necessary to 

carry out this section. 

(d) TRANSFERS OF AMOUNTS.—

(1) IN GENERAL.—The amounts required to be transferred to 

the Fund under this section shall be transferred at least monthly from the general fund of the Treasury to the Fund on the 

basis of estimates made by the Secretary of the Treasury. 

(2) ADJUSTMENTS.—Proper adjustment shall be made in 

amounts subsequently transferred to the extent prior estimates 

were in excess of or less than the amounts required to be transferred. 

(e) USES OF FUND.— (1) LOANS.— (A) IN GENERAL.—The Secretary shall use amounts in 

the Fund to provide loans to eligible units of local government to finance purchases of authorized equipment to monitor, remove, dispose of, and replace infested trees that are 

located—

(i) on land under the jurisdiction of the eligible 

units of local government; and 

(ii) within the borders of quarantine areas infested 

by plant pests. 

(B) MAXIMUM AMOUNT.—The maximum amount of a 

loan that may be provided by the Secretary to an eligible 

unit of local government under this subsection shall be the 

lesser of—

(i) the amount that the eligible unit of local government has appropriated to finance purchases of authorized equipment in accordance with subparagraph 

(A); or 

(ii) $5,000,000. 

(C) INTEREST RATE.—The interest rate on any loan 

made by the Secretary under this paragraph shall be a rate 

equal to 2 percent. 

(D) REPORT.—Not later than 180 days after the date on 

which an eligible unit of local government receives a loan 

provided by the Secretary under subparagraph (A), the eligible unit of local government shall submit to the Secretary 

a report that describes each purchase made by the eligible 

unit of local government using assistance provided through 

the loan. 

(2) LOAN REPAYMENT SCHEDULE.—

(A) IN GENERAL.—To be eligible to receive a loan from 

the Secretary under paragraph (1), in accordance with each 


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requirement described in subparagraph (B), an eligible unit 

of local government shall enter into an agreement with the 

Secretary to establish a loan repayment schedule relating to 

the repayment of the loan. 

(B) REQUIREMENTS RELATING TO LOAN REPAYMENT

SCHEDULE.—A loan repayment schedule established under 

subparagraph (A) shall require the eligible unit of local 

government—

(i) to repay to the Secretary of the Treasury, not 

later than 1 year after the date on which the eligible 

unit of local government receives a loan under paragraph (1), and semiannually thereafter, an amount 

equal to the quotient obtained by dividing—

(I) the principal amount of the loan (including 

interest); by 

(II) the total quantity of payments that the eligible unit of local government is required to make 

during the repayment period of the loan; and 

(ii) not later than 20 years after the date on which 

the eligible unit of local government receives a loan 

under paragraph (1), to complete repayment to the Secretary of the Treasury of the loan made under this section (including interest). 

(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to the Fund such sums as are necessary to carry 

out this section. 

SEC. 10206. COOPERATIVE AGREEMENTS RELATING TO PLANT PEST 

AND DISEASE PREVENTION ACTIVITIES. 

Section 431 of the Plant Protection Act (7 U.S.C. 7751) is 

amended by adding at the end the following: 

‘‘(f) TRANSFER OF COOPERATIVE AGREEMENT FUND.—

‘‘(1) IN GENERAL.—A State may provide to a unit of local 

government in the State described in paragraph (2) any costsharing assistance or financing mechanism provided to the 

State under a cooperative agreement entered into under this Act 

between the Secretary and the State relating to the eradication, 

prevention, control, or suppression of plant pests. 

‘‘(2) REQUIREMENTS.—To be eligible for assistance or financing under paragraph (1), a unit of local government shall 

be—

‘‘(A) engaged in any activity relating to the eradication, 

prevention, control, or suppression of the plant pest infestation covered under the cooperative agreement between the 

Secretary and the State; and 

‘‘(B) capable of documenting each plant pest infestation 

eradication, prevention, control, or suppression activity generally carried out by—

‘‘(i) the Department of Agriculture; or 

‘‘(ii) the State department of agriculture that has 

jurisdiction over the unit of local government.’’. 


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Subtitle C—Organic Agriculture 

SEC. 10301. NATIONAL ORGANIC CERTIFICATION COST-SHARE PROGRAM. 

Section 10606 of the Farm Security and Rural Investment Act 

of 2002 (7 U.S.C. 6523) is amended—

(1) in subsection (a), by striking ‘‘$5,000,000 for fiscal year 

2002’’ and inserting ‘‘$22,000,000 for fiscal year 2008’’; 

(2) in subsection (b)(2), by striking ‘‘$500’’ and inserting 

‘‘$750’’; and 

(3) by adding at the end the following: 

‘‘(c) REPORTING.—Not later than March 1 of each year, the Secretary shall submit to the Committee on Agriculture of the House of 

Representatives and the Committee on Agriculture, Nutrition, and 

Forestry of the Senate a report that describes the requests by, disbursements to, and expenditures for each State under the program 

during the current and previous fiscal year, including the number 

of producers and handlers served by the program in the previous 

fiscal year.’’. 

SEC. 10302. ORGANIC PRODUCTION AND MARKET DATA INITIATIVES. 

Section 7407 of the Farm Security and Rural Investment Act of 

2002 (7 U.S.C. 5925c) is amended to read as follows: 

‘‘SEC. 7407. ORGANIC PRODUCTION AND MARKET DATA INITIATIVES. 

‘‘(a) IN GENERAL.—The Secretary shall collect and report data 

on the production and marketing of organic agricultural products. 

‘‘(b) REQUIREMENTS.—In carrying out subsection (a), the Secretary shall, at a minimum—

‘‘(1) collect and distribute comprehensive reporting of prices 

relating to organically produced agricultural products; 

‘‘(2) conduct surveys and analysis and publish reports relating to organic production, handling, distribution, retail, and 

trend studies (including consumer purchasing patterns); and 

‘‘(3) develop surveys and report statistical analysis on organically produced agricultural products. 

‘‘(c) REPORT.—Not later than 180 days after the date of enactment of this subsection, the Secretary shall submit to the Committee 

on Agriculture of the House of Representatives and the Committee 

on Agriculture, Nutrition, and Forestry of the Senate a report that—

‘‘(1) describes the progress that has been made in implementing this section; and 

‘‘(2) identifies any additional production and marketing 

data needs. 

‘‘(d) FUNDING.— ‘‘(1) IN GENERAL.—Of the funds of the Commodity Credit 

Corporation, the Secretary shall use to carry out this section 

$5,000,000, to remain available until expended. 

‘‘(2) ADDITIONAL FUNDING.—In addition to funds made 

available under paragraph (1), there are authorized to be appropriated to carry out this section not more than $5,000,000 

for each of fiscal years 2008 through 2012, to remain available 

until expended.’’. 

SEC. 10303. NATIONAL ORGANIC PROGRAM. 

Section 2123 of the Organic Foods Production Act of 1990 (7 

U.S.C. 6522) is amended—


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(1) by striking ‘‘There are’’ and inserting the following: 

‘‘(a) IN GENERAL.—There are’’; and 

(2) by adding at the end the following: 

‘‘(b) NATIONAL ORGANIC PROGRAM.—Notwithstanding any other 

provision of law, in order to carry out activities under the national 

organic program established under this title, there are authorized to 

be appropriated—

‘‘(1) $5,000,000 for fiscal year 2008; 

‘‘(2) $6,500,000 for fiscal year 2009; 

‘‘(3) $8,000,000 for fiscal year 2010; 

‘‘(4) $9,500,000 for fiscal year 2011; 

‘‘(5) $11,000,000 for fiscal year 2012; and 

‘‘(6) in addition to those amounts, such additional sums as 

are necessary for fiscal year 2009 and each fiscal year thereafter.’’. 

Subtitle D—Miscellaneous 

SEC. 10401. NATIONAL HONEY BOARD. 

Section 7(c) of the Honey Research, Promotion, and Consumer 

Information Act (7 U.S.C. 4606(c)) is amended by adding at the end 

the following: 

‘‘(12) REFERENDUM REQUIREMENT.—

‘‘(A) DEFINITION OF EXISTING HONEY BOARD.—The term 

‘existing Honey Board’ means the Honey Board in effect on 

the date of enactment of this paragraph. 

‘‘(B) CONDUCT OF REFERENDA.—Notwithstanding any 

other provision of law, subject to subparagraph (C), the 

order providing for the establishment and operation of the 

existing Honey Board shall continue in force, until the Secretary first conducts, at the earliest practicable date, but 

not later than 180 days after the date of enactment of this 

paragraph, referenda on orders to establish a honey packerimporter board or a United States honey producer board. 

‘‘(C) REQUIREMENTS.—In conducting referenda under 

subparagraph (B), and in exercising fiduciary responsibilities in any transition to any 1 or more successor boards, 

the Secretary shall—

‘‘(i) conduct a referendum of eligible United States 

honey producers for the establishment of a marketing 

board solely for United States honey producers; 

‘‘(ii) conduct a referendum of eligible packers, importers, and handlers of honey for the establishment of 

a marketing board for packers, importers, and handlers of honey; 

‘‘(iii) notwithstanding the timing of the referenda 

required under clauses (i) and (ii) or of the establishment of any 1 or more successor boards pursuant to 

those referenda, ensure that the rights and interests of 

honey producers, importers, packers, and handlers of 

honey are equitably protected in any disposition of the 

assets, facilities, intellectual property, and programs of 

the existing Honey Board and in the transition to any 

1 or more new successor marketing boards; 


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‘‘(iv) ensure that the existing Honey Board continues in operation until such time as the Secretary determines that—

‘‘(I) any 1 or more successor boards, if approved, are operational; and 

‘‘(II) the interests of producers, importers, 

packers, and handlers of honey can be equitably 

protected during any remaining period in which a 

referendum on a successor board or the establishment of such a board is pending; and 

‘‘(v) discontinue collection of assessments under the 

order establishing the existing Honey Board on the 

date the Secretary requires that collections commence 

pursuant to an order approved in a referendum by eligible producers or processors and importers of honey. 

‘‘(D) HONEY BOARD REFERENDUM.—If 1 or more orders 

are approved pursuant to paragraph (C)—

‘‘(i) the Secretary shall not be required to conduct 

a continuation referendum on the order in existence on 

the date of enactment of this paragraph; and 

‘‘(ii) that order shall be terminated pursuant to the 

provisions of the order.’’. 

SEC. 10402. IDENTIFICATION OF HONEY. 

(a) IN GENERAL.—Section 203(h) of the Agricultural Marketing 

Act of 1946 (7 U.S.C. 1622(h)) is amended—

(1) by designating the first through sixth sentences as paragraphs (1), (2)(A), (2)(B), (3), (4), and (5), respectively; and 

(2) by adding at the end the following: 

‘‘(6) IDENTIFICATION OF HONEY.—

‘‘(A) IN GENERAL.—The use of a label or advertising 

material on, or in conjunction with, packaged honey that 

bears any official certificate of quality, grade mark or statement, continuous inspection mark or statement, sampling 

mark or statement, or any combination of the certificates, 

marks, or statements of the Department of Agriculture is 

hereby prohibited under this Act unless there appears legibly and permanently in close proximity (such as on the 

same side(s) or surface(s)) to the certificate, mark, or statement, and in at least a comparable size, the 1 or more 

names of the 1 or more countries of origin of the lot or container of honey, preceded by the words ‘Product of’ or other 

words of similar meaning. 

‘‘(B) VIOLATION.—A violation of the requirements of 

subparagraph (A) may be deemed by the Secretary to be 

sufficient cause for debarment from the benefits of this Act 

only with respect to honey.’’. 

(b) EFFECTIVE DATE.—The amendments made by subsection (a) 

take effect on the date that is 1 year after the date of enactment of 

this Act. 

SEC. 10403. GRANT PROGRAM TO IMPROVE MOVEMENT OF SPECIALTY 

CROPS. 

(a) GRANTS AUTHORIZED.—The Secretary may make grants 

under this section to an eligible entity described in subsection (b)—


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(1) to improve the cost-effective movement of specialty crops 

to local, regional, national, and international markets; and 

(2) to address regional intermodal transportation deficiencies that adversely affect the movement of specialty crops to 

markets inside or outside the United States. 

(b) ELIGIBLE GRANT RECIPIENTS.—Grants may be made under 

this section to any of, or any combination of: 

(1) State and local governments. 

(2) Grower cooperatives. 

(3) National, State, or regional organizations of producers, 

shippers, or carriers. 

(4) Other entities as determined to be appropriate by the 

Secretary. 

(c) MATCHING FUNDS.—The recipient of a grant under this section shall contribute an amount of non-Federal funds toward the 

project for which the grant is provided that is at least equal to the 

amount of grant funds received by the recipient under this section. 

(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section such sums as are necessary for each of fiscal years 2008 through 2012. 

SEC. 10404. MARKET LOSS ASSISTANCE FOR ASPARAGUS PRODUCERS. 

(a) IN GENERAL.—As soon as practicable after the date of enactment of this Act, the Secretary shall make payments to producers 

of the 2007 crop of asparagus for market loss resulting from imports 

during the 2004 through 2007 crop years. 

(b) PAYMENT RATE.—The payment rate for a payment under 

this section shall be based on the reduction in revenue received by 

asparagus producers associated with imports during the 2004 

through 2007 crop years. 

(c) PAYMENT QUANTITY.—The payment quantity for asparagus 

for which the producers on a farm are eligible for payments under 

this section shall be equal to the average quantity of the 2003 crop 

of asparagus produced by producers on the farm. 

(d) FUNDING.—

(1) IN GENERAL.—Subject to paragraph (2), the Secretary 

shall make available $15,000,000 of the funds of the Commodity Credit Corporation to carry out a program to provide 

market loss payments to producers of asparagus under this section. 

(2) ALLOCATION.—Of the amount made available under 

paragraph (1), the Secretary shall use—

(A) $7,500,000 to make payments to producers of asparagus for the fresh market; and 

(B) $7,500,000 to make payments to producers of asparagus for the processed or frozen market. 

TITLE XI—LIVESTOCK 

SEC. 11001. LIVESTOCK MANDATORY REPORTING. 

(a) WEB SITE IMPROVEMENTS AND USER EDUCATION.—

(1) IN GENERAL.—Section 251(g) of the Agricultural Marketing Act of 1946 (7 U.S.C. 1636(g)) is amended to read as follows: 

‘‘(g) ELECTRONIC REPORTING AND PUBLISHING.—


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‘‘(1) IN GENERAL.—The Secretary shall, to the maximum extent practicable, provide for the reporting and publishing of the 

information required under this subtitle by electronic means. ‘‘(2) IMPROVEMENTS AND EDUCATION.— ‘‘(A) ENHANCED ELECTRONIC PUBLISHING.—The Secretary shall develop and implement an enhanced system of 

electronic publishing to disseminate information collected 

pursuant to this subtitle. Such system shall— ‘‘(i) present information in a format that can be 

readily understood by producers, packers, and other 

market participants; ‘‘(ii) adhere to the publication deadlines in this 

subtitle; ‘‘(iii) present information in charts and graphs, as 

appropriate; ‘‘(iv) present comparative information for prior reporting periods, as the Secretary considers appropriate; 

and ‘‘(v) be updated as soon as practicable after information is reported to the Secretary. 

‘‘(B) EDUCATION.—The Secretary shall carry out a market news education program to educate the public and persons in the livestock and meat industries about— ‘‘(i) usage of the system developed under subparagraph (A); and ‘‘(ii) interpreting and understanding information 

collected and disseminated through such system.’’. (2) APPLICABILITY.— (A) ENHANCED REPORTING.—The Secretary of Agriculture shall develop and implement the system required 

under paragraph (2)(A) of section 251(g) of the Agricultural 

Marketing Act of 1946 (7 U.S.C. 1636(g)), as amended by 

paragraph (1), not later than one year after the date on 

which the Secretary determines sufficient funds have been 

appropriated pursuant to subsection (c). 

(B) CURRENT SYSTEM.—Notwithstanding the amendment made by paragraph (1), the Secretary shall continue 

to use the information format for disseminating information under subtitle B of the Agricultural Marketing Act of 

1946 (7 U.S.C. 1621 et seq.) in effect on the date of the enactment of this Act at least until the date that is two years 

after the date on which the Secretary makes the determination referred to in subparagraph (A). 

(b) STUDY AND REPORT.—

(1) STUDY.—The Secretary shall conduct a study on the effects of requiring packer processing plants to report to the Secretary information on wholesale pork cuts (including price and 

volume information), including—

(A) the positive or negative economic effects on producers and consumers; and 

(B) the effects of a confidentiality requirement on mandatory reporting. 

(2) INFORMATION.—During the period preceding the submission of the report under paragraph (3), the Secretary may 

collect, and each packer processing plant shall provide, such inVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00472 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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formation as is necessary to enable the Secretary to conduct the 

study required under paragraph (1). 

(3) REPORT.—Not later than one year after the date of the 

enactment of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the 

Committee on Agriculture, Nutrition, and Forestry of the Senate 

a report on the results of the study conducted under paragraph 

(1). 

(c) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as may be necessary to carry out this 

section. 

SEC. 11002. COUNTRY OF ORIGIN LABELING. 

Subtitle D of the Agricultural Marketing Act of 1946 (7 U.S.C. 

1638 et seq.) is amended—

(1) in section 281(2)(A)—

(A) in clause (v), by striking ‘‘and’’; 

(B) in clause (vi), by striking the period at the end and 

inserting ‘‘; and’’; and 

(C) by adding at the end the following: 

‘‘(vii) meat produced from goats; 

‘‘(viii) chicken, in whole and in part; 

‘‘(ix) ginseng; 

‘‘(x) pecans; and 

‘‘(xi) macadamia nuts.’’; 

(2) in section 282—

(A) in subsection (a), by striking paragraphs (2) and (3) 

and inserting the following: 

‘‘(2) DESIGNATION OF COUNTRY OF ORIGIN FOR BEEF, LAMB, 

PORK, CHICKEN, AND GOAT MEAT.—

‘‘(A) UNITED STATES COUNTRY OF ORIGIN.—A retailer of 

a covered commodity that is beef, lamb, pork, chicken, or 

goat meat may designate the covered commodity as exclusively having a United States country of origin only if the 

covered commodity is derived from an animal that was—

‘‘(i) exclusively born, raised, and slaughtered in the 

United States; 

‘‘(ii) born and raised in Alaska or Hawaii and 

transported for a period of not more than 60 days 

through Canada to the United States and slaughtered 

in the United States; or 

‘‘(iii) present in the United States on or before July 

15, 2008, and once present in the United States, remained continuously in the United States. 

‘‘(B) MULTIPLE COUNTRIES OF ORIGIN.—

‘‘(i) IN GENERAL.—A retailer of a covered commodity that is beef, lamb, pork, chicken, or goat meat 

that is derived from an animal that is—

‘‘(I) not exclusively born, raised, and slaughtered in the United States, 

‘‘(II) born, raised, or slaughtered in the United 

States, and 

‘‘(III) not imported into the United States for 

immediate slaughter, 


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may designate the country of origin of such covered 

commodity as all of the countries in which the animal 

may have been born, raised, or slaughtered. 

‘‘(ii) RELATION TO GENERAL REQUIREMENT.—Nothing in this subparagraph alters the mandatory requirement to inform consumers of the country of origin of 

covered commodities under paragraph (1). 

‘‘(C) IMPORTED FOR IMMEDIATE SLAUGHTER.—A retailer 

of a covered commodity that is beef, lamb, pork, chicken, or 

goat meat that is derived from an animal that is imported 

into the United States for immediate slaughter shall designate the origin of such covered commodity as—

‘‘(i) the country from which the animal was imported; and 

‘‘(ii) the United States. 

‘‘(D) FOREIGN COUNTRY OF ORIGIN.—A retailer of a covered commodity that is beef, lamb, pork, chicken, or goat 

meat that is derived from an animal that is not born, 

raised, or slaughtered in the United States shall designate 

a country other than the United States as the country of origin of such commodity. 

‘‘(E) GROUND BEEF, PORK, LAMB, CHICKEN, AND GOAT.—

The notice of country of origin for ground beef, ground 

pork, ground lamb, ground chicken, or ground goat shall 

include—

‘‘(i) a list of all countries of origin of such ground 

beef, ground pork, ground lamb, ground chicken, or 

ground goat; or 

‘‘(ii) a list of all reasonably possible countries of origin of such ground beef, ground pork, ground lamb, 

ground chicken, or ground goat. 

‘‘(3) DESIGNATION OF COUNTRY OF ORIGIN FOR FISH.—

‘‘(A) IN GENERAL.—A retailer of a covered commodity 

that is farm-raised fish or wild fish may designate the covered commodity as having a United States country of origin 

only if the covered commodity—

‘‘(i) in the case of farm-raised fish, is hatched, 

raised, harvested, and processed in the United States; 

and 

‘‘(ii) in the case of wild fish, is—

‘‘(I) harvested in the United States, a territory 

of the United States, or a State, or by a vessel that 

is documented under chapter 121 of title 46, 

United States Code, or registered in the United 

States; and 

‘‘(II) processed in the United States, a territory 

of the United States, or a State, including the waters thereof, or aboard a vessel that is documented 

under chapter 121 of title 46, United States Code, 

or registered in the United States. 

‘‘(B) DESIGNATION OF WILD FISH AND FARM-RAISED

FISH.—The notice of country of origin for wild fish and 

farm-raised fish shall distinguish between wild fish and 

farm-raised fish. 


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‘‘(4) DESIGNATION OF COUNTRY OF ORIGIN FOR PERISHABLE

AGRICULTURAL COMMODITIES, GINSENG, PEANUTS, PECANS, AND

MACADAMIA NUTS.—

‘‘(A) IN GENERAL.—A retailer of a covered commodity 

that is a perishable agricultural commodity, ginseng, peanut, pecan, or macadamia nut may designate the covered 

commodity as having a United States country of origin only 

if the covered commodity is exclusively produced in the 

United States. 

‘‘(B) STATE, REGION, LOCALITY OF THE UNITED

STATES.—With respect to a covered commodity that is a 

perishable agricultural commodity, ginseng, peanut, pecan, 

or macadamia nut produced exclusively in the United 

States, designation by a retailer of the State, region, or locality of the United States where such commodity was produced shall be sufficient to identify the United States as the 

country of origin.’’; and 

(B) by striking subsection (d) and inserting the following: 

‘‘(d) AUDIT VERIFICATION SYSTEM.—

‘‘(1) IN GENERAL.—The Secretary may conduct an audit of 

any person that prepares, stores, handles, or distributes a covered commodity for retail sale to verify compliance with this 

subtitle (including the regulations promulgated under section 

284(b)). 

‘‘(2) RECORD REQUIREMENTS.—

‘‘(A) IN GENERAL.—A person subject to an audit under 

paragraph (1) shall provide the Secretary with verification 

of the country of origin of covered commodities. Records 

maintained in the course of the normal conduct of the business of such person, including animal health papers, import or customs documents, or producer affidavits, may 

serve as such verification. 

‘‘(B) PROHIBITION ON REQUIREMENT OF ADDITIONAL

RECORDS.—The Secretary may not require a person that 

prepares, stores, handles, or distributes a covered commodity to maintain a record of the country of origin of a 

covered commodity other than those maintained in the 

course of the normal conduct of the business of such person.’’; and 

(3) in section 283—

(A) by striking subsections (a) and (c); 

(B) by redesignating subsection (b) as subsection (a); 

(C) in subsection (a) (as so redesignated), by striking 

‘‘retailer’’ and inserting ‘‘retailer or person engaged in the 

business of supplying a covered commodity to a retailer’’; 

and 

(D) by adding at the end the following new subsection: 

‘‘(b) FINES.—If, on completion of the 30-day period described in 

subsection (a)(2), the Secretary determines that the retailer or person engaged in the business of supplying a covered commodity to a 

retailer has—

‘‘(1) not made a good faith effort to comply with section 

282, and 


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‘‘(2) continues to willfully violate section 282 with respect to 

the violation about which the retailer or person received notification under subsection (a)(1), 

after providing notice and an opportunity for a hearing before the 

Secretary with respect to the violation, the Secretary may fine the 

retailer or person in an amount of not more than $1,000 for each 

violation.’’. 

SEC. 11003. AGRICULTURAL FAIR PRACTICES ACT OF 1967 DEFINITIONS. 

Section 3 of the Agricultural Fair Practices Act of 1967 (7 

U.S.C. 2302) is amended—

(1) by striking ‘‘When used in this Act—’’ and inserting ‘‘In 

this Act:’’; 

(2) in subsection (a)—

(A) by redesignating paragraphs (1) through (4) as 

clauses (i) through (iv), respectively; and 

(B) in clause (iv) (as so redesignated), by striking 

‘‘clause (1), (2), or (3) of this paragraph’’ and inserting 

‘‘clause (i), (ii), or (iii)’’; 

(3) by striking subsection (d); 

(4) by redesignating subsections (a), (b), (c), and (e) as 

paragraphs (3), (4), (2), (1), respectively, indenting appropriately, and moving those paragraphs so as to appear in numerical order; 

(5) in each paragraph (as so redesignated) that does not 

have a heading, by inserting a heading, in the same style as the 

heading in the amendment made by paragraph (6), the text of 

which is comprised of the term defined in the paragraph; 

(6) in paragraph (2) (as so redesignated)—

(A) by striking ‘‘The term ‘association of producers’

means’’ and inserting the following: 

‘‘(2) ASSOCIATION OF PRODUCERS.—

‘‘(A) IN GENERAL.—The term ‘association of producers’

means’’; and 

(B) by adding at the end the following: 

‘‘(B) INCLUSION.—The term ‘association of producers’

includes an organization whose membership is exclusively 

limited to agricultural producers and dedicated to promoting the common interest and general welfare of producers of agricultural products.’’; and 

(7) in paragraph (3) (as so redesignated)—

(A) by striking ‘‘The term’’ and inserting the following: 

‘‘(3) HANDLER.— ‘‘(A) IN GENERAL.—The term’’; and 

(B) by inserting after clause (iv) of subparagraph (A) 

(as redesignated by subparagraph (A) and paragraph (2)) 

the following: 

‘‘(B) EXCLUSION.—The term ‘handler’ does not include 

a person, other than a packer (as defined in section 201 of 

the Packers and Stockyards Act, 1921 (7 U.S.C. 191)), that 

provides custom feeding services for a producer.’’. 

SEC. 11004. ANNUAL REPORT. 

(a) IN GENERAL.—The Packers and Stockyards Act, 1921, is 

amended—


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(1) by redesignating section 416 (7 U.S.C. 229) as section 

417; and 

(2) by inserting after section 415 (7 U.S.C. 228d) the following: 

‘‘SEC. 416. ANNUAL REPORT. 

‘‘(a) IN GENERAL.—Not later than March 1 of each year, the 

Secretary shall submit to Congress and make publicly available a 

report that—

‘‘(1) states, for the preceding year, separately for livestock 

and poultry and separately by enforcement area category (financial, trade practice, or competitive acts and practices), with respect to investigations into possible violations of this Act— ‘‘(A) the number of investigations opened; 

‘‘(B) the number of investigations that were closed or 

settled without a referral to the General Counsel of the Department of Agriculture; ‘‘(C) for investigations described in subparagraph (B), 

the length of time from initiation of the investigation to 

when the investigation was closed or settled without the filing of an enforcement complaint; ‘‘(D) the number of investigations that resulted in referral to the General Counsel of the Department of Agriculture 

for further action, the number of such referrals resolved 

without administrative enforcement action, and the number 

of enforcement actions filed by the General Counsel; ‘‘(E) for referrals to the General Counsel that resulted 

in an administrative enforcement action being filed, the 

length of time from the referral to the filing of the administrative action; ‘‘(F) for referrals to the General Counsel that resulted 

in an administrative enforcement action being filed, the 

length of time from filing to resolution of the administrative enforcement action; ‘‘(G) the number of investigations that resulted in referral to the Department of Justice for further action, and the 

number of civil enforcement actions filed by the Department 

of Justice on behalf of the Secretary pursuant to such a referral; ‘‘(H) for referrals that resulted in a civil enforcement 

action being filed by the Department of Justice, the length 

of time from the referral to the filing of the enforcement action; ‘‘(I) for referrals that resulted in a civil enforcement action being filed by the Department of Justice, the length of 

time from the filing of the enforcement action to resolution; 

and ‘‘(J) the average civil penalty imposed in administrative or civil enforcement actions for violations of this Act, 

and the total amount of civil penalties imposed in all such 

enforcement actions; and 

‘‘(2) includes any other additional information the Secretary considers important to include in the annual report. 

‘‘(b) FORMAT OF INFORMATION PROVIDED.—For subparagraphs 

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vide summary statistics (including range, maximum, minimum, 

mean, and average times) and graphical representations.’’. (b) SUNSET.—Effective September 30, 2012, section 416 of the 

Packers and Stockyards Act, 1921, as added by subsection (a)(2), is 

repealed. 

SEC. 11005. PRODUCTION CONTRACTS. 

Title II of the Packers and Stockyards Act, 1921 (7 U.S.C. 198 

et seq.) is amended by adding at the end the following: 

‘‘SEC. 208. PRODUCTION CONTRACTS. 

‘‘(a) RIGHT OF CONTRACT PRODUCERS TO CANCEL PRODUCTION

CONTRACTS.— ‘‘(1) IN GENERAL.—A poultry grower or swine production 

contract grower may cancel a poultry growing arrangement or 

swine production contract by mailing a cancellation notice to 

the live poultry dealer or swine contractor not later than the 

later of—

‘‘(A) the date that is 3 business days after the date on 

which the poultry growing arrangement or swine production contract is executed; or ‘‘(B) any cancellation date specified in the poultry 

growing arrangement or swine production contract. 

‘‘(2) DISCLOSURE.—A poultry growing arrangement or 

swine production contract shall clearly disclose—

‘‘(A) the right of the poultry grower or swine production 

contract grower to cancel the poultry growing arrangement 

or swine production contract; 

‘‘(B) the method by which the poultry grower or swine 

production contract grower may cancel the poultry growing 

arrangement or swine production contract; and 

‘‘(C) the deadline for canceling the poultry growing arrangement or swine production contract. 

‘‘(b) REQUIRED DISCLOSURE OF ADDITIONAL CAPITAL INVESTMENTS IN PRODUCTION CONTRACTS.—

‘‘(1) IN GENERAL.—A poultry growing arrangement or swine 

production contract shall contain on the first page a statement 

identified as ‘Additional Capital Investments Disclosure Statement’, which shall conspicuously state that additional large 

capital investments may be required of the poultry grower or 

swine production contract grower during the term of the poultry 

growing arrangement or swine production contract. 

‘‘(2) APPLICATION.—Paragraph (1) shall apply to any poultry growing arrangement or swine production contract entered 

into, amended, altered, modified, renewed, or extended after the 

date of the enactment of this section. 

‘‘SEC. 209. CHOICE OF LAW AND VENUE. 

‘‘(a) LOCATION OF FORUM.—The forum for resolving any dispute 

among the parties to a poultry growing arrangement or swine production or marketing contract that arises out of the arrangement or 

contract shall be located in the Federal judicial district in which the 

principle part of the performance takes place under the arrangement 

or contract. 

‘‘(b) CHOICE OF LAW.—A poultry growing arrangement or swine 

production or marketing contract may specify which State’s law is 

to apply to issues governed by State law in any dispute arising out 


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of the arrangement or contract, except to the extent that doing so is 

prohibited by the law of the State in which the principal part of the 

performance takes place under the arrangement or contract. 

‘‘SEC. 210. ARBITRATION. 

‘‘(a) IN GENERAL.—Any livestock or poultry contract that contains a provision requiring the use of arbitration to resolve any controversy that may arise under the contract shall contain a provision 

that allows a producer or grower, prior to entering the contract to 

decline to be bound by the arbitration provision. 

‘‘(b) DISCLOSURE.—Any livestock or poultry contract that contains a provision requiring the use of arbitration shall contain 

terms that conspicuously disclose the right of the contract producer 

or grower, prior to entering the contract, to decline the requirement 

to use arbitration to resolve any controversy that may arise under 

the livestock or poultry contract. 

‘‘(c) DISPUTE RESOLUTION.—Any contract producer or grower 

that declines a requirement of arbitration pursuant to subsection (b) 

has the right, to nonetheless seek to resolve any controversy that 

may arise under the livestock or poultry contract, if, after the controversy arises, both parties consent in writing to use arbitration to 

settle the controversy. 

‘‘(d) APPLICATION.—Subsections (a) (b) and (c) shall apply to 

any contract entered into, amended, altered, modified, renewed, or 

extended after the date of the enactment of the Food, Conservation, 

and Energy Act of 2008. 

‘‘(e) UNLAWFUL PRACTICE.—Any action by or on behalf of a 

packer, swine contractor, or live poultry dealer that violates this section (including any action that has the intent or effect of limiting 

the ability of a producer or grower to freely make a choice described 

in subsection (b)) is an unlawful practice under this Act. 

‘‘(f) REGULATIONS.—The Secretary shall promulgate regulations 

to—

‘‘(1) carry out this section; and 

‘‘(2) establish criteria that the Secretary will consider in determining whether the arbitration process provided in a contract provides a meaningful opportunity for the grower or producer to participate fully in the arbitration process.’’. 

SEC. 11006. REGULATIONS. 

As soon as practicable, but not later than 2 years after the date 

of the enactment of this Act, the Secretary of Agriculture shall promulgate regulations with respect to the Packers and Stockyards Act, 

1921 (7 U.S.C. 181 et seq.) to establish criteria that the Secretary 

will consider in determining—

(1) whether an undue or unreasonable preference or advantage has occurred in violation of such Act; 

(2) whether a live poultry dealer has provided reasonable 

notice to poultry growers of any suspension of the delivery of 

birds under a poultry growing arrangement; 

(3) when a requirement of additional capital investments 

over the life of a poultry growing arrangement or swine production contract constitutes a violation of such Act; and 

(4) if a live poultry dealer or swine contractor has provided 

a reasonable period of time for a poultry grower or a swine production contract grower to remedy a breach of contract that 


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could lead to termination of the poultry growing arrangement 

or swine production contract. 

SEC. 11007. SENSE OF CONGRESS REGARDING PSEUDORABIES ERADICATION PROGRAM. 

It is the sense of Congress that— (1) the Secretary of Agriculture should recognize the threat 

feral swine pose to the domestic swine population and the entire 

livestock industry; 

(2) keeping the United States commercial swine herd free of 

pseudorabies is essential to maintaining and growing pork export markets; 

(3) the establishment and continued support of a swine surveillance system will assist the swine industry in the monitoring, surveillance, and eradication of pseudorabies; and 

(4) pseudorabies eradication is a high priority that the Secretary should carry out under the authorities of the Animal 

Health Protection Act. 

SEC. 11008. SENSE OF CONGRESS REGARDING THE CATTLE FEVER 

TICK ERADICATION PROGRAM. 

It is the sense of Congress that— (1) the cattle fever tick and the southern cattle tick are vectors of the causal agent of babesiosis, a severe and often fatal 

disease of cattle; and 

(2) implementing a national strategic plan for the cattle 

fever tick eradication program is a high priority that the Secretary of Agriculture should carry out in order to—

(A) prevent the entry of cattle fever ticks into the 

United States; 

(B) enhance and maintain an effective surveillance program to rapidly detect any cattle fever tick incursions; and 

(C) research, identify, and procure the tools and knowledge necessary to prevent and eradicate cattle fever ticks in 

the United States. 

SEC. 11009. NATIONAL SHEEP INDUSTRY IMPROVEMENT CENTER. 

(a) FUNDING.—Section 375(e)(6) of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 2008j(e)(6)) is amended by striking subparagraphs (B) and (C) and inserting the following: 

‘‘(B) MANDATORY FUNDING.—Of the funds of the Commodity Credit Corporation, the Secretary shall use to carry 

out this section $1,000,000 for fiscal year 2008, to remain 

available until expended. 

‘‘(C) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to the Secretary to carry out 

this section $10,000,000 for each of fiscal years 2008 

through 2012.’’. 

(b) REPEAL OF REQUIREMENT TO PRIVATIZE REVOLVING

FUND.—

(1) IN GENERAL.—Section 375 of the Consolidated Farm 

and Rural Development Act (7 U.S.C. 2008j) is amended by 

striking subsection (j). 

(2) EFFECTIVE DATE.—The amendment made by paragraph 

(1) takes effect on May 1, 2007. 

SEC. 11010. TRICHINAE CERTIFICATION PROGRAM. 

(a) VOLUNTARY TRICHINAE CERTIFICATION.—


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(1) ESTABLISHMENT.—Not later than 90 days after the date 

of the enactment of this Act, the Secretary of Agriculture shall 

establish a voluntary trichinae certification program. Such program shall include the facilitation of the export of pork products and certification services related to such products. 

(2) REGULATIONS.—The Secretary shall issue final regulations to implement the program under paragraph (1) not later 

than 90 days after the date of the enactment of this Act. 

(3) REPORT.—If final regulations are not published in accordance with paragraph (2) within 90 days of the date of the 

enactment of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the 

Committee on Agriculture, Nutrition, and Forestry of the Senate 

a report containing— (A) an explanation of why the final regulations have 

not been issued in accordance with paragraph (2); and 

(B) the date on which the Secretary expects to issue 

such final regulations. 

(b) FUNDING.—Subject to the availability of appropriations 

under subsection (d)(1)(A) of section 10405 of the Animal Health 

Protection Act (7 U.S.C. 8304), as added by subsection (c), the Secretary shall use not less than $6,200,000 of the funds made available under such subsection to carry out subsection (a). 

(c) AUTHORIZATION OF APPROPRIATIONS.—Section 10405 of the 

Animal Health Protection Act (7 U.S.C. 8304) is amended by adding at the end the following new subsection: ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.— ‘‘(1) IN GENERAL.—There is authorized to be appropriated— ‘‘(A) $1,500,000 for each of fiscal years 2008 through 

2012 to carry out section 11010 of the Food, Conservation, 

and Energy Act of 2008; and ‘‘(B) such sums as may be necessary for each of fiscal 

years 2008 through 2012 to carry out this section. 

‘‘(2) AVAILABILITY.—Funds appropriated under paragraph 

(1) shall remain available until expended.’’. 

SEC. 11011. LOW PATHOGENIC DISEASES. 

The Animal Health Protection Act (7 U.S.C. 8301 et seq.) is 

amended—

(1) in section 10407(d)(2)(C) (7 U.S.C. 8306(d)(2)(C)), by 

striking ‘‘of longer than 60 days’’; 

(2) in section 10409(b) (7 U.S.C. 8308(b))—

(A) by redesignating paragraph (2) as paragraph (3); 

(B) by inserting after paragraph (1) the following new 

paragraph: 

‘‘(2) SPECIFIC COOPERATIVE PROGRAMS.—The Secretary 

shall compensate industry participants and State agencies that 

cooperate with the Secretary in carrying out operations and 

measures under subsection (a) for 100 percent of eligible costs 

relating to cooperative programs involving Federal, State, and 

industry participants to control diseases of low pathogenicity in 

accordance with regulations issued by the Secretary.’’; and 

(C) in paragraph (3) (as so redesignated), by striking 

‘‘of longer than 60 days’’; and 

(3) in section 10417(b)(3) (7 U.S.C. 8316(b)(3)), by striking 

‘‘of longer than 60 days’’. 


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SEC. 11012. ANIMAL PROTECTION. 

(a) WILLFUL VIOLATIONS.—Section 10414(b)(1)(A) of the Animal 

Health Protection Act (7 U.S.C. 8316(b)(1)(A)) is amended by striking clause (iii) and inserting the following: ‘‘(iii) for all violations adjudicated in a single proceeding—

‘‘(I) $500,000 if the violations do not include a 

willful violation; or ‘‘(II) $1,000,000 if the violations include 1 or 

more willful violations.’’. (b) SUBPOENA AUTHORITY.—Section 10415(a)(2) of the Animal 

Health Protection Act (7 U.S.C. 8314) is amended 

(1) by striking subparagraph (A) and inserting the following: ‘‘(A) IN GENERAL.—The Secretary shall have the power 

to subpoena the attendance and testimony of any witness, 

the production of all evidence (including books, papers, documents, electronically stored information, and other tangible things that constitute or contain evidence), or to require the person to whom the subpoena is directed to permit the inspection of premises relating to the administration or enforcement of this title or any matter under investigation in connection with this title.’’; 

(2) in subparagraph (B), by striking ‘‘documentary’’; and 

(3) in subparagraph (C)— (A) in clause (i), by striking ‘‘testimony of any witness 

and the production of documentary evidence’’ and inserting ‘‘testimony of any witness, the production of evidence, or the 

inspection of premises’’; and 

(B) in clause (ii), by striking ‘‘question or to produce 

documentary evidence’’ and inserting ‘‘question, produce 

evidence, or permit the inspection of premises’’. 

SEC. 11013. NATIONAL AQUATIC ANIMAL HEALTH PLAN. 

(a) IN GENERAL.—The Secretary of Agriculture may enter into 

a cooperative agreement with an eligible entity to carry out a project 

under a national aquatic animal health plan under the authority 

of the Secretary under section 10411 of the Animal Health Protection Act (7 U.S.C. 8310) for the purpose of detecting, controlling, or 

eradicating diseases of aquaculture species and promoting speciesspecific best management practices. 

(b) COOPERATIVE AGREEMENTS BETWEEN ELIGIBLE ENTITIES

AND THE SECRETARY.—

(1) DUTIES.—As a condition of entering into a cooperative 

agreement with the Secretary under this section, an eligible entity shall agree to—

(A) assume responsibility for the non-Federal share of 

the cost of carrying out the project under the national 

aquatic health plan, as determined by the Secretary in accordance with paragraph (2); and 

(B) act in accordance with applicable disease and species specific best management practices relating to activities 

to be carried out under such project. 

(2) NON-FEDERAL SHARE.—The Secretary shall determine 

the non-Federal share of the cost of carrying out a project under 

the national aquatic health plan on a case-by-case basis for 


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each such project. Such non-Federal share may be provided in 

cash or in-kind. 

(c) APPLICABILITY OF OTHER LAWS.—In carrying out this section, the Secretary may make use of the authorities under the Animal Health Protection Act (7 U.S.C. 8301 et seq.), including the authority to carry out operations and measures to detect, control, and 

eradicate pests and diseases and the authority to pay claims arising 

out of the destruction of any animal, article, or means of conveyance. 

(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated such sums as may be necessary to carry out this 

section for each of fiscal years 2008 through 2012. 

(e) ELIGIBLE ENTITY DEFINED.—In this section, the term ‘‘eligible entity’’ means a State, a political subdivision of a State, Indian 

tribe, or other appropriate entity, as determined by the Secretary of 

Agriculture. 

SEC. 11014. STUDY ON BIOENERGY OPERATIONS. 

(a) STUDY.—The Secretary of Agriculture shall conduct a study 

to evaluate the role of animal manure as a source of fertilizer and 

its potential additional uses. Such study shall include—

(1) a determination of the extent to which animal manure 

is utilized as fertilizer in agricultural operations by type (including species and agronomic practices employed) and size; 

(2) an evaluation of the potential impact on consumers and 

on agricultural operations (by size) resulting from limitations 

being placed on the utilization of animal manure as fertilizer; 

and 

(3) an evaluation of the effects on agriculture production 

contributable to the increased competition for animal manure 

use due to bioenergy production, including as a feedstock or a 

replacement for fossil fuels. 

(b) REPORT.—Not later than one year after the date of the enactment of this Act, the Secretary shall submit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate the results of the 

study conducted under subsection (a). 

SEC. 11015. INTERSTATE SHIPMENT OF MEAT AND POULTRY INSPECTED BY FEDERAL AND STATE AGENCIES FOR CERTAIN SMALL ESTABLISHMENTS. 

(a) MEAT AND MEAT PRODUCTS.—The Federal Meat Inspection 

Act (21 U.S.C. 601 et seq.) is amended by adding at the end the following: 

‘‘TITLE V—INSPECTIONS BY FEDERAL AND STATE 

AGENCIES 

‘‘SEC. 501. INTERSTATE SHIPMENT OF MEAT INSPECTED BY FEDERAL 

AND STATE AGENCIES FOR CERTAIN SMALL ESTABLISHMENTS. 

‘‘(a) DEFINITIONS.—

‘‘(1) APPROPRIATE STATE AGENCY.—The term ‘appropriate 

State agency’ means a State agency described in section 301(b). 

‘‘(2) DESIGNATED PERSONNEL.—The term ‘designated personnel’ means inspection personnel of a State agency that have 

undergone all necessary inspection training and certification to 


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assist the Secretary in the administration and enforcement of 

this Act, including rules and regulations issued under this Act. ‘‘(3) ELIGIBLE ESTABLISHMENT.—The term ‘eligible establishment’ means an establishment that is in compliance with— ‘‘(A) the State inspection program of the State in which 

the establishment is located; and ‘‘(B) this Act, including rules and regulations issued 

under this Act. 

‘‘(4) MEAT ITEM.—The term ‘meat item’ means— ‘‘(A) a portion of meat; and 

‘‘(B) a meat food product. ‘‘(5) SELECTED ESTABLISHMENT.—The term ‘selected establishment’ means an eligible establishment that is selected by the 

Secretary, in coordination with the appropriate State agency of 

the State in which the eligible establishment is located, under 

subsection (b) to ship carcasses, portions of carcasses, and meat 

items in interstate commerce. 

‘‘(b) AUTHORITY OF SECRETARY TO ALLOW SHIPMENTS.— ‘‘(1) IN GENERAL.—Subject to paragraph (2), the Secretary, 

in coordination with the appropriate State agency of the State 

in which an establishment is located, may select the establishment to ship carcasses, portions of carcasses, and meat items in 

interstate commerce, and place on each carcass, portion of a 

carcass, and meat item shipped in interstate commerce a Federal mark, stamp, tag, or label of inspection, if—

‘‘(A) the carcass, portion of carcass, or meat item qualifies for the mark, stamp, tag, or label of inspection under 

the requirements of this Act; 

‘‘(B) the establishment is an eligible establishment; and 

‘‘(C) inspection services for the establishment are provided by designated personnel. 

‘‘(2) PROHIBITED ESTABLISHMENTS.—In carrying out paragraph (1), the Secretary, in coordination with an appropriate 

State agency, shall not select an establishment that— ‘‘(A) on average, employs more than 25 employees (including supervisory and nonsupervisory employees), as defined by the Secretary; ‘‘(B) as of the date of the enactment of this section, 

ships in interstate commerce carcasses, portions of carcasses, or meat items that are inspected by the Secretary in 

accordance with this Act; ‘‘(C)(i) is a Federal establishment; 

‘‘(ii) was a Federal establishment that was reorganized 

on a later date under the same name or a different name 

or person by the person, firm, or corporation that controlled 

the establishment as of the date of the enactment of this 

section; or ‘‘(iii) was a State establishment as of the date of the enactment of this section that— ‘‘(I) as of the date of the enactment of this section, 

employed more than 25 employees; and 

‘‘(II) was reorganized on a later date by the person, 

firm, or corporation that controlled the establishment 

as of the date of the enactment of this section; 

‘‘(D) is in violation of this Act; 


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‘‘(E) is located in a State that does not have a State inspection program; or 

‘‘(F) is the subject of a transition carried out in accordance with a procedure developed by the Secretary under 

paragraph (3)(A). 

‘‘(3) ESTABLISHMENTS THAT EMPLOY MORE THAN 25 EMPLOYEES.—

‘‘(A) DEVELOPMENT OF PROCEDURE.—The Secretary 

may develop a procedure to transition to a Federal establishment any establishment under this section that, on average, consistently employs more than 25 employees. 

‘‘(B) ELIGIBILITY OF CERTAIN ESTABLISHMENTS.—

‘‘(i) IN GENERAL.—A State establishment that employs more than 25 employees but less than 35 employees as of the date of the enactment of this section may 

be selected as a selected establishment under this subsection. 

‘‘(ii) PROCEDURES.—A State establishment shall be 

subject to the procedures established under subparagraph (A) beginning on the date that is 3 years after 

the effective date described in subsection (j). 

‘‘(c) REIMBURSEMENT OF STATE COSTS.—The Secretary shall reimburse a State for costs related to the inspection of selected establishments in the State in accordance with Federal requirements in 

an amount of not less than 60 percent of eligible State costs. 

‘‘(d) COORDINATION BETWEEN FEDERAL AND STATE AGENCIES.—

‘‘(1) IN GENERAL.—The Secretary shall designate an employee of the Federal Government as State coordinator for each 

appropriate State agency—

‘‘(A) to provide oversight and enforcement of this title; 

and 

‘‘(B) to oversee the training and inspection activities of 

designated personnel of the State agency. 

‘‘(2) SUPERVISION.—A State coordinator shall be under the 

direct supervision of the Secretary. 

‘‘(3) DUTIES OF STATE COORDINATOR.—

‘‘(A) IN GENERAL.—A State coordinator shall visit selected establishments with a frequency that is appropriate 

to ensure that selected establishments are operating in a 

manner that is consistent with this Act (including regulations and policies under this Act). 

‘‘(B) QUARTERLY REPORTS.—A State coordinator shall, 

on a quarterly basis, submit to the Secretary a report that 

describes the status of each selected establishment that is 

under the jurisdiction of the State coordinator with respect 

to the level of compliance of each selected establishment 

with the requirements of this Act. 

‘‘(C) IMMEDIATE NOTIFICATION REQUIREMENT.—If a 

State coordinator determines that any selected establishment that is under the jurisdiction of the State coordinator 

is in violation of any requirement of this Act, the State coordinator shall—

‘‘(i) immediately notify the Secretary of the violation; and 


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‘‘(ii) deselect the selected establishment or suspend 

inspection at the selected establishment. 

‘‘(4) PERFORMANCE EVALUATIONS.—Performance evaluations of State coordinators designated under this subsection 

shall be conducted by the Secretary as part of the Federal agency management control system. 

‘‘(e) AUDITS.—

‘‘(1) PERIODIC AUDITS CONDUCTED BY INSPECTOR GENERAL

OF THE DEPARTMENT OF AGRICULTURE.—Not later than 2 years 

after the effective date described in subsection (j), and not less 

often than every 3 years thereafter, the Inspector General of the 

Department of Agriculture shall conduct an audit of each activity taken by the Secretary under this section for the period covered by the audit to determine compliance with this section. 

‘‘(2) AUDIT CONDUCTED BY COMPTROLLER GENERAL OF THE

UNITED STATES.—Not earlier than 3 years, nor later than 5 

years, after the date of the enactment of this section, the Comptroller General of the United States shall conduct an audit of 

the implementation of this section to determine—

‘‘(A) the effectiveness of the implementation of this section; and 

‘‘(B) the number of selected establishments selected by 

the Secretary to ship carcasses, portions of carcasses, or 

meat items under this section. 

‘‘(f) TECHNICAL ASSISTANCE DIVISION.—

‘‘(1) ESTABLISHMENT.—Not later than 180 days after the effective date described in subsection (j), the Secretary shall establish in the Food Safety and Inspection Service of the Department of Agriculture a technical assistance division to coordinate 

the initiatives of any other appropriate agency of the Department of Agriculture to provide—

‘‘(A) outreach, education, and training to very small or 

certain small establishments (as defined by the Secretary); 

and 

‘‘(B) grants to appropriate State agencies to provide 

outreach, technical assistance, education, and training to 

very small or certain small establishments (as defined by 

the Secretary). 

‘‘(2) PERSONNEL.—The technical assistance division shall 

be comprised of individuals that, as determined by the Secretary—

‘‘(A) are of a quantity sufficient to carry out the duties 

of the technical assistance division; and 

‘‘(B) possess appropriate qualifications and expertise relating to the duties of the technical assistance division. 

‘‘(g) TRANSITION GRANTS.—The Secretary may provide grants to 

appropriate State agencies to assist the appropriate State agencies 

in helping establishments covered by title III to transition to selected 

establishments. 

‘‘(h) VIOLATIONS.—Any selected establishment that the Secretary 

determines to be in violation of any requirement of this Act shall be 

transitioned to a Federal establishment in accordance with a procedure developed by the Secretary under subsection (b)(3)(A). 


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‘‘(i) EFFECT.—Nothing in this section limits the jurisdiction of 

the Secretary with respect to the regulation of meat and meat products under this Act. ‘‘(j) EFFECTIVE DATE.— ‘‘(1) IN GENERAL.—This section takes effect on the date on 

which the Secretary, after providing a period of public comment 

(including through the conduct of public meetings or hearings), 

promulgates final regulations to carry out this section. ‘‘(2) REQUIREMENT.—Not later than 18 months after the 

date of the enactment of this section, the Secretary shall promulgate final regulations in accordance with paragraph (1).’’. (b) POULTRY AND POULTRY PRODUCTS.—The Poultry Products 

Inspection Act (21 U.S.C. 451 et seq.) is amended by adding at the 

end the following: 

‘‘SEC. 31. INTERSTATE SHIPMENT OF POULTRY INSPECTED BY FEDERAL AND STATE AGENCIES FOR CERTAIN SMALL ESTABLISHMENTS. 

‘‘(a) DEFINITIONS.— ‘‘(1) APPROPRIATE STATE AGENCY.—The term ‘appropriate 

State agency’ means a State agency described in section 5(a)(1). 

‘‘(2) DESIGNATED PERSONNEL.—The term ‘designated personnel’ means inspection personnel of a State agency that have 

undergone all necessary inspection training and certification to 

assist the Secretary in the administration and enforcement of 

this Act, including rules and regulations issued under this Act. ‘‘(3) ELIGIBLE ESTABLISHMENT.—The term ‘eligible establishment’ means an establishment that is in compliance with— ‘‘(A) the State inspection program of the State in which 

the establishment is located; and ‘‘(B) this Act, including rules and regulations issued 

under this Act. 

‘‘(4) POULTRY ITEM.—The term ‘poultry item’ means—

‘‘(A) a portion of poultry; and 

‘‘(B) a poultry product. ‘‘(5) SELECTED ESTABLISHMENT.—The term ‘selected establishment’ means an eligible establishment that is selected by the 

Secretary, in coordination with the appropriate State agency of 

the State in which the eligible establishment is located, under 

subsection (b) to ship poultry items in interstate commerce. 

‘‘(b) AUTHORITY OF SECRETARY TO ALLOW SHIPMENTS.—

‘‘(1) IN GENERAL.—Subject to paragraph (2), the Secretary, 

in coordination with the appropriate State agency of the State 

in which an establishment is located, may select the establishment to ship poultry items in interstate commerce, and place on 

each poultry item shipped in interstate commerce a Federal 

mark, stamp, tag, or label of inspection, if—

‘‘(A) the poultry item qualifies for the Federal mark, 

stamp, tag, or label of inspection under the requirements of 

this Act; ‘‘(B) the establishment is an eligible establishment; and 

‘‘(C) inspection services for the establishment are provided by designated personnel. 

‘‘(2) PROHIBITED ESTABLISHMENTS.—In carrying out paragraph (1), the Secretary, in coordination with an appropriate 

State agency, shall not select an establishment that—


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‘‘(A) on average, employs more than 25 employees (including supervisory and nonsupervisory employees), as defined by the Secretary; 

‘‘(B) as of the date of the enactment of this section, 

ships in interstate commerce carcasses, portions of carcasses, or poultry items that are inspected by the Secretary 

in accordance with this Act; 

‘‘(C)(i) is a Federal establishment; 

‘‘(ii) was a Federal establishment as of the date of the 

enactment of this section, and was reorganized on a later 

date under the same name or a different name or person 

by the person, firm, or corporation that controlled the establishment as of the date of the enactment of this section; or 

‘‘(iii) was a State establishment as of the date of the enactment of this section that—

‘‘(I) as of the date of the enactment of this section, 

employed more than 25 employees; and 

‘‘(II) was reorganized on a later date by the person, 

firm, or corporation that controlled the establishment 

as of the date of the enactment of this section; 

‘‘(D) is in violation of this Act; 

‘‘(E) is located in a State that does not have a State inspection program; or 

‘‘(F) is the subject of a transition carried out in accordance with a procedure developed by the Secretary under 

paragraph (3)(A). 

‘‘(3) ESTABLISHMENTS THAT EMPLOY MORE THAN 25 EMPLOYEES.—

‘‘(A) DEVELOPMENT OF PROCEDURE.—The Secretary 

may develop a procedure to transition to a Federal establishment any establishment under this section that, on average, consistently employs more than 25 employees. 

‘‘(B) ELIGIBILITY OF CERTAIN ESTABLISHMENTS.—

‘‘(i) IN GENERAL.—A State establishment that employs more than 25 employees but less than 35 employees as of the date of the enactment of this section may 

be selected as a selected establishment under this subsection. 

‘‘(ii) PROCEDURES.—A State establishment shall be 

subject to the procedures established under subparagraph (A) beginning on the date that is 3 years after 

the effective date described in subsection (i). 

‘‘(c) REIMBURSEMENT OF STATE COSTS.—The Secretary shall reimburse a State for costs related to the inspection of selected establishments in the State in accordance with Federal requirements in 

an amount of not less than 60 percent of eligible State costs. 

‘‘(d) COORDINATION BETWEEN FEDERAL AND STATE AGENCIES.—

‘‘(1) IN GENERAL.—The Secretary shall designate an employee of the Federal Government as State coordinator for each 

appropriate State agency—

‘‘(A) to provide oversight and enforcement of this section; and 

‘‘(B) to oversee the training and inspection activities of 

designated personnel of the State agency. 


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‘‘(2) SUPERVISION.—A State coordinator shall be under the 

direct supervision of the Secretary. ‘‘(3) DUTIES OF STATE COORDINATOR.— ‘‘(A) IN GENERAL.—A State coordinator shall visit selected establishments with a frequency that is appropriate 

to ensure that selected establishments are operating in a 

manner that is consistent with this Act (including regulations and policies under this Act). ‘‘(B) QUARTERLY REPORTS.—A State coordinator shall, 

on a quarterly basis, submit to the Secretary a report that 

describes the status of each selected establishment that is 

under the jurisdiction of the State coordinator with respect 

to the level of compliance of each selected establishment 

with the requirements of this Act. ‘‘(C) IMMEDIATE NOTIFICATION REQUIREMENT.—If a 

State coordinator determines that any selected establishment that is under the jurisdiction of the State coordinator 

is in violation of any requirement of this Act, the State coordinator shall—

‘‘(i) immediately notify the Secretary of the violation; and 

‘‘(ii) deselect the selected establishment or suspend 

inspection at the selected establishment. 

‘‘(4) PERFORMANCE EVALUATIONS.—Performance evaluations of State coordinators designated under this subsection 

shall be conducted by the Secretary as part of the Federal agency management control system. 

‘‘(e) AUDITS.— ‘‘(1) PERIODIC AUDITS CONDUCTED BY INSPECTOR GENERAL

OF THE DEPARTMENT OF AGRICULTURE.—Not later than 2 years 

after the effective date described in subsection (i), and not less 

often than every 3 years thereafter, the Inspector General of the 

Department of Agriculture shall conduct an audit of each activity taken by the Secretary under this section for the period covered by the audit to determine compliance with this section. ‘‘(2) AUDIT CONDUCTED BY COMPTROLLER GENERAL OF THE

UNITED STATES.—Not earlier than 3 years, nor later than 5 

years, after the date of the enactment of this section, the Comptroller General of the United States shall conduct an audit of 

the implementation of this section to determine— ‘‘(A) the effectiveness of the implementation of this section; and ‘‘(B) the number of selected establishments selected by 

the Secretary to ship poultry items under this section. ‘‘(f) TRANSITION GRANTS.—The Secretary may provide grants to 

appropriate State agencies to assist the appropriate State agencies 

in helping establishments covered by this Act to transition to selected establishments. 

‘‘(g) VIOLATIONS.—Any selected establishment that the Secretary 

determines to be in violation of any requirement of this Act shall be 

transitioned to a Federal establishment in accordance with a procedure developed by the Secretary under subsection (b)(3)(A). ‘‘(h) EFFECT.—Nothing in this section limits the jurisdiction of 

the Secretary with respect to the regulation of poultry and poultry 

products under this Act. 


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‘‘(i) EFFECTIVE DATE.— ‘‘(1) IN GENERAL.—This section takes effect on the date on 

which the Secretary, after providing a period of public comment 

(including through the conduct of public meetings or hearings), 

promulgates final regulations to carry out this section. ‘‘(2) REQUIREMENT.—Not later than 18 months after the 

date of the enactment of this section, the Secretary shall promulgate final regulations in accordance with paragraph (1).’’. 

SEC. 11016. INSPECTION AND GRADING. 

(a) GRADING.—Section 203 of the Agricultural Marketing Act of 

1946 (7 U.S.C. 1622) is amended— (1) by redesignating subsection (n) as subsection (o); and 

(2) by inserting after subsection (m) the following new subsection: 

‘‘(n) GRADING PROGRAM.—To establish within the Department 

of Agriculture a voluntary fee based grading program for— ‘‘(1) catfish (as defined by the Secretary under paragraph 

(2) of section 1(w) of the Federal Meat Inspection Act (21 U.S.C. 

601(w))); and ‘‘(2) any additional species of farm-raised fish or farmraised shellfish— ‘‘(A) for which the Secretary receives a petition requesting such voluntary fee based grading; and ‘‘(B) that the Secretary considers appropriate.’’. (b) INSPECTION.— (1) IN GENERAL.—The Federal Meat Inspection Act is 

amended—

(A) in section 1(w) (21 U.S.C. 601(w)) — (i) by striking ‘‘and’’ at the end of paragraph (1); 

(ii) by redesignating paragraph (2) as paragraph 

(3); and 

(iii) by inserting after paragraph (1) the following 

new paragraph: ‘‘(2) catfish, as defined by the Secretary; and’’; 

(B) by striking section 6 (21 U.S.C. 606) and inserting 

the following new section: ‘‘SEC. 6. (a) IN GENERAL.—For the purposes hereinbefore set 

forth the Secretary shall cause to be made, by inspectors appointed 

for that purpose, an examination and inspection of all meat food 

products prepared for commerce in any slaughtering, meat-canning, 

salting, packing, rendering, or similar establishment, and for the 

purposes of any examination and inspection and inspectors shall 

have access at all times, by day or night, whether the establishment 

be operated or not, to every part of said establishment; and said inspectors shall mark, stamp, tag, or label as ‘Inspected and passed’

all such products found to be not adulterated; and said inspectors 

shall label, mark, stamp, or tag as ‘Inspected and condemned’ all 

such products found adulterated, and all such condemned meat 

food products shall be destroyed for food purposes, as hereinbefore 

provided, and the Secretary may remove inspectors from any establishment which fails to so destroy such condemned meat food products: Provided, That subject to the rules and regulations of the Secretary the provisions of this section in regard to preservatives shall 

not apply to meat food products for export to any foreign country 

and which are prepared or packed according to the specifications or 


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directions of the foreign purchaser, when no substance is used in the 

preparation or packing thereof in conflict with the laws of the foreign country to which said article is to be exported; but if said article shall be in fact sold or offered for sale for domestic use or consumption then this proviso shall not exempt said article from the 

operation of all the other provisions of this chapter. ‘‘(b) CATFISH.—In the case of an examination and inspection 

under subsection (a) of a meat food product derived from catfish, 

the Secretary shall take into account the conditions under which the 

catfish is raised and transported to a processing establishment.’’; 

and 

(C) by adding at the end of title I the following new 

section: ‘‘SEC. 25. Notwithstanding any other provision of this Act, the 

requirements of sections 3, 4, 5, 10(b), and 23 shall not apply to catfish.’’. (2) EFFECTIVE DATE.— (A) IN GENERAL.—The amendments made by paragraph (1) shall not apply until the date on which the Secretary of Agriculture issues final regulations (after providing a period of public comment, including through the 

conduct of public meetings or hearings, in accordance with 

chapter 5 of title 5, United States Code) to carry out such 

amendments. 

(B) REGULATIONS.—Not later than 18 months after the 

date of the enactment of this Act, the Secretary of Agriculture, in consultation with the Commissioner of Food and 

Drugs, shall issue final regulations to carry out the amendments made by paragraph (1). 

(3) BUDGET REQUEST.—Not later than 30 days after the 

date of the enactment of this Act, the Secretary of Agriculture 

shall submit to Congress an estimate of the costs of implementing the amendments made by paragraph (1), including the 

estimated—

(A) staff years; 

(B) number of establishments; 

(C) volume expected to be produced at such establishments; and 

(D) any other information used in estimating the costs 

of implementing such amendments. 

SEC. 11017. FOOD SAFETY IMPROVEMENT. 

(a) FEDERAL MEAT INSPECTION ACT.—Title I of the Federal 

Meat Inspection Act is further amended by inserting after section 11 

(21 U.S.C. 611) the following: 

‘‘SEC. 12. NOTIFICATION. 

‘‘Any establishment subject to inspection under this Act that believes, or has reason to believe, that an adulterated or misbranded 

meat or meat food product received by or originating from the establishment has entered into commerce shall promptly notify the Secretary with regard to the type, amount, origin, and destination of 

the meat or meat food product. 

‘‘SEC. 13. PLANS AND REASSESSMENTS. 

‘‘The Secretary shall require that each establishment subject to 

inspection under this Act shall, at a minimum—


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‘‘(1) prepare and maintain current procedures for the recall 

of all meat or meat food products produced and shipped by the 

establishment; ‘‘(2) document each reassessment of the process control 

plans of the establishment; and ‘‘(3) upon request, make the procedures and reassessed process control plans available to inspectors appointed by the Secretary for review and copying.’’. (b) POULTRY PRODUCTS INSPECTION ACT.—Section 10 of the 

Poultry Products Inspection Act (21 U.S.C. 459) is amended— (1) by striking the section heading and all that follows 

through ‘‘sec. 10. No establishment’’ and inserting the following: 

‘‘SEC. 10. COMPLIANCE BY ALL ESTABLISHMENTS. 

‘‘(a) IN GENERAL.—No establishment’’; and 

(2) by adding at the end the following: 

‘‘(b) NOTIFICATION.—Any establishment subject to inspection 

under this Act that believes, or has reason to believe, that an adulterated or misbranded poultry or poultry product received by or 

originating from the establishment has entered into commerce shall 

promptly notify the Secretary with regard to the type, amount, origin, and destination of the poultry or poultry product. 

‘‘(c) PLANS AND REASSESSMENTS.—The Secretary shall require 

that each establishment subject to inspection under this Act shall, 

at a minimum—

‘‘(1) prepare and maintain current procedures for the recall 

of all poultry or poultry products produced and shipped by the 

establishment; 

‘‘(2) document each reassessment of the process control 

plans of the establishment; and 

‘‘(3) upon request, make the procedures and reassessed process control plans available to inspectors appointed by the Secretary for review and copying.’’. 

TITLE XII—CROP INSURANCE AND DISASTER 

ASSISTANCE PROGRAMS 

Subtitle A—Crop Insurance and Agricultural Disaster 

Assistance 

SEC. 12001. DEFINITION OF ORGANIC CROP. 

Section 502(b) of the Federal Crop Insurance Act (7 U.S.C. 

1502(b)) is amended—

(1) by redesignating paragraphs (7) and (8) as paragraphs 

(8) and (9), respectively; and 

(2) by inserting after paragraph (6) the following: 

‘‘(7) ORGANIC CROP.—The term ‘organic crop’ means an agricultural commodity that is organically produced consistent 

with section 2103 of the Organic Foods Production Act of 1990 

(7 U.S.C. 6502).’’. 

SEC. 12002. GENERAL POWERS. 

(a) IN GENERAL.—Section 506 of the Federal Crop Insurance 

Act (7 U.S.C. 1506) is amended— (1) in the first sentence of subsection (d), by striking ‘‘The 

Corporation’’ and inserting ‘‘Subject to section 508(j)(2)(A), the 

Corporation’’; and 


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(2) by striking subsection (n). 

(b) CONFORMING AMENDMENTS.—

(1) Section 506 of the Federal Crop Insurance Act (7 U.S.C. 

1506) is amended by redesignating subsections (o), (p), and (q) 

as subsections (n), (o), and (p), respectively. 

(2) Section 521 of the Federal Crop Insurance Act (7 U.S.C. 

1521) is amended by striking the last sentence. 

SEC. 12003. REDUCTION IN LOSS RATIO. 

(a) PROJECTED LOSS RATIO.—Subsection (n)(2) of section 506 of 

the Federal Crop Insurance Act (7 U.S.C. 1506) (as redesignated by 

section 12002(b)(1)) is amended—

(1) in the paragraph heading, by striking ‘‘AS OF OCTOBER

1, 1998’’; 

(2) by striking ‘‘, on and after October 1, 1998,’’; and 

(3) by striking ‘‘1.075’’ and inserting ‘‘1.0’’. 

(b) PREMIUMS REQUIRED.—Section 508(d)(1) of the Federal 

Crop Insurance Act (7 U.S.C. 1508(d)(1)) is amended by striking 

‘‘not greater than 1.1’’ and all that follows and inserting ‘‘not greater than—

‘‘(A) 1.1 through September 30, 1998; 

‘‘(B) 1.075 for the period beginning October 1, 1998, 

and ending on the day before the date of enactment of the 

Food, Conservation, and Energy Act of 2008; and 

‘‘(C) 1.0 on and after the date of enactment of that 

Act.’’. 

SEC. 12004. PREMIUMS ADJUSTMENTS. 

Section 508(a) of the Federal Crop Insurance Act (7 U.S.C. 

1508(a)) is amended by adding at the end the following: 

‘‘(9) PREMIUM ADJUSTMENTS.—

‘‘(A) PROHIBITION.—Except as provided in subparagraph (B), no person shall pay, allow, or give, or offer to 

pay, allow, or give, directly or indirectly, either as an inducement to procure insurance or after insurance has been 

procured, any rebate, discount, abatement, credit, or reduction of the premium named in an insurance policy or any 

other valuable consideration or inducement not specified in 

the policy. 

‘‘(B) EXCEPTIONS.—Subparagraph (A) does not apply 

with respect to—

‘‘(i) a payment authorized under subsection 

(b)(5)(B); 

‘‘(ii) a performance-based discount authorized 

under subsection (d)(3); or 

‘‘(iii) a patronage dividend, or similar payment, 

that is paid—

‘‘(I) by an entity that was approved by the Corporation to make such payments for the 2005, 

2006, or 2007 reinsurance year, in accordance with 

subsection (b)(5)(B) as in effect on the day before 

the date of enactment of this paragraph; and 

‘‘(II) in a manner consistent with the payment 

plan approved in accordance with that subsection 

for the entity by the Corporation for the applicable 

reinsurance year.’’. 


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SEC. 12005. CONTROLLED BUSINESS INSURANCE. 

Section 508(a) of the Federal Crop Insurance Act (7 U.S.C. 

1508(a)) (as amended by section 12004) is amended by adding at 

the end the following: 

‘‘(10) COMMISSIONS.—

‘‘(A) DEFINITION OF IMMEDIATE FAMILY.—In this paragraph, the term ‘immediate family’ means an individual’s 

father, mother, stepfather, stepmother, brother, sister, stepbrother, stepsister, son, daughter, stepson, stepdaughter, 

grandparent, grandson, granddaughter, father-in-law, 

mother-in-law, brother-in-law, sister-in-law, son-in-law, 

daughter-in-law, the spouse of the foregoing, and the individual’s spouse. 

‘‘(B) PROHIBITION.—No individual (including a 

subagent) may receive directly, or indirectly through an entity, any compensation (including any commission, profit 

sharing, bonus, or any other direct or indirect benefit) for 

the sale or service of a policy or plan of insurance offered 

under this title if—

‘‘(i) the individual has a substantial beneficial interest, or a member of the individual’s immediate family has a substantial beneficial interest, in the policy or 

plan of insurance; and 

‘‘(ii) the total compensation to be paid to the individual with respect to the sale or service of the policies 

or plans of insurance that meet the condition described 

in clause (i) exceeds 30 percent or the percentage specified in State law, whichever is less, of the total of all 

compensation received directly or indirectly by the individual for the sale or service of all policies and plans 

of insurance offered under this title for the reinsurance 

year. 

‘‘(C) REPORTING.—Not later than 90 days after the annual settlement date of the reinsurance year, any individual that received directly or indirectly any compensation 

for the service or sale of any policy or plan of insurance offered under this title in the prior reinsurance year shall 

certify to applicable approved insurance providers that the 

compensation that the individual received was in compliance with this paragraph. 

‘‘(D) SANCTIONS.—The procedural requirements and 

sanctions prescribed in section 515(h) shall apply to the 

prosecution of a violation of this paragraph. 

‘‘(E) APPLICABILITY.—

‘‘(i) IN GENERAL.—Sanctions for violations under 

this paragraph shall only apply to the individuals or 

entities directly responsible for the certification required under subparagraph (C) or the failure to comply 

with the requirements of this paragraph. 

‘‘(ii) PROHIBITION.—No sanctions shall apply with 

respect to the policy or plans of insurance upon which 

compensation is received, including the reinsurance for 

those policies or plans.’’. 


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SEC. 12006. ADMINISTRATIVE FEE. 

(a) IN GENERAL.—Section 508(b)(5) of the Federal Crop Insurance Act (7 U.S.C. 1508(b)(5)) is amended— (1) by striking subparagraph (A) and inserting the following: ‘‘(A) BASIC FEE.—Each producer shall pay an administrative fee for catastrophic risk protection in the amount of 

$300 per crop per county.’’; and 

(2) in subparagraph (B)— (A) by striking ‘‘PAYMENT ON BEHALF OF PRODUCERS’’ and inserting ‘‘PAYMENT OF CATASTROPHIC RISK PROTECTION FEE ON BEHALF 

OF PRODUCERS’’; 

(B) in clause (i)—

(i) by striking ‘‘or other payment’’; and 

(ii) by striking ‘‘with catastrophic risk protection or 

additional coverage’’ and inserting ‘‘through the payment of catastrophic risk protection administrative 

fees’’; 

(C) by striking clauses (ii) and (vi); 

(D) by redesignating clauses (iii), (iv), and (v) as 

clauses (ii), (iii), and (iv), respectively; 

(E) in clause (iii) (as so redesignated), by striking ‘‘A 

policy or plan of insurance’’ and inserting ‘‘Catastrophic 

risk protection coverage’’; and 

(F) in clause (iv) (as so redesignated)—

(i) by striking ‘‘or other arrangement under this 

subparagraph’’; and 

(ii) by striking ‘‘additional’’. 

(b) REPEAL.—Section 748 of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 1999 (7 U.S.C. 1508 note; Public Law 105–277) is repealed. 

SEC. 12007. TIME FOR PAYMENT. 

Section 508 of the Federal Crop Insurance Act (7 U.S.C. 1508) 

is amended—

(1) in subsection (b)(5)(C), by striking ‘‘the date that premium’’ and inserting ‘‘the same date on which the premium’’; 

(2) in subsection (c)(10), by adding at the end the following: 

‘‘(C) TIME FOR PAYMENT.—Subsection (b)(5)(C) shall 

apply with respect to the collection date for the administrative fee.’’; and 

(3) in subsection (d), by adding at the end the following: 

‘‘(4) BILLING DATE FOR PREMIUMS.—Effective beginning 

with the 2012 reinsurance year, the Corporation shall establish 

August 15 as the billing date for premiums.’’. 

SEC. 12008. CATASTROPHIC COVERAGE REIMBURSEMENT RATE. 

Section 508(b)(11) of the Federal Crop Insurance Act (7 U.S.C. 

1508(b)(11)) is amended by striking ‘‘8 percent’’ and inserting ‘‘6 

percent’’. 

SEC. 12009. GRAIN SORGHUM PRICE ELECTION. 

Section 508(c)(5) of the Federal Crop Insurance Act (7 U.S.C. 

1508(c)(5)) is amended by adding at the end the following: 

‘‘(D) GRAIN SORGHUM PRICE ELECTION.—


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‘‘(i) IN GENERAL.—The Corporation, in conjunction 

with the Secretary (referred to in this subparagraph as 

the ‘Corporation’), shall— ‘‘(I) not later than 60 days after the date of enactment of this subparagraph, make available all 

methods and data, including data from the Economic Research Service, used by the Corporation to 

develop the expected market prices for grain sorghum under the production and revenue-based 

plans of insurance of the Corporation; and ‘‘(II) request applicable data from the grain 

sorghum industry. 

‘‘(ii) EXPERT REVIEWERS.—

‘‘(I) IN GENERAL.—Not later than 120 days 

after the date of enactment of this subparagraph, 

the Corporation shall contract individually with 5 

expert reviewers described in subclause (II) to develop and recommend a methodology for determining an expected market price for sorghum for 

both the production and revenue-based plans of insurance to more accurately reflect the actual price 

at harvest. 

‘‘(II) REQUIREMENTS.—The expert reviewers 

under subclause (I) shall be comprised of agricultural economists with experience in grain sorghum 

and corn markets, of whom— ‘‘(aa) 2 shall be agricultural economists of 

institutions of higher education; ‘‘(bb) 2 shall be economists from within 

the Department; and ‘‘(cc) 1 shall be an economist nominated 

by the grain sorghum industry. ‘‘(iii) RECOMMENDATIONS.— ‘‘(I) IN GENERAL.—Not later than 90 days after 

the date of contracting with the expert reviewers 

under clause (ii), the expert reviewers shall submit, 

and the Corporation shall make available to the 

public, the recommendations of the expert reviewers. 

‘‘(II) CONSIDERATION.—The Corporation shall 

consider the recommendations under subclause (I) 

when determining the appropriate pricing methodology to determine the expected market price for 

grain sorghum under both the production and revenue-based plans of insurance. 

‘‘(III) PUBLICATION.—Not later than 60 days 

after the date on which the Corporation receives 

the recommendations of the expert reviewers, the 

Corporation shall publish the proposed pricing 

methodology for both the production and revenuebased plans of insurance for notice and comment 

and, during the comment period, conduct at least 

1 public meeting to discuss the proposed pricing 

methodologies. 

‘‘(iv) APPROPRIATE PRICING METHODOLOGY.—


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‘‘(I) IN GENERAL.—Not later than 180 days 

after the close of the comment period in clause 

(iii)(III), but effective not later than the 2010 crop 

year, the Corporation shall implement a pricing 

methodology for grain sorghum under the production and revenue-based plans of insurance that is 

transparent and replicable. 

‘‘(II) INTERIM METHODOLOGY.—Until the date 

on which the new pricing methodology is implemented, the Corporation may continue to use the 

pricing methodology that the Corporation determines best establishes the expected market price. 

‘‘(III) AVAILABILITY.—On an annual basis, the 

Corporation shall make available the pricing 

methodology and data used to determine the expected market prices for grain sorghum under the 

production and revenue-based plans of insurance, 

including any changes to the methodology used to 

determine the expected market prices for grain sorghum from the previous year.’’. 

SEC. 12010. PREMIUM REDUCTION AUTHORITY. 

Subsection 508(e) of the Federal Crop Insurance Act (7 U.S.C. 

1508(e)) is amended—

(1) in paragraph (2), by striking ‘‘paragraph (4)’’ and inserting ‘‘paragraph (3)’’; 

(2) by striking paragraph (3); and 

(3) by redesignating paragraphs (4) and (5) as paragraphs 

(3) and (4), respectively. 

SEC. 12011. ENTERPRISE AND WHOLE FARM UNITS. 

Section 508(e) of Federal Crop Insurance Act (7 U.S.C. 1508(e)) 

(as amended by section 12010) is amended by adding at the end the 

following: 

‘‘(5) ENTERPRISE AND WHOLE FARM UNITS.—

‘‘(A) IN GENERAL.—The Corporation may carry out a 

pilot program under which the Corporation pays a portion 

of the premiums for plans or policies of insurance for which 

the insurable unit is defined on a whole farm or enterprise 

unit basis that is higher than would otherwise be paid in 

accordance with paragraph (2). 

‘‘(B) AMOUNT.—The percentage of the premium paid by 

the Corporation to a policyholder for a policy with an enterprise or whole farm unit under this paragraph shall, to the 

maximum extent practicable, provide the same dollar 

amount of premium subsidy per acre that would otherwise 

have been paid by the Corporation under paragraph (2) if 

the policyholder had purchased a basic or optional unit for 

the crop for the crop year. 

‘‘(C) LIMITATION.—The amount of the premium paid by 

the Corporation under this paragraph may not exceed 80 

percent of the total premium for the enterprise or whole 

farm unit policy.’’. 


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SEC. 12012. PAYMENT OF PORTION OF PREMIUM FOR AREA REVENUE 

PLANS. 

Section 508(e) of the Federal Crop Insurance Act (7 U.S.C. 

1508(e)) (as amended by section 12011) is amended—

(1) in paragraph (2), in the matter preceding subparagraph 

(A), by striking ‘‘paragraph (4)’’ and inserting ‘‘paragraphs (4), 

(6), and (7)’’; and 

(2) by adding at the end the following: 

‘‘(6) PREMIUM SUBSIDY FOR AREA REVENUE PLANS.—Subject 

to paragraph (4), in the case of a policy or plan of insurance 

that covers losses due to a reduction in revenue in an area, the 

amount of the premium paid by the Corporation shall be as follows: 

‘‘(A) In the case of additional area coverage equal to or 

greater than 70 percent, but less than 75 percent, of the recorded county yield indemnified at not greater than 100 

percent of the expected market price, the amount shall be 

equal to the sum of—

‘‘(i) 59 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage 

level selected; and 

‘‘(ii) the amount determined under subsection 

(d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses. 

‘‘(B) In the case of additional area coverage equal to or 

greater than 75 percent, but less than 85 percent, of the recorded county yield indemnified at not greater than 100 

percent of the expected market price, the amount shall be 

equal to the sum of—

‘‘(i) 55 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage 

level selected; and 

‘‘(ii) the amount determined under subsection 

(d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses. 

‘‘(C) In the case of additional area coverage equal to or 

greater than 85 percent, but less than 90 percent, of the recorded county yield indemnified at not greater than 100 

percent of the expected market price, the amount shall be 

equal to the sum of—

‘‘(i) 49 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage 

level selected; and 

‘‘(ii) the amount determined under subsection 

(d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses. 

‘‘(D) In the case of additional area coverage equal to or 

greater than 90 percent of the recorded county yield indemnified at not greater than 100 percent of the expected market price, the amount shall be equal to the sum of—

‘‘(i) 44 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage 

level selected; and 


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‘‘(ii) the amount determined under subsection 

(d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses. 

‘‘(7) PREMIUM SUBSIDY FOR AREA YIELD PLANS.—Subject to 

paragraph (4), in the case of a policy or plan of insurance that 

covers losses due to a loss of yield or prevented planting in an 

area, the amount of the premium paid by the Corporation shall 

be as follows: 

‘‘(A) In the case of additional area coverage equal to or 

greater than 70 percent, but less than 80 percent, of the recorded county yield indemnified at not greater than 100 

percent of the expected market price, the amount shall be 

equal to the sum of—

‘‘(i) 59 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage 

level selected; and 

‘‘(ii) the amount determined under subsection 

(d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses. 

‘‘(B) In the case of additional area coverage equal to or 

greater than 80 percent, but less than 90 percent, of the recorded county yield indemnified at not greater than 100 

percent of the expected market price, the amount shall be 

equal to the sum of—

‘‘(i) 55 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage 

level selected; and 

‘‘(ii) the amount determined under subsection 

(d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses. 

‘‘(C) In the case of additional area coverage equal to or 

greater than 90 percent, of the recorded county yield indemnified at not greater than 100 percent of the expected market price, the amount shall be equal to the sum of—

‘‘(i) 51 percent of the amount of the premium established under subsection (d)(2)(B)(i) for the coverage 

level selected; and 

‘‘(ii) the amount determined under subsection 

(d)(2)(B)(ii) for the coverage level selected to cover operating and administrative expenses.’’. 

SEC. 12013. DENIAL OF CLAIMS. 

Section 508(j)(2)(A) of the Federal Crop Insurance Act (7 U.S.C. 

1508(j)(2)(A)) is amended by inserting ‘‘on behalf of the Corporation’’

after ‘‘approved provider’’. 

SEC. 12014. SETTLEMENT OF CROP INSURANCE CLAIMS ON FARMSTORED PRODUCTION. 

(a) IN GENERAL.—Section 508(j) of the Federal Crop Insurance 

Act (7 U.S.C. 1508(j)) is amended by adding at the end the following: 

‘‘(5) SETTLEMENT OF CLAIMS ON FARM-STORED PRODUCTION.—A producer with farm-stored production may, at the option of the producer, delay settlement of a crop insurance claim 

relating to the farm-stored production for up to 4 months after 


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the last date on which claims may be submitted under the policy of insurance.’’. 

(b) STUDY ON THE EFFICACY OF PACK FACTORS.—

(1) IN GENERAL.—The Secretary shall conduct a study of 

the efficacy and accuracy of the application of pack factors regarding the measurement of farm-stored production for purposes of providing policies or plans of insurance under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.). 

(2) CONSIDERATIONS.—The study shall consider—

(A) structural shape and size; 

(B) time in storage; 

(C) the impact of facility aeration systems; and 

(D) any other factors the Secretary considers appropriate. 

(3) REPORT.—Not later than 3 years after the date of enactment of this Act, the Secretary shall submit to the Committee 

on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a 

report that includes the findings of the study and any related 

policy recommendations. 

SEC. 12015. TIME FOR REIMBURSEMENT. 

Section 508(k)(4) of the Federal Crop Insurance Act (7 U.S.C. 

1508(k)(4)) is amended by adding at the end the following: ‘‘(D) TIME FOR REIMBURSEMENT.—Effective beginning 

with the 2012 reinsurance year, the Corporation shall reimburse approved insurance providers and agents for the allowable administrative and operating costs of the providers 

and agents as soon as practicable after October 1 (but not 

later than October 31) after the reinsurance year for which 

reimbursements are earned.’’. 

SEC. 12016. REIMBURSEMENT RATE. 

Section 508(k)(4) of the Federal Crop Insurance Act (7 U.S.C. 

1508(k)(4)) (as amended by section 12015) is amended—

(1) in subparagraph (A), by striking ‘‘Except as provided in 

subparagraph (B)’’ and inserting ‘‘Except as otherwise provided 

in this paragraph’’; and 

(2) by adding at the end the following: 

‘‘(E) REIMBURSEMENT RATE REDUCTION.—In the case of 

a policy of additional coverage that received a rate of reimbursement for administrative and operating costs for the 

2008 reinsurance year, for each of the 2009 and subsequent 

reinsurance years, the reimbursement rate for administrative and operating costs shall be 2.3 percentage points 

below the rates in effect as of the date of enactment of the 

Food, Conservation, and Energy Act of 2008 for all crop insurance policies used to define loss ratio, except that only 

1⁄2 of the reduction shall apply in a reinsurance year to the 

total premium written in a State in which the State loss 

ratio is greater than 1.2. ‘‘(F) REIMBURSEMENT RATE FOR AREA POLICIES AND

PLANS OF INSURANCE.—Notwithstanding subparagraphs 

(A) through (E), for each of the 2009 and subsequent reinsurance years, the reimbursement rate for area policies and 

plans of insurance widely available as of the date of enactVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00500 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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ment of this subparagraph shall be 12 percent of the premium used to define loss ratio for that reinsurance year.’’. 

SEC. 12017. RENEGOTIATION OF STANDARD REINSURANCE AGREEMENT. 

Section 508(k) of the Federal Crop Insurance Act (7 U.S.C. 

1508(k)) is amended by adding at the end the following: 

‘‘(8) RENEGOTIATION OF STANDARD REINSURANCE AGREEMENT.—

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

(B), notwithstanding section 536 of the Agricultural Research, Extension, and Education Reform Act of 1998 (7 

U.S.C. 1506 note; Public Law 105–185) and section 148 of 

the Agricultural Risk Protection Act of 2000 (7 U.S.C. 1506 

note; Public Law 106–224), the Corporation may renegotiate the financial terms and conditions of each Standard 

Reinsurance Agreement—

‘‘(i) to be effective for the 2011 reinsurance year beginning July 1, 2010; and 

‘‘(ii) once during each period of 5 reinsurance years 

thereafter. 

‘‘(B) EXCEPTIONS.—

‘‘(i) ADVERSE CIRCUMSTANCES.—Subject to clause 

(ii), subparagraph (A) shall not apply in any case in 

which the approved insurance providers, as a whole, 

experience unexpected adverse circumstances, as determined by the Secretary. 

‘‘(ii) EFFECT OF FEDERAL LAW CHANGES.—If Federal law is enacted after the date of enactment of this 

paragraph that requires revisions in the financial 

terms of the Standard Reinsurance Agreement, and 

changes in the Agreement are made on a mandatory 

basis by the Corporation, the changes shall not be considered to be a renegotiation of the Agreement for purposes of subparagraph (A). 

‘‘(C) NOTIFICATION REQUIREMENT.—If the Corporation 

renegotiates a Standard Reinsurance Agreement under subparagraph (A)(iii), the Corporation shall notify the Committee on Agriculture of the House of Representatives and 

the Committee on Agriculture, Nutrition, and Forestry of 

the Senate of the renegotiation. 

‘‘(D) CONSULTATION.—The approved insurance providers may confer with each other and collectively with the 

Corporation during any renegotiation under subparagraph 

(A). 

‘‘(E) 2011 REINSURANCE YEAR.—

‘‘(i) IN GENERAL.—As part of the Standard Reinsurance Agreement renegotiation authorized under subparagraph (A)(i), the Corporation shall consider alternative methods to determine reimbursement rates for 

administrative and operating costs. 

‘‘(ii) ALTERNATIVE METHODS.—Alternatives considered under clause (i) shall include—

‘‘(I) methods that—


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‘‘(aa) are graduated and base reimbursement rates in a State on changes in premiums 

in that State; ‘‘(bb) are graduated and base reimbursement rates in a State on the loss ratio for crop 

insurance for that State; and ‘‘(cc) are graduated and base reimbursement rates on individual policies on the level 

of total premium for each policy; and 

‘‘(II) any other method that takes into account 

current financial conditions of the program and 

ensures continued availability of the program to 

producers on a nationwide basis.’’. 

SEC. 12018. CHANGE IN DUE DATE FOR CORPORATION PAYMENTS FOR 

UNDERWRITING GAINS. 

Section 508(k) of the Federal Crop Insurance Act (7 U.S.C. 

1508(k)) (as amended by section 12017) is amended by adding at 

the end the following: 

‘‘(9) DUE DATE FOR PAYMENT OF UNDERWRITING GAINS.—Effective beginning with the 2011 reinsurance year, the Corporation shall make payments for underwriting gains under this 

title on—

‘‘(A) for the 2011 reinsurance year, October 1, 2012; 

and 

‘‘(B) for each reinsurance year thereafter, October 1 of 

the following calendar year.’’. 

SEC. 12019. MALTING BARLEY. 

Section 508(m) of the Federal Crop Insurance Act (7 U.S.C. 

1508(m)) is amended by adding at the end the following: 

‘‘(5) SPECIAL PROVISIONS FOR MALTING BARLEY.—The Corporation shall promulgate special provisions under this subsection specific to malting barley, taking into consideration any 

changes in quality factors, as required by applicable market 

conditions.’’. 

SEC. 12020. CROP PRODUCTION ON NATIVE SOD. 

(a) FEDERAL CROP INSURANCE.—Section 508 of the Federal 

Crop Insurance Act (7 U.S.C. 1508) is amended by adding at the 

end the following: 

‘‘(o) CROP PRODUCTION ON NATIVE SOD.—

‘‘(1) DEFINITION OF NATIVE SOD.—In this subsection, the 

term ‘native sod’ means land—

‘‘(A) on which the plant cover is composed principally 

of native grasses, grasslike plants, forbs, or shrubs suitable 

for grazing and browsing; and 

‘‘(B) that has never been tilled for the production of an 

annual crop as of the date of enactment of this subsection. 

‘‘(2) INELIGIBILITY FOR BENEFITS.—

‘‘(A) IN GENERAL.—Subject to subparagraph (B) and 

paragraph (3), native sod acreage that has been tilled for 

the production of an annual crop after the date of enactment of this subsection shall be ineligible during the first 

5 crop years of planting, as determined by the Secretary, for 

benefits under—

‘‘(i) this title; and 


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‘‘(ii) section 196 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7333). 

‘‘(B) DE MINIMIS ACREAGE EXEMPTION.—The Secretary 

shall exempt areas of 5 acres or less from subparagraph 

(A). 

‘‘(3) APPLICATION.—Paragraph (2) may apply to native sod 

acreage in the Prairie Pothole National Priority Area at the 

election of the Governor of the respective State.’’. (b) NONINSURED CROP DISASTER ASSISTANCE.—Section 196(a) 

of the Federal Agriculture Improvement and Reform Act of 1996 (7 

U.S.C. 7333(a)) is amended by adding at the end the following: ‘‘(4) PROGRAM INELIGIBILITY RELATING TO CROP PRODUC- TION ON NATIVE SOD.— ‘‘(A) DEFINITION OF NATIVE SOD.—In this paragraph, 

the term ‘native sod’ means land— ‘‘(i) on which the plant cover is composed principally of native grasses, grasslike plants, forbs, or 

shrubs suitable for grazing and browsing; and ‘‘(ii) that has never been tilled for the production of 

an annual crop as of the date of enactment of this 

paragraph. 

‘‘(B) INELIGIBILITY FOR BENEFITS.— ‘‘(i) IN GENERAL.—Subject to clause (ii) and subparagraph (C), native sod acreage that has been tilled 

for the production of an annual crop after the date of 

enactment of this paragraph shall be ineligible during 

the first 5 crop years of planting, as determined by the 

Secretary, for benefits under— ‘‘(I) this section; and 

‘‘(II) the Federal Crop Insurance Act (7 U.S.C. 

1501 et seq.). 

‘‘(ii) DE MINIMIS ACREAGE EXEMPTION.—The Secretary shall exempt areas of 5 acres or less from clause 

(i). 

‘‘(C) APPLICATION.—Subparagraph (B) may apply to 

native sod acreage in the Prairie Pothole National Priority 

Area at the election of the Governor of the respective State.’’. 

SEC. 12021. INFORMATION MANAGEMENT. 

Section 515 of the Federal Crop Insurance Act (7 U.S.C. 1515) 

is amended— (a) in subsection (j)(3), by adding before the period at the end 

the following: ‘‘, which shall be subject to competition on a periodic 

basis, as determined by the Secretary’’; and 

(b) by striking subsection (k) and inserting the following: 

‘‘(k) FUNDING.—

‘‘(1) INFORMATION TECHNOLOGY.—To carry out subsection 

(j)(1), the Corporation may use, from amounts made available 

from the insurance fund established under section 516(c), not 

more than $15,000,000 for each of fiscal years 2008 through 

2011. 

‘‘(2) DATA MINING.—To carry out subsection (j)(2), the Corporation may use, from amounts made available from the insurance fund established under section 516(c), not more than 

$4,000,000 for fiscal year 2009 and each subsequent fiscal 

year.’’. 


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SEC. 12022. RESEARCH AND DEVELOPMENT. 

(a) IN GENERAL.—Section 522(b) of the Federal Crop Insurance 

Act (7 U.S.C. 1522(b)) is amended by striking paragraphs (1) and 

(2) and inserting the following: 

‘‘(1) RESEARCH AND DEVELOPMENT PAYMENT.—

‘‘(A) IN GENERAL.—The Corporation shall provide a 

payment to an applicant for research and development 

costs in accordance with this subsection. 

‘‘(B) REIMBURSEMENT.—An applicant who submits a 

policy under section 508(h) shall be eligible for the reimbursement of reasonable research and development costs directly related to the policy if the policy is approved by the 

Board for sale to producers. 

‘‘(2) ADVANCE PAYMENTS.—

‘‘(A) IN GENERAL.—Subject to the other provisions of 

this paragraph, the Board may approve the request of an 

applicant for advance payment of a portion of reasonable 

research and development costs prior to submission and approval of the policy by the Board under section 508(h). 

‘‘(B) PROCEDURES.—The Board shall establish procedures for approving advance payment of reasonable research and development costs to applicants. 

‘‘(C) CONCEPT PROPOSAL.—As a condition of eligibility 

for advance payments, an applicant shall submit a concept 

proposal for the policy that the applicant plans to submit 

to the Board under section 508(h), consistent with procedures established by the Board for submissions under subparagraph (B), including—

‘‘(i) a summary of the qualifications of the applicant, including any prior concept proposals and submissions to the Board under section 508(h) and, if applicable, any work conducted under this section; 

‘‘(ii) a projection of total research and development 

costs that the applicant expects to incur; 

‘‘(iii) a description of the need for the policy, the 

marketability of and expected demand for the policy 

among affected producers, and the potential impact of 

the policy on producers and the crop insurance delivery 

system; 

‘‘(iv) a summary of data sources available to demonstrate that the policy can reasonably be developed 

and actuarially appropriate rates established; and 

‘‘(v) an identification of the risks the proposed policy will cover and an explanation of how the identified 

risks are insurable under this title. 

‘‘(D) REVIEW.—

‘‘(i) EXPERTS.—If the requirements of subparagraph (B) and (C) are met, the Board may submit a 

concept proposal described in subparagraph (C) to not 

less than 2 independent expert reviewers, whose services are appropriate for the type of concept proposal 

submitted, to assess the likelihood that the proposed 

policy being developed will result in a viable and marketable policy, as determined by the Board. 


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‘‘(ii) TIMING.—The time frames described in subparagraphs (C) and (D) of section 508(h)(4) shall apply 

to the review of concept proposals under this subparagraph. 

‘‘(E) APPROVAL.—The Board may approve up to 50 percent of the projected total research and development costs 

to be paid in advance to an applicant, in accordance with 

the procedures developed by the Board for the making of 

such payments, if, after consideration of the reviewer reports described in subparagraph (D) and such other information as the Board determines appropriate, the Board determines that— ‘‘(i) the concept, in good faith, will likely result in 

a viable and marketable policy consistent with section 

508(h); ‘‘(ii) in the sole opinion of the Board, the concept, 

if developed into a policy and approved by the Board, 

would provide crop insurance coverage— ‘‘(I) in a significantly improved form; 

‘‘(II) to a crop or region not traditionally 

served by the Federal crop insurance program; or ‘‘(III) in a form that addresses a recognized 

flaw or problem in the program; 

‘‘(iii) the applicant agrees to provide such reports 

as the Corporation determines are necessary to monitor 

the development effort; ‘‘(iv) the proposed budget and timetable are reasonable; and ‘‘(v) the concept proposal meets any other requirements that the Board determines appropriate. 

‘‘(F) SUBMISSION OF POLICY.—If the Board approves an 

advanced payment under subparagraph (E), the Board 

shall establish a date by which the applicant shall present 

a submission in compliance with section 508(h) (including 

the procedures implemented under that section) to the 

Board for approval. 

‘‘(G) FINAL PAYMENT.— ‘‘(i) APPROVED POLICIES.—If a policy is submitted 

under subparagraph (F) and approved by the Board 

under section 508(h) and the procedures established by 

the Board (including procedures established under subparagraph (B)), the applicant shall be eligible for a 

payment of reasonable research and development costs 

in the same manner as policies reimbursed under paragraph (1)(B), less any payments made pursuant to subparagraph (E). ‘‘(ii) POLICIES NOT APPROVED.—If a policy is submitted under subparagraph (F) and is not approved by 

the Board under section 508(h), the Corporation 

shall— ‘‘(I) not seek a refund of any payments made 

in accordance with this paragraph; and ‘‘(II) not make any further research and development cost payments associated with the submission of the policy under this paragraph. 


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‘‘(H) POLICY NOT SUBMITTED.—If an applicant receives 

an advance payment and fails to fulfill the obligation of the 

applicant to the Board by not submitting a completed submission without just cause and in accordance with the procedures established under subparagraph (B)), including notice and reasonable opportunity to respond, as determined 

by the Board, the applicant shall return to the Board the 

amount of the advance plus interest. 

‘‘(I) REPEATED SUBMISSIONS.—The Board may prohibit 

advance payments to applicants who have submitted—

‘‘(i) a concept proposal or submission that did not 

result in a marketable product; or 

‘‘(ii) a concept proposal or submission of poor quality. 

‘‘(J) CONTINUED ELIGIBILITY.—A determination that an 

applicant is not eligible for advance payments under this 

paragraph shall not prevent an applicant from reimbursement under paragraph (1)(B).’’. 

(b) CONFORMING AMENDMENTS.—Section 522(b) of the Federal 

Crop Insurance Act (7 U.S.C. 1522(b)) is amended—

(1) in paragraph (3), by striking ‘‘or (2)’’; and 

(2) in paragraph (4)(A), by striking ‘‘and (2)’’.’’

SEC. 12023. CONTRACTS FOR ADDITIONAL POLICIES AND STUDIES. 

Section 522(c) of the Federal Crop Insurance Act (7 U.S.C. 

1522) is amended—

(1) by redesignating paragraph (10) as paragraph (17); and 

(2) by inserting after paragraph (9) the following: 

‘‘(10) CONTRACTS FOR ORGANIC PRODUCTION COVERAGE IMPROVEMENTS.—

‘‘(A) CONTRACTS REQUIRED.—Not later than 180 days 

after the date of enactment of the Food, Conservation, and 

Energy Act of 2008, the Corporation shall enter into 1 or 

more contracts for the development of improvements in Federal crop insurance policies covering crops produced in 

compliance with standards issued by the Department of Agriculture under the national organic program established 

under the Organic Foods Production Act of 1990 (7 U.S.C. 

6501 et seq.). 

‘‘(B) REVIEW OF UNDERWRITING RISK AND LOSS EXPERIENCE.—

‘‘(i) REVIEW REQUIRED.—

‘‘(I) IN GENERAL.—A contract under subparagraph (A) shall include a review of the underwriting, risk, and loss experience of organic crops 

covered by the Corporation, as compared with the 

same crops produced in the same counties and 

during the same crop years using nonorganic 

methods. 

‘‘(II) REQUIREMENTS.—The review shall—

‘‘(aa) to the maximum extent practicable, 

be designed to allow the Corporation to determine whether significant, consistent, or systemic variations in loss history exist between 

organic and nonorganic production; 


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‘‘(bb) include the widest available range of 

data collected by the Secretary and other outside sources of information; and 

‘‘(cc) not be limited to loss history under 

existing crop insurance policies. 

‘‘(ii) EFFECT ON PREMIUM SURCHARGE.—Unless the 

review under this subparagraph documents the existence of significant, consistent, and systemic variations 

in loss history between organic and nonorganic crops, 

either collectively or on an individual crop basis, the 

Corporation shall eliminate or reduce the premium 

surcharge that the Corporation charges for coverage for 

organic crops, as determined in accordance with the results. 

‘‘(iii) ANNUAL UPDATES.—Beginning with the 2009 

crop year, the review under this subparagraph shall be 

updated on an annual basis as data is accumulated by 

the Secretary and other sources, so that the Corporation may make determinations regarding adjustments 

to the surcharge in a timely manner as quickly as 

evolving practices and data trends allow. 

‘‘(C) ADDITIONAL PRICE ELECTION.—

‘‘(i) IN GENERAL.—A contract under subparagraph 

(A) shall include the development of a procedure, including any associated changes in policy terms or materials required for implementation of the procedure, to 

offer producers of organic crops an additional price 

election that reflects actual prices received by organic 

producers for crops from the field (including appropriate retail and wholesale prices), as established using 

data collected and maintained by the Secretary or from 

other sources. 

‘‘(ii) TIMING.—The development of the procedure 

shall be completed in a timely manner to allow the 

Corporation to begin offering the additional price election for organic crops with sufficient data for the 2010 

crop year. 

‘‘(iii) EXPANSION.—The procedure shall be expanded as quickly as practicable as additional data on 

prices of organic crops collected by the Secretary and 

other sources of information becomes available, with a 

goal of applying this procedure to all organic crops not 

later than the fifth full crop year that begins after the 

date of enactment of Food, Conservation, and Energy 

Act of 2008. 

‘‘(D) REPORTING REQUIREMENTS.—

‘‘(i) IN GENERAL.—The Corporation shall submit to 

the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate an annual report on 

progress made in developing and improving Federal 

crop insurance for organic crops, including—

‘‘(I) the numbers and varieties of organic crops 

insured; 


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‘‘(II) the development of new insurance approaches; and ‘‘(III) the progress of implementing the initiatives required under this paragraph, including the 

rate at which additional price elections are adopted for organic crops. 

‘‘(ii) RECOMMENDATIONS.—The report shall include 

such recommendations as the Corporation considers 

appropriate to improve Federal crop insurance coverage for organic crops. ‘‘(11) ENERGY CROP INSURANCE POLICY.— ‘‘(A) DEFINITION OF DEDICATED ENERGY CROP.—In this 

subsection, the term ‘dedicated energy crop’ means an annual or perennial crop that—

‘‘(i) is grown expressly for the purpose of producing 

a feedstock for renewable biofuel, renewable electricity, 

or biobased products; and 

‘‘(ii) is not typically used for food, feed, or fiber. 

‘‘(B) AUTHORITY.—The Corporation shall offer to enter 

into 1 or more contracts with qualified entities to carry out 

research and development regarding a policy to insure 

dedicated energy crops. 

‘‘(C) RESEARCH AND DEVELOPMENT.—Research and development described in subparagraph (B) shall evaluate the 

effectiveness of risk management tools for the production of 

dedicated energy crops, including policies and plans of insurance that— ‘‘(i) are based on market prices and yields; 

‘‘(ii) to the extent that insufficient data exist to develop a policy based on market prices and yields, 

evaluate the policies and plans of insurance based on 

the use of weather or rainfall indices to protect the interests of crop producers; and ‘‘(iii) provide protection for production or revenue 

losses, or both. 

‘‘(12) AQUACULTURE INSURANCE POLICY.— ‘‘(A) DEFINITION OF AQUACULTURE.—In this subsection: ‘‘(i) IN GENERAL.—The term ‘aquaculture’ means 

the propagation and rearing of aquatic species in controlled or selected environments, including shellfish 

cultivation on grants or leased bottom and ocean 

ranching. ‘‘(ii) EXCLUSION.—The term ‘aquaculture’ does not 

include the private ocean ranching of Pacific salmon 

for profit in any State in which private ocean ranching 

of Pacific salmon is prohibited by any law (including 

regulations). 

‘‘(B) AUTHORITY.—

‘‘(i) IN GENERAL.—As soon as practicable after the 

date of enactment of the Food, Conservation, and Energy Act of 2008, the Corporation shall offer to enter 

into 3 or more contracts with qualified entities to carry 

out research and development regarding a policy to insure the production of aquacultural species in aquaculture operations. 


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‘‘(ii) BIVALVE SPECIES.—At least 1 of the contracts 

described in clause (i) shall address insurance of bivalve species, including—

‘‘(I) American oysters (crassostrea virginica); 

‘‘(II) hard clams (mercenaria mercenaria); 

‘‘(III) Pacific oysters (crassostrea gigas); 

‘‘(IV) Manila clams (tapes phillipinnarium); or 

‘‘(V) blue mussels (mytilus edulis). 

‘‘(iii) FRESHWATER SPECIES.—At least 1 of the contracts described in clause (i) shall address insurance of 

freshwater species, including—

‘‘(I) catfish (icataluridae); 

‘‘(II) rainbow trout (oncorhynchus mykiss); 

‘‘(III) largemouth bass (micropterus 

salmoides); 

‘‘(IV) striped bass (morone saxatilis); 

‘‘(V) bream (abramis brama); 

‘‘(VI) shrimp (penaeus); or 

‘‘(VII) tilapia (oreochromis niloticus). 

‘‘(iv) SALTWATER SPECIES.—At least 1 of the contracts described in clause (i) shall address insurance of 

saltwater species, including—

‘‘(I) Atlantic salmon (salmo salar); or 

‘‘(II) shrimp (penaeus). 

‘‘(C) RESEARCH AND DEVELOPMENT.—Research and development described in subparagraph (B) shall evaluate the 

effectiveness of policies and plans of insurance for the production of aquacultural species in aquaculture operations, 

including policies and plans of insurance that—

‘‘(i) are based on market prices and yields; 

‘‘(ii) to the extent that insufficient data exist to develop a policy based on market prices and yields, 

evaluate how best to incorporate insuring of production 

of aquacultural species in aquaculture operations into 

existing policies covering adjusted gross revenue; and 

‘‘(iii) provide protection for production or revenue 

losses, or both. 

‘‘(13) POULTRY INSURANCE POLICY.—

‘‘(A) DEFINITION OF POULTRY.—In this paragraph, the 

term ‘poultry’ has the meaning given the term in section 

2(a) of the Packers and Stockyards Act, 1921 (7 U.S.C. 

182(a)). 

‘‘(B) AUTHORITY.—The Corporation shall offer to enter 

into 1 or more contracts with qualified entities to carry out 

research and development regarding a policy to insure commercial poultry production. 

‘‘(C) RESEARCH AND DEVELOPMENT.—Research and development described in subparagraph (B) shall evaluate the 

effectiveness of risk management tools for the production of 

poultry, including policies and plans of insurance that provide protection for production or revenue losses, or both, 

while the poultry is in production. 

‘‘(14) APIARY POLICIES.—The Corporation shall offer to 

enter into a contract with a qualified entity to carry out reVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00509 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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search and development regarding insurance policies that cover 

loss of bees. ‘‘(15) ADJUSTED GROSS REVENUE POLICIES FOR BEGINNING

PRODUCERS.—The Corporation shall offer to enter into a contract with a qualified entity to carry out research and development into needed modifications of adjusted gross revenue insurance policies, consistent with principles of actuarial sufficiency, 

to permit coverage for beginning producers with no previous 

production history, including permitting those producers to 

have production and premium rates based on information with 

similar farming operations. ‘‘(16) SKIPROW CROPPING PRACTICES.— ‘‘(A) IN GENERAL.—The Corporation shall offer to enter 

into a contract with a qualified entity to carry out research 

into needed modifications of policies to insure corn and sorghum produced in the Central Great Plains (as determined 

by the Agricultural Research Service) through use of 

skiprow cropping practices. ‘‘(B) RESEARCH.—Research described in subparagraph 

(A) shall—

‘‘(i) review existing research on skiprow cropping 

practices and actual production history of producers 

using skiprow cropping practices; and ‘‘(ii) evaluate the effectiveness of risk management 

tools for producers using skiprow cropping practices, 

including—

‘‘(I) the appropriateness of rules in existence as 

of the date of enactment of this paragraph relating 

to the determination of acreage planted in skiprow 

patterns; and ‘‘(II) whether policies for crops produced 

through skiprow cropping practices reflect actual 

production capabilities.’’. 

SEC. 12024. FUNDING FROM INSURANCE FUND. 

Section 522(e) of the Federal Crop Insurance Act (7 U.S.C. 

1522(e)) is amended— (1) in paragraph (1), by striking ‘‘$10,000,000’’ and all that 

follows through the end of the paragraph and inserting 

‘‘$7,500,000 for fiscal year 2008 and each subsequent fiscal 

year’’; 

(2) in paragraph (2)(A), by striking ‘‘$20,000,000 for’’ and 

all that follows through ‘‘year 2004’’ and inserting ‘‘$12,500,000 

for fiscal year 2008’’; and 

(3) in paragraph (3), by striking ‘‘the Corporation may use’’

and all that follows through the end of the paragraph and inserting ‘‘the Corporation may use—

‘‘(A) not more than $5,000,000 for each fiscal year to 

improve program integrity, including by—

‘‘(i) increasing compliance-related training; 

‘‘(ii) improving analysis tools and technology regarding compliance; 

‘‘(iii) use of information technology, as determined 

by the Corporation; and 

‘‘(iv) identifying and using innovative compliance 

strategies; and 


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‘‘(B) any excess amounts to carry out other activities 

authorized under this section.’’. 

SEC. 12025. PILOT PROGRAMS. 

(a) IN GENERAL.—Section 523 of the Federal Crop Insurance 

Act (7 U.S.C. 1523) is amended by adding at the end the following: ‘‘(f) CAMELINA PILOT PROGRAM.— ‘‘(1) IN GENERAL.—The Corporation shall establish a pilot 

program under which producers or processors of camelina may 

propose for approval by the Board policies or plans of insurance 

for camelina, in accordance with section 508(h). ‘‘(2) DETERMINATION BY BOARD.—The Board shall approve 

a policy or plan of insurance proposed under paragraph (1) if, 

as determined by the Board, the policy or plan of insurance— ‘‘(A) protects the interests of producers; 

‘‘(B) is actuarially sound; and 

‘‘(C) meets the requirements of this title. ‘‘(3) TIMEFRAME.—The Corporation shall commence the 

camelina insurance pilot program as soon as practicable after 

the date of enactment of this subsection. 

‘‘(g) SESAME INSURANCE PILOT PROGRAM.— ‘‘(1) IN GENERAL.—In addition to any other authority of the 

Corporation, the Corporation shall establish and carry out a 

pilot program under which a producer of nondehiscent sesame 

under contract may elect to obtain multiperil crop insurance, as 

determined by the Corporation. ‘‘(2) TERMS AND CONDITIONS.—The multiperil crop insurance offered under the sesame insurance pilot program shall— ‘‘(A) be offered through reinsurance arrangements with 

private insurance companies; ‘‘(B) be actuarially sound; and 

‘‘(C) require the payment of premiums and administrative fees by a producer obtaining the insurance. 

‘‘(3) LOCATION.—The sesame insurance pilot program shall 

be carried out only in the State of Texas. ‘‘(4) DURATION.—The Corporation shall commence the sesame insurance pilot program as soon as practicable after the 

date of the enactment of this subsection. 

‘‘(h) GRASS SEED INSURANCE PILOT PROGRAM.— ‘‘(1) IN GENERAL.—In addition to any other authority of the 

Corporation, the Corporation shall establish and carry out a 

grass seed pilot program under which a producer of Kentucky 

bluegrass or perennial rye grass under contract may elect to obtain multiperil crop insurance, as determined by the Corporation. 

‘‘(2) TERMS AND CONDITIONS.—The multiperil crop insurance offered under the grass seed insurance pilot program 

shall—

‘‘(A) be offered through reinsurance arrangements with 

private insurance companies; 

‘‘(B) be actuarially sound; and 

‘‘(C) require the payment of premiums and administrative fees by a producer obtaining the insurance. 

‘‘(3) LOCATION.—The grass seed insurance pilot program 

shall be carried out only in each of the States of Minnesota and 

North Dakota. 


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‘‘(4) DURATION.—The Corporation shall commence the grass 

seed insurance pilot program as soon as practicable after the 

date of the enactment of this subsection.’’. 

(b) CONFORMING AMENDMENT.—Section 196(a)(2)(B) of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 

7333(a)(2)(B)) is amended by adding ‘‘camelina,’’ after ‘‘sea oats,’’. 

SEC. 12026. RISK MANAGEMENT EDUCATION FOR BEGINNING FARMERS OR RANCHERS. 

Section 524(a) of the Federal Crop Insurance Act (7 U.S.C. 

1524(a)) is amended—

(1) in paragraph (1), by striking ‘‘paragraph (4)’’ and inserting ‘‘paragraph (5)’’; 

(2) by redesignating paragraph (4) as paragraph (5); and 

(3) by inserting after paragraph (3) the following: 

‘‘(4) REQUIREMENTS.—In carrying out the programs established under paragraphs (2) and (3), the Secretary shall place 

special emphasis on risk management strategies, education, and 

outreach specifically targeted at—

‘‘(A) beginning farmers or ranchers; 

‘‘(B) legal immigrant farmers or ranchers that are attempting to become established producers in the United 

States; 

‘‘(C) socially disadvantaged farmers or ranchers; 

‘‘(D) farmers or ranchers that—

‘‘(i) are preparing to retire; and 

‘‘(ii) are using transition strategies to help new 

farmers or ranchers get started; and 

‘‘(E) new or established farmers or ranchers that are 

converting production and marketing systems to pursue 

new markets.’’. 

SEC. 12027. COVERAGE FOR AQUACULTURE UNDER NONINSURED 

CROP ASSISTANCE PROGRAM. 

Section 196(c)(2) of the Federal Agriculture Improvement and 

Reform Act of 1996 (7 U.S.C. 7333(c)(2)) is amended—

(1) by striking ‘‘On making’’ and inserting the following: 

‘‘(A) IN GENERAL.—On making’’; and 

(2) by adding at the end the following: 

‘‘(B) AQUACULTURE PRODUCERS.—On making a determination described in subsection (a)(3) for aquaculture producers, the Secretary shall provide assistance under this 

section to aquaculture producers from all losses related to 

drought.’’. 

SEC. 12028. INCREASE IN SERVICE FEES FOR NONINSURED CROP ASSISTANCE PROGRAM. 

Section 196(k)(1) of the Federal Agriculture Improvement and 

Reform Act of 1996 (7 U.S.C. 7333(k)(1)) is amended—

(1) in subparagraph (A), by striking ‘‘$100’’ and inserting 

‘‘$250’’; and 

(2) in subparagraph (B)—

(A) by striking ‘‘$300’’ and inserting ‘‘$750’’; and 

(B) by striking ‘‘$900’’ and inserting ‘‘$1,875’’. 


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SEC. 12029. DETERMINATION OF CERTAIN SWEET POTATO PRODUCTION. 

Section 9001(d) of the U.S. Troop Readiness, Veterans’ Care, 

Katrina Recovery, and Iraq Accountability Appropriations Act, 2007 

(Public Law 110–28; 121 Stat. 211) is amended—

(1) by redesignating paragraph (8) as paragraph (9); and 

(2) by inserting after paragraph (7) the following: 

‘‘(8) SWEET POTATOES.—

‘‘(A) DATA.—In the case of sweet potatoes, any data obtained under a pilot program carried out by the Risk Management Agency shall not be considered for the purpose of 

determining the quantity of production under the crop disaster assistance program established under this section. 

‘‘(B) EXTENSION OF DEADLINE.—If this paragraph is 

not implemented before the sign-up deadline for the crop 

disaster assistance program established under this section, 

the Secretary shall extend the deadline for producers of 

sweet potatoes to permit sign-up for the program in accordance with this paragraph.’’. 

SEC. 12030. DECLINING YIELD REPORT. 

Not later than 180 days after the date of enactment of this Act, 

the Secretary shall submit to the Committee on Agriculture of the 

House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a report containing details about 

activities and administrative options of the Federal Crop Insurance 

Corporation and Risk Management Agency that address issues relating to—

(1) declining yields on the actual production histories of 

producers; and 

(2) declining and variable yields for perennial crops, including pecans. 

SEC. 12031. DEFINITION OF BASIC UNIT. 

The Secretary shall not modify the definition of ‘‘basic unit’’ in 

accordance with the proposed regulations entitled ‘‘Common Crop 

Insurance Regulations’’ (72 Fed. Reg. 28895; relating to common 

crop insurance regulations) or any successor regulation. 

SEC. 12032. CROP INSURANCE MEDIATION. 

Section 275 of the Department of Agriculture Reorganization 

Act of 1994 (7 U.S.C. 6995) is amended— (1) by striking ‘‘If an officer’’ and inserting the following: ‘‘(a) IN GENERAL.—If an officer’’; 

(2) by striking ‘‘With respect to’’ and inserting the following: 

‘‘(b) FARM SERVICE AGENCY.—With respect to’’; 

(3) by striking ‘‘If a mediation’’; and inserting the following: 

‘‘(c) MEDIATION.—If a mediation’’; and 

(4) in subsection (c) (as so designated)—

(A) by striking ‘‘participant shall be offered’’ and inserting ‘‘participant shall— ‘‘(1) be offered’’; and 

(B) by striking the period at the end and inserting the 

following: ‘‘; and ‘‘(2) to the maximum extent practicable, be allowed to use 

both informal agency review and mediation to resolve disputes 

under that title.’’. 


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SEC. 12033. SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE. 

(a) IN GENERAL.—The Federal Crop Insurance Act (7 U.S.C. 

1501 et seq.) is amended by adding at the end the following: 

‘‘Subtitle B—Supplemental Agricultural Disaster Assistance 

‘‘SEC. 531. SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) ACTUAL PRODUCTION HISTORY YIELD.—The term ‘actual 

production history yield’ means the weighted average of the actual production history for each insurable commodity or noninsurable commodity, as calculated under subtitle A or the noninsured crop disaster assistance program, respectively. 

‘‘(2) ADJUSTED ACTUAL PRODUCTION HISTORY YIELD.—The 

term ‘adjusted actual production history yield’ means—

‘‘(A) in the case of an eligible producer on a farm that 

has at least 4 years of actual production history yields for 

an insurable commodity that are established other than 

pursuant to section 508(g)(4)(B), the actual production history for the eligible producer without regard to any yields 

established under that section; 

‘‘(B) in the case of an eligible producer on a farm that 

has less than 4 years of actual production history yields for 

an insurable commodity, of which 1 or more were established pursuant to section 508(g)(4)(B), the actual production history for the eligible producer as calculated without 

including the lowest of the yields established pursuant to 

section 508(g)(4)(B); and 

‘‘(C) in all other cases, the actual production history of 

the eligible producer on a farm. 

‘‘(3) ADJUSTED NONINSURED CROP DISASTER ASSISTANCE

PROGRAM YIELD.—The term ‘adjusted noninsured crop disaster 

assistance program yield’ means—

‘‘(A) in the case of an eligible producer on a farm that 

has at least 4 years of production history under the noninsured crop disaster assistance program that are not replacement yields, the noninsured crop disaster assistance 

program yield without regard to any replacement yields; 

‘‘(B) in the case of an eligible producer on a farm that 

less than 4 years of production history under the noninsured crop disaster assistance program that are not replacement yields, the noninsured crop disaster assistance 

program yield as calculated without including the lowest of 

the replacement yields; and 

‘‘(C) in all other cases, the production history of the eligible producer on the farm under the noninsured crop disaster assistance program. 

‘‘(4) COUNTER-CYCLICAL PROGRAM PAYMENT YIELD.—The 

term ‘counter-cyclical program payment yield’ means the 

weighted average payment yield established under section 1102 

of the Farm Security and Rural Investment Act of 2002 (7 

U.S.C. 7912), section 1102 of the Food, Conservation, and Energy Act of 2008, or a successor section. 

‘‘(5) DISASTER COUNTY.—


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‘‘(A) IN GENERAL.—The term ‘disaster county’ means a 

county included in the geographic area covered by a qualifying natural disaster declaration. ‘‘(B) INCLUSION.—The term ‘disaster county’ includes— ‘‘(i) a county contiguous to a county described in 

subparagraph (A); and ‘‘(ii) any farm in which, during a calendar year, 

the total loss of production of the farm relating to 

weather is greater than 50 percent of the normal production of the farm, as determined by the Secretary. ‘‘(6) ELIGIBLE PRODUCER ON A FARM.— ‘‘(A) IN GENERAL.—The term ‘eligible producer on a 

farm’ means an individual or entity described in subparagraph (B) that, as determined by the Secretary, assumes the 

production and market risks associated with the agricultural production of crops or livestock. 

‘‘(B) DESCRIPTION.—An individual or entity referred to 

in subparagraph (A) is—

‘‘(i) a citizen of the United States; 

‘‘(ii) a resident alien; 

‘‘(iii) a partnership of citizens of the United States; 

or 

‘‘(iv) a corporation, limited liability corporation, or 

other farm organizational structure organized under 

State law. 

‘‘(7) FARM.— ‘‘(A) IN GENERAL.—The term ‘farm’ means, in relation 

to an eligible producer on a farm, the sum of all crop acreage in all counties that is planted or intended to be planted 

for harvest by the eligible producer. ‘‘(B) AQUACULTURE.—In the case of aquaculture, the 

term ‘farm’ means, in relation to an eligible producer on a 

farm, all fish being produced in all counties that are intended to be harvested for sale by the eligible producer. 

‘‘(C) HONEY.—In the case of honey, the term ‘farm’ means, in relation to an eligible producer on a farm, all 

bees and beehives in all counties that are intended to be 

harvested for a honey crop by the eligible producer. 

‘‘(8) FARM-RAISED FISH.—The term ‘farm-raised fish’ means 

any aquatic species that is propagated and reared in a controlled environment. ‘‘(9) INSURABLE COMMODITY.—The term ‘insurable commodity’ means an agricultural commodity (excluding livestock) 

for which the producer on a farm is eligible to obtain a policy 

or plan of insurance under subtitle A. 

‘‘(10) LIVESTOCK.—The term ‘livestock’ includes—

‘‘(A) cattle (including dairy cattle); 

‘‘(B) bison; 

‘‘(C) poultry; 

‘‘(D) sheep; 

‘‘(E) swine; 

‘‘(F) horses; and 

‘‘(G) other livestock, as determined by the Secretary. ‘‘(11) NONINSURABLE COMMODITY.—The term ‘noninsurable 

commodity’ means a crop for which the eligible producers on a 


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farm are eligible to obtain assistance under the noninsured crop 

assistance program. 

‘‘(12) NONINSURED CROP ASSISTANCE PROGRAM.—The term 

‘noninsured crop assistance program’ means the program carried out under section 196 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7333). 

‘‘(13) QUALIFYING NATURAL DISASTER DECLARATION.—The 

term ‘qualifying natural disaster declaration’ means a natural 

disaster declared by the Secretary for production losses under 

section 321(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961(a)). 

‘‘(14) SECRETARY.—The term ‘Secretary’ means the Secretary of Agriculture. 

‘‘(15) SOCIALLY DISADVANTAGED FARMER OR RANCHER.—The 

term ‘socially disadvantaged farmer or rancher’ has the meaning given the term in section 2501(e) of the Food, Agriculture, 

Conservation, and Trade Act of 1990 (7 U.S.C. 2279(e)). 

‘‘(16) STATE.—The term ‘State’ means—

‘‘(A) a State; 

‘‘(B) the District of Columbia; 

‘‘(C) the Commonwealth of Puerto Rico; and 

‘‘(D) any other territory or possession of the United 

States. 

‘‘(17) TRUST FUND.—The term ‘Trust Fund’ means the Agricultural Disaster Relief Trust Fund established under section 

902 of the Trade Act of 1974. 

‘‘(18) UNITED STATES.—The term ‘United States’ when used 

in a geographical sense, means all of the States. 

‘‘(b) SUPPLEMENTAL REVENUE ASSISTANCE PAYMENTS.—

‘‘(1) IN GENERAL.—The Secretary shall use such sums as 

are necessary from the Trust Fund to make crop disaster assistance payments to eligible producers on farms in disaster counties that have incurred crop production losses or crop quality 

losses, or both, during the crop year. 

‘‘(2) AMOUNT.—

‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

Secretary shall provide crop disaster assistance payments 

under this section to an eligible producer on a farm in an 

amount equal to 60 percent of the difference between—

‘‘(i) the disaster assistance program guarantee, as 

described in paragraph (3); and 

‘‘(ii) the total farm revenue for a farm, as described 

in paragraph (4). 

‘‘(B) LIMITATION.—The disaster assistance program 

guarantee for a crop used to calculate the payments for a 

farm under subparagraph (A)(i) may not be greater than 90 

percent of the sum of the expected revenue, as described in 

paragraph (5) for each of the crops on a farm, as determined by the Secretary. 

‘‘(3) SUPPLEMENTAL REVENUE ASSISTANCE PROGRAM GUARANTEE.—

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

paragraph, the supplemental assistance program guarantee 

shall be the sum obtained by adding—


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‘‘(i) for each insurable commodity on the farm, 115 

percent of the product obtained by multiplying— ‘‘(I) a payment rate for the commodity that is 

equal to the price election for the commodity elected by the eligible producer; ‘‘(II) the payment acres for the commodity that 

is equal to the number of acres planted, or prevented from being planted, to the commodity; ‘‘(III) the payment yield for the commodity that 

is equal to the percentage of the crop insurance 

yield elected by the producer of the higher of— ‘‘(aa) the adjusted actual production history yield; or ‘‘(bb) the counter-cyclical program payment yield for each crop; and ‘‘(ii) for each noninsurable commodity on a farm, 

120 percent of the product obtained by multiplying— ‘‘(I) a payment rate for the commodity that is 

equal to 100 percent of the noninsured crop assistance program established price for the commodity; ‘‘(II) the payment acres for the commodity that 

is equal to the number of acres planted, or prevented from being planted, to the commodity; and ‘‘(III) the payment yield for the commodity that 

is equal to the higher of— ‘‘(aa) the adjusted noninsured crop assistance program yield guarantee; or ‘‘(bb) the counter-cyclical program payment yield for each crop. ‘‘(B) ADJUSTMENT INSURANCE GUARANTEE.—Notwithstanding subparagraph (A), in the case of an insurable 

commodity for which a plan of insurance provides for an 

adjustment in the guarantee, such as in the case of prevented planting, the adjusted insurance guarantee shall be 

the basis for determining the disaster assistance program 

guarantee for the insurable commodity. ‘‘(C) ADJUSTED ASSISTANCE LEVEL.—Notwithstanding 

subparagraph (A), in the case of a noninsurable commodity 

for which the noninsured crop assistance program provides 

for an adjustment in the level of assistance, such as in the 

case of unharvested crops, the adjusted assistance level 

shall be the basis for determining the disaster assistance 

program guarantee for the noninsurable commodity. ‘‘(D) EQUITABLE TREATMENT FOR NON-YIELD BASED

POLICIES.—The Secretary shall establish equitable treatment for non-yield based policies and plans of insurance, 

such as the Adjusted Gross Revenue Lite insurance program. 

‘‘(4) FARM REVENUE.— ‘‘(A) IN GENERAL.—For purposes of this subsection, the 

total farm revenue for a farm, shall equal the sum obtained 

by adding—

‘‘(i) the estimated actual value for each crop produced on a farm by using the product obtained by multiplying—


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‘‘(I) the actual crop acreage harvested by an eligible producer on a farm; ‘‘(II) the estimated actual yield of the crop production; and ‘‘(III) subject to subparagraphs (B) and (C), to 

the extent practicable, the national average market 

price received for the marketing year, as determined by the Secretary; 

‘‘(ii) 15 percent of amount of any direct payments 

made to the producer under sections 1103 and 1303 of 

the Food, Conservation, and Energy Act of 2008 or successor sections; ‘‘(iii) the total amount of any counter-cyclical payments made to the producer under sections 1104 and 

1304 of the Food, Conservation, and Energy Act of 

2008 or successor sections or of any average crop revenue election payments made to the producer under 

section 1105 of that Act; ‘‘(iv) the total amount of any loan deficiency payments, marketing loan gains, and marketing certificate 

gains made to the producer under subtitles B and C of 

the Food, Conservation, and Energy Act of 2008 or successor subtitles; ‘‘(v) the amount of payments for prevented planting 

on a farm; ‘‘(vi) the amount of crop insurance indemnities received by an eligible producer on a farm for each crop 

on a farm; ‘‘(vii) the amount of payments an eligible producer 

on a farm received under the noninsured crop assistance program for each crop on a farm; and ‘‘(viii) the value of any other natural disaster assistance payments provided by the Federal Government 

to an eligible producer on a farm for each crop on a 

farm for the same loss for which the eligible producer 

is seeking assistance. 

‘‘(B) ADJUSTMENT.—The Secretary shall adjust the average market price received by the eligible producer on a 

farm— ‘‘(i) to reflect the average quality discounts applied 

to the local or regional market price of a crop or mechanically harvested forage due to a reduction in the 

intrinsic characteristics of the production resulting 

from adverse weather, as determined annually by the 

State office of the Farm Service Agency; and ‘‘(ii) to account for a crop the value of which is reduced due to excess moisture resulting from a disasterrelated condition. 

‘‘(C) MAXIMUM AMOUNT FOR CERTAIN CROPS.—With respect to a crop for which an eligible producer on a farm receives assistance under the noninsured crop assistance program, the national average market price received during 

the marketing year shall be an amount not more than 100 

percent of the price of the crop established under the noninsured crop assistance program. 


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‘‘(5) EXPECTED REVENUE.—The expected revenue for each 

crop on a farm shall equal the sum obtained by adding—

‘‘(A) the product obtained by multiplying—

‘‘(i) the greatest of—

‘‘(I) the adjusted actual production history 

yield of the eligible producer on a farm; and 

‘‘(II) the counter-cyclical program payment 

yield; 

‘‘(ii) the acreage planted or prevented from being 

planted for each crop; and 

‘‘(iii) 100 percent of the insurance price guarantee; 

and 

‘‘(B) the product obtained by multiplying—

‘‘(i) 100 percent of the adjusted noninsured crop assistance program yield; and 

‘‘(ii) 100 percent of the noninsured crop assistance 

program price for each of the crops on a farm. 

‘‘(c) LIVESTOCK INDEMNITY PAYMENTS.—

‘‘(1) PAYMENTS.—The Secretary shall use such sums as are 

necessary from the Trust Fund to make livestock indemnity 

payments to eligible producers on farms that have incurred livestock death losses in excess of the normal mortality due to adverse weather, as determined by the Secretary, during the calendar year, including losses due to hurricanes, floods, blizzards, disease, wildfires, extreme heat, and extreme cold. 

‘‘(2) PAYMENT RATES.—Indemnity payments to an eligible 

producer on a farm under paragraph (1) shall be made at a 

rate of 75 percent of the market value of the applicable livestock 

on the day before the date of death of the livestock, as determined by the Secretary. 

‘‘(d) LIVESTOCK FORAGE DISASTER PROGRAM.—

‘‘(1) DEFINITIONS.—In this subsection: 

‘‘(A) COVERED LIVESTOCK.—

‘‘(i) IN GENERAL.—Except as provided in clause (ii), 

the term ‘covered livestock’ means livestock of an eligible livestock producer that, during the 60 days prior to 

the beginning date of a qualifying drought or fire condition, as determined by the Secretary, the eligible livestock producer—

‘‘(I) owned; 

‘‘(II) leased; 

‘‘(III) purchased; 

‘‘(IV) entered into a contract to purchase; 

‘‘(V) is a contract grower; or 

‘‘(VI) sold or otherwise disposed of due to 

qualifying drought conditions during—

‘‘(aa) the current production year; or 

‘‘(bb) subject to paragraph (3)(B)(ii), 1 or 

both of the 2 production years immediately 

preceding the current production year. 

‘‘(ii) EXCLUSION.—The term ‘covered livestock’ does 

not include livestock that were or would have been in 

a feedlot, on the beginning date of the qualifying 

drought or fire condition, as a part of the normal busiVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00519 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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ness operation of the eligible livestock producer, as determined by the Secretary. 

‘‘(B) DROUGHT MONITOR.—The term ‘drought monitor’

means a system for classifying drought severity according 

to a range of abnormally dry to exceptional drought, as defined by the Secretary. 

‘‘(C) ELIGIBLE LIVESTOCK PRODUCER.—

‘‘(i) IN GENERAL.—The term ‘eligible livestock producer’ means an eligible producer on a farm that—

‘‘(I) is an owner, cash or share lessee, or contract grower of covered livestock that provides the 

pastureland or grazing land, including cash-leased 

pastureland or grazing land, for the livestock; 

‘‘(II) provides the pastureland or grazing land 

for covered livestock, including cash-leased 

pastureland or grazing land that is physically located in a county affected by drought; 

‘‘(III) certifies grazing loss; and 

‘‘(IV) meets all other eligibility requirements 

established under this subsection. 

‘‘(ii) EXCLUSION.—The term ‘eligible livestock producer’ does not include an owner, cash or share lessee, 

or contract grower of livestock that rents or leases 

pastureland or grazing land owned by another person 

on a rate-of-gain basis. 

‘‘(D) NORMAL CARRYING CAPACITY.—The term ‘normal 

carrying capacity’, with respect to each type of grazing land 

or pastureland in a county, means the normal carrying capacity, as determined under paragraph (3)(D)(i), that 

would be expected from the grazing land or pastureland for 

livestock during the normal grazing period, in the absence 

of a drought or fire that diminishes the production of the 

grazing land or pastureland. 

‘‘(E) NORMAL GRAZING PERIOD.—The term ‘normal 

grazing period’, with respect to a county, means the normal 

grazing period during the calendar year for the county, as 

determined under paragraph (3)(D)(i). 

‘‘(2) PROGRAM.—The Secretary shall use such sums as are 

necessary from the Trust Fund to provide compensation for 

losses to eligible livestock producers due to grazing losses for 

covered livestock due to—

‘‘(A) a drought condition, as described in paragraph 

(3); or 

‘‘(B) fire, as described in paragraph (4). 

‘‘(3) ASSISTANCE FOR LOSSES DUE TO DROUGHT CONDITIONS.—

‘‘(A) ELIGIBLE LOSSES.—

‘‘(i) IN GENERAL.—An eligible livestock producer 

may receive assistance under this subsection only for 

grazing losses for covered livestock that occur on land 

that—

‘‘(I) is native or improved pastureland with 

permanent vegetative cover; or 


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‘‘(II) is planted to a crop planted specifically 

for the purpose of providing grazing for covered 

livestock. 

‘‘(ii) EXCLUSIONS.—An eligible livestock producer 

may not receive assistance under this subsection for 

grazing losses that occur on land used for haying or 

grazing under the conservation reserve program established under subchapter B of chapter 1 of subtitle D of 

title XII of the Food Security Act of 1985 (16 U.S.C. 

3831 et seq.). 

‘‘(B) MONTHLY PAYMENT RATE.—

‘‘(i) IN GENERAL.—Except as provided in clause (ii), 

the payment rate for assistance under this paragraph 

for 1 month shall, in the case of drought, be equal to 

60 percent of the lesser of—

‘‘(I) the monthly feed cost for all covered livestock owned or leased by the eligible livestock producer, as determined under subparagraph (C); or 

‘‘(II) the monthly feed cost calculated by using 

the normal carrying capacity of the eligible grazing 

land of the eligible livestock producer. 

‘‘(ii) PARTIAL COMPENSATION.—In the case of an eligible livestock producer that sold or otherwise disposed of covered livestock due to drought conditions in 

1 or both of the 2 production years immediately preceding the current production year, as determined by 

the Secretary, the payment rate shall be 80 percent of 

the payment rate otherwise calculated in accordance 

with clause (i). 

‘‘(C) MONTHLY FEED COST.—

‘‘(i) IN GENERAL.—The monthly feed cost shall 

equal the product obtained by multiplying—

‘‘(I) 30 days; 

‘‘(II) a payment quantity that is equal to the 

feed grain equivalent, as determined under clause 

(ii); and 

‘‘(III) a payment rate that is equal to the corn 

price per pound, as determined under clause (iii). 

‘‘(ii) FEED GRAIN EQUIVALENT.—For purposes of 

clause (i)(I), the feed grain equivalent shall equal—

‘‘(I) in the case of an adult beef cow, 15.7 

pounds of corn per day; or 

‘‘(II) in the case of any other type of weight of 

livestock, an amount determined by the Secretary 

that represents the average number of pounds of 

corn per day necessary to feed the livestock. 

‘‘(iii) CORN PRICE PER POUND.—For purposes of 

clause (i)(II), the corn price per pound shall equal the 

quotient obtained by dividing—

‘‘(I) the higher of—

‘‘(aa) the national average corn price per 

bushel for the 12-month period immediately 

preceding March 1 of the year for which the 

disaster assistance is calculated; or 


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‘‘(bb) the national average corn price per 

bushel for the 24-month period immediately 

preceding that March 1; by 

‘‘(II) 56. 

‘‘(D) NORMAL GRAZING PERIOD AND DROUGHT MONITOR

INTENSITY.—

‘‘(i) FSA COUNTY COMMITTEE DETERMINATIONS.—

‘‘(I) IN GENERAL.—The Secretary shall determine the normal carrying capacity and normal 

grazing period for each type of grazing land or 

pastureland in the county served by the applicable 

committee. 

‘‘(II) CHANGES.—No change to the normal carrying capacity or normal grazing period established for a county under subclause (I) shall be 

made unless the change is requested by the appropriate State and county Farm Service Agency committees. 

‘‘(ii) DROUGHT INTENSITY.—

‘‘(I) D2.—An eligible livestock producer that 

owns or leases grazing land or pastureland that is 

physically located in a county that is rated by the 

U.S. Drought Monitor as having a D2 (severe 

drought) intensity in any area of the county for at 

least 8 consecutive weeks during the normal grazing period for the county, as determined by the 

Secretary, shall be eligible to receive assistance 

under this paragraph in an amount equal to 1 

monthly payment using the monthly payment rate 

determined under subparagraph (B). 

‘‘(II) D3.—An eligible livestock producer that 

owns or leases grazing land or pastureland that is 

physically located in a county that is rated by the 

U.S. Drought Monitor as having at least a D3 (extreme drought) intensity in any area of the county 

at any time during the normal grazing period for 

the county, as determined by the Secretary, shall 

be eligible to receive assistance under this paragraph—

‘‘(aa) in an amount equal to 2 monthly 

payments using the monthly payment rate determined under subparagraph (B); or 

‘‘(bb) if the county is rated as having a D3 

(extreme drought) intensity in any area of the 

county for at least 4 weeks during the normal 

grazing period for the county, or is rated as 

having a D4 (exceptional drought) intensity in 

any area of the county at any time during the 

normal grazing period, in an amount equal to 

3 monthly payments using the monthly payment rate determined under subparagraph 

(B). 

‘‘(4) ASSISTANCE FOR LOSSES DUE TO FIRE ON PUBLIC MANAGED LAND.—


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‘‘(A) IN GENERAL.—An eligible livestock producer may 

receive assistance under this paragraph only if— ‘‘(i) the grazing losses occur on rangeland that is 

managed by a Federal agency; and ‘‘(ii) the eligible livestock producer is prohibited by 

the Federal agency from grazing the normal permitted 

livestock on the managed rangeland due to a fire. 

‘‘(B) PAYMENT RATE.—The payment rate for assistance 

under this paragraph shall be equal to 50 percent of the 

monthly feed cost for the total number of livestock covered 

by the Federal lease of the eligible livestock producer, as determined under paragraph (3)(C). ‘‘(C) PAYMENT DURATION.—

‘‘(i) IN GENERAL.—Subject to clause (ii), an eligible 

livestock producer shall be eligible to receive assistance 

under this paragraph for the period—

‘‘(I) beginning on the date on which the Federal agency excludes the eligible livestock producer 

from using the managed rangeland for grazing; 

and 

‘‘(II) ending on the last day of the Federal 

lease of the eligible livestock producer. 

‘‘(ii) LIMITATION.—An eligible livestock producer 

may only receive assistance under this paragraph for 

losses that occur on not more than 180 days per year. ‘‘(5) MINIMUM RISK MANAGEMENT PURCHASE REQUIRE- MENTS.—

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

paragraph, a livestock producer shall only be eligible for 

assistance under this subsection if the livestock producer— ‘‘(i) obtained a policy or plan of insurance under 

subtitle A for the grazing land incurring the losses for 

which assistance is being requested; or ‘‘(ii) filed the required paperwork, and paid the administrative fee by the applicable State filing deadline, 

for the noninsured crop assistance program for the 

grazing land incurring the losses for which assistance 

is being requested. 

‘‘(B) WAIVER FOR SOCIALLY DISADVANTAGED, LIMITED

RESOURCE, OR BEGINNING FARMER OR RANCHER.—In the 

case of an eligible livestock producer that is a socially disadvantaged farmer or rancher or limited resource or beginning farmer or rancher, as determined by the Secretary, the 

Secretary may—

‘‘(i) waive subparagraph (A); and 

‘‘(ii) provide disaster assistance under this section 

at a level that the Secretary determines to be equitable 

and appropriate. 

‘‘(C) WAIVER FOR 2008 CALENDAR YEAR.—In the case of 

an eligible livestock producer that suffered losses on grazing land during the 2008 calendar year but does not meet 

the requirements of subparagraph (A), the Secretary shall 

waive subparagraph (A) if the eligible livestock producer 

pays a fee in an amount equal to the applicable noninsured 

crop assistance program fee or catastrophic risk protection 


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plan fee required under subparagraph (A) to the Secretary 

not later than 90 days after the date of enactment of this 

subtitle. 

‘‘(D) EQUITABLE RELIEF.—

‘‘(i) IN GENERAL.—The Secretary may provide equitable relief to an eligible livestock producer that is otherwise ineligible or unintentionally fails to meet the requirements of subparagraph (A) for the grazing land 

incurring the loss on a case-by-case basis, as determined by the Secretary. 

‘‘(ii) 2008 CALENDAR YEAR.—In the case of an eligible livestock producer that suffered losses on grazing 

land during the 2008 calendar year, the Secretary 

shall take special consideration to provide equitable relief in cases in which the eligible livestock producer 

failed to meet the requirements of subparagraph (A) 

due to the enactment of this subtitle after the closing 

date of sales periods for crop insurance under subtitle 

A and the noninsured crop assistance program. 

‘‘(6) NO DUPLICATIVE PAYMENTS.—

‘‘(A) IN GENERAL.—An eligible livestock producer may 

elect to receive assistance for grazing or pasture feed losses 

due to drought conditions under paragraph (3) or fire 

under paragraph (4), but not both for the same loss, as determined by the Secretary. 

‘‘(B) RELATIONSHIP TO SUPPLEMENTAL REVENUE ASSISTANCE.—An eligible livestock producer that receives assistance under this subsection may not also receive assistance for losses to crops on the same land with the same intended use under subsection (b). 

‘‘(e) EMERGENCY ASSISTANCE FOR LIVESTOCK, HONEY BEES, AND

FARM-RAISED FISH.—

‘‘(1) IN GENERAL.—The Secretary shall use up to 

$50,000,000 per year from the Trust Fund to provide emergency 

relief to eligible producers of livestock, honey bees, and farmraised fish to aid in the reduction of losses due to disease, adverse weather, or other conditions, such as blizzards and 

wildfires, as determined by the Secretary, that are not covered 

under subsection (b), (c), or (d). 

‘‘(2) USE OF FUNDS.—Funds made available under this subsection shall be used to reduce losses caused by feed or water 

shortages, disease, or other factors as determined by the Secretary. 

‘‘(3) AVAILABILITY OF FUNDS.—Any funds made available 

under this subsection shall remain available until expended. 

‘‘(f) TREE ASSISTANCE PROGRAM.—

‘‘(1) DEFINITIONS.—In this subsection: 

‘‘(A) ELIGIBLE ORCHARDIST.—The term ‘eligible orchardist’ means a person that produces annual crops from 

trees for commercial purposes. 

‘‘(B) NATURAL DISASTER.—The term ‘natural disaster’

means plant disease, insect infestation, drought, fire, freeze, 

flood, earthquake, lightning, or other occurrence, as determined by the Secretary. 


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‘‘(C) NURSERY TREE GROWER.—The term ‘nursery tree 

grower’ means a person who produces nursery, ornamental, 

fruit, nut, or Christmas trees for commercial sale, as determined by the Secretary. 

‘‘(D) TREE.—The term ‘tree’ includes a tree, bush, and 

vine. 

‘‘(2) ELIGIBILITY.—

‘‘(A) LOSS.—Subject to subparagraph (B), the Secretary 

shall provide assistance—

‘‘(i) under paragraph (3) to eligible orchardists and 

nursery tree growers that planted trees for commercial 

purposes but lost the trees as a result of a natural disaster, as determined by the Secretary; and 

‘‘(ii) under paragraph (3)(B) to eligible orchardists 

and nursery tree growers that have a production history for commercial purposes on planted or existing 

trees but lost the trees as a result of a natural disaster, 

as determined by the Secretary. 

‘‘(B) LIMITATION.—An eligible orchardist or nursery 

tree grower shall qualify for assistance under subparagraph (A) only if the tree mortality of the eligible orchardist 

or nursery tree grower, as a result of damaging weather or 

related condition, exceeds 15 percent (adjusted for normal 

mortality). 

‘‘(3) ASSISTANCE.—Subject to paragraph (4), the assistance 

provided by the Secretary to eligible orchardists and nursery 

tree growers for losses described in paragraph (2) shall consist 

of—

‘‘(A)(i) reimbursement of 70 percent of the cost of replanting trees lost due to a natural disaster, as determined 

by the Secretary, in excess of 15 percent mortality (adjusted 

for normal mortality); or 

‘‘(ii) at the option of the Secretary, sufficient seedlings 

to reestablish a stand; and 

‘‘(B) reimbursement of 50 percent of the cost of pruning, 

removal, and other costs incurred by an eligible orchardist 

or nursery tree grower to salvage existing trees or, in the 

case of tree mortality, to prepare the land to replant trees 

as a result of damage or tree mortality due to a natural 

disaster, as determined by the Secretary, in excess of 15 

percent damage or mortality (adjusted for normal tree 

damage and mortality). 

‘‘(4) LIMITATIONS ON ASSISTANCE.—

‘‘(A) DEFINITIONS OF LEGAL ENTITY AND PERSON.—In 

this paragraph, the terms ‘legal entity’ and ‘person’ have 

the meaning given those terms in section 1001(a) of the 

Food Security Act of 1985 (7 U.S.C. 1308(a) (as amended 

by section 1603 of the Food, Conservation, and Energy Act 

of 2008). 

‘‘(B) AMOUNT.—The total amount of payments received, 

directly or indirectly, by a person or legal entity (excluding 

a joint venture or general partnership) under this subsection may not exceed $100,000 for any crop year, or an 

equivalent value in tree seedlings. 


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‘‘(C) ACRES.—The total quantity of acres planted to 

trees or tree seedlings for which a person or legal entity 

shall be entitled to receive payments under this subsection 

may not exceed 500 acres. ‘‘(g) RISK MANAGEMENT PURCHASE REQUIREMENT.— ‘‘(1) IN GENERAL.—Except as otherwise provided in this section, the eligible producers on a farm shall not be eligible for 

assistance under this section (other than subsection (c)) if the eligible producers on the farm— ‘‘(A) in the case of each insurable commodity of the eligible producers on the farm, did not obtain a policy or plan 

of insurance under subtitle A (excluding a crop insurance 

pilot program under that subtitle); or ‘‘(B) in the case of each noninsurable commodity of the 

eligible producers on the farm, did not file the required paperwork, and pay the administrative fee by the applicable 

State filing deadline, for the noninsured crop assistance 

program. 

‘‘(2) MINIMUM.—To be considered to have obtained insurance under paragraph (1)(A), an eligible producer on a farm 

shall have obtained a policy or plan of insurance with not less 

than 50 percent yield coverage at 55 percent of the insurable 

price for each crop grazed, planted, or intended to be planted 

for harvest on a whole farm. 

‘‘(3) WAIVER FOR SOCIALLY DISADVANTAGED, LIMITED RE- SOURCE, OR BEGINNING FARMER OR RANCHER.—With respect to 

eligible producers that are socially disadvantaged farmers or 

ranchers or limited resource or beginning farmers or ranchers, 

as determined by the Secretary, the Secretary may— ‘‘(A) waive paragraph (1); and 

‘‘(B) provide disaster assistance under this section at a 

level that the Secretary determines to be equitable and appropriate. 

‘‘(4) WAIVER FOR 2008 CROP YEAR.—In the case of an eligible 

producer that suffered losses in an insurable commodity or noninsurable commodity during the 2008 crop year but does not 

meet the requirements of paragraph (1), the Secretary shall 

waive paragraph (1) if the eligible producer pays a fee in an 

amount equal to the applicable noninsured crop assistance program fee or catastrophic risk protection plan fee required under 

paragraph (1) to the Secretary not later than 90 days after the 

date of enactment of this subtitle. 

‘‘(5) EQUITABLE RELIEF.—

‘‘(A) IN GENERAL.—The Secretary may provide equitable relief to eligible producers on a farm that are otherwise ineligible or unintentionally fail to meet the requirements of paragraph (1) for 1 or more crops on a farm on 

a case-by-case basis, as determined by the Secretary. 

‘‘(B) 2008 CROP YEAR.—In the case of eligible producers 

on a farm that suffered losses in an insurable commodity 

or noninsurable commodity during the 2008 crop year, the 

Secretary shall take special consideration to provide equitable relief in cases in which the eligible producers failed 

to meet the requirements of paragraph (1) due to the enactment of this subtitle after the closing date of sales periods 


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for crop insurance under subtitle A and the noninsured 

crop assistance program. 

‘‘(h) PAYMENT LIMITATIONS.—

‘‘(1) DEFINITIONS OF LEGAL ENTITY AND PERSON.—In this 

subsection, the terms ‘legal entity’ and ‘person’ have the meaning given those terms in section 1001(a) of the Food Security 

Act of 1985 (7 U.S.C. 1308(a) (as amended by section 1603 of 

the Food, Conservation, and Energy Act of 2008). 

‘‘(2) AMOUNT.—The total amount of disaster assistance payments received, directly or indirectly, by a person or legal entity 

(excluding a joint venture or general partnership) under this 

section (excluding payments received under subsection (f)) may 

not exceed $100,000 for any crop year. 

‘‘(3) AGI LIMITATION.—Section 1001D of the Food Security 

Act of 1985 (7 U.S.C. 1308–3a) or any successor provision shall 

apply with respect to assistance provided under this section. 

‘‘(4) DIRECT ATTRIBUTION.—Subsections (e) and (f) of section 1001 of the Food Security Act of 1985 (7 U.S.C. 1308) or 

any successor provisions relating to direct attribution shall 

apply with respect to assistance provided under this section. 

‘‘(i) PERIOD OF EFFECTIVENESS.—This section shall be effective 

only for losses that are incurred as the result of a disaster, adverse 

weather, or other environmental condition that occurs on or before 

September 30, 2011, as determined by the Secretary. 

‘‘(j) NO DUPLICATIVE PAYMENTS.—In implementing any other 

program which makes disaster assistance payments (except for indemnities made under subtitle A and section 196 of the Federal Agriculture Improvement and Reform Act of 1996), the Secretary shall 

prevent duplicative payments with respect to the same loss for 

which a person receives a payment under subsections (b), (c), (d), (e), 

or (f). 

‘‘(k) APPLICATION.—

‘‘(1) IN GENERAL.—Subject to paragraph (2) and notwithstanding any provision of subtitle A, subtitle A shall not apply 

to this subtitle. 

‘‘(2) CROSS REFERENCES.—Paragraph (1) shall not apply to 

a specific reference in this subtitle to a provision of subtitle A.’’. 

(b) TRANSITION.—For purposes of the 2008 crop year, the Secretary shall carry out subsections (f)(4) and (h) of section 531 of the 

Federal Crop Insurance Act (as added by subsection (a)) in accordance with the terms and conditions of sections 1001 through 1001D 

of the Food Security Act of 1985 (16 U.S.C. 1308 et seq.), as in effect 

on September 30, 2007. 

(c) CONFORMING AMENDMENTS.—

(1) Section 501 of the Federal Crop Insurance Act (7 U.S.C. 

1501) is amended by striking the section heading and enumerator and inserting the following: 

‘‘Subtitle A—Federal Crop Insurance Act 

‘‘SEC. 501. SHORT TITLE AND APPLICATION OF OTHER PROVISIONS.’’. 

(2) Subtitle A of the Federal Crop Insurance Act (as designated under paragraph (1)) is amended—

(A) by striking ‘‘This title’’ each place it appears and 

inserting ‘‘This subtitle’’; and 


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(B) by striking ‘‘this title’’ each place it appears and inserting ‘‘this subtitle’’. 

SEC. 12034. FISHERIES DISASTER ASSISTANCE. 

Of the funds of the Commodity Credit Corporation, the Secretary of Agriculture shall transfer to the Secretary of Commerce 

$170,000,000 for fiscal year 2008 for the National Marine Fisheries 

Service to distribute to commercial and recreational members of the 

fishing communities affected by the salmon fishery failure in the 

States of California, Oregon, and Washington designated under section 312(a) of the Magnuson-Stevens Fishery Conservation and 

Management Act (16 U.S.C. 1861a(a)) on May 1, 2008, in accordance with that section. 

Subtitle B—Small Business Disaster Loan Program 

SEC. 12051. SHORT TITLE. 

This subtitle may be cited as the ‘‘Small Business Disaster Response and Loan Improvements Act of 2008’’. 

SEC. 12052. DEFINITIONS. 

In this subtitle—

(1) the terms ‘‘Administration’’ and ‘‘Administrator’’ mean 

the Small Business Administration and the Administrator 

thereof, respectively; 

(2) the term ‘‘disaster area’’ means an area affected by a 

natural or other disaster, as determined for purposes of paragraph (1) or (2) of section 7(b) of the Small Business Act (15 

U.S.C. 636(b)), during the period of such declaration; 

(3) the term ‘‘disaster loan program of the Administration’’

means assistance under section 7(b) of the Small Business Act 

(15 U.S.C. 636(b)), as amended by this Act; 

(4) the term ‘‘disaster update period’’ means the period beginning on the date on which the President declares a major 

disaster (including any major disaster relating to which the Administrator declares eligibility for additional disaster assistance 

under paragraph (9) of section 7(b) of the Small Business Act 

(15 U.S.C. 636(b)), as added by this Act) and ending on the 

date on which such declaration terminates; 

(5) the term ‘‘major disaster’’ has the meaning given that 

term in section 102 of the Robert T. Stafford Disaster Relief and 

Emergency Assistance Act (42 U.S.C. 5122); 

(6) the term ‘‘small business concern’’ has the meaning 

given that term under section 3 of the Small Business Act (15 

U.S.C. 632); and 

(7) the term ‘‘State’’ means any State of the United States, 

the District of Columbia, the Commonwealth of Puerto Rico, the 

Northern Mariana Islands, the Virgin Islands, Guam, American Samoa, and any territory or possession of the United 

States. 

PART I—DISASTER PLANNING AND RESPONSE 

SEC. 12061. ECONOMIC INJURY DISASTER LOANS TO NONPROFITS. 

(a) IN GENERAL.—Section 7(b)(2) of the Small Business Act (15 

U.S.C. 636(b)(2)) is amended—


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(1) in the matter preceding subparagraph (A)—

(A) by inserting after ‘‘small business concern’’ the following: ‘‘, private nonprofit organization,’’; and 

(B) by inserting after ‘‘the concern’’ the following: ‘‘, the 

organization,’’; and 

(2) in subparagraph (D) by inserting after ‘‘small business 

concerns’’ the following: ‘‘, private nonprofit organizations,’’. 

(b) CONFORMING AMENDMENT.—Section 7(c)(5)(C) of the Small 

Business Act (15 U.S.C. 636(c)(5)(C)) is amended by inserting after 

‘‘business’’ the following: ‘‘, private nonprofit organization,’’. 

SEC. 12062. COORDINATION OF DISASTER ASSISTANCE PROGRAMS 

WITH FEMA. 

The Small Business Act (15 U.S.C. 631 et seq.) is amended—

(1) by redesignating section 37 as section 44; and 

(2) by inserting after section 36 the following: 

‘‘SEC. 37. COORDINATION OF DISASTER ASSISTANCE PROGRAMS WITH 

FEMA. 

‘‘(a) COORDINATION REQUIRED.—The Administrator shall ensure 

that the disaster assistance programs of the Administration are coordinated, to the maximum extent practicable, with the disaster assistance programs of the Federal Emergency Management Agency. 

‘‘(b) REGULATIONS REQUIRED.—The Administrator, in consultation with the Administrator of the Federal Emergency Management 

Agency, shall establish regulations to ensure that each application 

for disaster assistance is submitted as quickly as practicable to the 

Administration or directed to the appropriate agency under the circumstances. 

‘‘(c) COMPLETION; REVISION.—The initial regulations shall be 

completed not later than 270 days after the date of the enactment 

of the Small Business Disaster Response and Loan Improvements 

Act of 2008. Thereafter, the regulations shall be revised on an annual basis. 

‘‘(d) REPORT.—The Administrator shall include a report on the 

regulations whenever the Administration submits the report required by section 43.’’. 

SEC. 12063. PUBLIC AWARENESS OF DISASTER DECLARATION AND APPLICATION PERIODS. 

(a) IN GENERAL.—Section 7(b) of the Small Business Act (15 

U.S.C. 636(b)) is amended by inserting immediately after paragraph 

(3), the following: 

‘‘(4) COORDINATION WITH FEMA.—

‘‘(A) IN GENERAL.—Notwithstanding any other provision of law, for any disaster declared under this subsection 

or major disaster (including any major disaster relating to 

which the Administrator declares eligibility for additional 

disaster assistance under paragraph (9)), the Administrator, in consultation with the Administrator of the Federal Emergency Management Agency, shall ensure, to the 

maximum extent practicable, that all application periods 

for disaster relief under this Act correspond with application deadlines established under the Robert T. Stafford 

Disaster Relief and Emergency Assistance Act (42 U.S.C. 

5121 et seq.), or as extended by the President. 


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‘‘(B) DEADLINES.—Notwithstanding any other provision 

of law, not later than 10 days before the closing date of an 

application period for a major disaster (including any 

major disaster relating to which the Administrator declares 

eligibility for additional disaster assistance under paragraph (9)), the Administrator, in consultation with the Administrator of the Federal Emergency Management Agency, 

shall submit to the Committee on Small Business and Entrepreneurship of the Senate and the Committee on Small 

Business of the House of Representatives a report that includes—

‘‘(i) the deadline for submitting applications for assistance under this Act relating to that major disaster; 

‘‘(ii) information regarding the number of loan applications and disbursements processed by the Administrator relating to that major disaster for each day 

during the period beginning on the date on which that 

major disaster was declared and ending on the date of 

that report; and 

‘‘(iii) an estimate of the number of potential applicants that have not submitted an application relating 

to that major disaster. 

‘‘(5) PUBLIC AWARENESS OF DISASTERS.—If a disaster is declared under this subsection or the Administrator declares eligibility for additional disaster assistance under paragraph (9), 

the Administrator shall make every effort to communicate 

through radio, television, print, and web-based outlets, all relevant information needed by disaster loan applicants, including—

‘‘(A) the date of such declaration; 

‘‘(B) cities and towns within the area of such declaration; 

‘‘(C) loan application deadlines related to such disaster; 

‘‘(D) all relevant contact information for victim services 

available through the Administration (including links to 

small business development center websites); 

‘‘(E) links to relevant Federal and State disaster assistance websites, including links to websites providing information regarding assistance available from the Federal 

Emergency Management Agency; 

‘‘(F) information on eligibility criteria for Administration loan programs, including where such applications can 

be found; and 

‘‘(G) application materials that clearly state the function of the Administration as the Federal source of disaster 

loans for homeowners and renters.’’. 

(b) MARKETING AND OUTREACH.—Not later than 90 days after 

the date of enactment of this Act, the Administrator shall create a 

marketing and outreach plan that—

(1) encourages a proactive approach to the disaster relief efforts of the Administration; 

(2) makes clear the services provided by the Administration, 

including contact information, application information, and 


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timelines for submitting applications, the review of applications, and the disbursement of funds; 

(3) describes the different disaster loan programs of the Administration, including how they are made available and the 

eligibility requirements for each loan program; 

(4) provides for regional marketing, focusing on disasters 

occurring in each region before the date of enactment of this 

Act, and likely scenarios for disasters in each such region; and 

(5) ensures that the marketing plan is made available at 

small business development centers and on the website of the 

Administration. 

(c) TECHNICAL AND CONFORMING AMENDMENTS.—

(1) IN GENERAL.—Section 3 of the Small Business Act (15 

U.S.C. 632) is amended by adding at the end the following: 

‘‘(s) MAJOR DISASTER.—In this Act, the term ‘major disaster’

has the meaning given that term in section 102 of the Robert T. 

Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 

5122).’’. 

(2) TECHNICAL CORRECTION.—Section 7(b)(2) of the Small 

Business Act (15 U.S.C. 636(b)(2)) is amended by striking ‘‘Disaster Relief and Emergency Assistance Act’’ and inserting ‘‘Robert T. Stafford Disaster Relief and Emergency Assistance Act 

(42 U.S.C. 5121 et seq.)’’. 

SEC. 12064. CONSISTENCY BETWEEN ADMINISTRATION REGULATIONS 

AND STANDARD OPERATING PROCEDURES. 

(a) IN GENERAL.—The Administrator shall, promptly following 

the date of enactment of this Act, conduct a study of whether the 

standard operating procedures of the Administration for loans offered under section 7(b) of the Small Business Act (15 U.S.C. 

636(b)) are consistent with the regulations of the Administration for 

administering the disaster loan program. 

(b) REPORT.—Not later than 180 days after the date of enactment of this Act, the Administrator shall submit to Congress a report containing all findings and recommendations of the study conducted under subsection (a). 

SEC. 12065. INCREASING COLLATERAL REQUIREMENTS. 

Section 7(c)(6) of the Small Business Act (15 U.S.C. 636(c)(6)) 

is amended by striking ‘‘$10,000 or less’’ and inserting ‘‘$14,000 or 

less (or such higher amount as the Administrator determines appropriate in the event of a major disaster)’’. 

SEC. 12066. PROCESSING DISASTER LOANS. 

(a) AUTHORITY FOR QUALIFIED PRIVATE CONTRACTORS TO

PROCESS DISASTER LOANS.—Section 7(b) of the Small Business Act 

(15 U.S.C. 636(b)) is amended by inserting immediately after paragraph (5), as added by this Act, the following: 

‘‘(6) AUTHORITY FOR QUALIFIED PRIVATE CONTRACTORS.—

‘‘(A) DISASTER LOAN PROCESSING.—The Administrator 

may enter into an agreement with a qualified private contractor, as determined by the Administrator, to process 

loans under this subsection in the event of a major disaster 

(including any major disaster relating to which the Administrator declares eligibility for additional disaster assistance under paragraph (9)), under which the Administrator 

shall pay the contractor a fee for each loan processed. 


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‘‘(B) LOAN LOSS VERIFICATION SERVICES.—The Administrator may enter into an agreement with a qualified lender or loss verification professional, as determined by the 

Administrator, to verify losses for loans under this subsection in the event of a major disaster (including any 

major disaster relating to which the Administrator declares 

eligibility for additional disaster assistance under paragraph (9)), under which the Administrator shall pay the 

lender or verification professional a fee for each loan for 

which such lender or verification professional verifies 

losses.’’. (b) COORDINATION OF EFFORTS BETWEEN THE ADMINISTRATOR

AND THE INTERNAL REVENUE SERVICE TO EXPEDITE LOAN PROCESSING.—The Administrator and the Commissioner of Internal Revenue shall, to the maximum extent practicable, ensure that all relevant and allowable tax records for loan approval are shared with 

loan processors in an expedited manner, upon request by the Administrator. 

SEC. 12067. INFORMATION TRACKING AND FOLLOW-UP SYSTEM. 

The Small Business Act is amended by inserting after section 

37, as added by this Act, the following: 

‘‘SEC. 38. INFORMATION TRACKING AND FOLLOW-UP SYSTEM FOR DISASTER ASSISTANCE. 

‘‘(a) SYSTEM REQUIRED.—The Administrator shall develop, implement, or maintain a centralized information system to track communications between personnel of the Administration and applicants for disaster assistance. The system shall ensure that whenever 

an applicant for disaster assistance communicates with such personnel on a matter relating to the application, the following information is recorded: 

‘‘(1) The method of communication. 

‘‘(2) The date of communication. 

‘‘(3) The identity of the personnel. 

‘‘(4) A summary of the subject matter of the communication. 

‘‘(b) FOLLOW-UP REQUIRED.—The Administrator shall ensure 

that an applicant for disaster assistance receives, by telephone, 

mail, or electronic mail, follow-up communications from the Administration at all critical stages of the application process, including 

the following: 

‘‘(1) When the Administration determines that additional 

information or documentation is required to process the application. 

‘‘(2) When the Administration determines whether to approve or deny the loan. 

‘‘(3) When the primary contact person managing the loan 

application has changed.’’. 

SEC. 12068. INCREASED DEFERMENT PERIOD. 

(a) IN GENERAL.—Section 7 of the Small Business Act (15 

U.S.C. 636) is amended—

(1) by redesignating subsections (c) and (d) as subsections 

(d) and (e), respectively; and 

(2) by inserting after subsection (e), as so redesignated, the 

following: 

‘‘(f) ADDITIONAL REQUIREMENTS FOR 7(b) LOANS.—


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‘‘(1) INCREASED DEFERMENT AUTHORIZED.— ‘‘(A) IN GENERAL.—In making loans under subsection 

(b), the Administrator may provide, to the person receiving 

the loan, an option to defer repayment on the loan. ‘‘(B) PERIOD.—The period of a deferment under subparagraph (A) may not exceed 4 years.’’. (b) TECHNICAL AND CONFORMING AMENDMENTS.—The Small 

Business Act (15 U.S.C. 631 et seq.) is amended— (1) in section 4(c)— (A) in paragraph (1), by striking ‘‘7(c)(2)’’ and inserting ‘‘7(d)(2)’’; and 

(B) in paragraph (2)— (i) by striking ‘‘7(c)(2)’’ and inserting ‘‘7(d)(2)’’; and 

(ii) by striking ‘‘7(e),’’; and 

(2) in section 7(b), in the undesignated matter following 

paragraph (3)— (A) by striking ‘‘That the provisions of paragraph (1) of 

subsection (c)’’ and inserting ‘‘That the provisions of paragraph (1) of subsection (d)’’; and 

(B) by striking ‘‘Notwithstanding the provisions of any 

other law the interest rate on the Administration’s share of 

any loan made under subsection (b) except as provided in 

subsection (c),’’ and inserting ‘‘Notwithstanding any other 

provision of law, and except as provided in subsection (d), 

the interest rate on the Administration’s share of any loan 

made under subsection (b)’’. 

SEC. 12069. DISASTER PROCESSING REDUNDANCY. 

The Small Business Act (15 U.S.C. 631 et seq.) is amended by 

inserting after section 38, as added by this Act, the following: 

‘‘SEC. 39. DISASTER PROCESSING REDUNDANCY. 

‘‘(a) IN GENERAL.—The Administrator shall ensure that the Administration has in place a facility for disaster loan processing that, 

whenever the Administration’s primary facility for disaster loan 

processing becomes unavailable, is able to take over all disaster 

loan processing from that primary facility within 2 days. ‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as may be necessary to carry out this 

section.’’. 

SEC. 12070. NET EARNINGS CLAUSES PROHIBITED. 

Section 7 of the Small Business Act (15 U.S.C. 636) is amended 

by inserting after subsection (f), as added by this Act, the following: ‘‘(g) NET EARNINGS CLAUSES PROHIBITED FOR 7(b) LOANS.—In 

making loans under subsection (b), the Administrator shall not require the borrower to pay any non-amortized amount for the first 

five years after repayment begins.’’. 

SEC. 12071. ECONOMIC INJURY DISASTER LOANS IN CASES OF ICE 

STORMS AND BLIZZARDS. 

Section 3(k)(2) of the Small Business Act (15 U.S.C. 632(k)(2)) 

is amended—

(1) in subparagraph (A) by striking ‘‘and’’; 

(2) in subparagraph (B) by striking the period at the end 

and inserting ‘‘; and’’; and 

(3) by adding at the end the following: 

‘‘(C) ice storms and blizzards.’’. 


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SEC. 12072. DEVELOPMENT AND IMPLEMENTATION OF MAJOR DISASTER RESPONSE PLAN. 

(a) IN GENERAL.—Not later than 3 months after the date of enactment of this Act, the Administrator shall—

(1) by rule, amend the 2006 Atlantic hurricane season disaster response plan of the Administration (in this section referred to as the ‘‘disaster response plan’’) to apply to major disasters; and 

(2) submit a report to the Committee on Small Business 

and Entrepreneurship of the Senate and the Committee on 

Small Business of the House of Representatives detailing the 

amendments to the disaster response plan. 

(b) CONTENTS.—The report required under subsection (a)(2) 

shall include—

(1) any updates or modifications made to the disaster response plan since the report regarding the disaster response 

plan submitted to Congress on July 14, 2006; 

(2) a description of how the Administrator plans to use and 

integrate District Office personnel of the Administration in the 

response to a major disaster, including information on the use 

of personnel for loan processing and loan disbursement; 

(3) a description of the disaster scalability model of the Administration and on what basis or function the plan is scaled; 

(4) a description of how the agency-wide Disaster Oversight 

Council is structured, which offices comprise its membership, 

and whether the Associate Deputy Administrator for Entrepreneurial Development of the Administration is a member; 

(5) a description of how the Administrator plans to coordinate the disaster efforts of the Administration with State and 

local government officials, including recommendations on how 

to better incorporate State initiatives or programs, such as 

State-administered bridge loan programs, into the disaster response of the Administration; 

(6) recommendations, if any, on how the Administration 

can better coordinate its disaster response operations with the 

operations of other Federal, State, and local entities; 

(7) any surge plan for the disaster loan program of the Administration in effect on or after August 29, 2005 (including 

surge plans for loss verification, loan processing, mailroom, customer service or call center operations, and a continuity of operations plan); 

(8) the number of full-time equivalent employees and job 

descriptions for the planning and disaster response staff of the 

Administration; 

(9) the in-service and preservice training procedures for disaster response staff of the Administration; 

(10) information on the logistical support plans of the Administration (including equipment and staffing needs, and detailed information on how such plans will be scalable depending on the size and scope of the major disaster; 

(11) a description of the findings and recommendations of 

the Administrator, if any, based on a review of the response of 

the Administration to Hurricane Katrina of 2005, Hurricane 

Rita of 2005, and Hurricane Wilma of 2005; and 


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(12) a plan for how the Administrator, in consultation with 

the Administrator of the Federal Emergency Management Agency, will coordinate the provision of accommodations and necessary resources for disaster assistance personnel to effectively 

perform their responsibilities in the aftermath of a major disaster. 

(c) BIENNIAL DISASTER SIMULATION EXERCISE.— (1) EXERCISE REQUIRED.—The Administrator shall conduct 

a disaster simulation exercise at least once every 2 fiscal years. 

The exercise shall include the participation of, at a minimum, 

not less than 50 percent of the individuals in the disaster reserve corps and shall test, at maximum capacity, all of the information technology and telecommunications systems of the 

Administration that are vital to the activities of the Administration during such a disaster. 

(2) REPORT.—The Administrator shall include a report on 

the disaster simulation exercises conducted under paragraph (1) 

each time the Administration submits a report required under 

section 43 of the Small Business Act, as added by this Act. 

SEC. 12073. DISASTER PLANNING RESPONSIBILITIES. 

(a) ASSIGNMENT OF SMALL BUSINESS ADMINISTRATION DIS- ASTER PLANNING RESPONSIBILITIES.—The disaster planning function of the Administration shall be assigned to an individual appointed by the Administrator who— (1) is not an employee of the Office of Disaster Assistance 

of the Administration; 

(2) has proven management ability; 

(3) has substantial knowledge in the field of disaster readiness and emergency response; and 

(4) has demonstrated significant experience in the area of 

disaster planning. 

(b) RESPONSIBILITIES.—The individual assigned the disaster 

planning function of the Administration shall report directly and 

solely to the Administrator and shall be responsible for— (1) creating, maintaining, and implementing the comprehensive disaster response plan of the Administration described in section 12072; 

(2) ensuring there are in-service and pre-service training 

procedures for the disaster response staff of the Administration; 

(3) coordinating and directing the training exercises of the 

Administration relating to disasters, including disaster simulation exercises and disaster exercises coordinated with other government departments and agencies; and 

(4) other responsibilities relevant to disaster planning and 

readiness, as determined by the Administrator. 

(c) COORDINATION.—In carrying out the responsibilities described in subsection (b), the individual assigned the disaster planning function of the Administration shall coordinate with—

(1) the Office of Disaster Assistance of the Administration; 

(2) the Administrator of the Federal Emergency Management Agency; and 

(3) other Federal, State, and local disaster planning offices, 

as necessary. 

(d) RESOURCES.—The Administrator shall ensure that the individual assigned the disaster planning function of the AdministraVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00535 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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tion has adequate resources to carry out the duties under this section. 

(e) REPORT.—Not later than 30 days after the date of enactment 

of this Act, the Administrator shall submit to the Committee on 

Small Business and Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives a report 

containing—

(1) a description of the actions of the Administrator to assign an individual the disaster planning function of the Administration; 

(2) information detailing the background and expertise of 

the individual assigned; and 

(3) information on the status of the implementation of the 

responsibilities described in subsection (b). 

SEC. 12074. ASSIGNMENT OF EMPLOYEES OF THE OFFICE OF DISASTER 

ASSISTANCE AND DISASTER CADRE. 

(a) IN GENERAL.—Section 7(b) of the Small Business Act (15 

U.S.C. 636(b)) is amended by inserting immediately after paragraph 

(6), as added by this Act, the following: 

‘‘(7) DISASTER ASSISTANCE EMPLOYEES.—

‘‘(A) IN GENERAL.—In carrying out this section, the Administrator may, where practicable, ensure that the number 

of full-time equivalent employees—

‘‘(i) in the Office of the Disaster Assistance is not 

fewer than 800; and ‘‘(ii) in the Disaster Cadre of the Administration is 

not fewer than 1,000. 

‘‘(B) REPORT.—In carrying out this subsection, if the 

number of full-time employees for either the Office of Disaster Assistance or the Disaster Cadre of the Administration is below the level described in subparagraph (A) for 

that office, not later than 21 days after the date on which 

that staffing level decreased below the level described in 

subparagraph (A), the Administrator shall submit to the 

Committee on Appropriations and the Committee on Small 

Business and Entrepreneurship of the Senate and the Committee on Appropriations and Committee on Small Business of the House of Representatives, a report—

‘‘(i) detailing staffing levels on that date; 

‘‘(ii) requesting, if practicable and determined appropriate by the Administrator, additional funds for 

additional employees; and 

‘‘(iii) containing such additional information, as 

determined appropriate by the Administrator.’’. 

SEC. 12075. COMPREHENSIVE DISASTER RESPONSE PLAN. 

The Small Business Act (15 U.S.C. 631 et seq.) is amended inserting after section 39, as added by this Act, the following: 

‘‘SEC. 40. COMPREHENSIVE DISASTER RESPONSE PLAN. 

‘‘(a) PLAN REQUIRED.—The Administrator shall develop, implement, or maintain a comprehensive written disaster response plan. 

The plan shall include the following: 

‘‘(1) For each region of the Administration, a description of 

the disasters most likely to occur in that region. 

‘‘(2) For each disaster described under paragraph (1)—


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‘‘(A) an assessment of the disaster; 

‘‘(B) an assessment of the demand for Administration 

assistance most likely to occur in response to the disaster; ‘‘(C) an assessment of the needs of the Administration, 

with respect to such resources as information technology, 

telecommunications, human resources, and office space, to 

meet the demand referred to in subparagraph (B); and ‘‘(D) guidelines pursuant to which the Administration 

will coordinate with other Federal agencies and with State 

and local authorities to best respond to the demand referred to in subparagraph (B) and to best use the resources 

referred to in that subparagraph. ‘‘(b) COMPLETION; REVISION.—The first plan required by subsection (a) shall be completed not later than 180 days after the date 

of the enactment of this section. Thereafter, the Administrator shall 

update the plan on an annual basis and following any major disaster relating to which the Administrator declares eligibility for additional disaster assistance under section 7(b)(9). ‘‘(c) KNOWLEDGE REQUIRED.—The Administrator shall carry out 

subsections (a) and (b) through an individual with substantial 

knowledge in the field of disaster readiness and emergency response. 

‘‘(d) REPORT.—The Administrator shall include a report on the 

plan whenever the Administration submits the report required by 

section 43.’’. 

SEC. 12076. PLANS TO SECURE SUFFICIENT OFFICE SPACE. 

The Small Business Act is amended by inserting after section 

40, as added by this Act, the following: 

‘‘SEC. 41. PLANS TO SECURE SUFFICIENT OFFICE SPACE. 

‘‘(a) PLANS REQUIRED.—The Administrator shall develop longterm plans to secure sufficient office space to accommodate an expanded workforce in times of disaster. 

‘‘(b) REPORT.—The Administrator shall include a report on the 

plans developed under subsection (a) each time the Administration 

submits a report required under section 43.’’. 

SEC. 12077. APPLICANTS THAT HAVE BECOME A MAJOR SOURCE OF 

EMPLOYMENT DUE TO CHANGED ECONOMIC CIRCUMSTANCES. 

Section 7(b)(3)(E) of the Small Business Act (15 U.S.C. 

636(b)(3)(E)) is amended by inserting after ‘‘constitutes’’ the following: ‘‘, or have become due to changed economic circumstances,’’. 

SEC. 12078. DISASTER LOAN AMOUNTS. 

(a) INCREASED LOAN CAPS.—Section 7(b) of the Small Business 

Act (15 U.S.C. 636(b)) is amended by inserting immediately after 

paragraph (7), as added by this Act, the following: 

‘‘(8) INCREASED LOAN CAPS.—

‘‘(A) AGGREGATE LOAN AMOUNTS.—Except as provided 

in subparagraph (B), and notwithstanding any other provision of law, the aggregate loan amount outstanding and 

committed to a borrower under this subsection may not exceed $2,000,000. 

‘‘(B) WAIVER AUTHORITY.—The Administrator may, at 

the discretion of the Administrator, increase the aggregate 

loan amount under subparagraph (A) for loans relating to 

a disaster to a level established by the Administrator, based 


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on appropriate economic indicators for the region in which 

that disaster occurred.’’. 

(b) DISASTER MITIGATION.—

(1) IN GENERAL.—Section 7(b)(1)(A) of the Small Business 

Act (15 U.S.C. 636(b)(1)(A)) is amended by inserting ‘‘of the aggregate costs of such damage or destruction (whether or not 

compensated for by insurance or otherwise)’’ after ‘‘20 per centum’’. 

(2) EFFECTIVE DATE.—The amendment made by paragraph 

(1) shall apply with respect to a loan or guarantee made after 

the date of enactment of this Act. 

(c) TECHNICAL AMENDMENTS.—Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is amended—

(1) in the matter preceding paragraph (1), by striking ‘‘the, 

Administration’’ and inserting ‘‘the Administration’’; and 

(2) in the undesignated matter at the end—

(A) by striking ‘‘, (2), and (4)’’ and inserting ‘‘and (2)’’; 

and 

(B) by striking ‘‘, (2), or (4)’’ and inserting ‘‘(2)’’. 

SEC. 12079. SMALL BUSINESS BONDING THRESHOLD. 

(a) IN GENERAL.—Except as provided in subsection (b), and notwithstanding any other provision of law, for any procurement related to a major disaster, the Administrator may, upon such terms 

and conditions as the Administrator may prescribe, guarantee and 

enter into commitments to guarantee any surety against loss resulting from a breach of the terms of a bid bond, payment bond, performance bond, or bonds ancillary thereto, by a principal on any 

total work order or contract amount at the time of bond execution 

that does not exceed $5,000,000. 

(b) INCREASE OF AMOUNT.—Upon request of the head of any 

Federal agency other than the Administration involved in reconstruction efforts in response to a major disaster, the Administrator 

may guarantee and enter into a commitment to guarantee any security against loss under subsection (a) on any total work order or 

contract amount at the time of bond execution that does not exceed 

$10,000,000. 

(c) LIMITATION ON USE OF OTHER FUNDS.—The Administrator 

may carry out this section only with amounts appropriated in advance specifically to carry out this section. 

PART II—DISASTER LENDING 

SEC. 12081. ELIGIBILITY FOR ADDITIONAL DISASTER ASSISTANCE. 

Section 7(b) of the Small Business Act (15 U.S.C. 636(b)) is 

amended by inserting immediately after paragraph (8), as added by 

this Act, the following: 

‘‘(9) DECLARATION OF ELIGIBILITY FOR ADDITIONAL DISASTER

ASSISTANCE.—

‘‘(A) IN GENERAL.—If the President declares a major 

disaster, the Administrator may declare eligibility for additional disaster assistance in accordance with this paragraph. 


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‘‘(B) THRESHOLD.—A major disaster for which the Administrator declares eligibility for additional disaster assistance under this paragraph shall— ‘‘(i) have resulted in extraordinary levels of casualties or damage or disruption severely affecting the population (including mass evacuations), infrastructure, 

environment, economy, national morale, or government 

functions in an area; ‘‘(ii) be comparable to the description of a catastrophic incident in the National Response Plan of the 

Administration, or any successor thereto, unless there 

is no successor to such plan, in which case this clause 

shall have no force or effect; and ‘‘(iii) be of such size and scope that— ‘‘(I) the disaster assistance programs under the 

other paragraphs under this subsection are incapable of providing adequate and timely assistance to 

individuals or business concerns located within the 

disaster area; or ‘‘(II) a significant number of business concerns 

outside the disaster area have suffered disaster-related substantial economic injury as a result of the 

incident.’’. 

SEC. 12082. ADDITIONAL ECONOMIC INJURY DISASTER LOAN ASSISTANCE. 

Paragraph (9) of section 7(b) of the Small Business Act (15 

U.S.C. 636(b)), as added by section 12081, is amended by adding 

at the end the following: ‘‘(C) ADDITIONAL ECONOMIC INJURY DISASTER LOAN AS- SISTANCE.—

‘‘(i) IN GENERAL.—If the Administrator declares eligibility for additional disaster assistance under this 

paragraph, the Administrator may make such loans 

under this subparagraph (either directly or in cooperation with banks or other lending institutions through 

agreements to participate on an immediate or deferred 

basis) as the Administrator determines appropriate to 

eligible small business concerns located anywhere in 

the United States. 

‘‘(ii) PROCESSING TIME.—

‘‘(I) IN GENERAL.—If the Administrator determines that the average processing time for applications for disaster loans under this subparagraph 

relating to a specific major disaster is more than 

15 days, the Administrator shall give priority to 

the processing of such applications submitted by 

eligible small business concerns located inside the 

disaster area, until the Administrator determines 

that the average processing time for such applications is not more than 15 days. 

‘‘(II) SUSPENSION OF APPLICATIONS FROM OUTSIDE DISASTER AREA.—If the Administrator determines that the average processing time for applications for disaster loans under this subparagraph 

relating to a specific major disaster is more than 


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30 days, the Administrator shall suspend the processing of such applications submitted by eligible 

small business concerns located outside the disaster area, until the Administrator determines that 

the average processing time for such applications 

is not more than 15 days. 

‘‘(iii) LOAN TERMS.—A loan under this subparagraph shall be made on the same terms as a loan 

under paragraph (2). 

‘‘(D) DEFINITIONS.—In this paragraph— ‘‘(i) the term ‘disaster area’ means the area for 

which the applicable major disaster was declared; ‘‘(ii) the term ‘disaster-related substantial economic 

injury’ means economic harm to a business concern 

that results in the inability of the business concern to— ‘‘(I) meet its obligations as it matures; 

‘‘(II) meet its ordinary and necessary operating 

expenses; or ‘‘(III) market, produce, or provide a product or 

service ordinarily marketed, produced, or provided 

by the business concern because the business concern relies on materials from the disaster area or 

sells or markets in the disaster area; and 

‘‘(iii) the term ‘eligible small business concern’ means a small business concern— ‘‘(I) that has suffered disaster-related substantial economic injury as a result of the applicable 

major disaster; and ‘‘(II)(aa) for which not less than 25 percent of 

the market share of that small business concern is 

from business transacted in the disaster area; ‘‘(bb) for which not less than 25 percent of an 

input into a production process of that small business concern is from the disaster area; or ‘‘(cc) that relies on a provider located in the 

disaster area for a service that is not readily available elsewhere.’’. 

SEC. 12083. PRIVATE DISASTER LOANS. 

(a) IN GENERAL.—Section 7 of the Small Business Act (15 

U.S.C. 636) is amended by inserting after subsection (b) the following: 

‘‘(c) PRIVATE DISASTER LOANS.—

‘‘(1) DEFINITIONS.—In this subsection—

‘‘(A) the term ‘disaster area’ means any area for which 

the President declared a major disaster relating to which 

the Administrator declares eligibility for additional disaster assistance under subsection (b)(9), during the period 

of that major disaster declaration; 

‘‘(B) the term ‘eligible individual’ means an individual 

who is eligible for disaster assistance under subsection 

(b)(1) relating to a major disaster relating to which the Administrator declares eligibility for additional disaster assistance under subsection (b)(9); 

‘‘(C) the term ‘eligible small business concern’ means a 

business concern that is—


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‘‘(i) a small business concern, as defined under this 

Act; or 

‘‘(ii) a small business concern, as defined in section 

103 of the Small Business Investment Act of 1958; 

‘‘(D) the term ‘preferred lender’ means a lender participating in the Preferred Lender Program; 

‘‘(E) the term ‘Preferred Lender Program’ has the 

meaning given that term in subsection (a)(2)(C)(ii); and 

‘‘(F) the term ‘qualified private lender’ means any privately-owned bank or other lending institution that—

‘‘(i) is not a preferred lender; and 

‘‘(ii) the Administrator determines meets the criteria established under paragraph (10). 

‘‘(2) PROGRAM REQUIRED.—The Administrator shall carry 

out a program, to be known as the Private Disaster Assistance 

program, under which the Administration may guarantee timely payment of principal and interest, as scheduled, on any loan 

made to an eligible small business concern located in a disaster 

area and to an eligible individual. 

‘‘(3) USE OF LOANS.—A loan guaranteed by the Administrator under this subsection may be used for any purpose authorized under subsection (b). 

‘‘(4) ONLINE APPLICATIONS.—

‘‘(A) ESTABLISHMENT.—The Administrator may establish, directly or through an agreement with another entity, 

an online application process for loans guaranteed under 

this subsection. 

‘‘(B) OTHER FEDERAL ASSISTANCE.—The Administrator 

may coordinate with the head of any other appropriate Federal agency so that any application submitted through an 

online application process established under this paragraph may be considered for any other Federal assistance 

program for disaster relief. 

‘‘(C) CONSULTATION.—In establishing an online application process under this paragraph, the Administrator 

shall consult with appropriate persons from the public and 

private sectors, including private lenders. 

‘‘(5) MAXIMUM AMOUNTS.—

‘‘(A) GUARANTEE PERCENTAGE.—The Administrator 

may guarantee not more than 85 percent of a loan under 

this subsection. 

‘‘(B) LOAN AMOUNT.—The maximum amount of a loan 

guaranteed under this subsection shall be $2,000,000. 

‘‘(6) TERMS AND CONDITIONS.—A loan guaranteed under 

this subsection shall be made under the same terms and conditions as a loan under subsection (b). 

‘‘(7) LENDERS.—

‘‘(A) IN GENERAL.—A loan guaranteed under this subsection made to—

‘‘(i) a qualified individual may be made by a preferred lender; and 

‘‘(ii) a qualified small business concern may be 

made by a qualified private lender or by a preferred 

lender that also makes loans to qualified individuals. 


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‘‘(B) COMPLIANCE.—If the Administrator determines 

that a preferred lender knowingly failed to comply with the 

underwriting standards for loans guaranteed under this 

subsection or violated the terms of the standard operating 

procedure agreement between that preferred lender and the 

Administration, the Administrator shall do 1 or more of the 

following: 

‘‘(i) Exclude the preferred lender from participating 

in the program under this subsection. 

‘‘(ii) Exclude the preferred lender from participating in the Preferred Lender Program for a period of 

not more than 5 years. 

‘‘(8) FEES.—

‘‘(A) IN GENERAL.—The Administrator may not collect 

a guarantee fee under this subsection. 

‘‘(B) ORIGINATION FEE.—The Administrator may pay a 

qualified private lender or preferred lender an origination 

fee for a loan guaranteed under this subsection in an 

amount agreed upon in advance between the qualified private lender or preferred lender and the Administrator. 

‘‘(9) DOCUMENTATION.—A qualified private lender or preferred lender may use its own loan documentation for a loan 

guaranteed by the Administrator under this subsection, to the 

extent authorized by the Administrator. The ability of a lender 

to use its own loan documentation for a loan guaranteed under 

this subsection shall not be considered part of the criteria for 

becoming a qualified private lender under the regulations promulgated under paragraph (10). 

‘‘(10) IMPLEMENTATION REGULATIONS.—

‘‘(A) IN GENERAL.—Not later than 1 year after the date 

of enactment of the Small Business Disaster Response and 

Loan Improvements Act of 2008, the Administrator shall 

issue final regulations establishing permanent criteria for 

qualified private lenders. 

‘‘(B) REPORT TO CONGRESS.—Not later than 6 months 

after the date of enactment of the Small Business Disaster 

Response and Loan Improvements Act of 2008, the Administrator shall submit a report on the progress of the regulations required by subparagraph (A) to the Committee on 

Small Business and Entrepreneurship of the Senate and 

the Committee on Small Business of the House of Representatives. 

‘‘(11) AUTHORIZATION OF APPROPRIATIONS.—

‘‘(A) IN GENERAL.—Amounts necessary to carry out this 

subsection shall be made available from amounts appropriated to the Administration to carry out subsection (b). 

‘‘(B) AUTHORITY TO REDUCE INTEREST RATES AND

OTHER TERMS AND CONDITIONS.—Funds appropriated to the 

Administration to carry out this subsection, may be used by 

the Administrator to meet the loan terms and conditions 

specified in paragraph (6). 

‘‘(12) PURCHASE OF LOANS.—The Administrator may enter 

into an agreement with a qualified private lender or preferred 

lender to purchase any loan guaranteed under this subsection.’’. 


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(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to any major disaster declared on or after the date of 

enactment of this Act. 

SEC. 12084. IMMEDIATE DISASTER ASSISTANCE PROGRAM. 

The Small Business Act is amended by inserting after section 

41, as added by this Act, the following: 

‘‘SEC. 42. IMMEDIATE DISASTER ASSISTANCE PROGRAM. 

‘‘(a) PROGRAM REQUIRED.—The Administrator shall carry out a 

program, to be known as the Immediate Disaster Assistance program, under which the Administration participates on a deferred 

(guaranteed) basis in 85 percent of the balance of the financing outstanding at the time of disbursement of the loan if such balance is 

less than or equal to $25,000 for businesses affected by a disaster. ‘‘(b) ELIGIBILITY REQUIREMENT.—To receive a loan guaranteed 

under subsection (a), the applicant shall also apply for, and meet 

basic eligibility standards for, a loan under subsection (b) or (c) of 

section 7. ‘‘(c) USE OF PROCEEDS.—A person who receives a loan under 

subsection (b) or (c) of section 7 shall use the proceeds of that loan 

to repay all loans guaranteed under subsection (a), if any, before 

using the proceeds for any other purpose. 

‘‘(d) LOAN TERMS.—

‘‘(1) NO PREPAYMENT PENALTY.—There shall be no prepayment penalty on a loan guaranteed under subsection (a). 

‘‘(2) REPAYMENT.—A person who receives a loan guaranteed 

under subsection (a) and who is disapproved for a loan under 

subsection (b) or (c) of section 7, as the case may be, shall repay 

the loan guaranteed under subsection (a) not later than the date 

established by the Administrator, which may not be earlier 

than 10 years after the date on which the loan guaranteed 

under subsection is disbursed. 

‘‘(e) APPROVAL OR DISAPPROVAL.—The Administrator shall ensure that each applicant for a loan under the program receives a decision approving or disapproving of the application within 36 hours 

after the Administration receives the application.’’. 

SEC. 12085. EXPEDITED DISASTER ASSISTANCE LOAN PROGRAM. 

(a) DEFINITION.—In this section, the term ‘‘program’’ means the 

expedited disaster assistance business loan program established 

under subsection (b). 

(b) CREATION OF PROGRAM.—The Administrator shall take such 

administrative action as is necessary to establish and implement an 

expedited disaster assistance business loan program under which 

the Administration may, on an expedited basis, guarantee timely 

payment of principal and interest, as scheduled on any loan made 

to an eligible small business concern under paragraph (9) of section 

7(b) of the Small Business Act (15 U.S.C. 636(b)), as added by this 

Act. 

(c) CONSULTATION REQUIRED.—In establishing the program, the 

Administrator shall consult with—

(1) appropriate personnel of the Administration (including 

District Office personnel of the Administration); 

(2) appropriate technical assistance providers (including 

small business development centers); 

(3) appropriate lenders and credit unions; 


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(4) the Committee on Small Business and Entrepreneurship 

of the Senate; and 

(5) the Committee on Small Business of the House of Representatives. 

(d) RULES.—

(1) IN GENERAL.—Not later than 1 year after the date of enactment of this Act, the Administrator shall issue rules in final 

form establishing and implementing the program in accordance 

with this section. Such rules shall apply as provided for in this 

section, beginning 90 days after their issuance in final form. 

(2) CONTENTS.—The rules promulgated under paragraph 

(1) shall—

(A) identify whether appropriate uses of funds under 

the program may include—

(i) paying employees; 

(ii) paying bills and other financial obligations; 

(iii) making repairs; 

(iv) purchasing inventory; 

(v) restarting or operating a small business concern in the community in which it was conducting operations prior to the applicable major disaster, or to a 

neighboring area, county, or parish in the disaster 

area; or 

(vi) covering additional costs until the small business concern is able to obtain funding through insurance claims, Federal assistance programs, or other 

sources; and 

(B) set the terms and conditions of any loan made 

under the program, subject to paragraph (3). 

(3) TERMS AND CONDITIONS.—A loan guaranteed by the Administration under this section—

(A) shall be for not more than $150,000; 

(B) shall be a short-term loan, not to exceed 180 days, 

except that the Administrator may extend such term as the 

Administrator determines necessary or appropriate on a 

case-by-case basis; 

(C) shall have an interest rate not to exceed 300 basis 

points above the interest rate established by the Board of 

Governors of the Federal Reserve System that 1 bank 

charges another for reserves that are lent on an overnight 

basis on the date the loan is made; 

(D) shall have no prepayment penalty; 

(E) may only be made to a borrower that meets the requirements for a loan under section 7(b) of the Small Business Act (15 U.S.C. 636(b)), as amended by this Act; 

(F) may be refinanced as part of any subsequent disaster assistance provided under section 7(b) of the Small 

Business Act (15 U.S.C. 636(b)), as amended by this Act; 

(G) may receive expedited loss verification and loan 

processing, if the applicant is—

(i) a major source of employment in the disaster 

area (which shall be determined in the same manner 

as under section 7(b)(3)(B) of the Small Business Act 

(15 U.S.C. 636(b)(3)(B))); or 


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(ii) vital to recovery efforts in the region (including 

providing debris removal services, manufactured housing, or building materials); and 

(H) shall be subject to such additional terms as the Administrator determines necessary or appropriate. 

(e) REPORT TO CONGRESS.—Not later than 5 months after the 

date of enactment of this Act, the Administrator shall report to the 

Committee on Small Business and Entrepreneurship of the Senate 

and the Committee on Small Business of the House of Representatives on the progress of the Administrator in establishing the program. 

(f) AUTHORIZATION.—There are authorized to be appropriated to 

the Administrator such sums as are necessary to carry out this section. 

SEC. 12086. GULF COAST DISASTER LOAN REFINANCING PROGRAM. 

(a) IN GENERAL.—The Administrator may carry out a program 

to refinance Gulf Coast disaster loans (in this section referred to as 

the ‘‘program’’). 

(b) TERMS.—The terms of a Gulf Coast disaster loan refinanced 

under the program shall be identical to the terms of the original 

loan, except that the Administrator may provide an option to defer 

repayment on the loan. A deferment under the program shall end 

not later than 4 years after the date on which the initial disbursement under the original loan was made. 

(c) AMOUNT.—The amount of a Gulf Coast disaster loan refinanced under the program shall not exceed the amount of the original loan. 

(d) DISCLOSURE OF ACCRUED INTEREST.—If the Administrator 

provides an option to defer repayment under the program, the Administrator shall disclose the accrued interest that must be paid 

under the option. 

(e) DEFINITION.—In this section, the term ‘‘Gulf Coast disaster 

loan’’ means a loan—

(1) made under section 7(b) of the Small Business Act (15 

U.S.C. 636(b)); 

(2) in response to Hurricane Katrina of 2005, Hurricane 

Rita of 2005, or Hurricane Wilma of 2005; and 

(3) to a small business concern located in a county or parish designated by the Administrator as a disaster area by reason of a hurricane described in paragraph (2) under disaster 

declaration 10176, 10177, 10178, 10179, 10180, 10181, 10203, 

10204, 10205, 10206, 10222, or 10223. 

(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as may be necessary to carry out this 

section. 

PART III—MISCELLANEOUS 

SEC. 12091. REPORTS ON DISASTER ASSISTANCE. 

(a) MONTHLY ACCOUNTING REPORT TO CONGRESS.— (1) REPORTING REQUIREMENTS.—Not later than the fifth 

business day of each month during the applicable period for a 

major disaster, the Administrator shall submit to the Committee on Small Business and Entrepreneurship and the ComVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00545 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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mittee on Appropriations of the Senate and to the Committee on 

Small Business and the Committee on Appropriations of the 

House of Representatives a report on the operation of the disaster loan program authorized under section 7 of the Small 

Business Act (15 U.S.C. 636) for that major disaster during the 

preceding month. 

(2) CONTENTS.—Each report submitted under paragraph 

(1) shall include— (A) the daily average lending volume, in number of 

loans and dollars, and the percent by which each category 

has increased or decreased since the previous report under 

paragraph (1); 

(B) the weekly average lending volume, in number of 

loans and dollars, and the percent by which each category 

has increased or decreased since the previous report under 

paragraph (1); 

(C) the amount of funding spent over the month for 

loans, both in appropriations and program level, and the 

percent by which each category has increased or decreased 

since the previous report under paragraph (1); 

(D) the amount of funding available for loans, both in 

appropriations and program level, and the percent by 

which each category has increased or decreased since the 

previous report under paragraph (1), noting the source of 

any additional funding; 

(E) an estimate of how long the available funding for 

such loans will last, based on the spending rate; 

(F) the amount of funding spent over the month for 

staff, along with the number of staff, and the percent by 

which each category has increased or decreased since the 

previous report under paragraph (1); 

(G) the amount of funding spent over the month for administrative costs, and the percent by which such spending 

has increased or decreased since the previous report under 

paragraph (1); 

(H) the amount of funding available for salaries and 

expenses combined, and the percent by which such funding 

has increased or decreased since the previous report under 

paragraph (1), noting the source of any additional funding; 

and 

(I) an estimate of how long the available funding for 

salaries and expenses will last, based on the spending rate. 

(b) WEEKLY DISASTER UPDATES TO CONGRESS FOR PRESIDENTIALLY DECLARED DISASTERS.—

(1) IN GENERAL.—Each week during a disaster update period, the Administration shall submit to the Committee on 

Small Business and Entrepreneurship of the Senate and to the 

Committee on Small Business of the House of Representatives 

a report on the operation of the disaster loan program of the 

Administration for the area in which the President declared a 

major disaster. 

(2) CONTENTS.—Each report submitted under paragraph 

(1) shall include— (A) the number of Administration staff performing loan 

processing, field inspection, and other duties for the deVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00546 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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clared disaster, and the allocations of such staff in the disaster field offices, disaster recovery centers, workshops, and 

other Administration offices nationwide; 

(B) the daily number of applications received from applicants in the relevant area, as well as a breakdown of 

such figures by State; 

(C) the daily number of applications pending application entry from applicants in the relevant area, as well as 

a breakdown of such figures by State; 

(D) the daily number of applications withdrawn by applicants in the relevant area, as well as a breakdown of 

such figures by State; 

(E) the daily number of applications summarily declined by the Administration from applicants in the relevant area, as well as a breakdown of such figures by 

State; 

(F) the daily number of applications declined by the 

Administration from applicants in the relevant area, as 

well as a breakdown of such figures by State; 

(G) the daily number of applications in process from 

applicants in the relevant area, as well as a breakdown of 

such figures by State; 

(H) the daily number of applications approved by the 

Administration from applicants in the relevant area, as 

well as a breakdown of such figures by State; 

(I) the daily dollar amount of applications approved by 

the Administration from applicants in the relevant area, as 

well as a breakdown of such figures by State; 

(J) the daily amount of loans dispersed, both partially 

and fully, by the Administration to applicants in the relevant area, as well as a breakdown of such figures by 

State; 

(K) the daily dollar amount of loans disbursed, both 

partially and fully, from the relevant area, as well as a 

breakdown of such figures by State; 

(L) the number of applications approved, including dollar amount approved, as well as applications partially and 

fully disbursed, including dollar amounts, since the last report under paragraph (1); and 

(M) the declaration date, physical damage closing date, 

economic injury closing date, and number of counties included in the declaration of a major disaster. 

(c) PERIODS WHEN ADDITIONAL DISASTER ASSISTANCE IS MADE

AVAILABLE.—

(1) IN GENERAL.—During any period for which the Administrator declares eligibility for additional disaster assistance 

under paragraph (9) of section 7(b) of the Small Business Act 

(15 U.S.C. 632(b)), as amended by this Act, the Administrator 

shall, on a monthly basis, submit to the Committee on Small 

Business and Entrepreneurship of the Senate and to the Committee on Small Business of the House of Representatives a report on the disaster assistance operations of the Administration 

with respect to the applicable major disaster. 

(2) CONTENTS.—Each report submitted under paragraph 

(1) shall specify—


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(A) the number of applications for disaster assistance 

distributed; 

(B) the number of applications for disaster assistance 

received; 

(C) the average time for the Administration to approve 

or disapprove an application for disaster assistance; 

(D) the amount of disaster loans approved; 

(E) the average time for initial disbursement of disaster 

loan proceeds; and 

(F) the amount of disaster loan proceeds disbursed. 

(d) NOTICE OF THE NEED FOR SUPPLEMENTAL FUNDS.—On the 

same date that the Administrator notifies any committee of the Senate or the House of Representatives that supplemental funding is 

necessary for the disaster loan program of the Administration in 

any fiscal year, the Administrator shall notify in writing the Committee on Small Business and Entrepreneurship of the Senate and 

the Committee on Small Business of the House of Representatives 

regarding the need for supplemental funds for that loan program. 

(e) REPORT ON CONTRACTING.—

(1) IN GENERAL.—Not later than 6 months after the date on 

which the President declares a major disaster, and every 6 

months thereafter until the date that is 18 months after the 

date on which the major disaster was declared, the Administrator shall submit a report to the Committee on Small Business and Entrepreneurship of the Senate and to the Committee 

on Small Business of the House of Representatives regarding 

Federal contracts awarded as a result of that major disaster. 

(2) CONTENTS.—Each report submitted under paragraph 

(1) shall include— (A) the total number of contracts awarded as a result 

of that major disaster; 

(B) the total number of contracts awarded to small 

business concerns as a result of that major disaster; 

(C) the total number of contracts awarded to women 

and minority-owned businesses as a result of that major 

disaster; and 

(D) the total number of contracts awarded to local 

businesses as a result of that major disaster. 

(f) REPORT ON LOAN APPROVAL RATE.— (1) IN GENERAL.—Not later than 6 months after the date of 

enactment of this Act, the Administrator shall submit a report 

to the Committee on Small Business and Entrepreneurship of 

the Senate and the Committee on Small Business of the House 

of Representatives detailing how the Administration can improve the processing of applications under the disaster loan program of the Administration. 

(2) CONTENTS.—The report submitted under paragraph (1) 

shall include—

(A) recommendations, if any, regarding— (i) staffing levels during a major disaster; 

(ii) how to improve the process for processing, approving, and disbursing loans under the disaster loan 

program of the Administration, to ensure that the maximum assistance is provided to victims in a timely 

manner; 


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(iii) the viability of using alternative methods for 

assessing the ability of an applicant to repay a loan, 

including the credit score of the applicant on the day 

before the date on which the disaster for which the applicant is seeking assistance was declared; 

(iv) methods, if any, for the Administration to expedite loss verification and loan processing of disaster 

loans during a major disaster for businesses affected 

by, and located in the area for which the President declared, the major disaster that are a major source of 

employment in the area or are vital to recovery efforts 

in the region (including providing debris removal services, manufactured housing, or building materials); 

(v) legislative changes, if any, needed to implement 

findings from the Accelerated Disaster Response Initiative of the Administration; and 

(vi) a description of how the Administration plans 

to integrate and coordinate the response to a major disaster with the technical assistance programs of the Administration; and 

(B) the plans of the Administrator for implementing 

any recommendation made under subparagraph (A). 

(g) REPORTS ON DISASTER ASSISTANCE.—The Small Business 

Act is amended by inserting after section 42, as added by this Act, 

the following: 

‘‘SEC. 43. ANNUAL REPORTS ON DISASTER ASSISTANCE. 

‘‘Not later than 45 days after the end of a fiscal year, the Administrator shall submit to the Committee on Small Business and 

Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives a report on the disaster assistance operations of the Administration for that fiscal year. The report shall—

‘‘(1) specify the number of Administration personnel involved in such operations; 

‘‘(2) describe any material changes to those operations, such 

as changes to technologies used or to personnel responsibilities; 

‘‘(3) describe and assess the effectiveness of the Administration in responding to disasters during that fiscal year, including a description of the number and amounts of loans made for 

damage and for economic injury; and 

‘‘(4) describe the plans of the Administration for preparing 

to respond to disasters during the next fiscal year.’’. 

TITLE XIII—COMMODITY FUTURES 

SEC. 13001. SHORT TITLE. 

This title may be cited as the ‘‘CFTC Reauthorization Act of 

2008’’. 

Subtitle A—General Provisions 

SEC. 13101. COMMISSION AUTHORITY OVER AGREEMENTS, CONTRACTS 

OR TRANSACTIONS IN FOREIGN CURRENCY. 

(a) IN GENERAL.—Section 2(c)(2) of the Commodity Exchange 

Act (7 U.S.C. 2(c)(2)) is amended by striking subparagraphs (B) and 

(C) and inserting the following: 


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‘‘(B) AGREEMENTS, CONTRACTS, AND TRANSACTIONS IN

RETAIL FOREIGN CURRENCY.— ‘‘(i) This Act applies to, and the Commission shall 

have jurisdiction over, an agreement, contract, or 

transaction in foreign currency that— ‘‘(I) is a contract of sale of a commodity for future delivery (or an option on such a contract) or 

an option (other than an option executed or traded 

on a national securities exchange registered pursuant to section 6(a) of the Securities Exchange Act 

of 1934 (15 U.S.C. 78f(a))); and ‘‘(II) is offered to, or entered into with, a person that is not an eligible contract participant, unless the counterparty, or the person offering to be 

the counterparty, of the person is— ‘‘(aa) a financial institution; 

‘‘(bb)(AA) a broker or dealer registered 

under section 15(b) (except paragraph (11) 

thereof) or 15C of the Securities Exchange Act 

of 1934 (15 U.S.C. 78o(b), 78o–5); or ‘‘(BB) an associated person of a broker or 

dealer registered under section 15(b) (except 

paragraph (11) thereof) or 15C of the Securities Exchange Act of 1934 (15 U.S.C. 78o(b), 

78o–5) concerning the financial or securities 

activities of which the broker or dealer makes 

and keeps records under section 15C(b) or 

17(h) of the Securities Exchange Act of 1934 

(15 U.S.C. 78o–5(b), 78q(h)); ‘‘(cc)(AA) a futures commission merchant 

that is primarily or substantially engaged in 

the business activities described in section 

1a(20) of this Act, is registered under this Act, 

is not a person described in item (bb) of this 

subclause, and maintains adjusted net capital 

equal to or in excess of the dollar amount that 

applies for purposes of clause (ii) of this subparagraph; or 

‘‘(BB) an affiliated person of a futures 

commission merchant that is primarily or substantially engaged in the business activities 

described in section 1a(20) of this Act, is registered under this Act, and is not a person described in item (bb) of this subclause, if the affiliated person maintains adjusted net capital 

equal to or in excess of the dollar amount that 

applies for purposes of clause (ii) of this subparagraph and is not a person described in 

such item (bb), and the futures commission 

merchant makes and keeps records under section 4f(c)(2)(B) of this Act concerning the futures and other financial activities of the affiliated person; 

‘‘(dd) an insurance company described in 

section 1a(12)(A)(ii) of this Act, or a regulated 


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subsidiary or affiliate of such an insurance 

company; ‘‘(ee) a financial holding company (as defined in section 2 of the Bank Holding Company Act of 1956); ‘‘(ff) an investment bank holding company 

(as defined in section 17(i) of the Securities 

Exchange Act of 1934 (15 U.S.C. 78q(i))); or ‘‘(gg) a retail foreign exchange dealer that 

maintains adjusted net capital equal to or in 

excess of the dollar amount that applies for 

purposes of clause (ii) of this subparagraph 

and is registered in such capacity with the 

Commission, subject to such terms and conditions as the Commission shall prescribe, and 

is a member of a futures association registered 

under section 17. ‘‘(ii) The dollar amount that applies for purposes of 

this clause is— ‘‘(I) $10,000,000, beginning 120 days after the 

date of the enactment of this clause; ‘‘(II) $15,000,000, beginning 240 days after 

such date of enactment; and ‘‘(III) $20,000,000, beginning 360 days after 

such date of enactment. 

‘‘(iii) Notwithstanding items (cc) and (gg) of clause 

(i)(II) of this subparagraph, agreements, contracts, or 

transactions described in clause (i) of this subparagraph shall be subject to subsection (a)(1)(B) of this 

section and sections 4(b), 4b, 4c(b), 4o, 6(c) and 6(d) 

(except to the extent that sections 6(c) and 6(d) prohibit 

manipulation of the market price of any commodity in 

interstate commerce, or for future delivery on or subject 

to the rules of any market), 6c, 6d, 8(a), 13(a), and 

13(b) if the agreements, contracts, or transactions are 

offered, or entered into, by a person that is registered 

as a futures commission merchant or retail foreign exchange dealer, or an affiliated person of a futures commission merchant registered under this Act that is not 

also a person described in any of item (aa), (bb), (dd), 

(ee), or (ff) of clause (i)(II) of this subparagraph. 

‘‘(iv)(I) Notwithstanding items (cc) and (gg) of 

clause (i)(II), a person, unless registered in such capacity as the Commission by rule, regulation, or order 

shall determine and a member of a futures association 

registered under section 17, shall not—

‘‘(aa) solicit or accept orders from any person 

that is not an eligible contract participant in connection with agreements, contracts, or transactions 

described in clause (i) entered into with or to be 

entered into with a person who is not described in 

item (aa), (bb), (dd), (ee), or (ff) of clause (i)(II); 

‘‘(bb) exercise discretionary trading authority 

or obtain written authorization to exercise discretionary trading authority over any account for or 


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on behalf of any person that is not an eligible contract participant in connection with agreements, 

contracts, or transactions described in clause (i) 

entered into with or to be entered into with a person who is not described in item (aa), (bb), (dd), 

(ee), or (ff) of clause (i)(II); or ‘‘(cc) operate or solicit funds, securities, or 

property for any pooled investment vehicle that is 

not an eligible contract participant in connection 

with agreements, contracts, or transactions described in clause (i) entered into with or to be entered into with a person who is not described in 

item (aa), (bb), (dd), (ee), or (ff) of clause (i)(II). 

‘‘(II) Subclause (I) of this clause shall not apply 

to— ‘‘(aa) any person described in any of item (aa), 

(bb), (dd), (ee), or (ff) of clause (i)(II); ‘‘(bb) any such person’s associated persons; or ‘‘(cc) any person who would be exempt from 

registration if engaging in the same activities in 

connection with transactions conducted on or subject to the rules of a contract market or a derivatives transaction execution facility. 

‘‘(III) Notwithstanding items (cc) and (gg) of clause 

(i)(II), the Commission may make, promulgate, and enforce such rules and regulations as, in the judgment of 

the Commission, are reasonably necessary to effectuate 

any of the provisions of, or to accomplish any of the 

purposes of, this Act in connection with the activities of 

persons subject to subclause (I). ‘‘(IV) Subclause (III) of this clause shall not apply 

to— ‘‘(aa) any person described in any of item (aa) 

through (ff) of clause (i)(II); 

‘‘(bb) any such person’s associated persons; or 

‘‘(cc) any person who would be exempt from 

registration if engaging in the same activities in 

connection with transactions conducted on or subject to the rules of a contract market or a derivatives transaction execution facility. 

‘‘(v) Notwithstanding items (cc) and (gg) of clause 

(i)(II), the Commission may make, promulgate, and enforce such rules and regulations as, in the judgment of 

the Commission, are reasonably necessary to effectuate 

any of the provisions of, or to accomplish any of the 

purposes of, this Act in connection with agreements, 

contracts, or transactions described in clause (i) which 

are offered, or entered into, by a person described in 

item (cc) or (gg) of clause (i)(II). 

‘‘(C)(i)(I) This subparagraph shall apply to any agreement, contract, or transaction in foreign currency that is—

‘‘(aa) offered to, or entered into with, a person 

that is not an eligible contract participant (except 

that this subparagraph shall not apply if the 

counterparty, or the person offering to be the 


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counterparty, of the person that is not an eligible 

contract participant is a person described in any of 

item (aa), (bb), (dd), (ee), or (ff) of subparagraph 

(B)(i)(II)); and ‘‘(bb) offered, or entered into, on a leveraged or 

margined basis, or financed by the offeror, the 

counterparty, or a person acting in concert with 

the offeror or counterparty on a similar basis. ‘‘(II) Subclause (I) of this clause shall not apply to— ‘‘(aa) a security that is not a security futures product; or ‘‘(bb) a contract of sale that— ‘‘(AA) results in actual delivery within 2 days; 

or ‘‘(BB) creates an enforceable obligation to deliver between a seller and buyer that have the ability to deliver and accept delivery, respectively, in 

connection with their line of business. ‘‘(ii)(I) Agreements, contracts, or transactions described 

in clause (i) of this subparagraph shall be subject to subsection (a)(1)(B) of this section and sections 4(b), 4b, 4c(b), 

4o, 6(c) and 6(d) (except to the extent that sections 6(c) and 

6(d) prohibit manipulation of the market price of any commodity in interstate commerce, or for future delivery on or 

subject to the rules of any market), 6c, 6d, 8(a), 13(a), and 

13(b). ‘‘(II) Subclause (I) of this clause shall not apply to— ‘‘(aa) any person described in any of item (aa), 

(bb), (dd), (ee), or (ff) of subparagraph (B)(i)(II); or ‘‘(bb) any such person’s associated persons. ‘‘(III) The Commission may make, promulgate, and enforce such rules and regulations as, in the judgment of the 

Commission, are reasonably necessary to effectuate any of 

the provisions of or to accomplish any of the purposes of 

this Act in connection with agreements, contracts, or transactions described in clause (i) of this subparagraph if the 

agreements, contracts, or transactions are offered, or entered into, by a person that is not described in item (aa) 

through (ff) of subparagraph (B)(i)(II). 

‘‘(iii)(I) A person, unless registered in such capacity as 

the Commission by rule, regulation, or order shall determine and a member of a futures association registered 

under section 17, shall not—

‘‘(aa) solicit or accept orders from any person that 

is not an eligible contract participant in connection 

with agreements, contracts, or transactions described 

in clause (i) of this subparagraph entered into with or 

to be entered into with a person who is not described 

in item (aa), (bb), (dd), (ee), or (ff) of subparagraph 

(B)(i)(II); 

‘‘(bb) exercise discretionary trading authority or obtain written authorization to exercise written trading 

authority over any account for or on behalf of any person that is not an eligible contract participant in connection with agreements, contracts, or transactions deVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00553 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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scribed in clause (i) of this subparagraph entered into 

with or to be entered into with a person who is not described in item (aa), (bb), (dd), (ee), or (ff) of subparagraph (B)(i)(II); or ‘‘(cc) operate or solicit funds, securities, or property 

for any pooled investment vehicle that is not an eligible 

contract participant in connection with agreements, 

contracts, or transactions described in clause (i) of this 

subparagraph entered into with or to be entered into 

with a person who is not described in item (aa), (bb), 

(dd), (ee), or (ff) of subparagraph (B)(i)(II). 

‘‘(II) Subclause (I) of this clause shall not apply to— ‘‘(aa) any person described in item (aa), (bb), (dd), 

(ee), or (ff) of subparagraph (B)(i)(II); ‘‘(bb) any such person’s associated persons; or ‘‘(cc) any person who would be exempt from registration if engaging in the same activities in connection with transactions conducted on or subject to the 

rules of a contract market or a derivatives transaction 

execution facility. 

‘‘(III) The Commission may make, promulgate, and enforce such rules and regulations as, in the judgment of the 

Commission, are reasonably necessary to effectuate any of 

the provisions of, or to accomplish any of the purposes of, 

this Act in connection with the activities of persons subject 

to subclause (I). ‘‘(IV) Subclause (III) of this clause shall not apply to— ‘‘(aa) any person described in item (aa) through (ff) 

of subparagraph (B)(i)(II); ‘‘(bb) any such person’s associated persons; or ‘‘(cc) any person who would be exempt from registration if engaging in the same activities in connection with transactions conducted on or subject to the 

rules of a contract market or a derivatives transaction 

execution facility. 

‘‘(iv) Sections 4(b) and 4b shall apply to any agreement, 

contract, or transaction described in clause (i) of this subparagraph as if the agreement, contract, or transaction 

were a contract of sale of a commodity for future delivery. 

‘‘(v) This subparagraph shall not be construed to limit 

any jurisdiction that the Commission may otherwise have 

under any other provision of this Act over an agreement, 

contract, or transaction that is a contract of sale of a commodity for future delivery. 

‘‘(vi) This subparagraph shall not be construed to limit 

any jurisdiction that the Commission or the Securities and 

Exchange Commission may otherwise have under any other 

provision of this Act with respect to security futures products and persons effecting transactions in security futures 

products.’’. 

(b) EFFECTIVE DATE.—The following provisions of the Commodity Exchange Act, as amended by subsection (a) of this section, 

shall be effective 120 days after the date of the enactment of this Act 

or at such other time as the Commodity Futures Trading Commission shall determine: 


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(1) Subparagraphs (B)(i)(II)(gg), (B)(iv), and (C)(iii) of section 2(c)(2). 

(2) The provisions of section 2(c)(2)(B)(i)(II)(cc) that set 

forth adjusted net capital requirements, and the provisions of 

such section that require a futures commission merchant to be 

primarily or substantially engaged in certain business activities. 

SEC. 13102. ANTI-FRAUD AUTHORITY OVER PRINCIPAL-TO-PRINCIPAL 

TRANSACTIONS. 

Section 4b of the Commodity Exchange Act (7 U.S.C. Section 

6b) is amended—

(1) by redesignating subsections (b) and (c) as subsections 

(c) and (d), respectively; and 

(2) by striking all through the end of subsection (a) and inserting the following: 

‘‘SEC. 4b. CONTRACTS DESIGNED TO DEFRAUD OR MISLEAD. 

‘‘(a) UNLAWFUL ACTIONS.—It shall be unlawful—

‘‘(1) for any person, in or in connection with any order to 

make, or the making of, any contract of sale of any commodity 

in interstate commerce or for future delivery that is made, or to 

be made, on or subject to the rules of a designated contract 

market, for or on behalf of any other person; or 

‘‘(2) for any person, in or in connection with any order to 

make, or the making of, any contract of sale of any commodity 

for future delivery, or other agreement, contract, or transaction 

subject to paragraphs (1) and (2) of section 5a(g), that is made, 

or to be made, for or on behalf of, or with, any other person, 

other than on or subject to the rules of a designated contract 

market—

‘‘(A) to cheat or defraud or attempt to cheat or defraud 

the other person; 

‘‘(B) willfully to make or cause to be made to the other 

person any false report or statement or willfully to enter or 

cause to be entered for the other person any false record; 

‘‘(C) willfully to deceive or attempt to deceive the other 

person by any means whatsoever in regard to any order or 

contract or the disposition or execution of any order or contract, or in regard to any act of agency performed, with respect to any order or contract for or, in the case of paragraph (2), with the other person; or 

‘‘(D)(i) to bucket an order if the order is either represented by the person as an order to be executed, or is required to be executed, on or subject to the rules of a designated contract market; or 

‘‘(ii) to fill an order by offset against the order or orders 

of any other person, or willfully and knowingly and without the prior consent of the other person to become the 

buyer in respect to any selling order of the other person, or 

become the seller in respect to any buying order of the other 

person, if the order is either represented by the person as 

an order to be executed, or is required to be executed, on or 

subject to the rules of a designated contract market unless 

the order is executed in accordance with the rules of the 

designated contract market. 


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‘‘(b) CLARIFICATION.—Subsection (a)(2) of this section shall not 

obligate any person, in or in connection with a transaction in a contract of sale of a commodity for future delivery, or other agreement, 

contract or transaction subject to paragraphs (1) and (2) of section 

5a(g), with another person, to disclose to the other person nonpublic 

information that may be material to the market price, rate, or level 

of the commodity or transaction, except as necessary to make any 

statement made to the other person in or in connection with the 

transaction not misleading in any material respect.’’. 

SEC. 13103. CRIMINAL AND CIVIL PENALTIES. 

(a) ENFORCEMENT POWERS OF THE COMMISSION.—Section 6(c) 

of the Commodity Exchange Act (7 U.S.C. 9, 15) is amended in 

clause (3) of the 10th sentence—

(1) by inserting ‘‘(A)’’ after ‘‘assess such person’’; and 

(2) by inserting after ‘‘each such violation’’ the following: ‘‘, 

or (B) in any case of manipulation or attempted manipulation 

in violation of this subsection, subsection (d) of this section, or 

section 9(a)(2), a civil penalty of not more than the greater of 

$1,000,000 or triple the monetary gain to the person for each 

such violation,’’. 

(b) NONENFORCEMENT OF RULES OF GOVERNMENT OR OTHER

VIOLATIONS.—Section 6b of such Act (7 U.S.C. 13a) is amended—

(1) in the first sentence, by inserting before the period at the 

end the following: ‘‘, or, in any case of manipulation or attempted manipulation in violation of section 6(c), 6(d), or 

9(a)(2), a civil penalty of not more than $1,000,000 for each 

such violation’’; and 

(2) in the second sentence, by inserting before the period at 

the end the following: ‘‘, except that if the failure or refusal to 

obey or comply with the order involved any offense under section 9(a)(2), the registered entity, director, officer, agent, or employee shall be guilty of a felony and, on conviction, shall be 

subject to penalties under section 9(a)(2)’’. 

(c) ACTION TO ENJOIN OR RESTRAIN VIOLATIONS.—Section 6c(d) 

of such Act (7 U.S.C. 13a–1(d)) is amended by striking all that precedes paragraph (2) and inserting the following: 

‘‘(d) CIVIL PENALTIES.—

‘‘(1) IN GENERAL.—In any action brought under this section, 

the Commission may seek and the court shall have jurisdiction 

to impose, on a proper showing, on any person found in the action to have committed any violation—

‘‘(A) a civil penalty in the amount of not more than the 

greater of $100,000 or triple the monetary gain to the person for each violation; or 

‘‘(B) in any case of manipulation or attempted manipulation in violation of section 6(c), 6(d), or 9(a)(2), a civil 

penalty in the amount of not more than the greater of 

$1,000,000 or triple the monetary gain to the person for 

each violation.’’. 

(d) VIOLATIONS GENERALLY.—Section 9(a) of such Act (7 U.S.C. 

13(a)) is amended in the matter preceding paragraph (1)—

(1) by striking ‘‘(or $500,000 in the case of a person who is 

an individual)’’; and 

(2) by striking ‘‘five years’’ and inserting ‘‘10 years’’. 


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SEC. 13104. AUTHORIZATION OF APPROPRIATIONS. 

Section 12(d) of the Commodity Exchange Act (7 U.S.C. 16(d)) 

is amended to read as follows: ‘‘(d) There are authorized to be appropriated such sums as are 

necessary to carry out this Act for each of the fiscal years 2008 

through 2013.’’. 

SEC. 13105. TECHNICAL AND CONFORMING AMENDMENTS. 

(a) Section 4a(e) of the Commodity Exchange Act (7 U.S.C. 

6a(e)) is amended— (1) by inserting ‘‘or certified by a registered entity pursuant 

to section 5c(c)(1)’’ after ‘‘approved by the Commission’’ ; and 

(2) by striking ‘‘section 9(c)’’ and inserting ‘‘section 9(a)(5)’’. (b) Section 4f(c)(4)(B)(i) of such Act (7 U.S.C. 6f(c)(4)(B)(i)) is 

amended by striking ‘‘compiled’’ and inserting ‘‘complied’’. (c) Section 4k of such Act (7 U.S.C. 6k) is amended by redesignating the second paragraph (5) as paragraph (6). 

(d) The Commodity Exchange Act is amended— (1) by redesignating the first section 4p (7 U.S.C. 6o–1), as 

added by section 121 of the Commodity Futures Modernization 

Act of 2000, as section 4q; and 

(2) by moving such section to after the second section 4p, 

as added by section 206 of Public Law 93–446. 

(e) Subsections (a)(1) and (d)(1) of section 5c of such Act (7 

U.S.C. 7a–2(a)(1), (d)(1)) are each amended by striking ‘‘5b(d)(2)’’ and inserting ‘‘5b(c)(2)’’. (f) Sections 5c(f) and 17(r) of such Act (7 U.S.C. 7a–2(f), 21(r)) 

are each amended by striking ‘‘4d(3)’’ and inserting ‘‘4d(c)’’. (g) Section 8(a)(1) of such Act (7 U.S.C. 12(a)(1)) is amended in 

the matter following subparagraph (B)— (1) by striking ‘‘commenced’’ in the 2nd place it appears; 

and 

(2) by inserting ‘‘commenced’’ after ‘‘in a judicial proceeding’’. 

(h) Section 9 of such Act (7 U.S.C. 13) is amended— (1) in subsection (f)(1), by striking the period and inserting ‘‘; or’’; and 

(2) by redesignating subsection (f) as subsection (e). 

(i) Section 22(a)(2) of such Act (7 U.S.C. 25(a)(2)) is amended 

by striking ‘‘5b(b)(1)(E)’’ and inserting ‘‘5b(c)(2)(H)’’. (j) Section 1a(33)(A) of such Act (7 U.S.C. 1a(33)(A)) is amended by striking ‘‘transactions’’ and all that follows and inserting ‘‘transactions— ‘‘(i) by accepting bids or offers made by other participants that are open to multiple partipants in the facility or system; or 

‘‘(ii) through the interaction of multiple bids or 

multiple offers within a system with a pre-determined 

non-discretionary automated trade matching and execution algorithm.’’. 

(k) Section 14(d) of such Act (7 U.S.C. 18(d)) is amended—

(1) by inserting ‘‘(1)’’ before ‘‘If’’; and 

(2) by adding after and below the end the following: 

‘‘(2) A reparation award shall be directly enforceable in district court as if it were a judgment pursuant to section 1963 of 

title 28, United States Code. This paragraph shall operate 


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retroactively from the effective date of its enactment, and shall 

apply to all reparation awards for which a proceeding described 

in paragraph (1) is commenced within 3 years of the date of the 

Commission’s order.’’. 

SEC. 13106. PORTFOLIO MARGINING AND SECURITY INDEX ISSUES. 

(a) The Secretary of the Treasury, the Chairman of the Board 

of Governors of the Federal Reserve System, the Chairman of the Securities and Exchange Commission, and the Chairman of the Commodity Futures Trading Commission shall work to ensure that the 

Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC), or both, as appropriate, have 

taken the actions required under subsection (b). 

(b) The SEC, the CFTC, or both, as appropriate, shall take action under their existing authorities to permit— (1) by September 30, 2009, risk-based portfolio margining 

for security options and security futures products (as defined in 

section 1a(32) of the Commodity Exchange Act); and 

(2) by June 30, 2009, the trading of futures on certain security indexes by resolving issues related to foreign security indexes. 

Subtitle B—Significant Price Discovery Contracts on Exempt 

Commercial Markets 

SEC. 13201. SIGNIFICANT PRICE DISCOVERY CONTRACTS. 

(a) DEFINITIONS.—Section 1a of the Commodity Exchange Act 

(7 U.S.C. 1a) is amended—

(1) by redesignating paragraph (33) as paragraph (34); and 

(2) by inserting after paragraph (32) the following: 

‘‘(33) SIGNIFICANT PRICE DISCOVERY CONTRACT.—The term 

‘significant price discovery contract’ means an agreement, contract, or transaction subject to section 2(h)(7).’’. 

(b) STANDARDS APPLICABLE TO SIGNIFICANT PRICE DISCOVERY

CONTRACTS.—Section 2(h) of such Act (7 U.S.C. 2(h)) is amended by 

adding at the end the following: 

‘‘(7) SIGNIFICANT PRICE DISCOVERY CONTRACTS.—

‘‘(A) IN GENERAL.—An agreement, contract, or transaction conducted in reliance on the exemption in paragraph 

(3) shall be subject to the provisions of subparagraphs (B) 

through (D), under such rules and regulations as the Commission shall promulgate, provided that the Commission 

determines, in its discretion, that the agreement, contract, 

or transaction performs a significant price discovery function as described in subparagraph (B). 

‘‘(B) SIGNIFICANT PRICE DISCOVERY DETERMINATION.—

In making a determination whether an agreement, contract, 

or transaction performs a significant price discovery function, the Commission shall consider, as appropriate: 

‘‘(i) PRICE LINKAGE.—The extent to which the 

agreement, contract, or transaction uses or otherwise 

relies on a daily or final settlement price, or other 

major price parameter, of a contract or contracts listed 

for trading on or subject to the rules of a designated 

contract market or a derivatives transaction execution 

facility, or a significant price discovery contract traded 


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on an electronic trading facility, to value a position, 

transfer or convert a position, cash or financially settle 

a position, or close out a position. ‘‘(ii) ARBITRAGE.—The extent to which the price for 

the agreement, contract, or transaction is sufficiently 

related to the price of a contract or contracts listed for 

trading on or subject to the rules of a designated contract market or derivatives transaction execution facility, or a significant price discovery contract or contracts trading on or subject to the rules of an electronic 

trading facility, so as to permit market participants to 

effectively arbitrage between the markets by simultaneously maintaining positions or executing trades in 

the contracts on a frequent and recurring basis. ‘‘(iii) MATERIAL PRICE REFERENCE.—The extent to 

which, on a frequent and recurring basis, bids, offers, 

or transactions in a commodity are directly based on, 

or are determined by referencing, the prices generated 

by agreements, contracts, or transactions being traded 

or executed on the electronic trading facility. 

‘‘(iv) MATERIAL LIQUIDITY.—The extent to which 

the volume of agreements, contracts, or transactions in 

the commodity being traded on the electronic trading 

facility is sufficient to have a material effect on other 

agreements, contracts, or transactions listed for trading 

on or subject to the rules of a designated contract market, a derivatives transaction execution facility, or an 

electronic trading facility operating in reliance on the 

exemption in paragraph (3). ‘‘(v) OTHER MATERIAL FACTORS.—Such other material factors as the Commission specifies by rule as relevant to determine whether an agreement, contract, or 

transaction serves a significant price discovery function. 

‘‘(C) CORE PRINCIPLES APPLICABLE TO SIGNIFICANT

PRICE DISCOVERY CONTRACTS.— ‘‘(i) IN GENERAL.—An electronic trading facility on 

which significant price discovery contracts are traded 

or executed shall, with respect to those contracts, comply with the core principles specified in this subparagraph. ‘‘(ii) CORE PRINCIPLES.—The electronic trading facility shall have reasonable discretion (including discretion to account for differences between cleared and 

uncleared significant price discovery contracts) in establishing the manner in which it complies with the 

following core principles: 

‘‘(I) CONTRACTS NOT READILY SUSCEPTIBLE TO

MANIPULATION.—The electronic trading facility 

shall list only significant price discovery contracts 

that are not readily susceptible to manipulation. ‘‘(II) MONITORING OF TRADING.—The electronic 

trading facility shall monitor trading in significant price discovery contracts to prevent market 

manipulation, price distortion, and disruptions of 


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the delivery or cash-settlement process through 

market surveillance, compliance, and disciplinary 

practices and procedures, including methods for 

conducting real-time monitoring of trading and 

comprehensive and accurate trade reconstructions. 

‘‘(III) ABILITY TO OBTAIN INFORMATION.—The 

electronic trading facility shall—

‘‘(aa) establish and enforce rules that will 

allow the electronic trading facility to obtain 

any necessary information to perform any of 

the functions described in this subparagraph; 

‘‘(bb) provide the information to the Commission upon request; and 

‘‘(cc) have the capacity to carry out such 

international information-sharing agreements 

as the Commission may require. 

‘‘(IV) POSITION LIMITATIONS OR ACCOUNTABILITY.—The electronic trading facility shall 

adopt, where necessary and appropriate, position 

limitations or position accountability for speculators in significant price discovery contracts, taking into account positions in other agreements, 

contracts, and transactions that are treated by a 

derivatives clearing organization, whether registered or not registered, as fungible with such significant price discovery contracts to reduce the potential threat of market manipulation or congestion, especially during trading in the delivery 

month. 

‘‘(V) EMERGENCY AUTHORITY.—The electronic 

trading facility shall adopt rules to provide for the 

exercise of emergency authority, in consultation or 

cooperation with the Commission, where necessary 

and appropriate, including the authority—

‘‘(aa) to liquidate open positions in a significant price discovery contract; and 

‘‘(bb) to suspend or curtail trading in a 

significant price discovery contract. 

‘‘(VI) DAILY PUBLICATION OF TRADING INFORMATION.—The electronic trading facility shall 

make public daily information on price, trading 

volume, and other trading data to the extent appropriate for significant price discovery contracts 

‘‘(VII) COMPLIANCE WITH RULES.—The electronic trading facility shall monitor and enforce 

compliance with any rules of the electronic trading 

facility applicable to significant price discovery 

contracts, including the terms and conditions of 

the contracts and any limitations on access to the 

electronic trading facility with respect to the contracts. 

‘‘(VIII) CONFLICT OF INTEREST.—The electronic 

trading facility, with respect to significant price 

discovery contracts, shall—


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‘‘(aa) establish and enforce rules to minimize conflicts of interest in its decision-making 

process; and 

‘‘(bb) establish a process for resolving the 

conflicts of interest. 

‘‘(IX) ANTITRUST CONSIDERATIONS.—Unless 

necessary or appropriate to achieve the purposes of 

this Act, the electronic trading facility, with respect 

to significant price discovery contracts, shall endeavor to avoid—

‘‘(aa) adopting any rules or taking any actions that result in any unreasonable restraints of trade; or 

‘‘(bb) imposing any material anticompetitive burden on trading on the electronic trading facility. 

‘‘(D) IMPLEMENTATION.—

‘‘(i) CLEARING.—The Commission shall take into 

consideration differences between cleared and 

uncleared significant price discovery contracts when reviewing the implementation of the core principles by an 

electronic trading facility. 

‘‘(ii) REVIEW.—As part of the Commission’s continual monitoring and surveillance activities, the Commission shall, not less frequently than annually, evaluate, as appropriate, all the agreements, contracts, or 

transactions conducted on an electronic trading facility 

in reliance on the exemption provided in paragraph (3) 

to determine whether they serve a significant price discovery function as described in subparagraph (B) of 

this paragraph.’’. 

SEC. 13202. LARGE TRADER REPORTING. 

(a) REPORTING AND RECORDKEEPING.—Section 4g(a) of the 

Commodity Exchange Act (7 U.S.C. 6g(a)) is amended by inserting 

‘‘, and in any significant price discovery contract traded or executed 

on an electronic trading facility or any agreement, contract, or 

transaction that is treated by a derivatives clearing organization, 

whether registered or not registered, as fungible with a significant 

price discovery contract’’ after ‘‘elsewhere’’. 

(b) REPORTS OF POSITIONS EQUAL TO OR IN EXCESS OF TRAD- ING LIMITS.—Section 4i of such Act (7 U.S.C. 6i) is amended— (1) by inserting ‘‘, or any significant price discovery contract 

traded or executed on an electronic trading facility or any 

agreement, contract, or transaction that is treated by a derivatives clearing organization, whether registered or not registered, 

as fungible with a significant price discovery contract’’ after 

‘‘subject to the rules of any contract market or derivatives transaction execution facility’’; and 

(2) in the matter following paragraph (2), by inserting ‘‘or 

electronic trading facility’’ after ‘‘subject to the rules of any 

other board of trade’’. 

SEC. 13203. CONFORMING AMENDMENTS. 

(a) Section 1a(12)(A)(x) of the Commodity Exchange Act (7 

U.S.C. 1a(12)(A)(x)) is amended by inserting ‘‘(other than an elecVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00561 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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tronic trading facility with respect to a significant price discovery 

contract)’’ after ‘‘registered entity’’. (b) Section 1a(29) of such Act (7 U.S.C. 1a(29)) is amended— (1) in subparagraph (C), by striking ‘‘and’’ at the end; 

(2) in subparagraph (D), by striking the period and inserting ‘‘; and’’; and 

(3) by adding at the end the following: ‘‘(E) with respect to a contract that the Commission determines is a significant price discovery contract, any electronic trading facility on which the contract is executed or 

traded.’’. (c) Section 2(a)(1)(A) of such Act (7 U.S.C. 2(a)(1)(A)) is amended by inserting after ‘‘future delivery’’ the following: ‘‘(including significant price discovery contracts)’’. (d) Section 2(h)(3) of such Act (7 U.S.C. 2(h)(3)) is amended by 

striking ‘‘paragraph (4)’’ and inserting ‘‘paragraphs (4) and (7)’’. (e) Section 2(h)(4) of such Act (7 U.S.C. 2(h)(4)) is amended— (1) in subparagraph (B), by inserting ‘‘and, for a significant 

price discovery contract, requiring large trader reporting,’’ after ‘‘proscribing fraud’’; 

(2) by striking ‘‘and’’ at the end of subparagraph (C); and 

(3) by striking subparagraph (D) and inserting the following: ‘‘(D) such rules, regulations, and orders as the Commission may issue to ensure timely compliance with any of 

the provisions of this Act applicable to a significant price 

discovery contract traded on or executed on any electronic 

trading facility; and ‘‘(E) such other provisions of this Act as are applicable 

by their terms to significant price discovery contracts or to 

registered entities or electronic trading facilities with respect to significant price discovery contracts.’’. (f) Section 2(h)(5)(B)(iii)(I) of such Act (7 U.S.C. 

2(h)(5)(B)(iii)(I)) is amended by inserting ‘‘or to make the determination described in subparagraph (B) of paragraph (7)’’ after ‘‘paragraph (4)’’. 

(g) Section 4a of such Act (7 U.S.C. 6a) is amended—

(1) in subsection (a)—

(A) in the first sentence, by inserting ‘‘, or on electronic 

trading facilities with respect to a significant price discovery contract’’ after ‘‘derivatives transaction execution facilities’’; and 

(B) in the second sentence, by inserting ‘‘, or on an electronic trading facility with respect to a significant price 

discovery contract,’’ after ‘‘derivatives transaction execution 

facility’’; and 

(2) in subsection (b)—

(A) in paragraph (1), by inserting ‘‘or electronic trading 

facility with respect to a significant price discovery contract’’ after ‘‘facility or facilities’’; and 

(B) in paragraph (2), by inserting ‘‘or electronic trading 

facility with respect to a significant price discovery contract’’ after ‘‘derivatives transaction execution facility’’; and 

(3) in subsection (e)—

(A) in the first sentence—


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(i) by inserting ‘‘or by any electronic trading facility’’ after ‘‘registered by the Commission’’; 

(ii) by inserting ‘‘or on an electronic trading facility’’ after ‘‘derivatives transaction execution facility’’ the 

second place it appears; and 

(iii) by inserting ‘‘or electronic trading facility’’ before ‘‘or such board of trade’’ each place it appears; and 

(B) in the second sentence, by inserting ‘‘or electronic 

trading facility with respect to a significant price discovery 

contract’’ after ‘‘registered by the Commission’’. (h) Section 5a(d) of such Act (7 U.S.C. 7a(d)(1)) is amended— (1) by redesignating paragraphs (4) through (9) as paragraphs (5) through (10); and 

(2) by inserting after paragraph (3) the following: 

‘‘(4) POSITION LIMITATIONS OR ACCOUNTABILITY.—To reduce 

the potential threat of market manipulation or congestion, especially during trading in the delivery month, the derivatives 

transaction execution facility shall adopt position limits or position accountability for speculators, where necessary and appropriate for a contract, agreement or transaction with an underlying commodity that has a physically deliverable supply.’’. 

(i) Section 5c(a) of such Act (7 U.S.C. 7a–2(a)) is amended in 

paragraph (1) by inserting ‘‘, and section 2(h)(7) with respect to significant price discovery contracts,’’ after ‘‘, and 5b(d)(2)’’. 

(j) Section 5c(b) of such Act (7 U.S.C. 7a–2(b)) is amended—

(1) by striking paragraph (1) and inserting the following: 

‘‘(1) IN GENERAL.—A contract market, derivatives transaction execution facility, or electronic trading facility with respect to a significant price discovery contract may comply with 

any applicable core principle through delegation of any relevant 

function to a registered futures association or a registered entity 

that is not an electronic trading facility.’’; 

(2) in paragraph (2), by striking ‘‘contract market or derivatives transaction execution facility’’ and inserting ‘‘contract market, derivatives transaction execution facility, or electronic trading facility’’; and 

(3) in paragraph (3), by striking ‘‘contract market or derivatives transaction execution facility’’ each place it appears and 

inserting ‘‘contract market, derivatives transaction execution facility, or electronic trading facility’’. 

(k) Section 5c(d)(1) of such Act (7 U.S.C. 7a–2(d)(1)) is amended 

by inserting ‘‘or 2(h)(7)(C) with respect to a significant price discovery contract traded or executed on an electronic trading facility,’’

after ‘‘5b(d)(2)’’. 

(l) Section 5e of such Act (7 U.S.C. 7b) is amended by inserting 

‘‘, or revocation of the right of an electronic trading facility to rely 

on the exemption set forth in section 2(h)(3) with respect to a significant price discovery contract,’’ after ‘‘revocation of designation as a 

registered entity’’. 

(m) Section 6(b) of the Commodity Exchange Act (7 U.S.C. 8(b)) 

is amended by striking the first sentence and all that follows 

through ‘‘hearing on the record: Provided,’’ and inserting the following: 

‘‘The Commission is authorized to suspend for a period not to 

exceed 6 months or to revoke the designation or registration of any 


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contract market or derivatives transaction execution facility, or to 

revoke the right of an electronic trading facility to rely on the exemption set forth in section 2(h)(3) with respect to a significant price 

discovery contract, on a showing that the contract market or derivatives transaction execution facility is not enforcing or has not enforced its rules of government, made a condition of its designation 

or registration as set forth in sections 5 through 5b or section 5f, 

or that the contract market or derivatives transaction execution facility or electronic trading facility, or any director, officer, agent, or 

employee thereof, otherwise is violating or has violated any of the 

provisions of this Act or any of the rules, regulations, or orders of 

the Commission thereunder. Such suspension or revocation shall 

only be made after a notice to the officers of the contract market or 

derivatives transaction execution facility or electronic trading facility affected and upon a hearing on the record: Provided,’’. 

(n) Section 22(b)(1) of such Act (7 U.S.C. 25(b)(1)) is amended 

by inserting ‘‘section 2(h)(7) or’’ before ‘‘sections 5’’. 

SEC. 13204. EFFECTIVE DATE. 

(a) IN GENERAL.—Except as provided in this section, this subtitle shall become effective on the date of enactment of this Act. 

(b) SIGNIFICANT PRICE DISCOVERY STANDARDS RULEMAKING.—

(1) The Commodity Futures Trading Commission shall—

(A) not later than 180 days after the date of the enactment of this Act, issue a proposed rule regarding the implementation of section 2(h)(7) of the Commodity Exchange 

Act; and 

(B) not later than 270 days after the date of enactment 

of this Act, issue a final rule regarding the implementation. 

(2) In its rulemaking pursuant to paragraph (1) of this subsection, the Commission shall include the standards, terms, and 

conditions under which an electronic trading facility will have 

the responsibility to notify the Commission that an agreement, 

contract, or transaction conducted in reliance on the exemption 

provided in section 2(h)(3) of the Commodity Exchange Act may 

perform a price discovery function. 

(c) SIGNIFICANT PRICE DISCOVERY DETERMINATIONS.—With respect to any electronic trading facility operating on the effective date 

of the final rule issued pursuant to subsection (b)(1), the Commission shall complete a review of the agreements, contracts, and transactions of the facility not later than 180 days after that effective 

date to determine whether any such agreement, contract, or transaction performs a significant price discovery function. 

TITLE XIV—MISCELLANEOUS 

Subtitle A—Socially Disadvantaged Producers and Limited 

Resource Producers 

SEC. 14001. IMPROVED PROGRAM DELIVERY BY DEPARTMENT OF AGRICULTURE ON INDIAN RESERVATIONS. 

Section 2501(g)(1) of the Food, Agriculture, Conservation, and 

Trade Act of 1990 (7 U.S.C. 2279(g)(1)) is amended—

(1) in the first sentence—

(A) by striking ‘‘Agricultural Stabilization and Conservation Service, Soil Conservation Service, and Farmers 


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Home Administration offices’’ and inserting ‘‘Farm Service 

Agency and Natural Resources Conservation Service’’; and 

(B) by inserting ‘‘where there has been a need demonstrated’’ after ‘‘include’’; and 

(2) by striking the second sentence. 

SEC. 14002. FORECLOSURE. 

(a) IN GENERAL.—Section 331A of the Consolidated Farm and 

Rural Development Act (7 U.S.C. 1981a) is amended: 

(1) by inserting ‘‘(a)’’ after ‘‘SEC. 331A.’’; and 

(2) by adding at the end the following: ‘‘(b) MORATORIUM.— ‘‘(1) IN GENERAL.—Subject to the other provisions of this 

subsection, effective beginning on the date of the enactment of 

this subsection, there shall be in effect a moratorium, with respect to farmer program loans made under subtitle A, B, or C, 

on all acceleration and foreclosure proceedings instituted by the 

Department of Agriculture against any farmer or rancher 

who— ‘‘(A) has pending against the Department a claim of 

program discrimination that is accepted by the Department 

as valid; or ‘‘(B) files a claim of program discrimination that is accepted by the Department as valid. 

‘‘(2) WAIVER OF INTEREST AND OFFSETS.—During the period 

of the moratorium, the Secretary shall waive the accrual of interest and offsets on all farmer program loans made under subtitle A, B, or C for which loan acceleration or foreclosure proceedings have been suspended under paragraph (1). ‘‘(3) TERMINATION OF MORATORIUM.—The moratorium shall 

terminate with respect to a claim of discrimination by a farmer 

or rancher on the earlier of— ‘‘(A) the date the Secretary resolves the claim; or 

‘‘(B) if the farmer or rancher appeals the decision of the 

Secretary on the claim to a court of competent jurisdiction, 

the date that the court renders a final decision on the 

claim. 

‘‘(4) FAILURE TO PREVAIL.—If a farmer or rancher does not 

prevail on a claim of discrimination described in paragraph (1), 

the farmer or rancher shall be liable for any interest and offsets 

that accrued during the period that loan acceleration or foreclosure proceedings have been suspended under paragraph (1).’’. 

(b) FORECLOSURE REPORT.—

(1) IN GENERAL.—Not later than 1 year after the date of the 

enactment of this Act, the Inspector General of the Department 

of Agriculture (referred to in this subsection as the ‘‘Inspector 

General’’) shall determine whether decisions of the Department 

to implement foreclosure proceedings with respect to farmer program loans made under subtitle A, B, or C of the Consolidated 

Farm and Rural Development Act (7 U.S.C. 1922 et seq.) to socially disadvantaged farmers or ranchers during the 5-year period preceding the date of the enactment of this Act were consistent and in conformity with the applicable laws (including 

regulations) governing loan foreclosures. 

(2) REPORT.—Not later than 1 year after the date of the enactment of this Act, the Inspector General shall submit to the 


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Committee on Agriculture of the House of Representatives and 

the Committee on Agriculture, Nutrition, and Forestry of the 

Senate a report that describes the determination of the Inspector General under paragraph (1). 

SEC. 14003. RECEIPT FOR SERVICE OR DENIAL OF SERVICE FROM CERTAIN DEPARTMENT OF AGRICULTURE AGENCIES. 

Section 2501A of the Food, Agriculture, Conservation, and 

Trade Act of 1990 (7 U.S.C. 2279–1) is amended by adding at the 

end the following new subsection: ‘‘(e) RECEIPT FOR SERVICE OR DENIAL OF SERVICE.—In any case 

in which a current or prospective producer or landowner, in person 

or in writing, requests from the Farm Service Agency, the Natural 

Resources Conservation Service, or an agency of the Rural Development Mission Area any benefit or service offered by the Department 

to agricultural producers or landowners and, at the time of the request, also requests a receipt, the Secretary shall issue, on the date 

of the request, a receipt to the producer or landowner that contains— ‘‘(1) the date, place, and subject of the request; and 

‘‘(2) the action taken, not taken, or recommended to the producer or landowner.’’. 

SEC. 14004. OUTREACH AND TECHNICAL ASSISTANCE FOR SOCIALLY 

DISADVANTAGED FARMERS OR RANCHERS. 

(a) OUTREACH AND TECHNICAL ASSISTANCE PROGRAM.— (1) PROGRAM REQUIREMENTS.—Paragraph (2) of section 

2501(a) of the Food, Agriculture, Conservation, and Trade Act 

of 1990 (7 U.S.C. 2279(a)) is amended to read as follows: ‘‘(2) REQUIREMENTS.—The outreach and technical assistance program under paragraph (1) shall be used exclusively— ‘‘(A) to enhance coordination of the outreach, technical 

assistance, and education efforts authorized under agriculture programs; and ‘‘(B) to assist the Secretary in— ‘‘(i) reaching current and prospective socially disadvantaged farmers or ranchers in a linguistically appropriate manner; and ‘‘(ii) improving the participation of those farmers 

and ranchers in Department programs, as reported 

under section 2501A.’’. (2) GRANTS AND CONTRACTS UNDER PROGRAM.—Section 

2501(a)(3) of the Food, Agriculture, Conservation, and Trade 

Act of 1990 (7 U.S.C. 2279(a)(3)) is amended—

(A) in subparagraph (A), by striking ‘‘entity to provide 

information’’ and inserting ‘‘entity that has demonstrated 

an ability to carry out the requirements described in paragraph (2) to provide outreach’’; and 

(B) by adding at the end the following new subparagraph: 

‘‘(D) REPORT.—The Secretary shall submit to the Committee on Agriculture of the House of Representatives and 

the Committee on Agriculture, Nutrition, and Forestry of 

the Senate, and make publicly available, an annual report 

that includes a list of the following: ‘‘(i) The recipients of funds made available under 

the program. 


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‘‘(ii) The activities undertaken and services provided. ‘‘(iii) The number of current and prospective socially disadvantaged farmers or ranchers served and 

outcomes of such service. ‘‘(iv) The problems and barriers identified by entities in trying to increase participation by current and 

prospective socially disadvantaged farmers or ranchers.’’. (3) FUNDING AND LIMITATION ON USE OF FUNDS.—Section 

2501(a)(4) of the Food, Agriculture, Conservation, and Trade 

Act of 1990 (7 U.S.C. 2279(a)(4)) is amended— (A) by striking subparagraph (A) and inserting the following new subparagraph: ‘‘(A) IN GENERAL.—Of the funds of the Commodity 

Credit Corporation, the Secretary shall make available to 

carry out this section— ‘‘(i) $15,000,000 for fiscal year 2009; and 

‘‘(ii) $20,000,000 for each of fiscal years 2010 

through 2012.’’. (B) by adding at the end the following new subparagraph: ‘‘(C) LIMITATION ON USE OF FUNDS FOR ADMINISTRA- TIVE EXPENSES.—Not more than 5 percent of the amounts 

made available under subparagraph (A) for a fiscal year 

may be used for expenses related to administering the program under this section.’’. (b) ELIGIBLE ENTITY DEFINED.—Section 2501(e)(5)(A)(ii) of the 

Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 

2279(e)(5)(A)(ii)) is amended by striking ‘‘work with socially disadvantaged farmers or ranchers during the 2-year period’’ and inserting ‘‘work with, and on behalf of, socially disadvantaged farmers or ranchers during the 3-year period’’. 

SEC. 14005. ACCURATE DOCUMENTATION IN THE CENSUS OF AGRICULTURE AND CERTAIN STUDIES. 

Section 2501 of the Food, Agriculture, Conservation, and Trade 

Act of 1990 (7 U.S.C. 2279) is amended by adding at the end the 

following: ‘‘(h) ACCURATE DOCUMENTATION.—The Secretary shall ensure, 

to the maximum extent practicable, that the Census of Agriculture 

and studies carried out by the Economic Research Service accurately document the number, location, and economic contributions of 

socially disadvantaged farmers or ranchers in agricultural production.’’. 

SEC. 14006. TRANSPARENCY AND ACCOUNTABILITY FOR SOCIALLY DISADVANTAGED FARMERS OR RANCHERS. 

Section 2501A of the Food, Agriculture, Conservation, and 

Trade Act of 1990 (7 U.S.C. 2279–1) is amended by striking subsection (c) and inserting the following new subsections: 

‘‘(c) COMPILATION OF PROGRAM PARTICIPATION DATA.—

‘‘(1) ANNUAL REQUIREMENT.—For each county and State in 

the United States, the Secretary of Agriculture (referred to in 

this section as the ‘Secretary’) shall annually compile program 

application and participation rate data regarding socially disadvantaged farmers or ranchers by computing for each program 


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of the Department of Agriculture that serves agricultural producers and landowners—

‘‘(A) raw numbers of applicants and participants by 

race, ethnicity, and gender, subject to appropriate privacy 

protections, as determined by the Secretary; and 

‘‘(B) the application and participation rate, by race, 

ethnicity, and gender, as a percentage of the total participation rate of all agricultural producers and landowners. 

‘‘(2) AUTHORITY TO COLLECT DATA.—The heads of the agencies of the Department of Agriculture shall collect and transmit 

to the Secretary any data, including data on race, gender, and 

ethnicity, that the Secretary determines to be necessary to carry 

out paragraph (1). 

‘‘(3) REPORT.—Using the technologies and systems of the 

National Agricultural Statistics Service, the Secretary shall 

compile and present the data compiled under paragraph (1) for 

each program described in that paragraph in a manner that includes the raw numbers and participation rates for—

‘‘(A) the entire United States; 

‘‘(B) each State; and 

‘‘(C) each county in each State. 

‘‘(4) PUBLIC AVAILABILITY OF REPORT.—The Secretary shall 

maintain and make readily available to the public, via website 

and otherwise in electronic and paper form, the report described 

in paragraph (3). 

‘‘(d) LIMITATIONS ON USE OF DATA.—

‘‘(1) PRIVACY PROTECTIONS.—In carrying out this section, 

the Secretary shall not disclose the names or individual data of 

any program participant. 

‘‘(2) AUTHORIZED USES.—The data under this section shall 

be used exclusively for the purposes described in subsection (a). 

‘‘(3) LIMITATION.—Except as otherwise provided, the data 

under this section shall not be used for the evaluation of individual applications for assistance.’’. 

SEC. 14007. OVERSIGHT AND COMPLIANCE. 

The Secretary, acting through the Assistant Secretary for Civil 

Rights of the Department of Agriculture, shall use the reports described in subsection (c) of section 2501A of the Food, Agriculture, 

Conservation, and Trade Act of 1990 (7 U.S.C. 2279–1), as amended 

by section 14006, in the conduct of oversight and evaluation of civil 

rights compliance. 

SEC. 14008. MINORITY FARMER ADVISORY COMMITTEE. 

(a) ESTABLISHMENT.—Not later than 18 months after the date 

of the enactment of this Act, the Secretary of Agriculture shall establish an advisory committee, to be known as the ‘‘Advisory Committee 

on Minority Farmers’’ (in this section referred to as the ‘‘Committee’’). 

(b) DUTIES.—The Committee shall provide advice to the Secretary on—

(1) the implementation of section 2501 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279); 

(2) methods of maximizing the participation of minority 

farmers and ranchers in Department of Agriculture programs; 

and 


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(3) civil rights activities within the Department as such activities relate to participants in such programs. 

(c) MEMBERSHIP.—

(1) IN GENERAL.—The Committee shall be composed of not 

more than 15 members, who shall be appointed by the Secretary, and shall include—

(A) not less than four socially disadvantaged farmers 

or ranchers (as defined in section 2501(e)(2) of the Food, 

Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 

2279(e)(2))); 

(B) not less than two representatives of nonprofit organizations with a history of working with minority farmers 

and ranchers; 

(C) not less than two civil rights professionals; 

(D) not less than two representatives of institutions of 

higher education with demonstrated experience working 

with minority farmers and ranchers; and 

(E) such other persons as the Secretary considers appropriate. 

(2) EX-OFFICIO MEMBERS.—The Secretary may appoint such 

employees of the Department of Agriculture as the Secretary 

considers appropriate to serve as ex-officio members of the Committee. 

SEC. 14009. NATIONAL APPEALS DIVISION. 

Section 280 of the Department of Agriculture Reorganization 

Act of 1994 (7 U.S.C. 7000) is amended—

(1) by striking ‘‘On the return’’ and inserting the following: 

‘‘(a) IN GENERAL.—On the return’’; and 

(2) by adding at the end the following: 

‘‘(b) REPORTS.—

‘‘(1) IN GENERAL.—Not later than 180 days after the date 

of the enactment of this subsection, and every 180 days thereafter, the head of each agency shall submit to the Committee on 

Agriculture of the House of Representatives and the Committee 

on Agriculture, Nutrition, and Forestry of the Senate, and publish on the website of the Department, a report that includes—

‘‘(A) a description of all cases returned to the agency 

during the period covered by the report pursuant to a final 

determination of the Division; 

‘‘(B) the status of implementation of each final determination; and 

‘‘(C) if the final determination has not been implemented—

‘‘(i) the reason that the final determination has not 

been implemented; and 

‘‘(ii) the projected date of implementation of the 

final determination. 

‘‘(2) UPDATES.—Each month, the head of each agency shall 

publish on the website of the Department any updates to the reports submitted under paragraph (1).’’. 

SEC. 14010. REPORT OF CIVIL RIGHTS COMPLAINTS, RESOLUTIONS, 

AND ACTIONS. 

Each year, the Secretary shall—


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(1) prepare a report that describes, for each agency of the 

Department of Agriculture—

(A) the number of civil rights complaints filed that relate to the agency, including whether a complaint is a program complaint or an employment complaint; 

(B) the length of time the agency took to process each 

civil rights complaint; 

(C) the number of proceedings brought against the 

agency, including the number of complaints described in 

paragraph (1) that were resolved with a finding of discrimination; and 

(D) the number and type of personnel actions taken by 

the agency following resolution of civil rights complaints; 

(2) submit to the Committee on Agriculture of the House of 

Representatives and the Committee on Agriculture, Nutrition, 

and Forestry of the Senate a copy of the report; and 

(3) make the report available to the public by posting the 

report on the website of the Department. 

SEC. 14011. SENSE OF CONGRESS RELATING TO CLAIMS BROUGHT BY 

SOCIALLY DISADVANTAGED FARMERS OR RANCHERS. 

It is the sense of Congress that all pending claims and class actions brought against the Department of Agriculture by socially disadvantaged farmers or ranchers (as defined in section 355(e) of the 

Consolidated Farm and Rural Development Act (7 U.S.C. 2003(e)), 

including Native American, Hispanic, and female farmers or ranchers, based on racial, ethnic, or gender discrimination in farm program participation should be resolved in an expeditious and just 

manner. 

SEC. 14012. DETERMINATION ON MERITS OF PIGFORD CLAIMS. 

(a) DEFINITIONS.—In this section: 

(1) CONSENT DECREE.—The term ‘‘consent decree’’ means 

the consent decree in the case of Pigford v. Glickman, approved 

by the United States District Court for the District of Columbia 

on April 14, 1999. 

(2) DEPARTMENT.—The term ‘‘Department’’ means the Department of Agriculture. 

(3) PIGFORD CLAIM.—The term ‘‘Pigford claim’’ means a 

discrimination complaint, as defined by section 1(h) of the consent decree and documented under section 5(b) of the consent 

decree. 

(4) PIGFORD CLAIMANT.—The term ‘‘Pigford claimant’’

means an individual who previously submitted a late-filing request under section 5(g) of the consent decree. 

(b) DETERMINATION ON MERITS.—Any Pigford claimant who 

has not previously obtained a determination on the merits of a 

Pigford claim may, in a civil action brought in the United States 

District Court for the District of Columbia, obtain that determination. 

(c) LIMITATION.—

(1) IN GENERAL.—Subject to paragraph (2), all payments or 

debt relief (including any limitation on foreclosure under subsection (h)) shall be made exclusively from funds made available under subsection (i). 


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(2) MAXIMUM AMOUNT.—The total amount of payments and 

debt relief pursuant to actions commenced under subsection (b) 

shall not exceed $100,000,000. 

(d) INTENT OF CONGRESS AS TO REMEDIAL NATURE OF SEC- TION.—It is the intent of Congress that this section be liberally construed so as to effectuate its remedial purpose of giving a full determination on the merits for each Pigford claim previously denied 

that determination. 

(e) LOAN DATA.— (1) REPORT TO PERSON SUBMITTING PETITION.— (A) IN GENERAL.—Not later than 120 days after the 

Secretary receives notice of a complaint filed by a claimant 

under subsection (b), the Secretary shall provide to the 

claimant a report on farm credit loans and noncredit benefits, as appropriate, made within the claimant’s county (or 

if no documents are found, within an adjacent county as 

determined by the claimant), by the Department during the 

period beginning on January 1 of the year preceding the period covered by the complaint and ending on December 31 

of the year following the period. 

(B) REQUIREMENTS.—A report under subparagraph (A) 

shall contain information on all persons whose application 

for a loan or benefit was accepted, including— (i) the race of the applicant; 

(ii) the date of application; 

(iii) the date of the loan or benefit decision, as appropriate; 

(iv) the location of the office making the loan or 

benefit decision, as appropriate; 

(v) all data relevant to the decisionmaking process 

for the loan or benefit, as appropriate; and 

(vi) all data relevant to the servicing of the loan or 

benefit, as appropriate. 

(2) NO PERSONALLY IDENTIFIABLE INFORMATION.—The reports provided pursuant to paragraph (1) shall not contain any 

information that would identify any person who applied for a 

loan from the Department. 

(3) REPORTING DEADLINE.— (A) IN GENERAL.—The Secretary shall— (i) provide to claimants the reports required under 

paragraph (1) as quickly as practicable after the Secretary receives notice of a complaint filed by a claimant 

under subsection (b); and 

(ii) devote such resources of the Department as are 

necessary to make providing the reports expeditiously a 

high priority of the Department. 

(B) EXTENSION.—A court may extend the deadline for 

providing the report required in a particular case under 

paragraph (1) if the Secretary establishes that meeting the 

deadline is not feasible and demonstrates a continuing effort and commitment to provide the required report expeditiously. 

(f) EXPEDITED RESOLUTIONS AUTHORIZED.—

(1) IN GENERAL.—Any person filing a complaint under this 

section for discrimination in the application for, or making or 


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servicing of, a farm loan, at the discretion of the person, may 

seek liquidated damages of $50,000, discharge of the debt that 

was incurred under, or affected by, the 1 or more programs that 

were the subject of the 1 or more discrimination claims that are 

the subject of the person’s complaint, and a tax payment in the 

amount equal to 25 percent of the liquidated damages and loan 

principal discharged, in which case— (A) if only such damages, debt discharge, and tax payment are sought, the complainant shall be able to prove the 

case of the complainant by substantial evidence (as defined 

in section 1(l) of the consent decree); and 

(B) the court shall decide the case based on a review 

of documents submitted by the complainant and defendant 

relevant to the issues of liability and damages. 

(2) NONCREDIT CLAIMS.—

(A) STANDARD.—In any case in which a claimant asserts a noncredit claim under a benefit program of the Department, the court shall determine the merits of the claim 

in accordance with section 9(b)(i) of the consent decree. 

(B) RELIEF.—A claimant who prevails on a claim of 

discrimination involving a noncredit benefit program of the 

Department shall be entitled to a payment by the Department in a total amount of $3,000, without regard to the 

number of such claims on which the claimant prevails. 

(g) ACTUAL DAMAGES.—A claimant who files a claim under this 

section for discrimination under subsection (b) but not under subsection (f) and who prevails on the claim shall be entitled to actual 

damages sustained by the claimant. 

(h) LIMITATION ON FORECLOSURES.—Notwithstanding any other 

provision of law, during the pendency of a Pigford claim, the Secretary may not begin acceleration on or foreclosure of a loan if—

(1) the borrower is a Pigford claimant; and 

(2) makes a prima facie case in an appropriate administrative proceeding that the acceleration or foreclosure is related to 

a Pigford claim. 

(i) FUNDING.— (1) IN GENERAL.—Of the funds of the Commodity Credit 

Corporation, the Secretary shall make available for payments 

and debt relief in satisfaction of claims against the United 

States under subsection (b) and for any actions under subsection (g) $100,000,000 for fiscal year 2008, to remain available until expended. 

(2) AUTHORIZATION OF APPROPRIATIONS.—In addition to 

funds made available under paragraph (1), there are authorized to be appropriated such sums as are necessary to carry out 

this section. 

(j) REPORTING REQUIREMENTS.—

(1) IN GENERAL.—Not later than 180 days after the date of 

the enactment of this Act and every 180 days thereafter until 

the funds made available under subsection (i) are depleted, the 

Secretary shall submit to the Committee on the Judiciary of the 

House of Representatives and the Committee on the Judiciary 

of the Senate a report that describes the status of available 

funds under subsection (i) and the number of pending claims 

under subsection (f). 


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(2) DEPLETION OF FUNDS REPORT.—In addition to the reports required under paragraph (1), the Secretary shall submit 

to the Committee on the Judiciary of the House of Representatives and the Committee on the Judiciary of the Senate a report 

that notifies the Committees when 75 percent of the funds made 

available under subsection (i)(1) have been depleted. 

(k) TERMINATION OF AUTHORITY.—The authority to file a claim 

under this section terminates 2 years after the date of the enactment 

of this Act. 

SEC. 14013. OFFICE OF ADVOCACY AND OUTREACH. 

(a) IN GENERAL.—The Department of Agriculture Reorganization Act of 1994 is amended by inserting after section 226A (7 

U.S.C. 6933) the following: 

‘‘SEC. 226B. OFFICE OF ADVOCACY AND OUTREACH. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) BEGINNING FARMER OR RANCHER.—The term ‘beginning 

farmer or rancher’ has the meaning given the term in section 

343(a) of the Consolidated Farm and Rural Development Act (7 

U.S.C. 1991(a)). 

‘‘(2) OFFICE.—The term ‘Office’ means the Office of Advocacy and Outreach established under this section. 

‘‘(3) SOCIALLY DISADVANTAGED FARMER OR RANCHER.—The 

term ‘socially disadvantaged farmer or rancher’ has the meaning given the term in section 2501(e) of the Food, Agriculture, 

Conservation, and Trade Act of 1990 (7 U.S.C. 2279(e)). 

‘‘(b) ESTABLISHMENT AND PURPOSE.—

‘‘(1) IN GENERAL.—The Secretary shall establish within the 

executive operations of the Department an office to be known as 

the ‘Office of Advocacy and Outreach’—

‘‘(A) to improve access to programs of the Department; 

and 

‘‘(B) to improve the viability and profitability of—

‘‘(i) small farms and ranches; 

‘‘(ii) beginning farmers or ranchers; and 

‘‘(iii) socially disadvantaged farmers or ranchers. 

‘‘(2) DIRECTOR.—The Office shall be headed by a Director, 

to be appointed by the Secretary from among the competitive 

service. 

‘‘(c) DUTIES.—The duties of the Office shall be to ensure small 

farms and ranches, beginning farmers or ranchers, and socially disadvantaged farmers or ranchers access to, and equitable participation in, programs and services of the Department by—

‘‘(1) establishing and monitoring the goals and objectives of 

the Department to increase participation in programs of the Department by small, beginning, or socially disadvantaged farmers or ranchers; 

‘‘(2) assessing the effectiveness of Department outreach programs; ‘‘(3) developing and implementing a plan to coordinate outreach activities and services provided by the Department; ‘‘(4) providing input to the agencies and offices on programmatic and policy decisions; ‘‘(5) measuring outcomes of the programs and activities of 

the Department on small farms and ranches, beginning farmers 


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or ranchers, and socially disadvantaged farmers or ranchers 

programs; ‘‘(6) recommending new initiatives and programs to the 

Secretary; and ‘‘(7) carrying out any other related duties that the Secretary 

determines to be appropriate. 

‘‘(d) SOCIALLY DISADVANTAGED FARMERS GROUP.— ‘‘(1) ESTABLISHMENT.—The Secretary shall establish within 

the Office the Socially Disadvantaged Farmers Group. ‘‘(2) OUTREACH AND ASSISTANCE.—The Socially Disadvantaged Farmers Group— ‘‘(A) shall carry out section 2501 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 

2279); and ‘‘(B) in the case of activities described in section 

2501(a) of that Act, may conduct such activities through 

other agencies and offices of the Department. 

‘‘(3) SOCIALLY DISADVANTAGED FARMERS AND FARMWORKERS.—The Socially Disadvantaged Farmers Group shall 

oversee the operations of—

‘‘(A) the Advisory Committee on Minority Farmers established under section 14009 of the Food, Conservation, 

and Energy Act of 2008; and 

‘‘(B) the position of Farmworker Coordinator established under subsection (f). 

‘‘(4) OTHER DUTIES.— ‘‘(A) IN GENERAL.—The Socially Disadvantaged Farmers Group may carry out other duties to improve access to, 

and participation in, programs of the Department by socially disadvantaged farmers or ranchers, as determined by 

the Secretary. ‘‘(B) OFFICE OF OUTREACH AND DIVERSITY.—The Office 

of Advocacy and Outreach shall carry out the functions and 

duties of the Office of Outreach and Diversity carried out 

by the Assistant Secretary for Civil Rights as such functions and duties existed immediately before the date of the 

enactment of this section. ‘‘(e) SMALL FARMS AND BEGINNING FARMERS AND RANCHERS

GROUP.—

‘‘(1) ESTABLISHMENT.—The Secretary shall establish within 

the Office the Small Farms and Beginning Farmers and 

Ranchers Group. 

‘‘(2) DUTIES.—

‘‘(A) OVERSEE OFFICES.—The Small Farms and Beginning Farmers and Ranchers Group shall oversee the operations of the Office of Small Farms Coordination established by Departmental Regulation 9700–1 (August 3, 

2006). 

‘‘(B) BEGINNING FARMER AND RANCHER DEVELOPMENT

PROGRAM.—The Small Farms and Beginning Farmers and 

Ranchers Group shall consult with the National Institute 

for Food and Agriculture on the administration of the beginning farmer and rancher development program established under section 7405 of the Farm Security and Rural 

Investment Act of 2002 (7 U.S.C. 3319f). 


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‘‘(C) ADVISORY COMMITTEE FOR BEGINNING FARMERS

AND RANCHERS.—The Small Farms and Beginning Farmers and Ranchers Group shall coordinate the activities of 

the Group with the Advisory Committee for Beginning 

Farmers and Ranchers established under section 5(b) of the 

Agricultural Credit Improvement Act of 1992 (7 U.S.C. 

1621 note; Public Law 102–554). 

‘‘(D) OTHER DUTIES.—The Small Farms and Beginning 

Farmers and Ranchers Group may carry out other duties 

to improve access to, and participation in, programs of the 

Department by small farms and ranches and beginning 

farmers or ranchers, as determined by the Secretary. 

‘‘(f) FARMWORKER COORDINATOR.—

‘‘(1) ESTABLISHMENT.—The Secretary shall establish within 

the Office the position of Farmworker Coordinator (referred to 

in this subsection as the ‘Coordinator’). 

‘‘(2) DUTIES.—The Secretary shall delegate to the Coordinator responsibility for the following: 

‘‘(A) Assisting in administering the program established by section 2281 of the Food, Agriculture, Conservation, and Trade Act of 1990 (42 U.S.C. 5177a). 

‘‘(B) Serving as a liaison to community-based nonprofit 

organizations that represent and have demonstrated experience serving low-income migrant and seasonal farmworkers. 

‘‘(C) Coordinating with the Department, other Federal 

agencies, and State and local governments to ensure that 

farmworker needs are assessed and met during declared 

disasters and other emergencies. 

‘‘(D) Consulting within the Office and with other entities to better integrate farmworker perspectives, concerns, 

and interests into the ongoing programs of the Department. 

‘‘(E) Consulting with appropriate institutions on research, program improvements, or agricultural education 

opportunities that assist low-income and migrant seasonal 

farmworkers. 

‘‘(F) Assisting farmworkers in becoming agricultural 

producers or landowners. 

‘‘(3) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated such sums as are necessary to carry 

out this subsection for each of fiscal years 2009 through 2012.’’. 

(b) CONFORMING AMENDMENT.—Section 296(b) of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 7014(b)), 

as amended by section 7511(b), is further amended—

(1) in paragraph (5), by striking ‘‘; or’’ and inserting ‘‘;’’; 

(2) in paragraph (6), by striking the period and inserting 

‘‘; or’’; and 

(3) by adding at the end the following new paragraph: 

‘‘(7) the authority of the Secretary to establish in the Department the Office of Advocacy and Outreach in accordance 

with section 226B.’’. 


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Subtitle B—Agricultural Security 

SEC. 14101. SHORT TITLE. 

This subtitle may be cited as the ‘‘Agricultural Security Improvement Act of 2008’’. 

SEC. 14102. DEFINITIONS. 

In this subtitle: 

(1) AGENT.—The term ‘‘agent’’ means a nuclear, biological, 

chemical, or radiological substance that causes agricultural disease or the adulteration of products regulated by the Secretary 

of Agriculture under any provision of law. 

(2) AGRICULTURAL BIOSECURITY.—The term ‘‘agricultural 

biosecurity’’ means protection from an agent that poses a threat 

to— (A) plant or animal health; 

(B) public health as it relates to the adulteration of 

products regulated by the Secretary of Agriculture under 

any provision of law that is caused by exposure to an agent; 

or 

(C) the environment as it relates to agriculture facilities, farmland, and air and water within the immediate vicinity of an area associated with an agricultural disease or 

outbreak. 

(3) AGRICULTURAL COUNTERMEASURE.—The term ‘‘agricultural countermeasure’’—

(A) means a product, practice, or technology that is intended to enhance or maintain the agricultural biosecurity 

of the United States; and 

(B) does not include a product, practice, or technology 

used solely in response to a human medical incident or 

public health emergency not related to agriculture. 

(4) AGRICULTURAL DISEASE.—The term ‘‘agricultural disease’’ has the meaning given the term by the Secretary. 

(5) AGRICULTURAL DISEASE EMERGENCY.—The term ‘‘agricultural disease emergency’’ means an incident of agricultural 

disease that requires prompt action to prevent significant damage to people, plants, or animals. 

(6) AGROTERRORIST ACT.—The term ‘‘agroterrorist act’’

means an act that—

(A) causes or attempts to cause—

(i) damage to agriculture; or 

(ii) injury to a person associated with agriculture; 

and 

(B) is committed or appears to be committed with the 

intent to—

(i) intimidate or coerce a civilian population; or 

(ii) disrupt the agricultural industry in order to influence the policy of a government by intimidation or 

coercion. 

(7) ANIMAL.—The term ‘‘animal’’ has the meaning given the 

term in section 10403 of the Animal Health Protection Act of 

2002 (7 U.S.C. 8302). 

(8) DEPARTMENT.—The term ‘‘Department’’ means the Department of Agriculture. 

(9) DEVELOPMENT.—The term ‘‘development’’ means—


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(A) research leading to the identification of products or 

technologies intended for use as agricultural countermeasures to protect animal health; 

(B) the formulation, production, and subsequent modification of those products or technologies; 

(C) the conduct of in vitro and in vivo studies; 

(D) the conduct of field, efficacy, and safety studies; 

(E) the preparation of an application for marketing approval for submission to an applicable agency; or 

(F) other actions taken by an applicable agency in a 

case in which an agricultural countermeasure is procured 

or used prior to issuance of a license or other form of Federal Government approval. 

(10) PLANT.—The term ‘‘plant’’ has the meaning given the 

term in section 411 of the Plant Protection Act of 2000 (7 U.S.C. 

7702). 

(11) QUALIFIED AGRICULTURAL COUNTERMEASURE.—The 

term ‘‘qualified agricultural countermeasure’’ means an agricultural countermeasure that the Secretary, in consultation with 

the Secretary of Homeland Security, determines to be a priority 

in order to address an agricultural biosecurity threat. 

CHAPTER 1—AGRICULTURAL SECURITY 

SEC. 14111. OFFICE OF HOMELAND SECURITY. 

(a) ESTABLISHMENT.—There is established within the Department the Office of Homeland Security (in this section referred to as 

the ‘‘Office’’). 

(b) DIRECTOR.—The Office shall be headed by a Director of 

Homeland Security, who shall be appointed by the Secretary. 

(c) RESPONSIBILITIES.—The Director of Homeland Security 

shall—

(1) coordinate all homeland security activities of the Department, including integration and coordination of interagency 

emergency response plans for—

(A) agricultural disease emergencies; 

(B) agroterrorist acts; and 

(C) other threats to agricultural biosecurity; 

(2) act as the primary liaison on behalf of the Department 

with other Federal departments and agencies on the coordination of efforts and interagency activities pertaining to agricultural biosecurity; and 

(3) advise the Secretary on policies, regulations, processes, 

budget, and actions pertaining to homeland security. 

SEC. 14112. AGRICULTURAL BIOSECURITY COMMUNICATION CENTER. 

(a) ESTABLISHMENT.—The Secretary shall establish a communication center within the Department to—

(1) collect and disseminate information and prepare for an 

agricultural disease emergency, agroterrorist act, or other threat 

to agricultural biosecurity; and 

(2) coordinate activities described in paragraph (1) among 

agencies and offices within the Department. 

(b) RELATION TO EXISTING DHS COMMUNICATION SYSTEMS.— (1) CONSISTENCY AND COORDINATION.—The communication 

center established under subsection (a) shall, to the maximum 


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extent practicable, share and coordinate the dissemination of 

timely information with the Department of Homeland Security 

and other communication systems of appropriate Federal departments and agencies. 

(2) AVOIDING REDUNDANCIES.—Paragraph (1) shall not be 

construed to impede, conflict with, or duplicate the communications activities performed by the Secretary of Homeland Security under any provision of law. 

(c) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to 

be appropriated such sums as may be necessary to carry out this 

section for each of fiscal years 2008 through 2012. 

SEC. 14113. ASSISTANCE TO BUILD LOCAL CAPACITY IN AGRICULTURAL BIOSECURITY PLANNING, PREPAREDNESS, AND 

RESPONSE. 

(a) ADVANCED TRAINING PROGRAMS.—

(1) GRANT ASSISTANCE.—The Secretary shall establish a 

competitive grant program to support the development and expansion of advanced training programs in agricultural biosecurity planning and response for food science professionals and 

veterinarians. 

(2) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to the Secretary such sums as may be 

necessary to carry out this subsection for each of fiscal years 

2008 through 2012. 

(b) ASSESSMENT OF RESPONSE CAPABILITY.—

(1) GRANT AND LOAN ASSISTANCE.—The Secretary shall establish a competitive grant and low-interest loan assistance 

program to assist States in assessing agricultural disease response capability. 

(2) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection $25,000,000 

for each of fiscal years 2008 through 2012. 

CHAPTER 2—OTHER PROVISIONS 

SEC. 14121. RESEARCH AND DEVELOPMENT OF AGRICULTURAL COUNTERMEASURES. 

(a) GRANT PROGRAM.—

(1) COMPETITIVE GRANT PROGRAM.—The Secretary shall establish a competitive grant program to encourage basic and applied research and the development of qualified agricultural 

countermeasures. 

(2) WAIVER IN EMERGENCIES.—The Secretary may waive the 

requirement under paragraph (1) that a grant be provided on 

a competitive basis if—

(A) the Secretary has declared a plant or animal disease emergency under the Plant Protection Act (7 U.S.C. 

7701 et seq.) or the Animal Health Protection Act (7 U.S.C. 

8301 et seq.); and 

(B) waiving the requirement would lead to the rapid 

development of a qualified agricultural countermeasure, as 

determined by the Secretary. 

(b) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $50,000,000 for each of 

fiscal years 2008 through 2012. 


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SEC. 14122. AGRICULTURAL BIOSECURITY GRANT PROGRAM. 

(a) COMPETITIVE GRANT PROGRAM.—The Secretary shall establish a competitive grant program to promote the development of 

teaching programs in agriculture, veterinary medicine, and disciplines closely allied to the food and agriculture system to increase 

the number of trained individuals with an expertise in agricultural 

biosecurity. 

(b) ELIGIBILITY.—The Secretary may award a grant under this 

section only to an entity that is—

(1) an accredited school of veterinary medicine; or 

(2) a department of an institution of higher education with 

a primary focus on—

(A) comparative medicine; 

(B) veterinary science; or 

(C) agricultural biosecurity. 

(c) PREFERENCE.—The Secretary shall give preference in awarding grants based on the ability of an applicant—

(1) to increase the number of veterinarians or individuals 

with advanced degrees in food and agriculture disciplines who 

are trained in agricultural biosecurity practice areas; 

(2) to increase research capacity in areas of agricultural 

biosecurity; or 

(3) to fill critical agricultural biosecurity shortage situations outside of the Federal Government. 

(d) USE OF FUNDS.—

(1) IN GENERAL.—Amounts received under this section shall 

be used by a grantee to pay—

(A) costs associated with the acquisition of equipment 

and other capital costs relating to the expansion of food, agriculture, and veterinary medicine teaching programs in 

agricultural biosecurity; 

(B) capital costs associated with the expansion of academic programs that offer postgraduate training for veterinarians or concurrent training for veterinary students in 

specific areas of specialization; or 

(C) other capacity and infrastructure program costs 

that the Secretary considers appropriate. 

(2) LIMITATION.—Funds received under this section may not 

be used for the construction, renovation, or rehabilitation of a 

building or facility. 

(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated sums as are necessary to carry out this section 

for each of fiscal years 2008 through 2012, to remain available until 

expended. 

Subtitle C—Other Miscellaneous Provisions 

SEC. 14201. COTTON CLASSIFICATION SERVICES. 

Section 3a of the Act of March 3, 1927 (7 U.S.C. 473a), is 

amended to read as follows: 

‘‘SEC. 3a. COTTON CLASSIFICATION SERVICES. 

‘‘(a) IN GENERAL.—The Secretary of Agriculture (referred to in 

this section as the ‘Secretary’) shall—

‘‘(1) make cotton classification services available to producers of cotton; and 


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‘‘(2) provide for the collection of classification fees from participating producers or agents that voluntarily agree to collect 

and remit the fees on behalf of producers. 

‘‘(b) FEES.—

‘‘(1) USE OF FEES.—Classification fees collected under subsection (a)(2) and the proceeds from the sales of samples submitted under this section shall, to the maximum extent practicable, be used to pay the cost of the services provided under 

this section, including administrative and supervisory costs. 

‘‘(2) ANNOUNCEMENT OF FEES.—The Secretary shall announce a uniform classification fee and any applicable surcharge for classification services not later than June 1 of the 

year in which the fee applies. 

‘‘(c) CONSULTATION.—

‘‘(1) IN GENERAL.—In establishing the amount of fees under 

this section, the Secretary shall consult with representatives of 

the United States cotton industry. 

‘‘(2) EXEMPTION.—The Federal Advisory Committee Act (5 

U.S.C. App.) shall not apply to consultations with representatives of the United States cotton industry under this section. 

‘‘(d) CREDITING OF FEES.—Any fees collected under this section 

and under section 3d, late payment penalties, the proceeds from the 

sales of samples, and interest earned from the investment of such 

funds shall—

‘‘(1) be credited to the current appropriation account that 

incurs the cost of services provided under this section and section 3d; and 

‘‘(2) remain available without fiscal year limitation to pay 

the expenses of the Secretary in providing those services. 

‘‘(e) INVESTMENT OF FUNDS.—Funds described in subsection (d) 

may be invested—

‘‘(1) by the Secretary in insured or fully collateralized, interest-bearing accounts; or 

‘‘(2) at the discretion of the Secretary, by the Secretary of 

the Treasury in United States Government debt instruments. 

‘‘(f) LEASE AGREEMENTS.—Notwithstanding any other provision 

of law, the Secretary may enter into long-term lease agreements that 

exceed 5 years or may take title to property (including through purchase agreements) for the purpose of obtaining offices to be used for 

the classification of cotton in accordance with this Act, if the Secretary determines that action would best effectuate the purposes of 

this Act. 

‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—To the extent that financing is not available from fees and the proceeds from the sales 

of samples, there are authorized to be appropriated such sums as 

are necessary to carry out this section.’’. 

SEC. 14202. DESIGNATION OF STATES FOR COTTON RESEARCH AND 

PROMOTION. 

Section 17(f) of the Cotton Research and Promotion Act (7 

U.S.C. 2116(f)) is amended—

(1) by striking ‘‘(f) The term’’ and inserting the following: 

‘‘(f) COTTON-PRODUCING STATE.—

‘‘(1) IN GENERAL.—The term’’; 


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(2) by striking ‘‘more, and the term’’ and all that follows 

through the end of the subsection and inserting the following: 

‘‘more. 

‘‘(2) INCLUSIONS.—The term ‘cotton-producing State’ includes—

‘‘(A) any combination of States described in paragraph 

(1); and 

‘‘(B) effective beginning with the 2008 crop of cotton, 

the States of Kansas, Virginia, and Florida.’’. 

SEC. 14203. GRANTS TO REDUCE PRODUCTION OF 

METHAMPHETAMINES FROM ANHYDROUS AMMONIA. 

(a) DEFINITIONS.—In this section: 

(1) ELIGIBLE ENTITY.—The term ‘‘eligible entity’’ means—

(A) a producer of agricultural commodities; 

(B) a cooperative association, a majority of the members of which produce or process agricultural commodities; 

or 

(C) a person in the trade or business of—

(i) selling an agricultural product (including an 

agricultural chemical) at retail, predominantly to 

farmers and ranchers; or 

(ii) aerial and ground application of an agricultural chemical. 

(2) NURSE TANK.—The term ‘‘nurse tank’’ shall be considered to be a cargo tank (within the meaning of section 

173.315(m) of title 49, Code of Federal Regulations, as in effect 

as of the date of the enactment of this Act). 

(b) GRANT AUTHORITY.—The Secretary may make a grant to an 

eligible entity to enable the eligible entity to obtain and add to an 

anhydrous ammonia fertilizer nurse tank a physical lock or a substance to reduce the amount of methamphetamine that can be produced from any anhydrous ammonia removed from the nurse tank. 

(c) GRANT AMOUNT.—The amount of a grant made under this 

section to an eligible entity shall be the product obtained by multiplying—

(1) an amount not less than $40 and not more than $60, 

as determined by the Secretary; and 

(2) the number of fertilizer nurse tanks of the eligible entity. 

(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to the Secretary to make grants under this section $15,000,000 for the period of fiscal years 2008 through 2012. 

SEC. 14204. GRANTS TO IMPROVE SUPPLY, STABILITY, SAFETY, AND 

TRAINING OF AGRICULTURAL LABOR FORCE. 

(a) DEFINITION OF ELIGIBLE ENTITY.—In this section, the term 

‘‘eligible entity’’ means an entity described in section 379C(a) of the 

Consolidated Farm and Rural Development Act (7 U.S.C. 2008q(a)). 

(b) GRANTS.—

(1) IN GENERAL.—To assist agricultural employers and 

farmworkers by improving the supply, stability, safety, and 

training of the agricultural labor force, the Secretary may provide grants to eligible entities for use in providing services to 

assist farmworkers who are citizens or otherwise legally present 

in the United States in securing, retaining, upgrading, or returning from agricultural jobs. 


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(2) ELIGIBLE SERVICES.—The services referred to in paragraph (1) include—

(A) agricultural labor skills development; 

(B) the provision of agricultural labor market information; 

(C) transportation; 

(D) short-term housing while in transit to an agricultural worksite; 

(E) workplace literacy and assistance with English as 

a second language; 

(F) health and safety instruction, including ways of 

safeguarding the food supply of the United States; and 

(G) such other services as the Secretary determines to 

be appropriate. 

(c) LIMITATION ON ADMINISTRATIVE EXPENSES.—Not more than 

15 percent of the funds made available to carry out this section for 

a fiscal year may be used to pay for administrative expenses. 

(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this section for each of fiscal years 2008 through 2012. 

SEC. 14205. AMENDMENT TO THE RIGHT TO FINANCIAL PRIVACY ACT 

OF 1978. 

Section 1113(k) of the Right to Financial Privacy Act of 1978 

(12 U.S.C. 3413(k)) is amended—

(1) by striking the subsection heading and inserting the following: 

‘‘(k) DISCLOSURE NECESSARY FOR PROPER ADMINISTRATION OF

PROGRAMS OF CERTAIN GOVERNMENT AUTHORITIES.—’’; and 

(2) by striking paragraph (2) and inserting the following: 

‘‘(2) Nothing in this title shall apply to the disclosure by the 

financial institution of information contained in the financial 

records of any customer to any Government authority that certifies, disburses, or collects payments, where the disclosure of 

such information is necessary to, and such information is used 

solely for the purpose of—

‘‘(A) verification of the identity of any person or proper 

routing and delivery of funds in connection with the 

issuance of a Federal payment or collection of funds by a 

Government authority; or 

‘‘(B) the investigation or recovery of an improper Federal payment or collection of funds or an improperly negotiated Treasury check. 

‘‘(3) Notwithstanding any other provision of law, a request 

authorized by paragraph (1) or (2) (and the information contained therein) may be used by the financial institution or its 

agents solely for the purpose of providing information contained 

in the financial records of the customer to the Government authority requesting the information, and the financial institution 

and its agents shall be barred from redisclosure of such information. Any Government authority receiving information pursuant to paragraph (1) or (2) may not disclose or use the information, except for the purposes set forth in such paragraph.’’. 

SEC. 14206. REPORT ON STORED QUANTITIES OF PROPANE. 

(a) REPORT.—


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(1) IN GENERAL.—Not later than 240 days after the date of 

the enactment of this Act, the Secretary of Homeland Security 

(referred to in this section as the ‘‘Secretary’’) shall submit to 

the Committee on Agriculture, Nutrition, and Forestry of the 

Senate and the Committee on Agriculture of the House of Representatives a report describing the effect of interim or final regulations issued by the Secretary pursuant to section 550(a) of 

the Department of Homeland Security Appropriations Act, 2007 

(6 U.S.C. 121 note; Public Law 109–295), with respect to possession of quantities of propane that meet or exceed the screening 

threshold quantity for propane established in the final rule 

under that section. 

(2) INCLUSIONS.—The report under paragraph (1) shall include a description of— (A) the number of facilities that completed a top screen 

consequence assessment due to possession of quantities of 

propane that meet or exceed the listed screening threshold 

quantity for propane; 

(B) the number of agricultural facilities that completed 

the top screen consequence assessment due to possession of 

quantities of propane that meet or exceed the listed screening threshold quantity for propane; 

(C) the number of propane facilities initially determined to be high risk by the Secretary; 

(D) the number of propane facilities— (i) required to complete a security vulnerability assessment or a site security plan; or 

(ii) that submit to the Secretary an alternative security program; 

(E) the number of propane facilities that file an appeal 

of a finding under the final rule described in paragraph 

(1); and 

(F) to the extent available, the average cost of— (i) completing a top screen consequence assessment 

requirement; 

(ii) completing a security vulnerability assessment; 

and 

(iii) completing and implementing a site security 

plan; and 

(3) FORM.—The report under paragraph (1) shall be submitted in unclassified form, but may include a classified annex. 

(b) EDUCATIONAL OUTREACH.—Not later than 30 days after the 

date of the enactment of this Act, the Secretary shall conduct educational outreach activities for rural facilities that may be required 

to complete a top screen consequence assessment due to possession 

of propane in a quantity that meets or exceeds the listed screening 

threshold quantity for propane. 

SEC. 14207. PROHIBITIONS ON DOG FIGHTING VENTURES. 

(a) IN GENERAL.—Section 26 of the Animal Welfare Act (7 

U.S.C. 2156) is amended—

(1) in subsection (a)—

(A) in paragraph (1), by striking ‘‘, if any animal in the 

venture was moved in interstate or foreign commerce’’; and 

(B) in the heading of paragraph (2), by striking 

‘‘STATE’’ and inserting ‘‘STATE’’; 


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(2) in subsection (b)—

(A) by striking ‘‘(b) It shall be’’ and inserting the following: 

‘‘(b) BUYING, SELLING, DELIVERING, POSSESSING, TRAINING, OR

TRANSPORTING ANIMALS FOR PARTICIPATION IN ANIMAL FIGHTING

VENTURE.—It shall be’’; and 

(B) by striking ‘‘transport, deliver’’ and all that follows 

through ‘‘participate’’ and inserting ‘‘possess, train, transport, deliver, or receive any animal for purposes of having 

the animal participate’’; 

(3) in subsection (c)—

(A) by striking ‘‘(c) It shall be’’ and inserting the following: 

‘‘(c) USE OF POSTAL SERVICE OR OTHER INTERSTATE INSTRUMENTALITY FOR PROMOTING OR FURTHERING ANIMAL FIGHTING

VENTURE.—It shall be’’; and 

(B) by inserting ‘‘advertising an animal, or an instrument described in subsection (e), for use in an animal fighting venture,’’ after ‘‘for purposes of’’; 

(4) in subsection (d), by striking ‘‘(d) Notwithstanding’’ and 

inserting the following: 

‘‘(d) VIOLATION OF STATE LAW.—Notwithstanding’’; 

(5) in subsection (e), by striking ‘‘(e) It shall be’’ and inserting the following: 

‘‘(e) BUYING, SELLING, DELIVERING, OR TRANSPORTING SHARP

INSTRUMENTS FOR USE IN ANIMAL FIGHTING VENTURE.—It shall 

be’’; 

(6) in subsection (f)—

(A) by striking ‘‘(f) The Secretary’’ and inserting the following: 

‘‘(f) INVESTIGATION OF VIOLATIONS BY SECRETARY; ASSISTANCE

BY OTHER FEDERAL AGENCIES; ISSUANCE OF SEARCH WARRANT; 

FORFEITURE; COSTS RECOVERABLE IN FORFEITURE OR CIVIL ACTION.—The Secretary’’; and 

(B) in the last sentence—

(i) by striking ‘‘by the United States’’; 

(ii) by inserting ‘‘(1)’’ after ‘‘owner of the animals’’; 

and 

(iii) by striking ‘‘proceeding or in’’ and inserting 

‘‘proceeding, or (2) in’’; 

(7) in subsection (g)—

(A) by striking ‘‘(g) For purposes of’’ and inserting the 

following: 

‘‘(g) DEFINITIONS.—In’’; 

(B) in paragraph (1), by striking ‘‘any event’’ and all 

that follows through ‘‘entertainment’’ and inserting ‘‘any 

event, in or affecting interstate or foreign commerce, that 

involves a fight conducted or to be conducted between at 

least 2 animals for purposes of sport, wagering, or entertainment,’’; 

(C) by striking paragraph (2); 

(D) in paragraph (5)—

(i) by striking ‘‘dog or other’’; and 

(ii) by striking ‘‘; and’’ and inserting a period; and 


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(E) by redesignating paragraphs (3) through (5) as 

paragraphs (2) through (4), respectively; 

(8) by redesignating subsections (h) and (i) as subsections 

(i) and (j), respectively; 

(9) in subsection (i) (as so redesignated), by striking ‘‘(i)(1) 

The provisions’’ and inserting the following: 

‘‘(i) CONFLICT WITH STATE LAW.—

‘‘(1) IN GENERAL.—The provisions’’; 

(10) in subsection (j) (as so redesignated), by striking ‘‘(j) 

The criminal’’ and inserting the following: 

‘‘(j) CRIMINAL PENALTIES.—The criminal’’; and 

(11) in subsection (g)(6), by striking ‘‘(6) the conduct’’ and 

inserting the following: 

‘‘(h) RELATIONSHIP TO OTHER PROVISIONS.—The conduct’’. 

(b) ENFORCEMENT OF ANIMAL FIGHTING PROHIBITIONS.—Section 49 of title 18, United States Code, is amended by striking ‘‘3 

years’’ and inserting ‘‘5 years’’. 

SEC. 14208. DEPARTMENT OF AGRICULTURE CONFERENCE TRANSPARENCY. 

(a) REPORT.—

(1) REQUIREMENT.—Not later than September 30 of each 

year, the Secretary of Agriculture shall submit to the Committee 

on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate, a 

report on conferences sponsored or held by the Department of 

Agriculture or attended by employees of the Department of Agriculture. 

(2) CONTENTS.—Each report under paragraph (1) shall 

contain—

(A) for each conference sponsored or held by the Department or attended by employees of the Department—

(i) the name of the conference; 

(ii) the location of the conference; 

(iii) the number of Department of Agriculture employees attending the conference; and 

(iv) the costs (including travel expenses) relating to 

such conference; and 

(B) for each conference sponsored or held by the Department of Agriculture for which the Department awarded 

a procurement contract, a description of the contracting 

procedures related to such conference. 

(3) EXCLUSIONS.—The requirement in paragraph (1) shall 

not apply to any conference—

(A) for which the cost to the Federal Government was 

less than $10,000; or 

(B) outside of the United States that is attended by the 

Secretary or the Secretary’s designee as an official representative of the United States government. 

(b) AVAILABILITY OF REPORT.—Each report submitted in accordance with subsection (a) shall be posted in a searchable format on 

a Department of Agriculture website that is available to the public. 

(c) DEFINITION OF CONFERENCE.—In this section, the term ‘‘conference’’—

(1) means a meeting that—


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(A) is held for consultation, education, awareness, or 

discussion; 

(B) includes participants from at least one agency of 

the Department of Agriculture; 

(C) is held in whole or in part at a facility outside of 

an agency of the Department of Agriculture; and 

(D) involves costs associated with travel and lodging 

for some participants; and 

(2) does not include any training program that is continuing education or a curriculum-based educational program, 

provided that such training program is held independent of a 

conference of a non-governmental organization. 

SEC. 14209. FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE 

ACT AMENDMENTS. 

(a) PAYMENT OF EXPENSES.—Section 17(d) of the Federal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. 136o(d)) is amended—

(1) by striking ‘‘The Administrator’’ and inserting the following: 

‘‘(1) IN GENERAL.—The Administrator’’; and 

(2) by adding at the end the following new paragraph: 

‘‘(2) DEPARTMENT OF STATE EXPENSES.—Any expenses incurred by an employee of the Environmental Protection Agency 

who participates in any international technical, economic, or 

policy review board, committee, or other official body that is 

meeting in relation to an international treaty shall be paid by 

the Department of State.’’. 

(b) CONTAINER RECYCLING.—Section 19(a) of the Federal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. 136q(a)) is amended by adding at the end the following new paragraph: 

‘‘(4) CONTAINER RECYCLING.—The Secretary may promulgate a regulation for the return and recycling of disposable pesticide containers used for the distribution or sale of registered 

pesticide products in interstate commerce. Any such regulation 

requiring recycling of disposable pesticide containers shall not 

apply to antimicrobial pesticides (as defined in section 2) or 

other pesticide products intended for non-agricultural uses.’’. 

SEC. 14210. IMPORTATION OF LIVE DOGS. 

(a) IN GENERAL.—The Animal Welfare Act is amended by adding after section 17 (7 U.S.C. 2147) the following: 

‘‘SEC. 18. IMPORTATION OF LIVE DOGS. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) IMPORTER.—The term ‘importer’ means any person 

who, for purposes of resale, transports into the United States 

puppies from a foreign country. 

‘‘(2) RESALE.—The term ‘resale’ includes any transfer of 

ownership or control of an imported dog of less than 6 months 

of age to another person, for more than de minimis consideration. 

‘‘(b) REQUIREMENTS.—

‘‘(1) IN GENERAL.—Except as provided in paragraph (2), no 

person shall import a dog into the United States for purposes 

of resale unless, as determined by the Secretary, the dog—

‘‘(A) is in good health; 


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‘‘(B) has received all necessary vaccinations; and 

‘‘(C) is at least 6 months of age, if imported for resale. 

‘‘(2) EXCEPTION.—

‘‘(A) IN GENERAL.—The Secretary, by regulation, shall 

provide an exception to any requirement under paragraph 

(1) in any case in which a dog is imported for—

‘‘(i) research purposes; or 

‘‘(ii) veterinary treatment. 

‘‘(B) LAWFUL IMPORTATION INTO HAWAII.—Paragraph 

(1)(C) shall not apply to the lawful importation of a dog 

into the State of Hawaii from the British Isles, Australia, 

Guam, or New Zealand in compliance with the applicable 

regulations of the State of Hawaii and the other requirements of this section, if the dog is not transported out of the 

State of Hawaii for purposes of resale at less than 6 months 

of age. 

‘‘(c) IMPLEMENTATION AND REGULATIONS.—The Secretary, the 

Secretary of Health and Human Services, the Secretary of Commerce, and the Secretary of Homeland Security shall promulgate 

such regulations as the Secretaries determine to be necessary to implement and enforce this section. 

‘‘(d) ENFORCEMENT.—An importer that fails to comply with this 

section shall—

‘‘(1) be subject to penalties under section 19; and 

‘‘(2) provide for the care (including appropriate veterinary 

care), forfeiture, and adoption of each applicable dog, at the expense of the importer.’’. 

(b) EFFECTIVE DATE.—The amendment made by subsection (a) 

takes effect on the date of the enactment of this Act. 

SEC. 14211. PERMANENT DEBARMENT FROM PARTICIPATION IN DEPARTMENT OF AGRICULTURE PROGRAMS FOR FRAUD. 

(a) IN GENERAL.—Subject to subsection (b), the Secretary of Agriculture shall permanently debar an individual, organization, corporation, or other entity convicted of a felony for knowingly defrauding the United States in connection with any program administered 

by the Department of Agriculture from any subsequent participation 

in Department of Agriculture programs. 

(b) EXCEPTIONS.—

(1) SECRETARY DETERMINATION.—The Secretary may reduce 

a debarment under subsection (a) to a period of not less than 

10 years if the Secretary considers it appropriate. 

(2) FOOD ASSISTANCE.—A debarment under subsection (a) 

shall not apply with respect to participation in domestic food 

assistance programs (as defined by the Secretary). 

SEC. 14212. PROHIBITION ON CLOSURE OR RELOCATION OF COUNTY 

OFFICES FOR THE FARM SERVICE AGENCY. 

(a) TEMPORARY PROHIBITION.—

(1) IN GENERAL.—Subject to paragraph (2), until the date 

that is two years after the date of the enactment of this Act, the 

Secretary of Agriculture may not close or relocate a county or 

field office of the Farm Service Agency. 

(2) EXCEPTION.—Paragraph (1) shall not apply to—

(A) an office that is located not more than 20 miles 

from another office of the Farm Service Agency; or 


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(B) the relocation of an office within the same county 

in the course of routine leasing operations. 

(b) LIMITATION ON CLOSURE; NOTICE.—

(1) LIMITATION.—After the period referred to in subsection 

(a)(1), the Secretary shall, before closing any office of the Farm 

Service Agency that is located more than 20 miles from another 

office of the Farm Service Agency, to the maximum extent practicable, first close any offices of the Farm Service Agency that—

(A) are located less than 20 miles from another office 

of the Farm Service Agency; and 

(B) have two or fewer permanent full-time employees. 

(2) NOTICE.—After the period referred to in subsection 

(a)(1), the Secretary of Agriculture may not close a county or 

field office of the Farm Service Agency unless—

(A) not later than 30 days after the Secretary proposes 

to close such office, the Secretary holds a public meeting regarding the proposed closure in the county in which such 

office is located; and 

(B) after the public meeting referred to in subparagraph (A), but not less than 90 days before the date on 

which the Secretary approves the closure of such office, the 

Secretary notifies the Committee on Agriculture and the 

Committee on Appropriations of the House of Representatives, the Committee on Agriculture, Nutrition, and Forestry and the Committee on Appropriations of the Senate, 

each Senator representing the State in which the office proposed to be closed is located, and the member of the House 

of Representatives who represents the Congressional district 

in which the office proposed to be closed is located of the 

proposed closure of such office. 

SEC. 14213. USDA GRADUATE SCHOOL. 

(a) IN GENERAL.—Section 921 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 2279b) is amended—

(1) in the heading, to read as follows: 

‘‘SEC. 921. DEPARTMENT OF AGRICULTURE EDUCATIONAL, TRAINING, 

AND PROFESSIONAL DEVELOPMENT ACTIVITIES.’’; and 

(2) by striking subsection (b) and inserting the following 

new subsection: 

‘‘(b) OPERATION AS NONAPPROPRIATED FUND INSTRUMENTALITY.—

‘‘(1) CEASE OPERATIONS.—Not later than October 1, 2009, 

the Secretary of Agriculture shall cease to maintain or operate 

a nonappropriated fund instrumentality of the United States to 

develop, administer, or provide educational training and professional development activities, including educational activities 

for Federal agencies, Federal employees, non-profit organizations, other entities, and members of the general public. 

‘‘(2) TRANSITION.— ‘‘(A) IN GENERAL.—The Secretary of Agriculture is authorized to use funds available to the Department of Agriculture and such resources of the Department as the Secretary considers appropriate (including the assignment of 

such employees of the Department as the Secretary considers appropriate) to assist the General Administrative 


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Board of the Graduate School in the conversion of the 

Graduate School to an entity that is non-governmental and 

not a nonappropriated fund instrumentality of the United 

States, including such privatization activities not otherwise 

inconsistent with law or regulation. 

‘‘(B) TERMINATION OF AUTHORITY.—The authority 

under paragraph (1) shall terminate on the earlier of—

‘‘(i) the completion of the transition of the Graduate School to an entity that is non-governmental and 

not a nonappropriated fund instrumentality of the 

United States, as determined by the Secretary; or 

‘‘(ii) September 30, 2009.’’. 

(b) PROCUREMENT PROCEDURES.—Notwithstanding the amendments made by subsection (a), effective on the date of the enactment 

of this Act, the Graduate School of the Department of Agriculture 

shall be subject to Federal procurement laws and regulations in the 

same manner and subject to the same requirements as a private entity providing services to the Federal Government. 

SEC. 14214. FINES FOR VIOLATIONS OF THE ANIMAL WELFARE ACT. 

Section 19(b) of the Animal Welfare Act (7 U.S.C. 2149(b)) is 

amended in the first sentence by striking ‘‘not more than $2,500 for 

each such violation’’ and inserting ‘‘not more than $10,000 for each 

such violation’’. 

SEC. 14215. DEFINITION OF CENTRAL FILING SYSTEM. 

Section 1324(c)(2) of the Food Security Act of 1985 (7 U.S.C. 

1631(c)(2)) is amended—

(1) in subparagraph (C)(ii)(II), by inserting after ‘‘such 

debtors’’ the following: ‘‘, except that the numerical list containing social security or taxpayer identification numbers may 

be encrypted for security purposes if the Secretary of State provides a method by which an effective search of the encrypted 

numbers may be conducted to determine whether the farm product at issue is subject to 1 or more liens’’; and 

(2) in subparagraph (E)—

(A) by striking ‘‘paragraph (C)’’ and inserting ‘‘subparagraph (C)’’; and 

(B) by inserting before the semicolon at the end the following: ‘‘except that—

‘‘(i) the distribution of the portion of the master list 

may be in electronic, written, or printed form; and 

‘‘(ii) if social security or taxpayer identification 

numbers on the master list are encrypted, the Secretary 

of State may distribute the master list only—

‘‘(I) by compact disc or other electronic media 

that contains—

‘‘(aa) the recorded list of debtor names; 

and 

‘‘(bb) an encryption program that enables 

the buyer, commission merchant, and selling 

agent to enter a social security number for 

matching against the recorded list of 

encrypted social security or taxpayer identification numbers; and 


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‘‘(II) on the written request of the buyer, commission merchant, or selling agent, by paper copy 

of the list to the requestor’’. 

SEC. 14216. CONSIDERATION OF PROPOSED RECOMMENDATIONS OF 

STUDY ON USE OF CATS AND DOGS IN FEDERAL RESEARCH. 

(a) IN GENERAL.—The Secretary of Agriculture shall— (1) review— (A) any independent reviews conducted by a nationally 

recognized panel of experts of the use of Class B dogs and 

cats in federally supported research to determine how frequently such dogs and cats are used in research by the National Institutes of Health; and 

(B) any recommendations proposed by such panel outlining the parameters of such use; and 

(2) submit to the Committee on Agriculture of the House of 

Representatives and the Committee on Agriculture, Nutrition, 

and Forestry of the Senate a report on how recommendations 

referred to in paragraph (1)(B) can be applied within the Department of Agriculture to ensure such dogs and cats are treated in accordance with regulations of the Department of Agriculture. 

(b) CLASS B DOGS AND CATS DEFINED.—In this section, the 

term ‘‘Class B dogs and cats’’ means dogs and cats obtained from 

a Class ‘‘B’’ licensee, as such term is defined in section 1.1 of title 

9, Code of Federal Regulations. 

SEC. 14217. REGIONAL ECONOMIC AND INFRASTRUCTURE DEVELOPMENT. 

(a) IN GENERAL.—Title 40, United States Code, is amended—

(1) by redesignating subtitle V as subtitle VI; and 

(2) by inserting after subtitle IV the following: 

‘‘Subtitle V—Regional Economic and Infrastructure 

Development 

‘‘Chapter 

‘‘151. GENERAL PROVISIONS ........................................................................... 15101 

‘‘153. REGIONAL COMMISSIONS ...................................................................... 15301 

‘‘155. FINANCIAL ASSISTANCE ........................................................................ 15501 

‘‘157. ADMINISTRATIVE PROVISIONS ............................................................ 15701 

‘‘CHAPTER 1—GENERAL PROVISIONS 

‘‘Sec. 

‘‘15101. Definitions. 

‘‘§ 15101. Definitions 

‘‘In this subtitle, the following definitions apply: 

‘‘(1) COMMISSION.—The term ‘Commission’ means a Commission established under section 15301. 

‘‘(2) LOCAL DEVELOPMENT DISTRICT.—The term ‘local development district’ means an entity that—

‘‘(A)(i) is an economic development district that is—

‘‘(I) in existence on the date of the enactment of this 

chapter; and 

‘‘(II) located in the region; or 

‘‘(ii) if an entity described in clause (i) does not exist—


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‘‘(I) is organized and operated in a manner that 

ensures broad-based community participation and an 

effective opportunity for local officials, community leaders, and the public to contribute to the development 

and implementation of programs in the region; 

‘‘(II) is governed by a policy board with at least a 

simple majority of members consisting of—

‘‘(aa) elected officials; or 

‘‘(bb) designees or employees of a general purpose unit of local government that have been appointed to represent the unit of local government; 

and 

‘‘(III) is certified by the Governor or appropriate 

State officer as having a charter or authority that includes the economic development of counties, portions 

of counties, or other political subdivisions within the 

region; and 

‘‘(B) has not, as certified by the Federal Cochairperson—

‘‘(i) inappropriately used Federal grant funds from 

any Federal source; or ‘‘(ii) appointed an officer who, during the period in 

which another entity inappropriately used Federal 

grant funds from any Federal source, was an officer of 

the other entity. 

‘‘(3) FEDERAL GRANT PROGRAM.—The term ‘Federal grant 

program’ means a Federal grant program to provide assistance 

in carrying out economic and community development activities. 

‘‘(4) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning given the term in section 4 of the Indian Self-Determination 

and Education Assistance Act (25 U.S.C. 450b). 

‘‘(5) NONPROFIT ENTITY.—The term ‘nonprofit entity’ means 

any organization described in section 501(c) of the Internal Revenue Code of 1986 and exempt from taxation under 501(a) of 

that Code that has been formed for the purpose of economic development. 

‘‘(6) REGION.—The term ‘region’ means the area covered by 

a Commission as described in subchapter II of chapter 157. 

‘‘CHAPTER 2—REGIONAL COMMISSIONS 

‘‘Sec. 

‘‘15301. Establishment, membership, and employees. 

‘‘15302. Decisions. 

‘‘15303. Functions. 

‘‘15304. Administrative powers and expenses. 

‘‘15305. Meetings. 

‘‘15306. Personal financial interests. 

‘‘15307. Tribal participation. 

‘‘15308. Annual report. 

‘‘§ 15301. Establishment, membership, and employees 

‘‘(a) ESTABLISHMENT.—There are established the following regional Commissions: 

‘‘(1) The Southeast Crescent Regional Commission. 

‘‘(2) The Southwest Border Regional Commission. 


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‘‘(3) The Northern Border Regional Commission. 

‘‘(b) MEMBERSHIP.—

‘‘(1) FEDERAL AND STATE MEMBERS.—Each Commission 

shall be composed of the following members: 

‘‘(A) A Federal Cochairperson, to be appointed by the 

President, by and with the advice and consent of the Senate. 

‘‘(B) The Governor of each participating State in the region of the Commission. 

‘‘(2) ALTERNATE MEMBERS.—

‘‘(A) ALTERNATE FEDERAL COCHAIRPERSON.—The President shall appoint an alternate Federal Cochairperson for 

each Commission. The alternate Federal Cochairperson, 

when not actively serving as an alternate for the Federal 

Cochairperson, shall perform such functions and duties as 

are delegated by the Federal Cochairperson. 

‘‘(B) STATE ALTERNATES.—The State member of a participating State may have a single alternate, who shall be 

appointed by the Governor of the State from among the 

members of the Governor’s cabinet or personal staff. 

‘‘(C) VOTING.—An alternate member shall vote in the 

case of the absence, death, disability, removal, or resignation of the Federal or State member for which the alternate 

member is an alternate. 

‘‘(3) COCHAIRPERSONS.—A Commission shall be headed 

by—

‘‘(A) the Federal Cochairperson, who shall serve as a liaison between the Federal Government and the Commission; and 

‘‘(B) a State Cochairperson, who shall be a Governor of 

a participating State in the region and shall be elected by 

the State members for a term of not less than 1 year. 

‘‘(4) CONSECUTIVE TERMS.—A State member may not be 

elected to serve as State Cochairperson for more than 2 consecutive terms. 

‘‘(c) COMPENSATION.—

‘‘(1) FEDERAL COCHAIRPERSONS.—Each Federal Cochairperson shall be compensated by the Federal Government at level 

III of the Executive Schedule as set out in section 5314 of title 

5. 

‘‘(2) ALTERNATE FEDERAL COCHAIRPERSONS.—Each Federal 

Cochairperson’s alternate shall be compensated by the Federal 

Government at level V of the Executive Schedule as set out in 

section 5316 of title 5. 

‘‘(3) STATE MEMBERS AND ALTERNATES.—Each State member and alternate shall be compensated by the State that they 

represent at the rate established by the laws of that State. 

‘‘(d) EXECUTIVE DIRECTOR AND STAFF.—

‘‘(1) IN GENERAL.—A Commission shall appoint and fix the 

compensation of an executive director and such other personnel 

as are necessary to enable the Commission to carry out its duties. Compensation under this paragraph may not exceed the 

maximum rate of basic pay established for the Senior Executive 

Service under section 5382 of title 5, including any applicable 


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locality-based comparability payment that may be authorized 

under section 5304(h)(2)(C) of that title. 

‘‘(2) EXECUTIVE DIRECTOR.—The executive director shall be 

responsible for carrying out the administrative duties of the 

Commission, directing the Commission staff, and such other 

duties as the Commission may assign. 

‘‘(e) NO FEDERAL EMPLOYEE STATUS.—No member, alternate, 

officer, or employee of a Commission (other than the Federal Cochairperson, the alternate Federal Cochairperson, staff of the Federal Cochairperson, and any Federal employee detailed to the Commission) shall be considered to be a Federal employee for any purpose. 

‘‘§ 15302. Decisions 

‘‘(a) REQUIREMENTS FOR APPROVAL.—Except as provided in section 15304(c)(3), decisions by the Commission shall require the affirmative vote of the Federal Cochairperson and a majority of the 

State members (exclusive of members representing States delinquent 

under section 15304(c)(3)(C)). 

‘‘(b) CONSULTATION.—In matters coming before the Commission, 

the Federal Cochairperson shall, to the extent practicable, consult 

with the Federal departments and agencies having an interest in 

the subject matter. 

‘‘(c) QUORUMS.—A Commission shall determine what constitutes 

a quorum for Commission meetings; except that—

‘‘(1) any quorum shall include the Federal Cochairperson or 

the alternate Federal Cochairperson; and 

‘‘(2) a State alternate member shall not be counted toward 

the establishment of a quorum. 

‘‘(d) PROJECTS AND GRANT PROPOSALS.—The approval of project 

and grant proposals shall be a responsibility of each Commission 

and shall be carried out in accordance with section 15503. 

‘‘§ 15303. Functions 

‘‘A Commission shall—

‘‘(1) assess the needs and assets of its region based on available research, demonstration projects, investigations, assessments, and evaluations of the region prepared by Federal, 

State, and local agencies, universities, local development districts, and other nonprofit groups; 

‘‘(2) develop, on a continuing basis, comprehensive and coordinated economic and infrastructure development strategies to 

establish priorities and approve grants for the economic development of its region, giving due consideration to other Federal, 

State, and local planning and development activities in the region; 

‘‘(3) not later than one year after the date of the enactment 

of this section, and after taking into account State plans developed under section 15502, establish priorities in an economic 

and infrastructure development plan for its region, including 5- 

year regional outcome targets; 

‘‘(4)(A) enhance the capacity of, and provide support for, 

local development districts in its region; or 


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‘‘(B) if no local development district exists in an area in a 

participating State in the region, foster the creation of a local 

development district; ‘‘(5) encourage private investment in industrial, commercial, and other economic development projects in its region; ‘‘(6) cooperate with and assist State governments with the 

preparation of economic and infrastructure development plans 

and programs for participating States; ‘‘(7) formulate and recommend to the Governors and legislatures of States that participate in the Commission forms of 

interstate cooperation and, where appropriate, international cooperation; and ‘‘(8) work with State and local agencies in developing appropriate model legislation to enhance local and regional economic development. 

‘‘§ 15304. Administrative powers and expenses 

‘‘(a) POWERS.—In carrying out its duties under this subtitle, a 

Commission may— ‘‘(1) hold such hearings, sit and act at such times and 

places, take such testimony, receive such evidence, and print or 

otherwise reproduce and distribute a description of the proceedings and reports on actions by the Commission as the Commission considers appropriate; ‘‘(2) authorize, through the Federal or State Cochairperson 

or any other member of the Commission designated by the Commission, the administration of oaths if the Commission determines that testimony should be taken or evidence received 

under oath; ‘‘(3) request from any Federal, State, or local agency such 

information as may be available to or procurable by the agency 

that may be of use to the Commission in carrying out the duties 

of the Commission; ‘‘(4) adopt, amend, and repeal bylaws and rules governing 

the conduct of business and the performance of duties by the 

Commission; 

‘‘(5) request the head of any Federal agency, State agency, 

or local government to detail to the Commission such personnel 

as the Commission requires to carry out its duties, each such 

detail to be without loss of seniority, pay, or other employee status; 

‘‘(6) provide for coverage of Commission employees in a 

suitable retirement and employee benefit system by making arrangements or entering into contracts with any participating 

State government or otherwise providing retirement and other 

employee coverage; 

‘‘(7) accept, use, and dispose of gifts or donations or services 

or real, personal, tangible, or intangible property; 

‘‘(8) enter into and perform such contracts, cooperative 

agreements, or other transactions as are necessary to carry out 

Commission duties, including any contracts or cooperative 

agreements with a department, agency, or instrumentality of the 

United States, a State (including a political subdivision, agency, or instrumentality of the State), or a person, firm, association, or corporation; and 


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‘‘(9) maintain a government relations office in the District 

of Columbia and establish and maintain a central office at 

such location in its region as the Commission may select. 

‘‘(b) FEDERAL AGENCY COOPERATION.—A Federal agency shall— ‘‘(1) cooperate with a Commission; and 

‘‘(2) provide, to the extent practicable, on request of the Federal Cochairperson, appropriate assistance in carrying out this 

subtitle, in accordance with applicable Federal laws (including 

regulations). 

‘‘(c) ADMINISTRATIVE EXPENSES.— ‘‘(1) IN GENERAL.—Subject to paragraph (2), the administrative expenses of a Commission shall be paid— ‘‘(A) by the Federal Government, in an amount equal to 

50 percent of the administrative expenses of the Commission; and ‘‘(B) by the States participating in the Commission, in 

an amount equal to 50 percent of the administrative expenses. 

‘‘(2) EXPENSES OF THE FEDERAL COCHAIRPERSON.—All expenses of the Federal Cochairperson, including expenses of the 

alternate and staff of the Federal Cochairperson, shall be paid 

by the Federal Government. 

‘‘(3) STATE SHARE.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

share of administrative expenses of a Commission to be 

paid by each State of the Commission shall be determined 

by a unanimous vote of the State members of the Commission. ‘‘(B) NO FEDERAL PARTICIPATION.—The Federal Cochairperson shall not participate or vote in any decision 

under subparagraph (A). 

‘‘(C) DELINQUENT STATES.—During any period in 

which a State is more than 1 year delinquent in payment 

of the State’s share of administrative expenses of the Commission under this subsection— ‘‘(i) no assistance under this subtitle shall be provided to the State (including assistance to a political 

subdivision or a resident of the State) for any project 

not approved as of the date of the commencement of the 

delinquency; and ‘‘(ii) no member of the Commission from the State 

shall participate or vote in any action by the Commission. ‘‘(4) EFFECT ON ASSISTANCE.—A State’s share of administrative expenses of a Commission under this subsection shall 

not be taken into consideration when determining the amount 

of assistance provided to the State under this subtitle. 

‘‘§ 15305. Meetings 

‘‘(a) INITIAL MEETING.—Each Commission shall hold an initial 

meeting not later than 180 days after the date of the enactment of 

this section. ‘‘(b) ANNUAL MEETING.—Each Commission shall conduct at 

least 1 meeting each year with the Federal Cochairperson and at 

least a majority of the State members present. 


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‘‘(c) ADDITIONAL MEETINGS.—Each Commission shall conduct 

additional meetings at such times as it determines and may conduct 

such meetings by electronic means. 

‘‘§ 15306. Personal financial interests 

‘‘(a) CONFLICTS OF INTEREST.— ‘‘(1) NO ROLE ALLOWED.—Except as permitted by paragraph 

(2), an individual who is a State member or alternate, or an officer or employee of a Commission, shall not participate personally and substantially as a member, alternate, officer, or employee of the Commission, through decision, approval, disapproval, recommendation, request for a ruling, or other determination, contract, claim, controversy, or other matter in which, 

to the individual’s knowledge, any of the following has a financial interest: ‘‘(A) The individual. 

‘‘(B) The individual’s spouse, minor child, or partner. ‘‘(C) An organization (except a State or political subdivision of a State) in which the individual is serving as 

an officer, director, trustee, partner, or employee. ‘‘(D) Any person or organization with whom the individual is negotiating or has any arrangement concerning 

prospective employment. 

‘‘(2) EXCEPTION.—Paragraph (1) shall not apply if the individual, in advance of the proceeding, application, request for a 

ruling or other determination, contract, claim controversy, or 

other particular matter presenting a potential conflict of interest— ‘‘(A) advises the Commission of the nature and circumstances of the matter presenting the conflict of interest; ‘‘(B) makes full disclosure of the financial interest; and 

‘‘(C) receives a written decision of the Commission that 

the interest is not so substantial as to be considered likely 

to affect the integrity of the services that the Commission 

may expect from the individual. 

‘‘(3) VIOLATION.—An individual violating this subsection 

shall be fined under title 18, imprisoned for not more than 1 

year, or both. 

‘‘(b) STATE MEMBER OR ALTERNATE.—A State member or alternate member may not receive any salary, or any contribution to, or 

supplementation of, salary, for services on a Commission from a 

source other than the State of the member or alternate. ‘‘(c) DETAILED EMPLOYEES.—

‘‘(1) IN GENERAL.—No person detailed to serve a Commission shall receive any salary, or any contribution to, or supplementation of, salary, for services provided to the Commission 

from any source other than the State, local, or intergovernmental department or agency from which the person was detailed to the Commission. ‘‘(2) VIOLATION.—Any person that violates this subsection 

shall be fined under title 18, imprisoned not more than 1 year, 

or both. 

‘‘(d) FEDERAL COCHAIRMAN, ALTERNATE TO FEDERAL COCHAIRMAN, AND FEDERAL OFFICERS AND EMPLOYEES.—The Federal Cochairman, the alternate to the Federal Cochairman, and any FedVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00596 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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eral officer or employee detailed to duty with the Commission are 

not subject to this section but remain subject to sections 202 through 

209 of title 18. ‘‘(e) RESCISSION.—A Commission may declare void any contract, 

loan, or grant of or by the Commission in relation to which the 

Commission determines that there has been a violation of any provision under subsection (a)(1), (b), or (c), or any of the provisions of 

sections 202 through 209 of title 18. 

‘‘§ 15307. Tribal participation 

‘‘Governments of Indian tribes in the region of the Southwest 

Border Regional Commission shall be allowed to participate in matters before that Commission in the same manner and to the same 

extent as State agencies and instrumentalities in the region. 

‘‘§ 15308. Annual report 

‘‘(a) IN GENERAL.—Not later than 90 days after the last day of 

each fiscal year, each Commission shall submit to the President and 

Congress a report on the activities carried out by the Commission 

under this subtitle in the fiscal year. ‘‘(b) CONTENTS.—The report shall include— ‘‘(1) a description of the criteria used by the Commission to 

designate counties under section 15702 and a list of the counties designated in each category; 

‘‘(2) an evaluation of the progress of the Commission in 

meeting the goals identified in the Commission’s economic and 

infrastructure development plan under section 15303 and State 

economic and infrastructure development plans under section 

15502; and 

‘‘(3) any policy recommendations approved by the Commission. 

‘‘CHAPTER 3—FINANCIAL ASSISTANCE 

‘‘Sec. 

‘‘15501. Economic and infrastructure development grants. 

‘‘15502. Comprehensive economic and infrastructure development plans. 

‘‘15503. Approval of applications for assistance. 

‘‘15504. Program development criteria. 

‘‘15505. Local development districts and organizations. 

‘‘15506. Supplements to Federal grant programs. 

‘‘§ 15501. Economic and infrastructure development grants 

‘‘(a) IN GENERAL.—A Commission may make grants to States 

and local governments, Indian tribes, and public and nonprofit organizations for projects, approved in accordance with section 

15503—

‘‘(1) to develop the transportation infrastructure of its region; 

‘‘(2) to develop the basic public infrastructure of its region; 

‘‘(3) to develop the telecommunications infrastructure of its 

region; 

‘‘(4) to assist its region in obtaining job skills training, 

skills development and employment-related education, entrepreneurship, technology, and business development; 

‘‘(5) to provide assistance to severely economically distressed 

and underdeveloped areas of its region that lack financial reVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00597 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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sources for improving basic health care and other public services; 

‘‘(6) to promote resource conservation, tourism, recreation, 

and preservation of open space in a manner consistent with economic development goals; 

‘‘(7) to promote the development of renewable and alternative energy sources; and 

‘‘(8) to otherwise achieve the purposes of this subtitle. 

‘‘(b) ALLOCATION OF FUNDS.—A Commission shall allocate at 

least 40 percent of any grant amounts provided by the Commission 

in a fiscal year for projects described in paragraphs (1) through (3) 

of subsection (a). 

‘‘(c) SOURCES OF GRANTS.—Grant amounts may be provided entirely from appropriations to carry out this subtitle, in combination 

with amounts available under other Federal grant programs, or 

from any other source. 

‘‘(d) MAXIMUM COMMISSION CONTRIBUTIONS.—

‘‘(1) IN GENERAL.—Subject to paragraphs (2) and (3), the 

Commission may contribute not more than 50 percent of a 

project or activity cost eligible for financial assistance under 

this section from amounts appropriated to carry out this subtitle. 

‘‘(2) DISTRESSED COUNTIES.—The maximum Commission 

contribution for a project or activity to be carried out in a county for which a distressed county designation is in effect under 

section 15702 may be increased to 80 percent. 

‘‘(3) SPECIAL RULE FOR REGIONAL PROJECTS.—A Commission may increase to 60 percent under paragraph (1) and 90 

percent under paragraph (2) the maximum Commission contribution for a project or activity if—

‘‘(A) the project or activity involves 3 or more counties 

or more than one State; and 

‘‘(B) the Commission determines in accordance with 

section 15302(a) that the project or activity will bring significant interstate or multicounty benefits to a region. 

‘‘(e) MAINTENANCE OF EFFORT.—Funds may be provided by a 

Commission for a program or project in a State under this section 

only if the Commission determines that the level of Federal or State 

financial assistance provided under a law other than this subtitle, 

for the same type of program or project in the same area of the State 

within region, will not be reduced as a result of funds made available by this subtitle. 

‘‘(f) NO RELOCATION ASSISTANCE.—Financial assistance authorized by this section may not be used to assist a person or entity in 

relocating from one area to another. 

‘‘§ 15502. Comprehensive economic and infrastructure development plans 

‘‘(a) STATE PLANS.—In accordance with policies established by 

a Commission, each State member of the Commission shall submit 

a comprehensive economic and infrastructure development plan for 

the area of the region represented by the State member. 

‘‘(b) CONTENT OF PLAN.—A State economic and infrastructure 

development plan shall reflect the goals, objectives, and priorities 


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identified in any applicable economic and infrastructure development plan developed by a Commission under section 15303. ‘‘(c) CONSULTATION WITH INTERESTED LOCAL PARTIES.—In carrying out the development planning process (including the selection 

of programs and projects for assistance), a State shall— ‘‘(1) consult with local development districts, local units of 

government, and local colleges and universities; and ‘‘(2) take into consideration the goals, objectives, priorities, 

and recommendations of the entities described in paragraph (1). 

‘‘(d) PUBLIC PARTICIPATION.— ‘‘(1) IN GENERAL.—A Commission and applicable State and 

local development districts shall encourage and assist, to the 

maximum extent practicable, public participation in the development, revision, and implementation of all plans and programs under this subtitle. ‘‘(2) GUIDELINES.—A Commission shall develop guidelines 

for providing public participation, including public hearings. 

‘‘§ 15503. Approval of applications for assistance 

‘‘(a) EVALUATION BY STATE MEMBER.—An application to a Commission for a grant or any other assistance for a project under this 

subtitle shall be made through, and evaluated for approval by, the 

State member of the Commission representing the applicant. 

‘‘(b) CERTIFICATION.—An application to a Commission for a 

grant or other assistance for a project under this subtitle shall be 

eligible for assistance only on certification by the State member of 

the Commission representing the applicant that the application for 

the project—

‘‘(1) describes ways in which the project complies with any 

applicable State economic and infrastructure development plan; ‘‘(2) meets applicable criteria under section 15504; 

‘‘(3) adequately ensures that the project will be properly administered, operated, and maintained; and ‘‘(4) otherwise meets the requirements for assistance under 

this subtitle. 

‘‘(c) VOTES FOR DECISIONS.—On certification by a State member 

of a Commission of an application for a grant or other assistance 

for a specific project under this section, an affirmative vote of the 

Commission under section 15302 shall be required for approval of 

the application. 

‘‘§ 15504. Program development criteria 

‘‘In considering programs and projects to be provided assistance 

by a Commission under this subtitle, and in establishing a priority 

ranking of the requests for assistance provided to the Commission, 

the Commission shall follow procedures that ensure, to the maximum extent practicable, consideration of— ‘‘(1) the relationship of the project or class of projects to 

overall regional development; ‘‘(2) the per capita income and poverty and unemployment 

and outmigration rates in an area; 

‘‘(3) the financial resources available to the applicants for 

assistance seeking to carry out the project, with emphasis on ensuring that projects are adequately financed to maximize the 

probability of successful economic development; 


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‘‘(4) the importance of the project or class of projects in relation to the other projects or classes of projects that may be in 

competition for the same funds; ‘‘(5) the prospects that the project for which assistance is 

sought will improve, on a continuing rather than a temporary 

basis, the opportunities for employment, the average level of income, or the economic development of the area to be served by 

the project; and ‘‘(6) the extent to which the project design provides for detailed outcome measurements by which grant expenditures and 

the results of the expenditures may be evaluated. 

‘‘§ 15505. Local development districts and organizations 

‘‘(a) GRANTS TO LOCAL DEVELOPMENT DISTRICTS.—Subject to 

the requirements of this section, a Commission may make grants to 

a local development district to assist in the payment of development 

planning and administrative expenses. 

‘‘(b) CONDITIONS FOR GRANTS.— ‘‘(1) MAXIMUM AMOUNT.—The amount of a grant awarded 

under this section may not exceed 80 percent of the administrative and planning expenses of the local development district receiving the grant. 

‘‘(2) MAXIMUM PERIOD FOR STATE AGENCIES.—In the case of 

a State agency certified as a local development district, a grant 

may not be awarded to the agency under this section for more 

than 3 fiscal years. ‘‘(3) LOCAL SHARE.—The contributions of a local development district for administrative expenses may be in cash or in 

kind, fairly evaluated, including space, equipment, and services. 

‘‘(c) DUTIES OF LOCAL DEVELOPMENT DISTRICTS.—A local development district shall— ‘‘(1) operate as a lead organization serving multicounty 

areas in the region at the local level; 

‘‘(2) assist the Commission in carrying out outreach activities for local governments, community development groups, the 

business community, and the public; 

‘‘(3) serve as a liaison between State and local governments, 

nonprofit organizations (including community-based groups 

and educational institutions), the business community, and citizens; and 

‘‘(4) assist the individuals and entities described in paragraph (3) in identifying, assessing, and facilitating projects and 

programs to promote the economic development of the region. 

‘‘§ 15506. Supplements to Federal grant programs 

‘‘(a) FINDING.—Congress finds that certain States and local 

communities of the region, including local development districts, 

may be unable to take maximum advantage of Federal grant programs for which the States and communities are eligible because— ‘‘(1) they lack the economic resources to provide the required 

matching share; or ‘‘(2) there are insufficient funds available under the applicable Federal law with respect to a project to be carried out in 

the region. 


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‘‘(b) FEDERAL GRANT PROGRAM FUNDING.—A Commission, with 

the approval of the Federal Cochairperson, may use amounts made 

available to carry out this subtitle—

‘‘(1) for any part of the basic Federal contribution to 

projects or activities under the Federal grant programs authorized by Federal laws; and 

‘‘(2) to increase the Federal contribution to projects and activities under the programs above the fixed maximum part of 

the cost of the projects or activities otherwise authorized by the 

applicable law. 

‘‘(c) CERTIFICATION REQUIRED.—For a program, project, or activity for which any part of the basic Federal contribution to the 

project or activity under a Federal grant program is proposed to be 

made under subsection (b), the Federal contribution shall not be 

made until the responsible Federal official administering the Federal law authorizing the Federal contribution certifies that the program, project, or activity meets the applicable requirements of the 

Federal law and could be approved for Federal contribution under 

that law if amounts were available under the law for the program, 

project, or activity. 

‘‘(d) LIMITATIONS IN OTHER LAWS INAPPLICABLE.—Amounts provided pursuant to this subtitle are available without regard to any 

limitations on areas eligible for assistance or authorizations for appropriation in any other law. 

‘‘(e) FEDERAL SHARE.—The Federal share of the cost of a project 

or activity receiving assistance under this section shall not exceed 80 

percent. 

‘‘(f) MAXIMUM COMMISSION CONTRIBUTION.—Section 15501(d), 

relating to limitations on Commission contributions, shall apply to 

a program, project, or activity receiving assistance under this section. 

‘‘CHAPTER 4—ADMINISTRATIVE PROVISIONS 

‘‘SUBCHAPTER I—GENERAL PROVISIONS

‘‘Sec. 15701. Consent of States. 

‘‘Sec. 15702. Distressed counties and areas. 

‘‘Sec. 15703. Counties eligible for assistance in more than one region. 

‘‘Sec. 15704. Inspector General; records. 

‘‘Sec. 15705. Biannual meetings of representatives of all Commissions. 

‘‘SUBCHAPTER II—DESIGNATION OF REGIONS

‘‘Sec. 15731. Southeast Crescent Regional Commission. 

‘‘Sec. 15732. Southwest Border Regional Commission. 

‘‘Sec. 15733. Northern Border Regional Commission. 

‘‘SUBCHAPTER III—AUTHORIZATION OF APPROPRIATIONS

‘‘Sec. 15751. Authorization of appropriations. 

‘‘SUBCHAPTER I—GENERAL PROVISIONS 

‘‘§ 15701. Consent of States 

‘‘This subtitle does not require a State to engage in or accept a 

program under this subtitle without its consent. 


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‘‘§ 15702. Distressed counties and areas 

‘‘(a) DESIGNATIONS.—Not later than 90 days after the date of 

the enactment of this section, and annually thereafter, each Commission shall make the following designations: 

‘‘(1) DISTRESSED COUNTIES.—The Commission shall designate as distressed counties those counties in its region that 

are the most severely and persistently economically distressed 

and underdeveloped and have high rates of poverty, unemployment, or outmigration. 

‘‘(2) TRANSITIONAL COUNTIES.—The Commission shall designate as transitional counties those counties in its region that 

are economically distressed and underdeveloped or have recently suffered high rates of poverty, unemployment, or outmigration. 

‘‘(3) ATTAINMENT COUNTIES.—The Commission shall designate as attainment counties, those counties in its region that 

are not designated as distressed or transitional counties under 

this subsection. 

‘‘(4) ISOLATED AREAS OF DISTRESS.—The Commission shall 

designate as isolated areas of distress, areas located in counties 

designated as attainment counties under paragraph (3) that 

have high rates of poverty, unemployment, or outmigration. 

‘‘(b) ALLOCATION.—A Commission shall allocate at least 50 percent of the appropriations made available to the Commission to 

carry out this subtitle for programs and projects designed to serve 

the needs of distressed counties and isolated areas of distress in the 

region. 

‘‘(c) ATTAINMENT COUNTIES.—

‘‘(1) IN GENERAL.—Except as provided in paragraph (2), 

funds may not be provided under this subtitle for a project located in a county designated as an attainment county under 

subsection (a). 

‘‘(2) EXCEPTIONS.—

‘‘(A) ADMINISTRATIVE EXPENSES OF LOCAL DEVELOPMENT DISTRICTS.—The funding prohibition under paragraph (1) shall not apply to grants to fund the administrative expenses of local development districts under section 

15505. 

‘‘(B) MULTICOUNTY AND OTHER PROJECTS.—A Commission may waive the application of the funding prohibition 

under paragraph (1) with respect to—

‘‘(i) a multicounty project that includes participation by an attainment county; and 

‘‘(ii) any other type of project, if a Commission determines that the project could bring significant benefits to areas of the region outside an attainment county. 

‘‘(3) ISOLATED AREAS OF DISTRESS.—For a designation of an 

isolated area of distress to be effective, the designation shall be 

supported—

‘‘(A) by the most recent Federal data available; or 

‘‘(B) if no recent Federal data are available, by the 

most recent data available through the government of the 

State in which the isolated area of distress is located. 


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‘‘§ 15703. Counties eligible for assistance in more than one region 

‘‘(a) LIMITATION.—A political subdivision of a State may not receive assistance under this subtitle in a fiscal year from more than 

one Commission. 

‘‘(b) SELECTION OF COMMISSION.—A political subdivision included in the region of more than one Commission shall select the 

Commission with which it will participate by notifying, in writing, 

the Federal Cochairperson and the appropriate State member of 

that Commission. 

‘‘(c) CHANGES IN SELECTIONS.—The selection of a Commission 

by a political subdivision shall apply in the fiscal year in which the 

selection is made, and shall apply in each subsequent fiscal year 

unless the political subdivision, at least 90 days before the first day 

of the fiscal year, notifies the Cochairpersons of another Commission 

in writing that the political subdivision will participate in that 

Commission and also transmits a copy of such notification to the 

Cochairpersons of the Commission in which the political subdivision is currently participating. 

‘‘(d) INCLUSION OF APPALACHIAN REGIONAL COMMISSION.—In 

this section, the term ‘Commission’ includes the Appalachian Regional Commission established under chapter 143. 

‘‘§ 15704. Inspector General; records 

‘‘(a) APPOINTMENT OF INSPECTOR GENERAL.—There shall be an 

Inspector General for the Commissions appointed in accordance 

with section 3(a) of the Inspector General Act of 1978 (5 U.S.C. 

App.). All of the Commissions shall be subject to a single Inspector 

General. 

‘‘(b) RECORDS OF A COMMISSION.—

‘‘(1) IN GENERAL.—A Commission shall maintain accurate 

and complete records of all its transactions and activities. 

‘‘(2) AVAILABILITY.—All records of a Commission shall be 

available for audit and examination by the Inspector General 

(including authorized representatives of the Inspector General). 

‘‘(c) RECORDS OF RECIPIENTS OF COMMISSION ASSISTANCE.—

‘‘(1) IN GENERAL.—A recipient of funds from a Commission 

under this subtitle shall maintain accurate and complete 

records of transactions and activities financed with the funds 

and report to the Commission on the transactions and activities. 

‘‘(2) AVAILABILITY.—All records required under paragraph 

(1) shall be available for audit by the Commission and the Inspector General (including authorized representatives of the 

Commission and the Inspector General). 

‘‘(d) ANNUAL AUDIT.—The Inspector General shall audit the activities, transactions, and records of each Commission on an annual 

basis. 

‘‘§ 15705. Biannual meetings of representatives of all Commissions 

‘‘(a) IN GENERAL.—Representatives of each Commission, the Appalachian Regional Commission, and the Denali Commission shall 

meet biannually to discuss issues confronting regions suffering from 


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chronic and contiguous distress and successful strategies for promoting regional development. 

‘‘(b) CHAIR OF MEETINGS.—The chair of each meeting shall rotate among the Commissions, with the Appalachian Regional Commission to host the first meeting. 

‘‘SUBCHAPTER II—DESIGNATION OF REGIONS 

‘‘§ 15731. Southeast Crescent Regional Commission 

‘‘The region of the Southeast Crescent Regional Commission 

shall consist of all counties of the States of Virginia, North Carolina, South Carolina, Georgia, Alabama, Mississippi, and Florida 

not already served by the Appalachian Regional Commission or the 

Delta Regional Authority. 

‘‘§ 15732. Southwest Border Regional Commission 

‘‘The region of the Southwest Border Regional Commission 

shall consist of the following political subdivisions: 

‘‘(1) ARIZONA.—The counties of Cochise, Gila, Graham, 

Greenlee, La Paz, Maricopa, Pima, Pinal, Santa Cruz, and 

Yuma in the State of Arizona. 

‘‘(2) CALIFORNIA.—The counties of Imperial, Los Angeles, 

Orange, Riverside, San Bernardino, San Diego, and Ventura in 

the State of California. 

‘‘(3) NEW MEXICO.—The counties of Catron, Chaves, Dona 

Ana, Eddy, Grant, Hidalgo, Lincoln, Luna, Otero, Sierra, and 

Socorro in the State of New Mexico. 

‘‘(4) TEXAS.—The counties of Atascosa, Bandera, Bee, 

Bexar, Brewster, Brooks, Cameron, Coke, Concho, Crane, Crockett, Culberson, Dimmit, Duval, Ector, Edwards, El Paso, Frio, 

Gillespie, Glasscock, Hidalgo, Hudspeth, Irion, Jeff Davis, Jim 

Hogg, Jim Wells, Karnes, Kendall, Kenedy, Kerr, Kimble, 

Kinney, Kleberg, La Salle, Live Oak, Loving, Mason, Maverick, 

McMullen, Medina, Menard, Midland, Nueces, Pecos, Presidio, 

Reagan, Real, Reeves, San Patricio, Shleicher, Sutton, Starr, 

Sterling, Terrell, Tom Green Upton, Uvalde, Val Verde, Ward, 

Webb, Willacy, Wilson, Winkler, Zapata, and Zavala in the 

State of Texas. 

‘‘§ 15733. Northern Border Regional Commission 

‘‘The region of the Northern Border Regional Commission shall 

include the following counties: 

‘‘(1) MAINE.—The counties of Androscoggin, Aroostook, 

Franklin, Hancock, Kennebec, Knox, Oxford, Penobscot, 

Piscataquis, Somerset, Waldo, and Washington in the State of 

Maine. 

‘‘(2) NEW HAMPSHIRE.—The counties of Carroll, Coos, Grafton, and Sullivan in the State of New Hampshire. 

‘‘(3) NEW YORK.—The counties of Cayuga, Clinton, Essex, 

Franklin, Fulton, Hamilton, Herkimer, Jefferson, Lewis, Madison, Oneida, Oswego, Seneca, and St. Lawrence in the State of 

New York. 

‘‘(4) VERMONT.—The counties of Caledonia, Essex, Franklin, Grand Isle, Lamoille, and Orleans in the State of Vermont. 


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‘‘SUBCHAPTER III—AUTHORIZATION OF APPROPRIATIONS 

‘‘§ 15751. Authorization of appropriations 

‘‘(a) IN GENERAL.—There is authorized to be appropriated to 

each Commission to carry out this subtitle $30,000,000 for each of 

fiscal years 2008 through 2012. 

‘‘(b) ADMINISTRATIVE EXPENSES.—Not more than 10 percent of 

the funds made available to a Commission in a fiscal year under 

this section may be used for administrative expenses.’’. 

(b) CLERICAL AMENDMENT TO TABLE OF SUBTITLES.—The table 

of subtitles for chapter 40, United States Code, is amended by striking the item relating to subtitle V and inserting the following: 

‘‘V. REGIONAL ECONOMIC AND INFRASTRUCTURE DEVELOPMENT ...15101

‘‘VI. MISCELLANEOUS ........................................................................................17101’’. 

(c) CONFORMING AMENDMENTS TO INSPECTOR GENERAL ACT.—

Section 11 of the Inspector General Act of 1978 (5 U.S.C. App.) is 

amended—

(1) in paragraph (1), by striking ‘‘or the President of the Export-Import Bank;’’ and inserting ‘‘the President of the ExportImport Bank; or the Federal Cochairpersons of the Commissions established under section 15301 of title 40, United States 

Code;’’; and 

(2) in paragraph (2), by striking ‘‘or the Export-Import 

Bank,’’ and inserting ‘‘the Export-Import Bank, or the Commissions established under section 15301 of title 40, United States 

Code,’’. 

(d) EFFECTIVE DATE.—This section, and the amendments made 

by this section, shall take effect on the first day of the first fiscal 

year beginning after the date of the enactment of this Act. 

SEC. 14218. COORDINATOR FOR CHRONICALLY UNDERSERVED RURAL 

AREAS. 

(a) ESTABLISHMENT.—The Secretary of Agriculture shall establish a Coordinator for Chronically Underserved Rural Areas (in this 

section referred to as the ‘‘Coordinator’’), to be located in the Rural 

Development Mission Area. 

(b) MISSION.—The mission of the Coordinator shall be to direct 

Department of Agriculture resources to high need, high poverty 

rural areas. 

(c) DUTIES.—The Coordinator shall consult with other offices in 

directing technical assistance, strategic regional planning, at the 

State and local level, for developing rural economic development 

that leverages the resources of State and local governments and 

non-profit and community development organizations. 

(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to the Secretary such sums as necessary to carry 

out this section for fiscal years 2008 through 2012. 

SEC. 14219. ELIMINATION OF STATUTE OF LIMITATIONS APPLICABLE 

TO COLLECTION OF DEBT BY ADMINISTRATIVE OFFSET. 

(a) ELIMINATION.—Section 3716(e) of title 31, United States 

Code, is amended to read as follows: 

‘‘(e)(1) Notwithstanding any other provision of law, regulation, 

or administrative limitation, no limitation on the period within 

which an offset may be initiated or taken pursuant to this section 

shall be effective. 


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‘‘(2) This section does not apply when a statute explicitly prohibits using administrative offset or setoff to collect the claim or 

type of claim involved.’’. 

(b) APPLICATION OF AMENDMENT.—The amendment made by 

subsection (a) shall apply to any debt outstanding on or after the 

date of the enactment of this Act. 

SEC. 14220. AVAILABILITY OF EXCESS AND SURPLUS COMPUTERS IN 

RURAL AREAS. 

In addition to any other authority, the Secretary of Agriculture 

may make available to an organization excess or surplus computers 

or other technical equipment of the Department of Agriculture for 

the purposes of distribution to a city, town, or local government entity in a rural area (as defined in section 343(a)(13)(A) of the Consolidated Farm and Rural Development Act). 

SEC. 14221. REPEAL OF SECTION 3068 OF THE WATER RESOURCES DEVELOPMENT ACT OF 2007. 

Effective upon the date of enactment of this Act, section 3068 

of the Water Resources Development Act of 2007 (Public Law 110–

114; 121 Stat. 1123), and the item relating to section 3068 in the 

table of contents of that Act, are repealed. 

SEC. 14222. DOMESTIC FOOD ASSISTANCE PROGRAMS. 

(a) DEFINITION OF SECTION 32.—In this section, the term ‘‘section 32’’ means section 32 of the Act of August 24, 1935 (7 U.S.C. 

612c). 

(b) TRANSFER TO FOOD AND NUTRITION SERVICE.—

(1) IN GENERAL.—Amounts made available for a fiscal year 

to carry out section 32 in excess of the maximum amount calculated under paragraph (2) shall be transferred to the Secretary, acting through the Administrator of the Food and Nutrition Service, to be used to carry out the Richard B. Russell National School Lunch Act (42 U.S.C. 1751 et seq.). 

(2) MAXIMUM AMOUNT.—The maximum amount calculated 

under this paragraph for a fiscal year is the sum of—

(A)(i) in the case of fiscal year 2009, $1,173,000,000; 

(ii) in the case of fiscal year 2010, $1,199,000,000; 

(iii) in the case of fiscal year 2011, $1,215,000,000; 

(iv) in the case of fiscal year 2012, $1,231,000,000; 

(v) in the case of fiscal year 2013, $1,248,000,000; 

(vi) in the case of fiscal year 2014, $1,266,000,000; 

(vii) in the case of fiscal year 2015, $1,284,000,000; 

(viii) in the case of fiscal year 2016, $1,303,000,000; 

(ix) in the case of fiscal year 2017, $1,322,000,000; and 

(x) for fiscal year 2018 and each fiscal year thereafter, 

the amount made available for the preceding fiscal year, as 

adjusted to reflect changes for the 12-month period ending 

on the preceding November 30 in the Consumer Price Index 

for All Urban Consumers published by the Bureau of Labor 

Statistics of the Department of Labor; and 

(B) any transfers for the fiscal year from section 32 to the 

Department of Commerce under the Fish and Wildlife Act of 

1956 (16 U.S.C. 742a et seq.). 

(c) FRESH FRUIT AND VEGETABLE PROGRAM.—Of amounts made 

available to carry out section 32 under subsection (b)(2)(A), the Secretary shall transfer for use to carry out the fresh fruit and vegeVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00606 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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table program under section 19 of the Richard B. Russell National 

School Lunch Act the amounts specified in subsection (i) of that section. 

(d) WHOLE GRAIN PRODUCTS.—Of amounts made available to 

carry out section 32 under subsection (b)(2)(A), the Secretary shall 

use to carry out section 4305 $4,000,000 for fiscal year 2009. 

(e) MAINTENANCE OF FUNDING.—The funding provided under 

subsections (c) and (d) shall supplement (and not supplant) other 

Federal funding (including section 32 funding) for programs carried 

out under—

(1) the Richard B. Russell National School Lunch Act (42 

U.S.C. 1751 et seq.), except for section 19 of that Act; 

(2) the Emergency Food Assistance Act of 1983 (7 U.S.C. 

7501 et seq.); and 

(3) section 27 of the Food Stamp Act of 1977 (7 U.S.C. 

2036). 

SEC. 14223. TECHNICAL CORRECTION. 

Section 923(1)(B) of the Federal Agriculture Improvement and 

Reform Act of 1996 (7 U.S.C. 2206a(1)(B)) is amended by striking 

‘‘as defined in section 316(b) of the Higher Education Act of 1965 

(20 U.S.C. 1059c(b))’’ and inserting ‘‘as defined in section 502(a)(5) 

of the Higher Education Act of 1965 (20 U.S.C. 1101a(a)(5))’’. 

TITLE XV—TRADE AND TAX PROVISIONS 

SEC. 15001. SHORT TITLE; ETC. 

(a) SHORT TITLE.—This title may be cited as the ‘‘Heartland, 

Habitat, Harvest, and Horticulture Act of 2008’’. 

(b) AMENDMENTS TO 1986 CODE.—Except as otherwise expressly 

provided, whenever in this title an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other 

provision, the reference shall be considered to be made to a section 

or other provision of the Internal Revenue Code of 1986. 

Subtitle A—Supplemental Agricultural Disaster Assistance 

From the Agricultural Disaster Relief Trust Fund 

SEC. 15101. SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE. 

(a) IN GENERAL.—The Trade Act of 1974 (19 U.S.C. 2101 et 

seq.) is amended by adding at the end the following: 

‘‘TITLE IX—SUPPLEMENTAL AGRICULTURAL DISASTER 

ASSISTANCE 

‘‘SEC. 901. SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) ACTUAL PRODUCTION HISTORY YIELD.—The term ‘actual 

production history yield’ means the weighted average of the actual production history for each insurable commodity or noninsurable commodity, as calculated under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.) or the noninsured crop disaster assistance program, respectively. ‘‘(2) ADJUSTED ACTUAL PRODUCTION HISTORY YIELD.—The 

term ‘adjusted actual production history yield’ means— ‘‘(A) in the case of an eligible producer on a farm that 

has at least 4 years of actual production history yields for 


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an insurable commodity that are established other than 

pursuant to section 508(g)(4)(B) of the Federal Crop Insurance Act (7 U.S.C. 1508(g)(4)(B)), the actual production history for the eligible producer without regard to any yields 

established under that section; 

‘‘(B) in the case of an eligible producer on a farm that 

has less than 4 years of actual production history yields for 

an insurable commodity, of which 1 or more were established pursuant to section 508(g)(4)(B) of that Act, the actual production history for the eligible producer as calculated without including the lowest of the yields established pursuant to section 508(g)(4)(B) of that Act; and 

‘‘(C) in all other cases, the actual production history of 

the eligible producer on a farm. 

‘‘(3) ADJUSTED NONINSURED CROP DISASTER ASSISTANCE

PROGRAM YIELD.—The term ‘adjusted noninsured crop disaster 

assistance program yield’ means—

‘‘(A) in the case of an eligible producer on a farm that 

has at least 4 years of production history under the noninsured crop disaster assistance program that are not replacement yields, the noninsured crop disaster assistance 

program yield without regard to any replacement yields; 

‘‘(B) in the case of an eligible producer on a farm that 

less than 4 years of production history under the noninsured crop disaster assistance program that are not replacement yields, the noninsured crop disaster assistance 

program yield as calculated without including the lowest of 

the replacement yields; and 

‘‘(C) in all other cases, the production history of the eligible producer on the farm under the noninsured crop disaster assistance program. 

‘‘(4) COUNTER-CYCLICAL PROGRAM PAYMENT YIELD.—The 

term ‘counter-cyclical program payment yield’ means the 

weighted average payment yield established under section 1102 

of the Farm Security and Rural Investment Act of 2002 (7 

U.S.C. 7912), section 1102 of the Food, Conservation, and Energy Act of 2008, or a successor section. 

‘‘(5) DISASTER COUNTY.—

‘‘(A) IN GENERAL.—The term ‘disaster county’ means a 

county included in the geographic area covered by a qualifying natural disaster declaration. 

‘‘(B) INCLUSION.—The term ‘disaster county’ includes—

‘‘(i) a county contiguous to a county described in 

subparagraph (A); and 

‘‘(ii) any farm in which, during a calendar year, 

the total loss of production of the farm relating to 

weather is greater than 50 percent of the normal production of the farm, as determined by the Secretary. 

‘‘(6) ELIGIBLE PRODUCER ON A FARM.—

‘‘(A) IN GENERAL.—The term ‘eligible producer on a 

farm’ means an individual or entity described in subparagraph (B) that, as determined by the Secretary, assumes the 

production and market risks associated with the agricultural production of crops or livestock. 


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‘‘(B) DESCRIPTION.—An individual or entity referred to 

in subparagraph (A) is— ‘‘(i) a citizen of the United States; 

‘‘(ii) a resident alien; 

‘‘(iii) a partnership of citizens of the United States; 

or ‘‘(iv) a corporation, limited liability corporation, or 

other farm organizational structure organized under 

State law. ‘‘(7) FARM.— ‘‘(A) IN GENERAL.—The term ‘farm’ means, in relation 

to an eligible producer on a farm, the sum of all crop acreage in all counties that is planted or intended to be planted 

for harvest by the eligible producer. ‘‘(B) AQUACULTURE.—In the case of aquaculture, the 

term ‘farm’ means, in relation to an eligible producer on a 

farm, all fish being produced in all counties that are intended to be harvested for sale by the eligible producer. 

‘‘(C) HONEY.—In the case of honey, the term ‘farm’

means, in relation to an eligible producer on a farm, all 

bees and beehives in all counties that are intended to be 

harvested for a honey crop by the eligible producer. 

‘‘(8) FARM-RAISED FISH.—The term ‘farm-raised fish’ means 

any aquatic species that is propagated and reared in a controlled environment. ‘‘(9) INSURABLE COMMODITY.—The term ‘insurable commodity’ means an agricultural commodity (excluding livestock) 

for which the producer on a farm is eligible to obtain a policy 

or plan of insurance under the Federal Crop Insurance Act (7 

U.S.C. 1501 et seq.). ‘‘(10) LIVESTOCK.—The term ‘livestock’ includes— ‘‘(A) cattle (including dairy cattle); 

‘‘(B) bison; 

‘‘(C) poultry; 

‘‘(D) sheep; 

‘‘(E) swine; 

‘‘(F) horses; and 

‘‘(G) other livestock, as determined by the Secretary. 

‘‘(11) NONINSURABLE COMMODITY.—The term ‘noninsurable 

commodity’ means a crop for which the eligible producers on a 

farm are eligible to obtain assistance under the noninsured crop 

assistance program. ‘‘(12) NONINSURED CROP ASSISTANCE PROGRAM.—The term 

‘noninsured crop assistance program’ means the program carried out under section 196 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7333). 

‘‘(13) QUALIFYING NATURAL DISASTER DECLARATION.—The 

term ‘qualifying natural disaster declaration’ means a natural 

disaster declared by the Secretary for production losses under 

section 321(a) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961(a)). ‘‘(14) SECRETARY.—The term ‘Secretary’ means the Secretary of Agriculture. ‘‘(15) SOCIALLY DISADVANTAGED FARMER OR RANCHER.—The 

term ‘socially disadvantaged farmer or rancher’ has the meanVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00609 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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ing given the term in section 2501(e) of the Food, Agriculture, 

Conservation, and Trade Act of 1990 (7 U.S.C. 2279(e)). 

‘‘(16) STATE.—The term ‘State’ means—

‘‘(A) a State; 

‘‘(B) the District of Columbia; 

‘‘(C) the Commonwealth of Puerto Rico; and 

‘‘(D) any other territory or possession of the United 

States. 

‘‘(17) TRUST FUND.—The term ‘Trust Fund’ means the Agricultural Disaster Relief Trust Fund established under section 

902. 

‘‘(18) UNITED STATES.—The term ‘United States’ when used 

in a geographical sense, means all of the States. 

‘‘(b) SUPPLEMENTAL REVENUE ASSISTANCE PAYMENTS.—

‘‘(1) IN GENERAL.—The Secretary shall use such sums as 

are necessary from the Trust Fund to make crop disaster assistance payments to eligible producers on farms in disaster counties that have incurred crop production losses or crop quality 

losses, or both, during the crop year. 

‘‘(2) AMOUNT.—

‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

Secretary shall provide crop disaster assistance payments 

under this section to an eligible producer on a farm in an 

amount equal to 60 percent of the difference between—

‘‘(i) the disaster assistance program guarantee, as 

described in paragraph (3); and 

‘‘(ii) the total farm revenue for a farm, as described 

in paragraph (4). 

‘‘(B) LIMITATION.—The disaster assistance program 

guarantee for a crop used to calculate the payments for a 

farm under subparagraph (A)(i) may not be greater than 90 

percent of the sum of the expected revenue, as described in 

paragraph (5) for each of the crops on a farm, as determined by the Secretary. 

‘‘(3) SUPPLEMENTAL REVENUE ASSISTANCE PROGRAM GUARANTEE.—

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

paragraph, the supplemental assistance program guarantee 

shall be the sum obtained by adding—

‘‘(i) for each insurable commodity on the farm, 115 

percent of the product obtained by multiplying—

‘‘(I) a payment rate for the commodity that is 

equal to the price election for the commodity elected by the eligible producer; 

‘‘(II) the payment acres for the commodity that 

is equal to the number of acres planted, or prevented from being planted, to the commodity; 

‘‘(III) the payment yield for the commodity that 

is equal to the percentage of the crop insurance 

yield elected by the producer of the higher of—

‘‘(aa) the adjusted actual production history yield; or 

‘‘(bb) the counter-cyclical program payment yield for each crop; and 


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‘‘(ii) for each noninsurable commodity on a farm, 

120 percent of the product obtained by multiplying— ‘‘(I) a payment rate for the commodity that is 

equal to 100 percent of the noninsured crop assistance program established price for the commodity; ‘‘(II) the payment acres for the commodity that 

is equal to the number of acres planted, or prevented from being planted, to the commodity; and ‘‘(III) the payment yield for the commodity that 

is equal to the higher of— ‘‘(aa) the adjusted noninsured crop assistance program yield guarantee; or ‘‘(bb) the counter-cyclical program payment yield for each crop. ‘‘(B) ADJUSTMENT INSURANCE GUARANTEE.—Notwithstanding subparagraph (A), in the case of an insurable 

commodity for which a plan of insurance provides for an 

adjustment in the guarantee, such as in the case of prevented planting, the adjusted insurance guarantee shall be 

the basis for determining the disaster assistance program 

guarantee for the insurable commodity. 

‘‘(C) ADJUSTED ASSISTANCE LEVEL.—Notwithstanding 

subparagraph (A), in the case of a noninsurable commodity 

for which the noninsured crop assistance program provides 

for an adjustment in the level of assistance, such as in the 

case of unharvested crops, the adjusted assistance level 

shall be the basis for determining the disaster assistance 

program guarantee for the noninsurable commodity. ‘‘(D) EQUITABLE TREATMENT FOR NON-YIELD BASED

POLICIES.—The Secretary shall establish equitable treatment for non-yield based policies and plans of insurance, 

such as the Adjusted Gross Revenue Lite insurance program. 

‘‘(4) FARM REVENUE.—

‘‘(A) IN GENERAL.—For purposes of this subsection, the 

total farm revenue for a farm, shall equal the sum obtained 

by adding—

‘‘(i) the estimated actual value for each crop produced on a farm by using the product obtained by multiplying—

‘‘(I) the actual crop acreage harvested by an eligible producer on a farm; ‘‘(II) the estimated actual yield of the crop production; and ‘‘(III) subject to subparagraphs (B) and (C), to 

the extent practicable, the national average market 

price received for the marketing year, as determined by the Secretary; 

‘‘(ii) 15 percent of amount of any direct payments 

made to the producer under sections 1103 and 1303 of 

the Food, Conservation, and Energy Act of 2008 or successor sections; 

‘‘(iii) the total amount of any counter-cyclical payments made to the producer under sections 1104 and 

1304 of the Food, Conservation, and Energy Act of 


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2008 or successor sections or of any average crop revenue election payments made to the producer under 

section 1105 of that Act; ‘‘(iv) the total amount of any loan deficiency payments, marketing loan gains, and marketing certificate 

gains made to the producer under subtitles B and C of 

the Food, Conservation, and Energy Act of 2008 or successor subtitles; ‘‘(v) the amount of payments for prevented planting 

on a farm; ‘‘(vi) the amount of crop insurance indemnities received by an eligible producer on a farm for each crop 

on a farm; ‘‘(vii) the amount of payments an eligible producer 

on a farm received under the noninsured crop assistance program for each crop on a farm; and ‘‘(viii) the value of any other natural disaster assistance payments provided by the Federal Government 

to an eligible producer on a farm for each crop on a 

farm for the same loss for which the eligible producer 

is seeking assistance. 

‘‘(B) ADJUSTMENT.—The Secretary shall adjust the average market price received by the eligible producer on a 

farm— ‘‘(i) to reflect the average quality discounts applied 

to the local or regional market price of a crop or mechanically harvested forage due to a reduction in the 

intrinsic characteristics of the production resulting 

from adverse weather, as determined annually by the 

State office of the Farm Service Agency; and ‘‘(ii) to account for a crop the value of which is reduced due to excess moisture resulting from a disasterrelated condition. 

‘‘(C) MAXIMUM AMOUNT FOR CERTAIN CROPS.—With respect to a crop for which an eligible producer on a farm receives assistance under the noninsured crop assistance program, the national average market price received during 

the marketing year shall be an amount not more than 100 

percent of the price of the crop established under the noninsured crop assistance program. 

‘‘(5) EXPECTED REVENUE.—The expected revenue for each 

crop on a farm shall equal the sum obtained by adding—

‘‘(A) the product obtained by multiplying—

‘‘(i) the greatest of—

‘‘(I) the adjusted actual production history 

yield of the eligible producer on a farm; and 

‘‘(II) the counter-cyclical program payment 

yield; 

‘‘(ii) the acreage planted or prevented from being 

planted for each crop; and ‘‘(iii) 100 percent of the insurance price guarantee; 

and 

‘‘(B) the product obtained by multiplying— ‘‘(i) 100 percent of the adjusted noninsured crop assistance program yield; and 


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‘‘(ii) 100 percent of the noninsured crop assistance 

program price for each of the crops on a farm. ‘‘(c) LIVESTOCK INDEMNITY PAYMENTS.— ‘‘(1) PAYMENTS.—The Secretary shall use such sums as are 

necessary from the Trust Fund to make livestock indemnity 

payments to eligible producers on farms that have incurred livestock death losses in excess of the normal mortality due to adverse weather, as determined by the Secretary, during the calendar year, including losses due to hurricanes, floods, blizzards, disease, wildfires, extreme heat, and extreme cold. ‘‘(2) PAYMENT RATES.—Indemnity payments to an eligible 

producer on a farm under paragraph (1) shall be made at a 

rate of 75 percent of the market value of the applicable livestock 

on the day before the date of death of the livestock, as determined by the Secretary. 

‘‘(d) LIVESTOCK FORAGE DISASTER PROGRAM.—

‘‘(1) DEFINITIONS.—In this subsection: 

‘‘(A) COVERED LIVESTOCK.— ‘‘(i) IN GENERAL.—The term ‘covered livestock’

means livestock of an eligible livestock producer that, 

during the 60 days prior to the beginning date of a 

qualifying drought or fire condition, as determined by 

the Secretary, the eligible livestock producer—

‘‘(I) owned; 

‘‘(II) leased; 

‘‘(III) purchased; 

‘‘(IV) entered into a contract to purchase; 

‘‘(V) is a contract grower; or 

‘‘(VI) sold or otherwise disposed of due to 

qualifying drought conditions during—

‘‘(aa) the current production year; or 

‘‘(bb) subject to paragraph (3)(B)(ii), 1 or 

both of the 2 production years immediately 

preceding the current production year. ‘‘(ii) EXCLUSION.—The term ‘covered livestock’ does 

not include livestock that were or would have been in 

a feedlot, on the beginning date of the qualifying 

drought or fire condition, as a part of the normal business operation of the eligible livestock producer, as determined by the Secretary. 

‘‘(B) DROUGHT MONITOR.—The term ‘drought monitor’

means a system for classifying drought severity according 

to a range of abnormally dry to exceptional drought, as defined by the Secretary. 

‘‘(C) ELIGIBLE LIVESTOCK PRODUCER.—

‘‘(i) IN GENERAL.—The term ‘eligible livestock producer’ means an eligible producer on a farm that—

‘‘(I) is an owner, cash or share lessee, or contract grower of covered livestock that provides the 

pastureland or grazing land, including cash-leased 

pastureland or grazing land, for the livestock; ‘‘(II) provides the pastureland or grazing land 

for covered livestock, including cash-leased 

pastureland or grazing land that is physically located in a county affected by drought; 


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‘‘(III) certifies grazing loss; and 

‘‘(IV) meets all other eligibility requirements 

established under this subsection. 

‘‘(ii) EXCLUSION.—The term ‘eligible livestock producer’ does not include an owner, cash or share lessee, 

or contract grower of livestock that rents or leases 

pastureland or grazing land owned by another person 

on a rate-of-gain basis. 

‘‘(D) NORMAL CARRYING CAPACITY.—The term ‘normal 

carrying capacity’, with respect to each type of grazing land 

or pastureland in a county, means the normal carrying capacity, as determined under paragraph (3)(D)(i), that 

would be expected from the grazing land or pastureland for 

livestock during the normal grazing period, in the absence 

of a drought or fire that diminishes the production of the 

grazing land or pastureland. 

‘‘(E) NORMAL GRAZING PERIOD.—The term ‘normal 

grazing period’, with respect to a county, means the normal 

grazing period during the calendar year for the county, as 

determined under paragraph (3)(D)(i). 

‘‘(2) PROGRAM.—The Secretary shall use such sums as are 

necessary from the Trust Fund to provide compensation for 

losses to eligible livestock producers due to grazing losses for 

covered livestock due to—

‘‘(A) a drought condition, as described in paragraph 

(3); or 

‘‘(B) fire, as described in paragraph (4). 

‘‘(3) ASSISTANCE FOR LOSSES DUE TO DROUGHT CONDITIONS.—

‘‘(A) ELIGIBLE LOSSES.—

‘‘(i) IN GENERAL.—An eligible livestock producer 

may receive assistance under this subsection only for 

grazing losses for covered livestock that occur on land 

that—

‘‘(I) is native or improved pastureland with 

permanent vegetative cover; or 

‘‘(II) is planted to a crop planted specifically 

for the purpose of providing grazing for covered 

livestock. 

‘‘(ii) EXCLUSIONS.—An eligible livestock producer 

may not receive assistance under this subsection for 

grazing losses that occur on land used for haying or 

grazing under the conservation reserve program established under subchapter B of chapter 1 of subtitle D of 

title XII of the Food Security Act of 1985 (16 U.S.C. 

3831 et seq.). 

‘‘(B) MONTHLY PAYMENT RATE.—

‘‘(i) IN GENERAL.—Except as provided in clause (ii), 

the payment rate for assistance under this paragraph 

for 1 month shall, in the case of drought, be equal to 

60 percent of the lesser of—

‘‘(I) the monthly feed cost for all covered livestock owned or leased by the eligible livestock producer, as determined under subparagraph (C); or 


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‘‘(II) the monthly feed cost calculated by using 

the normal carrying capacity of the eligible grazing 

land of the eligible livestock producer. 

‘‘(ii) PARTIAL COMPENSATION.—In the case of an eligible livestock producer that sold or otherwise disposed of covered livestock due to drought conditions in 

1 or both of the 2 production years immediately preceding the current production year, as determined by 

the Secretary, the payment rate shall be 80 percent of 

the payment rate otherwise calculated in accordance 

with clause (i). 

‘‘(C) MONTHLY FEED COST.—

‘‘(i) IN GENERAL.—The monthly feed cost shall 

equal the product obtained by multiplying—

‘‘(I) 30 days; 

‘‘(II) a payment quantity that is equal to the 

feed grain equivalent, as determined under clause 

(ii); and 

‘‘(III) a payment rate that is equal to the corn 

price per pound, as determined under clause (iii). 

‘‘(ii) FEED GRAIN EQUIVALENT.—For purposes of 

clause (i)(I), the feed grain equivalent shall equal— ‘‘(I) in the case of an adult beef cow, 15.7 

pounds of corn per day; or ‘‘(II) in the case of any other type of weight of 

livestock, an amount determined by the Secretary 

that represents the average number of pounds of 

corn per day necessary to feed the livestock. 

‘‘(iii) CORN PRICE PER POUND.—For purposes of 

clause (i)(II), the corn price per pound shall equal the 

quotient obtained by dividing—

‘‘(I) the higher of—

‘‘(aa) the national average corn price per 

bushel for the 12-month period immediately 

preceding March 1 of the year for which the 

disaster assistance is calculated; or ‘‘(bb) the national average corn price per 

bushel for the 24-month period immediately 

preceding that March 1; by 

‘‘(II) 56. ‘‘(D) NORMAL GRAZING PERIOD AND DROUGHT MONITOR

INTENSITY.—

‘‘(i) FSA COUNTY COMMITTEE DETERMINATIONS.—

‘‘(I) IN GENERAL.—The Secretary shall determine the normal carrying capacity and normal 

grazing period for each type of grazing land or 

pastureland in the county served by the applicable 

committee. 

‘‘(II) CHANGES.—No change to the normal carrying capacity or normal grazing period established for a county under subclause (I) shall be 

made unless the change is requested by the appropriate State and county Farm Service Agency committees. 

‘‘(ii) DROUGHT INTENSITY.—


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‘‘(I) D2.—An eligible livestock producer that 

owns or leases grazing land or pastureland that is 

physically located in a county that is rated by the 

U.S. Drought Monitor as having a D2 (severe 

drought) intensity in any area of the county for at 

least 8 consecutive weeks during the normal grazing period for the county, as determined by the 

Secretary, shall be eligible to receive assistance 

under this paragraph in an amount equal to 1 

monthly payment using the monthly payment rate 

determined under subparagraph (B). ‘‘(II) D3.—An eligible livestock producer that 

owns or leases grazing land or pastureland that is 

physically located in a county that is rated by the 

U.S. Drought Monitor as having at least a D3 (extreme drought) intensity in any area of the county 

at any time during the normal grazing period for 

the county, as determined by the Secretary, shall 

be eligible to receive assistance under this paragraph—

‘‘(aa) in an amount equal to 2 monthly 

payments using the monthly payment rate determined under subparagraph (B); or 

‘‘(bb) if the county is rated as having a D3 

(extreme drought) intensity in any area of the 

county for at least 4 weeks during the normal 

grazing period for the county, or is rated as 

having a D4 (exceptional drought) intensity in 

any area of the county at any time during the 

normal grazing period, in an amount equal to 

3 monthly payments using the monthly payment rate determined under subparagraph 

(B). 

‘‘(4) ASSISTANCE FOR LOSSES DUE TO FIRE ON PUBLIC MANAGED LAND.— ‘‘(A) IN GENERAL.—An eligible livestock producer may 

receive assistance under this paragraph only if— ‘‘(i) the grazing losses occur on rangeland that is 

managed by a Federal agency; and ‘‘(ii) the eligible livestock producer is prohibited by 

the Federal agency from grazing the normal permitted 

livestock on the managed rangeland due to a fire. 

‘‘(B) PAYMENT RATE.—The payment rate for assistance 

under this paragraph shall be equal to 50 percent of the 

monthly feed cost for the total number of livestock covered 

by the Federal lease of the eligible livestock producer, as determined under paragraph (3)(C). 

‘‘(C) PAYMENT DURATION.—

‘‘(i) IN GENERAL.—Subject to clause (ii), an eligible 

livestock producer shall be eligible to receive assistance 

under this paragraph for the period— ‘‘(I) beginning on the date on which the Federal agency excludes the eligible livestock producer 

from using the managed rangeland for grazing; 

and 


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‘‘(II) ending on the last day of the Federal 

lease of the eligible livestock producer. 

‘‘(ii) LIMITATION.—An eligible livestock producer 

may only receive assistance under this paragraph for 

losses that occur on not more than 180 days per year. 

‘‘(5) MINIMUM RISK MANAGEMENT PURCHASE REQUIREMENTS.—

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

paragraph, a livestock producer shall only be eligible for 

assistance under this subsection if the livestock producer—

‘‘(i) obtained a policy or plan of insurance under 

the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.) 

for the grazing land incurring the losses for which assistance is being requested; or 

‘‘(ii) filed the required paperwork, and paid the administrative fee by the applicable State filing deadline, 

for the noninsured crop assistance program for the 

grazing land incurring the losses for which assistance 

is being requested. 

‘‘(B) WAIVER FOR SOCIALLY DISADVANTAGED, LIMITED

RESOURCE, OR BEGINNING FARMER OR RANCHER.—In the 

case of an eligible livestock producer that is a socially disadvantaged farmer or rancher or limited resource or beginning farmer or rancher, as determined by the Secretary, the 

Secretary may—

‘‘(i) waive subparagraph (A); and 

‘‘(ii) provide disaster assistance under this section 

at a level that the Secretary determines to be equitable 

and appropriate. 

‘‘(C) WAIVER FOR 2008 CALENDAR YEAR.—In the case of 

an eligible livestock producer that suffered losses on grazing land during the 2008 calendar year but does not meet 

the requirements of subparagraph (A), the Secretary shall 

waive subparagraph (A) if the eligible livestock producer 

pays a fee in an amount equal to the applicable noninsured 

crop assistance program fee or catastrophic risk protection 

plan fee required under subparagraph (A) to the Secretary 

not later than 90 days after the date of enactment of this 

subtitle. 

‘‘(D) EQUITABLE RELIEF.—

‘‘(i) IN GENERAL.—The Secretary may provide equitable relief to an eligible livestock producer that is otherwise ineligible or unintentionally fails to meet the requirements of subparagraph (A) for the grazing land 

incurring the loss on a case-by-case basis, as determined by the Secretary. 

‘‘(ii) 2008 CALENDAR YEAR.—In the case of an eligible livestock producer that suffered losses on grazing 

land during the 2008 calendar year, the Secretary 

shall take special consideration to provide equitable relief in cases in which the eligible livestock producer 

failed to meet the requirements of subparagraph (A) 

due to the enactment of this title after the closing date 

of sales periods for crop insurance under the Federal 


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Crop Insurance Act (7 U.S.C. 1501 et seq.) and the 

noninsured crop assistance program. ‘‘(6) NO DUPLICATIVE PAYMENTS.— ‘‘(A) IN GENERAL.—An eligible livestock producer may 

elect to receive assistance for grazing or pasture feed losses 

due to drought conditions under paragraph (3) or fire 

under paragraph (4), but not both for the same loss, as determined by the Secretary. ‘‘(B) RELATIONSHIP TO SUPPLEMENTAL REVENUE AS- SISTANCE.—An eligible livestock producer that receives assistance under this subsection may not also receive assistance for losses to crops on the same land with the same intended use under subsection (b). ‘‘(e) EMERGENCY ASSISTANCE FOR LIVESTOCK, HONEY BEES, AND

FARM-RAISED FISH.—

‘‘(1) IN GENERAL.—The Secretary shall use up to 

$50,000,000 per year from the Trust Fund to provide emergency 

relief to eligible producers of livestock, honey bees, and farmraised fish to aid in the reduction of losses due to disease, adverse weather, or other conditions, such as blizzards and 

wildfires, as determined by the Secretary, that are not covered 

under subsection (b), (c), or (d). 

‘‘(2) USE OF FUNDS.—Funds made available under this subsection shall be used to reduce losses caused by feed or water 

shortages, disease, or other factors as determined by the Secretary. ‘‘(3) AVAILABILITY OF FUNDS.—Any funds made available 

under this subsection shall remain available until expended. 

‘‘(f) TREE ASSISTANCE PROGRAM.—

‘‘(1) DEFINITIONS.—In this subsection: 

‘‘(A) ELIGIBLE ORCHARDIST.—The term ‘eligible orchardist’ means a person that produces annual crops from 

trees for commercial purposes. ‘‘(B) NATURAL DISASTER.—The term ‘natural disaster’

means plant disease, insect infestation, drought, fire, freeze, 

flood, earthquake, lightning, or other occurrence, as determined by the Secretary. 

‘‘(C) NURSERY TREE GROWER.—The term ‘nursery tree 

grower’ means a person who produces nursery, ornamental, 

fruit, nut, or Christmas trees for commercial sale, as determined by the Secretary. ‘‘(D) TREE.—The term ‘tree’ includes a tree, bush, and 

vine. 

‘‘(2) ELIGIBILITY.—

‘‘(A) LOSS.—Subject to subparagraph (B), the Secretary 

shall provide assistance—

‘‘(i) under paragraph (3) to eligible orchardists and 

nursery tree growers that planted trees for commercial 

purposes but lost the trees as a result of a natural disaster, as determined by the Secretary; and ‘‘(ii) under paragraph (3)(B) to eligible orchardists 

and nursery tree growers that have a production history for commercial purposes on planted or existing 

trees but lost the trees as a result of a natural disaster, 

as determined by the Secretary. 


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‘‘(B) LIMITATION.—An eligible orchardist or nursery 

tree grower shall qualify for assistance under subparagraph (A) only if the tree mortality of the eligible orchardist 

or nursery tree grower, as a result of damaging weather or 

related condition, exceeds 15 percent (adjusted for normal 

mortality). 

‘‘(3) ASSISTANCE.—Subject to paragraph (4), the assistance 

provided by the Secretary to eligible orchardists and nursery 

tree growers for losses described in paragraph (2) shall consist 

of— ‘‘(A)(i) reimbursement of 70 percent of the cost of replanting trees lost due to a natural disaster, as determined 

by the Secretary, in excess of 15 percent mortality (adjusted 

for normal mortality); or ‘‘(ii) at the option of the Secretary, sufficient seedlings 

to reestablish a stand; and ‘‘(B) reimbursement of 50 percent of the cost of pruning, 

removal, and other costs incurred by an eligible orchardist 

or nursery tree grower to salvage existing trees or, in the 

case of tree mortality, to prepare the land to replant trees 

as a result of damage or tree mortality due to a natural 

disaster, as determined by the Secretary, in excess of 15 

percent damage or mortality (adjusted for normal tree 

damage and mortality). 

‘‘(4) LIMITATIONS ON ASSISTANCE.— ‘‘(A) DEFINITIONS OF LEGAL ENTITY AND PERSON.—In 

this paragraph, the terms ‘legal entity’ and ‘person’ have 

the meaning given those terms in section 1001(a) of the 

Food Security Act of 1985 (7 U.S.C. 1308(a) (as amended 

by section 1603 of the Food, Conservation, and Energy Act 

of 2008). ‘‘(B) AMOUNT.—The total amount of payments received, 

directly or indirectly, by a person or legal entity (excluding 

a joint venture or general partnership) under this subsection may not exceed $100,000 for any crop year, or an 

equivalent value in tree seedlings. ‘‘(C) ACRES.—The total quantity of acres planted to 

trees or tree seedlings for which a person or legal entity 

shall be entitled to receive payments under this subsection 

may not exceed 500 acres. ‘‘(g) RISK MANAGEMENT PURCHASE REQUIREMENT.—

‘‘(1) IN GENERAL.—Except as otherwise provided in this section, the eligible producers on a farm shall not be eligible for 

assistance under this section (other than subsection (c)) if the eligible producers on the farm—

‘‘(A) in the case of each insurable commodity of the eligible producers on the farm, did not obtain a policy or plan 

of insurance under the Federal Crop Insurance Act (7 

U.S.C. 1501 et seq.) (excluding a crop insurance pilot program under that Act); or ‘‘(B) in the case of each noninsurable commodity of the 

eligible producers on the farm, did not file the required paperwork, and pay the administrative fee by the applicable 

State filing deadline, for the noninsured crop assistance 

program. 


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‘‘(2) MINIMUM.—To be considered to have obtained insurance under paragraph (1)(A), an eligible producer on a farm 

shall have obtained a policy or plan of insurance with not less 

than 50 percent yield coverage at 55 percent of the insurable 

price for each crop grazed, planted, or intended to be planted 

for harvest on a whole farm. 

‘‘(3) WAIVER FOR SOCIALLY DISADVANTAGED, LIMITED RESOURCE, OR BEGINNING FARMER OR RANCHER.—With respect to 

eligible producers that are socially disadvantaged farmers or 

ranchers or limited resource or beginning farmers or ranchers, 

as determined by the Secretary, the Secretary may—

‘‘(A) waive paragraph (1); and 

‘‘(B) provide disaster assistance under this section at a 

level that the Secretary determines to be equitable and appropriate. 

‘‘(4) WAIVER FOR 2008 CROP YEAR.—In the case of an eligible 

producer that suffered losses in an insurable commodity or noninsurable commodity during the 2008 crop year but does not 

meet the requirements of paragraph (1), the Secretary shall 

waive paragraph (1) if the eligible producer pays a fee in an 

amount equal to the applicable noninsured crop assistance program fee or catastrophic risk protection plan fee required under 

paragraph (1) to the Secretary not later than 90 days after the 

date of enactment of this subtitle. 

‘‘(5) EQUITABLE RELIEF.—

‘‘(A) IN GENERAL.—The Secretary may provide equitable relief to eligible producers on a farm that are otherwise ineligible or unintentionally fail to meet the requirements of paragraph (1) for 1 or more crops on a farm on 

a case-by-case basis, as determined by the Secretary. 

‘‘(B) 2008 CROP YEAR.—In the case of eligible producers 

on a farm that suffered losses in an insurable commodity 

or noninsurable commodity during the 2008 crop year, the 

Secretary shall take special consideration to provide equitable relief in cases in which the eligible producers failed 

to meet the requirements of paragraph (1) due to the enactment of this title after the closing date of sales periods for 

crop insurance under the Federal Crop Insurance Act (7 

U.S.C. 1501 et seq.) and the noninsured crop assistance 

program. 

‘‘(h) PAYMENT LIMITATIONS.—

‘‘(1) DEFINITIONS OF LEGAL ENTITY AND PERSON.—In this 

subsection, the terms ‘legal entity’ and ‘person’ have the meaning given those terms in section 1001(a) of the Food Security 

Act of 1985 (7 U.S.C. 1308(a) (as amended by section 1603 of 

the Food, Conservation, and Energy Act of 2008). 

‘‘(2) AMOUNT.—The total amount of disaster assistance payments received, directly or indirectly, by a person or legal entity 

(excluding a joint venture or general partnership) under this 

section (excluding payments received under subsection (f)) may 

not exceed $100,000 for any crop year. 

‘‘(3) AGI LIMITATION.—Section 1001D of the Food Security 

Act of 1985 (7 U.S.C. 1308–3a) or any successor provision shall 

apply with respect to assistance provided under this section. 


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‘‘(4) DIRECT ATTRIBUTION.—Subsections (e) and (f) of section 1001 of the Food Security Act of 1985 (7 U.S.C. 1308) or 

any successor provisions relating to direct attribution shall 

apply with respect to assistance provided under this section. 

‘‘(i) PERIOD OF EFFECTIVENESS.—This section shall be effective 

only for losses that are incurred as the result of a disaster, adverse 

weather, or other environmental condition that occurs on or before 

September 30, 2011, as determined by the Secretary. ‘‘(j) NO DUPLICATIVE PAYMENTS.—In implementing any other 

program which makes disaster assistance payments (except for indemnities made under the Federal Crop Insurance Act (7 U.S.C. 

1501 et seq.)) and section 196 of the Federal Agriculture Improvement and Reform Act of 1996), the Secretary shall prevent duplicative payments with respect to the same loss for which a person receives a payment under subsections (b), (c), (d), (e), or (f). 

‘‘SEC. 902. AGRICULTURAL DISASTER RELIEF TRUST FUND. 

‘‘(a) CREATION OF TRUST FUND.—There is established in the 

Treasury of the United States a trust fund to be known as the ‘Agricultural Disaster Relief Trust Fund’, consisting of such amounts as 

may be appropriated or credited to such Trust Fund as provided in 

this section. ‘‘(b) TRANSFER TO TRUST FUND.— ‘‘(1) IN GENERAL.—There are appropriated to the Agricultural Disaster Relief Trust Fund amounts equivalent to 3.08 

percent of the amounts received in the general fund of the 

Treasury of the United States during fiscal years 2008 through 

2011 attributable to the duties collected on articles entered, or 

withdrawn from warehouse, for consumption under the Harmonized Tariff Schedule of the United States. ‘‘(2) AMOUNTS BASED ON ESTIMATES.—The amounts appropriated under this section shall be transferred at least monthly 

from the general fund of the Treasury of the United States to 

the Agricultural Disaster Relief Trust Fund on the basis of estimates made by the Secretary of the Treasury. Proper adjustments shall be made in the amounts subsequently transferred 

to the extent prior estimates were in excess of or less than the 

amounts required to be transferred. ‘‘(3) LIMITATION ON TRANSFERS TO AGRICULTURAL DISASTER

RELIEF TRUST FUND.—No amount may be appropriated to the 

Agricultural Disaster Relief Trust Fund on and after the date 

of any expenditure from the Agricultural Disaster Relief Trust 

Fund which is not permitted by this section. The determination 

of whether an expenditure is so permitted shall be made without regard to—

‘‘(A) any provision of law which is not contained or referenced in this title or in a revenue Act, and 

‘‘(B) whether such provision of law is a subsequently 

enacted provision or directly or indirectly seeks to waive the 

application of this paragraph. 

‘‘(c) ADMINISTRATION.—

‘‘(1) REPORTS.—The Secretary of the Treasury shall be the 

trustee of the Agricultural Disaster Relief Trust Fund and shall 

submit an annual report to Congress each year on the financial 

condition and the results of the operations of such Trust Fund 

during the preceding fiscal year and on its expected condition 


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and operations during the 4 fiscal years succeeding such fiscal 

year. Such report shall be printed as a House document of the 

session of Congress to which the report is made. ‘‘(2) INVESTMENT.— ‘‘(A) IN GENERAL.—The Secretary of the Treasury shall 

invest such portion of the Agricultural Disaster Relief Trust 

Fund as is not in his judgment required to meet current 

withdrawals. Such investments may be made only in interest bearing obligations of the United States. For such purpose, such obligations may be acquired— ‘‘(i) on original issue at the issue price, or 

‘‘(ii) by purchase of outstanding obligations at the 

market price. 

‘‘(B) SALE OF OBLIGATIONS.—Any obligation acquired 

by the Agricultural Disaster Relief Trust Fund may be sold 

by the Secretary of the Treasury at the market price. ‘‘(C) INTEREST ON CERTAIN PROCEEDS.—The interest on, 

and the proceeds from the sale or redemption of, any obligations held in the Agricultural Disaster Relief Trust Fund 

shall be credited to and form a part of such Trust Fund. ‘‘(d) EXPENDITURES FROM TRUST FUND.—Amounts in the Agricultural Disaster Relief Trust Fund shall be available for the purposes of making expenditures to meet those obligations of the United 

States incurred under section 901 or section 531 of the Federal Crop 

Insurance Act (as such sections are in effect on the date of the enactment of the Food, Conservation, and Energy Act of 2008). ‘‘(e) AUTHORITY TO BORROW.— ‘‘(1) IN GENERAL.—There are authorized to be appropriated, 

and are appropriated, to the Agricultural Disaster Relief Trust 

Fund, as repayable advances, such sums as may be necessary 

to carry out the purposes of such Trust Fund. ‘‘(2) REPAYMENT OF ADVANCES.— ‘‘(A) IN GENERAL.—Advances made to the Agricultural 

Disaster Relief Trust Fund shall be repaid, and interest on 

such advances shall be paid, to the general fund of the 

Treasury when the Secretary determines that moneys are 

available for such purposes in such Trust Fund. ‘‘(B) RATE OF INTEREST.—Interest on advances made 

pursuant to this subsection shall be— ‘‘(i) at a rate determined by the Secretary of the 

Treasury (as of the close of the calendar month preceding the month in which the advance is made) to be 

equal to the current average market yield on outstanding marketable obligations of the United States 

with remaining periods to maturity comparable to the 

anticipated period during which the advance will be 

outstanding, and 

‘‘(ii) compounded annually. 

‘‘SEC. 903. JURISDICTION. 

‘‘Legislation in the Senate of the United States amending section 901 or 902 shall be referred to the Committee on Finance of the 

Senate.’’. 

(b) TRANSITION.—For purposes of the 2008 crop year, the Secretary shall carry out subsections (f)(4) and (h) of section 901 of the 

Trade Act of 1974 (as added by subsection (a)) in accordance with 


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the terms and conditions of sections 1001 through 1001D of the 

Food Security Act of 1985 (16 U.S.C. 1308 et seq.), as in effect on 

September 30, 2007. 

(c) CLERICAL AMENDMENT.—The table of contents for the Trade 

Act of 1974 (19 U.S.C. 2101 et seq.) is amended by adding at the 

end the following: 

‘‘TITLE IX—SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE 

‘‘Sec. 901. Supplemental agricultural disaster assistance. 

‘‘Sec. 902. Agricultural Disaster Relief Trust Fund. 

‘‘Sec. 903. Jurisdiction.’’. 

Subtitle B—Revenue Provisions for Agriculture Programs 

SEC. 15201. CUSTOMS USER FEES. 

(a) IN GENERAL.—Section 13031(j)(3)(A) of the Consolidated 

Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)(A)) 

is amended by striking ‘‘December 27, 2014’’ and inserting ‘‘November 14, 2017’’. 

(b) OTHER FEES.—Section 13031(j)(3)(B)(i) of the Consolidated 

Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 

58c(j)(3)(B)(i)) is amended by striking ‘‘December 27, 2014’’ and inserting ‘‘September 30, 2017’’. 

(c) TIME FOR REMITTING CERTAIN COBRA FEES.—Notwithstanding any other provision of law, any fees authorized under 

paragraphs (1) through (8) of section 13031(a) of the Consolidated 

Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(a) (1) 

through (8)) with respect to customs services provided on or after 

July 1, 2017, and before September 20, 2017, shall be paid not later 

than September 25, 2017. 

(d) TIME FOR REMITTING CERTAIN MERCHANDISE PROCESSING

FEES.—

(1) IN GENERAL.—Notwithstanding any other provision of 

law, any fees authorized under paragraphs (9) and (10) of section 13031(a) of the Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(a) (9) and (10)) with respect 

to processing merchandise entered on or after October 1, 2017, 

and before November 15, 2017, shall be paid not later than 

September 25, 2017, in an amount equivalent to the amount of 

such fees paid by the person responsible for such fees with respect to merchandise entered on or after October 1, 2016, and 

before November 15, 2016, as determined by the Secretary of the 

Treasury. 

(2) RECONCILIATION OF MERCHANDISE PROCESSING FEES.— Not later than December 15, 2017, the Secretary of the Treasury 

shall reconcile the fees paid pursuant to paragraph (1) with the 

fees for services actually provided on or after October 1, 2017, 

and before November 15, 2017, and shall refund with interest 

any overpayment of such fees and make proper adjustments 

with respect to any underpayment of such fees. No interest may 

be assessed with respect to any such underpayment that was 

based on the amount of fees paid for merchandise entered on or 

after October 1, 2016, and before November 15, 2016. 

SEC. 15202. TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES. 

The percentage under subparagraph (B) of section 401(1) of the 

Tax Increase Prevention and Reconciliation Act of 2005 in effect on 


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the date of the enactment of this Act is increased by 7.75 percentage 

points. 

Subtitle C—Tax Provisions 

PART I—CONSERVATION 

Subpart A—Land and Species Preservation 

Provisions 

SEC. 15301. EXCLUSION OF CONSERVATION RESERVE PROGRAM PAYMENTS FROM SECA TAX FOR CERTAIN INDIVIDUALS. 

(a) INTERNAL REVENUE CODE.—Section 1402(a)(1) (defining net 

earnings from self-employment) is amended by inserting ‘‘, and including payments under section 1233(2) of the Food Security Act of 

1985 (16 U.S.C. 3833(2)) to individuals receiving benefits under section 202 or 223 of the Social Security Act’’ after ‘‘crop shares’’. (b) SOCIAL SECURITY ACT.—Section 211(a)(1) of the Social Security Act is amended by inserting ‘‘, and including payments under 

section 1233(2) of the Food Security Act of 1985 (16 U.S.C. 3833(2)) 

to individuals receiving benefits under section 202 or 223’’ after ‘‘crop shares’’. (c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to payments made after December 31, 2007. 

SEC. 15302. TWO-YEAR EXTENSION OF SPECIAL RULE ENCOURAGING 

CONTRIBUTIONS OF CAPITAL GAIN REAL PROPERTY FOR 

CONSERVATION PURPOSES. 

(a) IN GENERAL.— (1) INDIVIDUALS.—Section 170(b)(1)(E)(vi) (relating to termination) is amended by striking ‘‘December 31, 2007’’ and inserting ‘‘December 31, 2009’’. (2) CORPORATIONS.—Section 170(b)(2)(B)(iii) (relating to 

termination) is amended by striking ‘‘December 31, 2007’’ and 

inserting ‘‘December 31, 2009’’. (b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to contributions made in taxable years beginning after 

December 31, 2007. 

SEC. 15303. DEDUCTION FOR ENDANGERED SPECIES RECOVERY EXPENDITURES. 

(a) DEDUCTION FOR ENDANGERED SPECIES RECOVERY EXPENDI- TURES.—

(1) IN GENERAL.—Paragraph (1) of section 175(c) (relating 

to definitions) is amended by inserting after the first sentence 

the following new sentence: ‘‘Such term shall include expenditures paid or incurred for the purpose of achieving site-specific 

management actions recommended in recovery plans approved 

pursuant to the Endangered Species Act of 1973.’’. (2) CONFORMING AMENDMENTS.— (A) Section 175 is amended by inserting ‘‘, or for endangered species recovery’’ after ‘‘prevention of erosion of 

land used in farming’’ each place it appears in subsections 

(a) and (c). 

(B) The heading of section 175 is amended by inserting ‘‘; ENDANGERED SPECIES RECOVERY EXPENDITURES’’ before the period. 


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(C) The item relating to section 175 in the table of sections for part VI of subchapter B of chapter 1 is amended 

by inserting ‘‘; endangered species recovery expenditures’’

before the period. 

(b) LIMITATIONS.—Paragraph (3) of section 175(c) (relating to 

additional limitations) is amended—

(1) in the heading of subparagraph (A), by inserting ‘‘OR

ENDANGERED SPECIES RECOVERY PLAN’’ after ‘‘CONSERVATION

PLAN’’, and 

(2) in subparagraph (A)(i), by inserting ‘‘or the recovery 

plan approved pursuant to the Endangered Species Act of 1973’’

after ‘‘Department of Agriculture’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to expenditures paid or incurred after December 31, 

2008. 

Subpart B—Timber Provisions 

SEC. 15311. TEMPORARY REDUCTION IN RATE OF TAX ON QUALIFIED 

TIMBER GAIN OF CORPORATIONS. 

(a) IN GENERAL.—Section 1201 (relating to alternative tax for 

corporations) is amended by redesignating subsection (b) as subsection (c) and by adding after subsection (a) the following new subsection: 

‘‘(b) SPECIAL RATE FOR QUALIFIED TIMBER GAINS.—

‘‘(1) IN GENERAL.—If, for any taxable year ending after the 

date of the enactment of the Food, Conservation, and Energy 

Act of 2008 and beginning on or before the date which is 1 year 

after such date, a corporation has both a net capital gain and 

qualified timber gain—

‘‘(A) subsection (a) shall apply to such corporation for 

the taxable year without regard to whether the applicable 

tax rate exceeds 35 percent, and 

‘‘(B) the tax computed under subsection (a)(2) shall be 

equal to the sum of—

‘‘(i) 15 percent of the least of—

‘‘(I) qualified timber gain, 

‘‘(II) net capital gain, or 

‘‘(III) taxable income, plus 

‘‘(ii) 35 percent of the excess (if any) of taxable income over the sum of the amounts for which a tax was 

determined under subsection (a)(1) and clause (i). 

‘‘(2) QUALIFIED TIMBER GAIN.—For purposes of this section, 

the term ‘qualified timber gain’ means, with respect to any taxpayer for any taxable year, the excess (if any) of—

‘‘(A) the sum of the taxpayer’s gains described in subsections (a) and (b) of section 631 for such year, over 

‘‘(B) the sum of the taxpayer’s losses described in such 

subsections for such year. 

For purposes of subparagraphs (A) and (B), only timber held 

more than 15 years shall be taken into account. 

‘‘(3) COMPUTATION FOR TAXABLE YEARS IN WHICH RATE

FIRST APPLIES OR ENDS.—In the case of any taxable year which 

includes either of the dates set forth in paragraph (1), the qualiVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00625 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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fied timber gain for such year shall not exceed the qualified 

timber gain properly taken into account for— ‘‘(A) in the case of the taxable year including the date 

of the enactment of the Food, Conservation, and Energy Act 

of 2008, the portion of the year after such date, and ‘‘(B) in the case of the taxable year including the date 

which is 1 year after such date of enactment, the portion of 

the year on or before such later date.’’. (b) MINIMUM TAX.—Subsection (b) of section 55 is amended by 

adding at the end the following paragraph: ‘‘(4) MAXIMUM RATE OF TAX ON QUALIFIED TIMBER GAIN OF

CORPORATIONS.—In the case of any taxable year to which section 1201(b) applies, the amount determined under clause (i) of 

subparagraph (B) shall not exceed the sum of— ‘‘(A) 20 percent of so much of the taxable excess (if any) 

as exceeds the qualified timber gain (or, if less, the net capital gain), plus ‘‘(B) 15 percent of the taxable excess in excess of the 

amount on which a tax is determined under subparagraph 

(A). 

Any term used in this paragraph which is also used in section 

1201 shall have the meaning given such term by such section, 

except to the extent such term is subject to adjustment under 

this part.’’. (c) CONFORMING AMENDMENT.—Section 857(b)(3)(A)(ii) is 

amended by striking ‘‘rate’’ and inserting ‘‘rates’’. (d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years ending after the date of enactment. 

SEC. 15312. TIMBER REIT MODERNIZATION. 

(a) IN GENERAL.—Section 856(c)(5) is amended by adding after 

subparagraph (G) the following new subparagraph: ‘‘(H) TREATMENT OF TIMBER GAINS.— ‘‘(i) IN GENERAL.—Gain from the sale of real property described in paragraph (2)(D) and (3)(C) shall include gain which is— ‘‘(I) recognized by an election under section 

631(a) from timber owned by the real estate investment trust, the cutting of which is provided by a 

taxable REIT subsidiary of the real estate investment trust; ‘‘(II) recognized under section 631(b); or 

‘‘(III) income which would constitute gain 

under subclause (I) or (II) but for the failure to 

meet the 1-year holding period requirement. 

‘‘(ii) SPECIAL RULES.—

‘‘(I) For purposes of this subtitle, cut timber, 

the gain from which is recognized by a real estate 

investment trust pursuant to an election under section 631(a) described in clause (i)(I) or so much of 

clause (i)(III) as relates to clause (i)(I), shall be 

deemed to be sold to the taxable REIT subsidiary 

of the real estate investment trust on the first day 

of the taxable year. 

‘‘(II) For purposes of this subtitle, income described in this subparagraph shall not be treated 


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as gain from the sale of property described in section 1221(a)(1). 

‘‘(iii) TERMINATION.—This subparagraph shall not 

apply to dispositions after the termination date.’’. 

(b) TERMINATION DATE.—Subsection (c) of section 856 is 

amended by adding at the end the following new paragraph: 

‘‘(8) TERMINATION DATE.—For purposes of this subsection, 

the term ‘termination date’ means, with respect to any taxpayer, 

the last day of the taxpayer’s first taxable year beginning after 

the date of the enactment of this paragraph and before the date 

that is 1 year after such date of enactment.’’. 

(c) EFFECTIVE DATE.—The amendments made by subsection (a) 

shall apply to dispositions in taxable years beginning after the date 

of the enactment of this Act. 

SEC. 15313. MINERAL ROYALTY INCOME QUALIFYING INCOME FOR TIMBER REITS. 

(a) IN GENERAL.—Section 856(c)(2) is amended by striking 

‘‘and’’ at the end of subparagraph (G), by inserting ‘‘and’’ at the end 

of subparagraph (H), and by adding after subparagraph (H) the following new subparagraph: 

‘‘(I) mineral royalty income earned in the first taxable 

year beginning after the date of the enactment of this subparagraph from real property owned by a timber real estate 

investment trust and held, or once held, in connection with 

the trade or business of producing timber by such real estate investment trust;’’. 

(b) TIMBER REAL ESTATE INVESTMENT TRUST.—Section 

856(c)(5), as amended by this Act, is amended by adding after subparagraph (H) the following new subparagraph: 

‘‘(I) TIMBER REAL ESTATE INVESTMENT TRUST.—The 

term ‘timber real estate investment trust’ means a real estate investment trust in which more than 50 percent in 

value of its total assets consists of real property held in connection with the trade or business of producing timber.’’. 

(c) EFFECTIVE DATE.—The amendments by this section shall 

apply to taxable years beginning after the date of the enactment of 

this Act. 

SEC. 15314. MODIFICATION OF TAXABLE REIT SUBSIDIARY ASSET TEST 

FOR TIMBER REITS. 

(a) IN GENERAL.—Section 856(c)(4)(B)(ii) is amended by inserting ‘‘(in the case of a quarter which closes on or before the termination date, 25 percent in the case of a timber real estate investment 

trust)’’ after ‘‘REIT subsidiaries’’. (b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after the date of the enactment of this Act. 

SEC. 15315. SAFE HARBOR FOR TIMBER PROPERTY. 

(a) IN GENERAL.—Section 857(b)(6) (relating to income from 

prohibited transactions) is amended by adding at the end the following new subparagraph: 

‘‘(G) SPECIAL RULES FOR SALES TO QUALIFIED ORGANIZATIONS.—

‘‘(i) IN GENERAL.—In the case of the sale of a real 

estate asset (as defined in section 856(c)(5)(B)) to a 


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qualified organization (as defined in section 170(h)(3)) 

exclusively for conservation purposes (within the meaning of section 170(h)(1)(C)), subparagraph (D) shall be 

applied—

‘‘(I) by substituting ‘2 years’ for ‘4 years’ in 

clause (i), and 

‘‘(II) by substituting ‘2-year period’ for ‘4-year 

period’ in clauses (ii) and (iii). 

‘‘(ii) TERMINATION.—This subparagraph shall not 

apply to sales after the termination date.’’. 

(b) PROHIBITED TRANSACTIONS.—Section 857(b)(6)(D)(v) is 

amended by inserting ‘‘, or, in the case of a sale on or before the 

termination date, a taxable REIT subsidiary’’ after ‘‘any income’’. 

(c) SALES THAT ARE NOT PROHIBITED TRANSACTIONS.—Section 

857(b)(6), as amended by subsection (a), is amended by adding at 

the end the following new subparagraph: 

‘‘(H) SALES OF PROPERTY THAT ARE NOT A PROHIBITED

TRANSACTION.—In the case of a sale on or before the termination date, the sale of property which is not a prohibited 

transaction through the application of subparagraph (D) 

shall be considered property held for investment or for use 

in a trade or business and not property described in section 

1221(a)(1) for all purposes of this subtitle.’’. 

(d) TERMINATION DATE.—Section 857(b)(6), as amended by subsections (a) and (c), is amended by adding at the end the following 

new subparagraph: 

‘‘(I) TERMINATION DATE.—For purposes of this paragraph, the term ‘termination date’ has the meaning given 

such term by section 856(c)(8).’’. 

(e) EFFECTIVE DATE.—The amendments made by this section 

shall apply to dispositions in taxable years beginning after the date 

of the enactment of this Act. 

SEC. 15316. QUALIFIED FORESTRY CONSERVATION BONDS. 

(a) IN GENERAL.—Part IV of subchapter A of chapter 1 (relating 

to credits against tax) is amended by adding at the end the following new subpart: 

‘‘Subpart I—Qualified Tax Credit Bonds 

‘‘Sec. 54A. Credit to holders of qualified tax credit bonds. 

‘‘Sec. 54B. Qualified forestry conservation bonds. 

‘‘SEC. 54A. CREDIT TO HOLDERS OF QUALIFIED TAX CREDIT BONDS. 

‘‘(a) ALLOWANCE OF CREDIT.—If a taxpayer holds a qualified 

tax credit bond on one or more credit allowance dates of the bond 

during any taxable year, there shall be allowed as a credit against 

the tax imposed by this chapter for the taxable year an amount 

equal to the sum of the credits determined under subsection (b) with 

respect to such dates. 

‘‘(b) AMOUNT OF CREDIT.—

‘‘(1) IN GENERAL.—The amount of the credit determined 

under this subsection with respect to any credit allowance date 

for a qualified tax credit bond is 25 percent of the annual credit 

determined with respect to such bond. 


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‘‘(2) ANNUAL CREDIT.—The annual credit determined with 

respect to any qualified tax credit bond is the product of—

‘‘(A) the applicable credit rate, multiplied by 

‘‘(B) the outstanding face amount of the bond. 

‘‘(3) APPLICABLE CREDIT RATE.—For purposes of paragraph 

(2), the applicable credit rate is the rate which the Secretary estimates will permit the issuance of qualified tax credit bonds 

with a specified maturity or redemption date without discount 

and without interest cost to the qualified issuer. The applicable 

credit rate with respect to any qualified tax credit bond shall 

be determined as of the first day on which there is a binding, 

written contract for the sale or exchange of the bond. 

‘‘(4) SPECIAL RULE FOR ISSUANCE AND REDEMPTION.—In the 

case of a bond which is issued during the 3-month period ending on a credit allowance date, the amount of the credit determined under this subsection with respect to such credit allowance date shall be a ratable portion of the credit otherwise determined based on the portion of the 3-month period during 

which the bond is outstanding. A similar rule shall apply when 

the bond is redeemed or matures. 

‘‘(c) LIMITATION BASED ON AMOUNT OF TAX.—

‘‘(1) IN GENERAL.—The credit allowed under subsection (a) 

for any taxable year shall not exceed the excess of—

‘‘(A) the sum of the regular tax liability (as defined in 

section 26(b)) plus the tax imposed by section 55, over 

‘‘(B) the sum of the credits allowable under this part 

(other than subpart C and this subpart). 

‘‘(2) CARRYOVER OF UNUSED CREDIT.—If the credit allowable under subsection (a) exceeds the limitation imposed by 

paragraph (1) for such taxable year, such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year (determined 

before the application of paragraph (1) for such succeeding taxable year). 

‘‘(d) QUALIFIED TAX CREDIT BOND.—For purposes of this section—

‘‘(1) QUALIFIED TAX CREDIT BOND.—The term ‘qualified tax 

credit bond’ means a qualified forestry conservation bond which 

is part of an issue that meets the requirements of paragraphs 

(2), (3), (4), (5), and (6). 

‘‘(2) SPECIAL RULES RELATING TO EXPENDITURES.—

‘‘(A) IN GENERAL.—An issue shall be treated as meeting 

the requirements of this paragraph if, as of the date of 

issuance, the issuer reasonably expects—

‘‘(i) 100 percent or more of the available project 

proceeds to be spent for 1 or more qualified purposes 

within the 3-year period beginning on such date of 

issuance, and 

‘‘(ii) a binding commitment with a third party to 

spend at least 10 percent of such available project proceeds will be incurred within the 6-month period beginning on such date of issuance. 

‘‘(B) FAILURE TO SPEND REQUIRED AMOUNT OF BOND

PROCEEDS WITHIN 3 YEARS.—


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‘‘(i) IN GENERAL.—To the extent that less than 100 

percent of the available project proceeds of the issue are 

expended by the close of the expenditure period for 1 or 

more qualified purposes, the issuer shall redeem all of 

the nonqualified bonds within 90 days after the end of 

such period. For purposes of this paragraph, the 

amount of the nonqualified bonds required to be redeemed shall be determined in the same manner as 

under section 142. ‘‘(ii) EXPENDITURE PERIOD.—For purposes of this 

subpart, the term ‘expenditure period’ means, with respect to any issue, the 3-year period beginning on the 

date of issuance. Such term shall include any extension 

of such period under clause (iii). ‘‘(iii) EXTENSION OF PERIOD.—Upon submission of 

a request prior to the expiration of the expenditure period (determined without regard to any extension under 

this clause), the Secretary may extend such period if 

the issuer establishes that the failure to expend the proceeds within the original expenditure period is due to 

reasonable cause and the expenditures for qualified 

purposes will continue to proceed with due diligence. 

‘‘(C) QUALIFIED PURPOSE.—For purposes of this paragraph, the term ‘qualified purpose’ means a purpose specified in section 54B(e). ‘‘(D) REIMBURSEMENT.—For purposes of this subtitle, 

available project proceeds of an issue shall be treated as 

spent for a qualified purpose if such proceeds are used to 

reimburse the issuer for amounts paid for a qualified purpose after the date that the Secretary makes an allocation 

of bond limitation with respect to such issue, but only if— ‘‘(i) prior to the payment of the original expenditure, the issuer declared its intent to reimburse such 

expenditure with the proceeds of a qualified tax credit 

bond, 

‘‘(ii) not later than 60 days after payment of the 

original expenditure, the issuer adopts an official intent to reimburse the original expenditure with such 

proceeds, and 

‘‘(iii) the reimbursement is made not later than 18 

months after the date the original expenditure is paid. 

‘‘(3) REPORTING.—An issue shall be treated as meeting the 

requirements of this paragraph if the issuer of qualified tax 

credit bonds submits reports similar to the reports required 

under section 149(e). 

‘‘(4) SPECIAL RULES RELATING TO ARBITRAGE.—

‘‘(A) IN GENERAL.—An issue shall be treated as meeting 

the requirements of this paragraph if the issuer satisfies the 

requirements of section 148 with respect to the proceeds of 

the issue. ‘‘(B) SPECIAL RULE FOR INVESTMENTS DURING EXPENDI- TURE PERIOD.—An issue shall not be treated as failing to 

meet the requirements of subparagraph (A) by reason of 

any investment of available project proceeds during the expenditure period. 


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‘‘(C) SPECIAL RULE FOR RESERVE FUNDS.—An issue 

shall not be treated as failing to meet the requirements of 

subparagraph (A) by reason of any fund which is expected 

to be used to repay such issue if—

‘‘(i) such fund is funded at a rate not more rapid 

than equal annual installments, 

‘‘(ii) such fund is funded in a manner reasonably 

expected to result in an amount not greater than an 

amount necessary to repay the issue, and 

‘‘(iii) the yield on such fund is not greater than the 

discount rate determined under paragraph (5)(B) with 

respect to the issue. 

‘‘(5) MATURITY LIMITATION.—

‘‘(A) IN GENERAL.—An issue shall be treated as meeting 

the requirements of this paragraph if the maturity of any 

bond which is part of such issue does not exceed the maximum term determined by the Secretary under subparagraph (B). 

‘‘(B) MAXIMUM TERM.—During each calendar month, 

the Secretary shall determine the maximum term permitted 

under this paragraph for bonds issued during the following 

calendar month. Such maximum term shall be the term 

which the Secretary estimates will result in the present 

value of the obligation to repay the principal on the bond 

being equal to 50 percent of the face amount of such bond. 

Such present value shall be determined using as a discount 

rate the average annual interest rate of tax-exempt obligations having a term of 10 years or more which are issued 

during the month. If the term as so determined is not a 

multiple of a whole year, such term shall be rounded to the 

next highest whole year. 

‘‘(6) PROHIBITION ON FINANCIAL CONFLICTS OF INTEREST.—

An issue shall be treated as meeting the requirements of this 

paragraph if the issuer certifies that—

‘‘(A) applicable State and local law requirements governing conflicts of interest are satisfied with respect to such 

issue, and 

‘‘(B) if the Secretary prescribes additional conflicts of 

interest rules governing the appropriate Members of Congress, Federal, State, and local officials, and their spouses, 

such additional rules are satisfied with respect to such 

issue. 

‘‘(e) OTHER DEFINITIONS.—For purposes of this subchapter—

‘‘(1) CREDIT ALLOWANCE DATE.—The term ‘credit allowance 

date’ means—

‘‘(A) March 15, 

‘‘(B) June 15, 

‘‘(C) September 15, and 

‘‘(D) December 15. 

Such term includes the last day on which the bond is outstanding. 

‘‘(2) BOND.—The term ‘bond’ includes any obligation. 

‘‘(3) STATE.—The term ‘State’ includes the District of Columbia and any possession of the United States. 


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‘‘(4) AVAILABLE PROJECT PROCEEDS.—The term ‘available 

project proceeds’ means—

‘‘(A) the excess of—

‘‘(i) the proceeds from the sale of an issue, over 

‘‘(ii) the issuance costs financed by the issue (to the 

extent that such costs do not exceed 2 percent of such 

proceeds), and 

‘‘(B) the proceeds from any investment of the excess described in subparagraph (A). 

‘‘(f) CREDIT TREATED AS INTEREST.—For purposes of this subtitle, the credit determined under subsection (a) shall be treated as 

interest which is includible in gross income. 

‘‘(g) S CORPORATIONS AND PARTNERSHIPS.—In the case of a tax 

credit bond held by an S corporation or partnership, the allocation 

of the credit allowed by this section to the shareholders of such corporation or partners of such partnership shall be treated as a distribution. 

‘‘(h) BONDS HELD BY REGULATED INVESTMENT COMPANIES AND

REAL ESTATE INVESTMENT TRUSTS.—If any qualified tax credit 

bond is held by a regulated investment company or a real estate investment trust, the credit determined under subsection (a) shall be 

allowed to shareholders of such company or beneficiaries of such 

trust (and any gross income included under subsection (f) with respect to such credit shall be treated as distributed to such shareholders or beneficiaries) under procedures prescribed by the Secretary. 

‘‘(i) CREDITS MAY BE STRIPPED.—Under regulations prescribed 

by the Secretary—

‘‘(1) IN GENERAL.—There may be a separation (including at 

issuance) of the ownership of a qualified tax credit bond and 

the entitlement to the credit under this section with respect to 

such bond. In case of any such separation, the credit under this 

section shall be allowed to the person who on the credit allowance date holds the instrument evidencing the entitlement to the 

credit and not to the holder of the bond. 

‘‘(2) CERTAIN RULES TO APPLY.—In the case of a separation 

described in paragraph (1), the rules of section 1286 shall apply 

to the qualified tax credit bond as if it were a stripped bond 

and to the credit under this section as if it were a stripped coupon. 

‘‘SEC. 54B. QUALIFIED FORESTRY CONSERVATION BONDS. 

‘‘(a) QUALIFIED FORESTRY CONSERVATION BOND.—For purposes 

of this subchapter, the term ‘qualified forestry conservation bond’

means any bond issued as part of an issue if—

‘‘(1) 100 percent of the available project proceeds of such 

issue are to be used for one or more qualified forestry conservation purposes, 

‘‘(2) the bond is issued by a qualified issuer, and 

‘‘(3) the issuer designates such bond for purposes of this section. 

‘‘(b) LIMITATION ON AMOUNT OF BONDS DESIGNATED.—The 

maximum aggregate face amount of bonds which may be designated 

under subsection (a) by any issuer shall not exceed the limitation 

amount allocated to such issuer under subsection (d). 


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‘‘(c) NATIONAL LIMITATION ON AMOUNT OF BONDS DES- IGNATED.—There is a national qualified forestry conservation bond limitation of $500,000,000. ‘‘(d) ALLOCATIONS.— ‘‘(1) IN GENERAL.—The Secretary shall make allocations of 

the amount of the national qualified forestry conservation bond 

limitation described in subsection (c) among qualified forestry 

conservation purposes in such manner as the Secretary determines appropriate so as to ensure that all of such limitation is 

allocated before the date which is 24 months after the date of 

the enactment of this section. ‘‘(2) SOLICITATION OF APPLICATIONS.—The Secretary shall 

solicit applications for allocations of the national qualified forestry conservation bond limitation described in subsection (c) 

not later than 90 days after the date of the enactment of this 

section. 

‘‘(e) QUALIFIED FORESTRY CONSERVATION PURPOSE.—For purposes of this section, the term ‘qualified forestry conservation purpose’ means the acquisition by a State or any political subdivision 

or instrumentality thereof or a 501(c)(3) organization (as defined in 

section 150(a)(4)) from an unrelated person of forest and forest land 

that meets the following qualifications: 

‘‘(1) Some portion of the land acquired must be adjacent to 

United States Forest Service Land. 

‘‘(2) At least half of the land acquired must be transferred 

to the United States Forest Service at no net cost to the United 

States and not more than half of the land acquired may either 

remain with or be conveyed to a State. 

‘‘(3) All of the land must be subject to a native fish habitat 

conservation plan approved by the United States Fish and 

Wildlife Service. 

‘‘(4) The amount of acreage acquired must be at least 

40,000 acres. 

‘‘(f) QUALIFIED ISSUER.—For purposes of this section, the term 

‘qualified issuer’ means a State or any political subdivision or instrumentality thereof or a 501(c)(3) organization (as defined in section 150(a)(4)). 

‘‘(g) SPECIAL ARBITRAGE RULE.—In the case of any qualified 

forestry conservation bond issued as part of an issue, section 

54A(d)(4)(C) shall be applied to such issue without regard to clause 

(i). ‘‘(h) ELECTION TO TREAT 50 PERCENT OF BOND ALLOCATION AS

PAYMENT OF TAX.—

‘‘(1) IN GENERAL.—If—

‘‘(A) a qualified issuer receives an allocation of any portion of the national qualified forestry conservation bond 

limitation described in subsection (c), and 

‘‘(B) the qualified issuer elects the application of this 

subsection with respect to such allocation, 

then the qualified issuer (without regard to whether the issuer 

is subject to tax under this chapter) shall be treated as having 

made a payment against the tax imposed by this chapter, for 

the taxable year preceding the taxable year in which the allocation is received, in an amount equal to 50 percent of the amount 

of such allocation. 


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‘‘(2) TREATMENT OF DEEMED PAYMENT.—

‘‘(A) IN GENERAL.—Notwithstanding any other provision of this title, the Secretary shall not use the payment 

of tax described in paragraph (1) as an offset or credit 

against any tax liability of the qualified issuer but shall refund such payment to such issuer. 

‘‘(B) NO INTEREST.—Except as provided in paragraph 

(3)(A), the payment described in paragraph (1) shall not be 

taken into account in determining any amount of interest 

under this title. 

‘‘(3) REQUIREMENT FOR, AND EFFECT OF, ELECTION.—

‘‘(A) REQUIREMENT.—No election under this subsection 

shall take effect unless the qualified issuer certifies to the 

Secretary that any payment of tax refunded to the issuer 

under this subsection will be used exclusively for 1 or more 

qualified forestry conservation purposes. If the qualified 

issuer fails to use any portion of such payment for such 

purpose, the issuer shall be liable to the United States in 

an amount equal to such portion, plus interest at the overpayment rate under section 6621 for the period from the 

date such portion was refunded to the date such amount is 

paid. Any such amount shall be assessed and collected in 

the same manner as tax imposed by this chapter, except 

that subchapter B of chapter 63 (relating to deficiency procedures) shall not apply in respect of such assessment or 

collection. 

‘‘(B) EFFECT OF ELECTION ON ALLOCATION.—If a qualified issuer makes the election under this subsection with respect to any allocation—

‘‘(i) the issuer may issue no bonds pursuant to the 

allocation, and 

‘‘(ii) the Secretary may not reallocate such allocation for any other purpose.’’. 

(b) REPORTING.—Subsection (d) of section 6049 (relating to returns regarding payments of interest) is amended by adding at the 

end the following new paragraph: 

‘‘(9) REPORTING OF CREDIT ON QUALIFIED TAX CREDIT

BONDS.—

‘‘(A) IN GENERAL.—For purposes of subsection (a), the 

term ‘interest’ includes amounts includible in gross income 

under section 54A and such amounts shall be treated as 

paid on the credit allowance date (as defined in section 

54A(e)(1)). 

‘‘(B) REPORTING TO CORPORATIONS, ETC.—Except as 

otherwise provided in regulations, in the case of any interest described in subparagraph (A) of this paragraph, subsection (b)(4) of this section shall be applied without regard 

to subparagraphs (A), (H), (I), (J), (K), and (L)(i). 

‘‘(C) REGULATORY AUTHORITY.—The Secretary may prescribe such regulations as are necessary or appropriate to 

carry out the purposes of this paragraph, including regulations which require more frequent or more detailed reporting.’’. 

(c) CONFORMING AMENDMENTS.—


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(1) Sections 54(c)(2) and 1400N(l)(3)(B) are each amended 

by striking ‘‘subpart C’’ and inserting ‘‘subparts C and I’’. (2) Section 1397E(c)(2) is amended by striking ‘‘subpart H’’ and inserting ‘‘subparts H and I’’. (3) Section 6401(b)(1) is amended by striking ‘‘and H’’ and 

inserting ‘‘H, and I’’. (4) The heading of subpart H of part IV of subchapter A 

of chapter 1 is amended by striking ‘‘Certain Bonds’’ and inserting ‘‘Clean Renewable Energy Bonds’’. (5) The table of subparts for part IV of subchapter A of 

chapter 1 is amended by striking the item relating to subpart 

H and inserting the following new items: 

‘‘SUBPART H. NONREFUNDABLE CREDIT TO HOLDERS OF CLEAN RENEWABLE ENERGY

BONDS. 

‘‘SUBPART I. QUALIFIED TAX CREDIT BONDS.’’. 

(6) Paragraph (2) of section 1324(b) of title 31, United 

States Code, is amended by striking ‘‘or 6428 or 53(e)’’ and inserting ‘‘, 53(e), 54B(h), or 6428’’. (d) EFFECTIVE DATES.—The amendments made by this section 

shall apply to obligations issued after the date of the enactment of 

this Act. 

PART II—ENERGY PROVISIONS 

Subpart A—Cellulosic Biofuel 

SEC. 15321. CREDIT FOR PRODUCTION OF CELLULOSIC BIOFUEL. 

(a) IN GENERAL.—Subsection (a) of section 40 (relating to alcohol used as fuel) is amended by striking ‘‘plus’’ at the end of paragraph (1), by striking ‘‘plus’’ at the end of paragraph (2), by striking 

the period at the end of paragraph (3) and inserting ‘‘, plus’’, and 

by adding at the end the following new paragraph: ‘‘(4) the cellulosic biofuel producer credit.’’. 

(b) CELLULOSIC BIOFUEL PRODUCER CREDIT.—

(1) IN GENERAL.—Subsection (b) of section 40 is amended 

by adding at the end the following new paragraph: 

‘‘(6) CELLULOSIC BIOFUEL PRODUCER CREDIT.—

‘‘(A) IN GENERAL.—The cellulosic biofuel producer credit of any taxpayer is an amount equal to the applicable 

amount for each gallon of qualified cellulosic biofuel production. 

‘‘(B) APPLICABLE AMOUNT.—For purposes of subparagraph (A), the applicable amount means $1.01, except that 

such amount shall, in the case of cellulosic biofuel which 

is alcohol, be reduced by the sum of—

‘‘(i) the amount of the credit in effect for such alcohol under subsection (b)(1) (without regard to subsection (b)(3)) at the time of the qualified cellulosic 

biofuel production, plus 

‘‘(ii) in the case of ethanol, the amount of the credit 

in effect under subsection (b)(4) at the time of such production. 

‘‘(C) QUALIFIED CELLULOSIC BIOFUEL PRODUCTION.—

For purposes of this section, the term ‘qualified cellulosic 


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biofuel production’ means any cellulosic biofuel which is 

produced by the taxpayer, and which during the taxable 

year—

‘‘(i) is sold by the taxpayer to another person—

‘‘(I) for use by such other person in the production of a qualified cellulosic biofuel mixture in 

such other person’s trade or business (other than 

casual off-farm production), 

‘‘(II) for use by such other person as a fuel in 

a trade or business, or 

‘‘(III) who sells such cellulosic biofuel at retail 

to another person and places such cellulosic biofuel 

in the fuel tank of such other person, or 

‘‘(ii) is used or sold by the taxpayer for any purpose 

described in clause (i). 

The qualified cellulosic biofuel production of any taxpayer 

for any taxable year shall not include any alcohol which is 

purchased by the taxpayer and with respect to which such 

producer increases the proof of the alcohol by additional 

distillation. 

‘‘(D) QUALIFIED CELLULOSIC BIOFUEL MIXTURE.—For 

purposes of this paragraph, the term ‘qualified cellulosic 

biofuel mixture’ means a mixture of cellulosic biofuel and 

gasoline or of cellulosic biofuel and a special fuel which—

‘‘(i) is sold by the person producing such mixture 

to any person for use as a fuel, or 

‘‘(ii) is used as a fuel by the person producing such 

mixture. 

‘‘(E) CELLULOSIC BIOFUEL.—For purposes of this paragraph—

‘‘(i) IN GENERAL.—The term ‘cellulosic biofuel’

means any liquid fuel which—

‘‘(I) is produced from any lignocellulosic or 

hemicellulosic matter that is available on a renewable or recurring basis, and 

‘‘(II) meets the registration requirements for 

fuels and fuel additives established by the Environmental Protection Agency under section 211 of 

the Clean Air Act (42 U.S.C. 7545). 

‘‘(ii) EXCLUSION OF LOW-PROOF ALCOHOL.—Such 

term shall not include any alcohol with a proof of less 

than 150. The determination of the proof of any alcohol 

shall be made without regard to any added denaturants. 

‘‘(F) ALLOCATION OF CELLULOSIC BIOFUEL PRODUCER

CREDIT TO PATRONS OF COOPERATIVE.—Rules similar to the 

rules under subsection (g)(6) shall apply for purposes of 

this paragraph. 

‘‘(G) REGISTRATION REQUIREMENT.—No credit shall be 

determined under this paragraph with respect to any taxpayer unless such taxpayer is registered with the Secretary 

as a producer of cellulosic biofuel under section 4101. 

‘‘(H) APPLICATION OF PARAGRAPH.—This paragraph 

shall apply with respect to qualified cellulosic biofuel proVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00636 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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duction after December 31, 2008, and before January 1, 

2013.’’. (2) TERMINATION DATE NOT TO APPLY.—Subsection (e) of 

section 40 (relating to termination) is amended— (A) by inserting ‘‘or subsection (b)(6)(H)’’ after ‘‘by reason of paragraph (1)’’ in paragraph (2), and 

(B) by adding at the end the following new paragraph: ‘‘(3) EXCEPTION FOR CELLULOSIC BIOFUEL PRODUCER CRED- IT.—Paragraph (1) shall not apply to the portion of the credit 

allowed under this section by reason of subsection (a)(4).’’. (3) CONFORMING AMENDMENTS.— (A) Paragraph (1) of section 4101(a) is amended— (i) by striking ‘‘and every person’’ and inserting ‘‘, every person’’, and 

(ii) by inserting ‘‘, and every person producing cellulosic biofuel (as defined in section 40(b)(6)(E))’’ after ‘‘section 6426(b)(4)(A))’’. (B) The heading of section 40, and the item relating to 

such section in the table of sections for subpart D of part 

IV of subchapter A of chapter 1, are each amended by inserting ‘‘, etc.,’’ after ‘‘Alcohol’’. (c) BIOFUEL NOT USED AS A FUEL, ETC.— (1) IN GENERAL.—Paragraph (3) of section 40(d) is amended by redesignating subparagraph (D) as subparagraph (E) and 

by inserting after subparagraph (C) the following new subparagraph: ‘‘(D) CELLULOSIC BIOFUEL PRODUCER CREDIT.—If— ‘‘(i) any credit is allowed under subsection (a)(4), 

and ‘‘(ii) any person does not use such fuel for a purpose described in subsection (b)(6)(C), 

then there is hereby imposed on such person a tax equal to 

the applicable amount (as defined in subsection (b)(6)(B)) 

for each gallon of such cellulosic biofuel.’’. 

(2) CONFORMING AMENDMENTS.— (A) Subparagraph (C) of section 40(d)(3) is amended by 

striking ‘‘PRODUCER’’ in the heading and inserting ‘‘SMALL

ETHANOL PRODUCER’’. (B) Subparagraph (E) of section 40(d)(3), as redesignated by paragraph (1), is amended by striking ‘‘or (C)’’ and inserting ‘‘(C), or (D)’’. (d) BIOFUEL PRODUCED IN THE UNITED STATES.—Section 40(d) 

is amended by adding at the end the following new paragraph: 

‘‘(6) SPECIAL RULE FOR CELLULOSIC BIOFUEL PRODUCER

CREDIT.—No cellulosic biofuel producer credit shall be determined under subsection (a) with respect to any cellulosic biofuel 

unless such cellulosic biofuel is produced in the United States 

and used as a fuel in the United States. For purposes of this 

subsection, the term ‘United States’ includes any possession of 

the United States.’’. (e) WAIVER OF CREDIT LIMIT FOR CELLULOSIC BIOFUEL PRO- DUCTION BY SMALL ETHANOL PRODUCERS.—Section 40(b)(4)(C) is 

amended by inserting ‘‘(determined without regard to any qualified 

cellulosic biofuel production)’’ after ‘‘15,000,000 gallons’’. (f) DENIAL OF DOUBLE BENEFIT.—


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(1) BIODIESEL.—Paragraph (1) of section 40A(d) is amended by adding at the end the following new flush sentence: 

‘‘Such term shall not include any liquid with respect to which 

a credit may be determined under section 40.’’. (2) RENEWABLE DIESEL.—Paragraph (3) of section 40A(f) is 

amended by adding at the end the following new flush sentence: 

‘‘Such term shall not include any liquid with respect to which 

a credit may be determined under section 40.’’. (g) EFFECTIVE DATE.—The amendments made by this section 

shall apply to fuel produced after December 31, 2008. 

SEC. 15322. COMPREHENSIVE STUDY OF BIOFUELS. 

(a) STUDY.—The Secretary of the Treasury, in consultation with 

the Secretary of Agriculture, the Secretary of Energy, and the Administrator of the Environmental Protection Agency, shall enter into 

an agreement with the National Academy of Sciences to produce an 

analysis of current scientific findings to determine— (1) current biofuels production, as well as projections for future production, 

(2) the maximum amount of biofuels production capable in 

United States forests and farmlands, including the current 

quantities and character of the feedstocks and including such 

information as regional forest inventories that are commercially 

available, used in the production of biofuels, 

(3) the domestic effects of an increase in biofuels production 

levels, including the effects of such levels on— (A) the price of fuel, 

(B) the price of land in rural and suburban communities, 

(C) crop acreage, forest acreage, and other land use, 

(D) the environment, due to changes in crop acreage, 

fertilizer use, runoff, water use, emissions from vehicles utilizing biofuels, and other factors, 

(E) the price of feed, 

(F) the selling price of grain crops and forest products, 

(G) exports and imports of grains and forest products, 

(H) taxpayers, through cost or savings to commodity 

crop payments, and 

(I) the expansion of refinery capacity, 

(4) the ability to convert corn ethanol plants for other uses, 

such as cellulosic ethanol or biodiesel, 

(5) a comparative analysis of corn ethanol versus other 

biofuels and renewable energy sources, considering cost, energy 

output, and ease of implementation, 

(6) the impact of the tax credit established by this subpart 

on the regional agricultural and silvicultural capabilities of 

commercially available forest inventories, and 

(7) the need for additional scientific inquiry, and specific 

areas of interest for future research. 

(b) REPORT.—The Secretary of the Treasury shall submit an initial report of the findings of the study required under subsection (a) 

to Congress not later than 6 months after the date of the enactment 

of this Act (36 months after such date in the case of the information 

required by subsection (a)(6)), and a final report not later than 12 

months after such date (42 months after such date in the case of the 

information required by subsection (a)(6)). 


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Subpart B—Revenue Provisions 

SEC. 15331. MODIFICATION OF ALCOHOL CREDIT. 

(a) INCOME TAX CREDIT.—

(1) IN GENERAL.—The table in paragraph (2) of section 

40(h) is amended—

(A) by striking ‘‘through 2010’’ in the first column and 

inserting ‘‘, 2006, 2007, or 2008’’, 

(B) by striking the period at the end of the third row, 

and 

(C) by adding at the end the following new row: 

‘‘2009 through 2010 ........................................... 45 cents ........................ 33.33 cents.’’. 

(2) EXCEPTION.—Section 40(h) is amended by adding at the 

end the following new paragraph: 

‘‘(3) REDUCTION DELAYED UNTIL ANNUAL PRODUCTION OR

IMPORTATION OF 7,500,000,000 GALLONS.—

‘‘(A) IN GENERAL.—In the case of any calendar year beginning after 2008, if the Secretary makes a determination 

described in subparagraph (B) with respect to all preceding 

calendar years beginning after 2007, the last row in the 

table in paragraph (2) shall be applied by substituting ‘51 

cents’ for ‘45 cents’. 

‘‘(B) DETERMINATION.—A determination described in 

this subparagraph with respect to any calendar year is a 

determination, in consultation with the Administrator of 

the Environmental Protection Agency, that an amount less 

than 7,500,000,000 gallons of ethanol (including cellulosic 

ethanol) has been produced in or imported into the United 

States in such year.’’. 

(b) EXCISE TAX CREDIT.—

(1) IN GENERAL.—Subparagraph (A) of section 6426(b)(2) 

(relating to alcohol fuel mixture credit) is amended by striking 

‘‘the applicable amount is 51 cents’’ and inserting ‘‘the applicable amount is—

‘‘(i) in the case of calendar years beginning before 

2009, 51 cents, and 

‘‘(ii) in the case of calendar years beginning after 

2008, 45 cents.’’. 

(2) EXCEPTION.—Paragraph (2) of section 6426(b) is amended by adding at the end the following new subparagraph: 

‘‘(C) REDUCTION DELAYED UNTIL ANNUAL PRODUCTION

OR IMPORTATION OF 7,500,000,000 GALLONS.—In the case of 

any calendar year beginning after 2008, if the Secretary 

makes a determination described in section 40(h)(3)(B) with 

respect to all preceding calendar years beginning after 

2007, subparagraph (A)(ii) shall be applied by substituting 

‘51 cents’ for ‘45 cents’.’’

(3) CONFORMING AMENDMENT.—Subparagraph (A) of section 6426(b)(2) is amended by striking ‘‘subparagraph (B)’’ and 

inserting ‘‘subparagraphs (B) and (C)’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall take effect on the date of the enactment of this Act. 


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SEC. 15332. CALCULATION OF VOLUME OF ALCOHOL FOR FUEL CREDITS. 

(a) IN GENERAL.—Paragraph (4) of section 40(d) (relating to 

volume of alcohol) is amended by striking ‘‘5 percent’’ and inserting 

‘‘2 percent’’. 

(b) CONFORMING AMENDMENT FOR EXCISE TAX CREDIT.—Section 6426(b) (relating to alcohol fuel mixture credit) is amended by 

redesignating paragraph (5) as paragraph (6) and by inserting after 

paragraph (4) the following new paragraph: 

‘‘(5) VOLUME OF ALCOHOL.—For purposes of determining 

under subsection (a) the number of gallons of alcohol with respect to which a credit is allowable under subsection (a), the 

volume of alcohol shall include the volume of any denaturant 

(including gasoline) which is added under any formulas approved by the Secretary to the extent that such denaturants do 

not exceed 2 percent of the volume of such alcohol (including denaturants).’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to fuel sold or used after December 31, 2008. 

SEC. 15333. ETHANOL TARIFF EXTENSION. 

Headings 9901.00.50 and 9901.00.52 of the Harmonized Tariff 

Schedule of the United States are each amended in the effective period column by striking ‘‘1/1/2009’’ and inserting ‘‘1/1/2011’’. 

SEC. 15334. LIMITATIONS ON DUTY DRAWBACK ON CERTAIN IMPORTED 

ETHANOL. 

(a) IN GENERAL.—Section 313(p) of the Tariff Act of 1930 (19 

U.S.C. 1313(p)) is amended by adding at the end the following new 

paragraph: 

‘‘(5) SPECIAL RULES FOR ETHYL ALCOHOL.—For purposes of 

this subsection, any duty paid under subheading 9901.00.50 of 

the Harmonized Tariff Schedule of the United States on imports of ethyl alcohol or a mixture of ethyl alcohol may not be 

refunded if the exported article upon which a drawback claim 

is based does not contain ethyl alcohol or a mixture of ethyl alcohol.’’. 

(b) EFFECTIVE DATE.—The amendment made by this section applies with respect to—

(1) imports of ethyl alcohol or a mixture of ethyl alcohol entered for consumption, or withdrawn from warehouse for consumption, on or after October 1, 2008; and 

(2) imports of ethyl alcohol or a mixture of ethyl alcohol entered for consumption, or withdrawn from warehouse for consumption, before October 1, 2008, if a duty drawback claim is 

filed with respect to such imports on or after October 1, 2010. 

PART III—AGRICULTURAL PROVISIONS 

SEC. 15341. INCREASE IN LOAN LIMITS ON AGRICULTURAL BONDS. 

(a) IN GENERAL.—Subparagraph (A) of section 147(c)(2) (relating to exception for first-time farmers) is amended by striking 

‘‘$250,000’’ and inserting ‘‘$450,000’’. 

(b) INFLATION ADJUSTMENT.—Section 147(c)(2) is amended by 

adding at the end the following new subparagraph: 


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‘‘(H) ADJUSTMENTS FOR INFLATION.—In the case of any 

calendar year after 2008, the dollar amount in subparagraph (A) shall be increased by an amount equal to—

‘‘(i) such dollar amount, multiplied by 

‘‘(ii) the cost-of-living adjustment determined 

under section 1(f)(3) for the calendar year, determined 

by substituting ‘calendar year 2007’ for ‘calendar year 

1992’ in subparagraph (B) thereof. 

If any amount as increased under the preceding sentence is 

not a multiple of $100, such amount shall be rounded to 

the nearest multiple of $100.’’. 

(c) MODIFICATION OF SUBSTANTIAL FARMLAND DEFINITION.—

Section 147(c)(2)(E) (defining substantial farmland) is amended by 

striking ‘‘unless’’ and all that follows through the period and inserting ‘‘unless such parcel is smaller than 30 percent of the median 

size of a farm in the county in which such parcel is located.’’. 

(d) CONFORMING AMENDMENT.—Section 147(c)(2)(C)(i)(II) is 

amended by striking ‘‘$250,000’’ and inserting ‘‘the amount in effect 

under subparagraph (A)’’. 

(e) EFFECTIVE DATE.—The amendments made by this section 

shall apply to bonds issued after the date of the enactment of this 

Act. 

SEC. 15342. ALLOWANCE OF SECTION 1031 TREATMENT FOR EXCHANGES INVOLVING CERTAIN MUTUAL DITCH, RESERVOIR, OR IRRIGATION COMPANY STOCK. 

(a) IN GENERAL.—Section 1031 (relating to exchange of property 

held for productive use or investment) is amended by adding at the 

end the following new subsection: 

‘‘(i) SPECIAL RULES FOR MUTUAL DITCH, RESERVOIR, OR IRRIGATION COMPANY STOCK.—For purposes of subsection (a)(2)(B), the 

term ‘stocks’ shall not include shares in a mutual ditch, reservoir, 

or irrigation company if at the time of the exchange—

‘‘(1) the mutual ditch, reservoir, or irrigation company is an 

organization described in section 501(c)(12)(A) (determined 

without regard to the percentage of its income that is collected 

from its members for the purpose of meeting losses and expenses), and 

‘‘(2) the shares in such company have been recognized by 

the highest court of the State in which such company was organized or by applicable State statute as constituting or representing real property or an interest in real property.’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to exchanges completed after the date of the enactment 

of this Act. 

SEC. 15343. AGRICULTURAL CHEMICALS SECURITY CREDIT. 

(a) IN GENERAL.—Subpart D of part IV of subchapter A of 

chapter 1 (relating to business related credits) is amended by adding at the end the following new section: 

‘‘SEC. 45O. AGRICULTURAL CHEMICALS SECURITY CREDIT. 

‘‘(a) IN GENERAL.—For purposes of section 38, in the case of an 

eligible agricultural business, the agricultural chemicals security 

credit determined under this section for the taxable year is 30 percent of the qualified security expenditures for the taxable year. 


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‘‘(b) FACILITY LIMITATION.—The amount of the credit determined under subsection (a) with respect to any facility for any taxable year shall not exceed—

‘‘(1) $100,000, reduced by 

‘‘(2) the aggregate amount of credits determined under subsection (a) with respect to such facility for the 5 prior taxable 

years. 

‘‘(c) ANNUAL LIMITATION.—The amount of the credit determined 

under subsection (a) with respect to any taxpayer for any taxable 

year shall not exceed $2,000,000. 

‘‘(d) QUALIFIED CHEMICAL SECURITY EXPENDITURE.—For purposes of this section, the term ‘qualified chemical security expenditure’ means, with respect to any eligible agricultural business for 

any taxable year, any amount paid or incurred by such business 

during such taxable year for—

‘‘(1) employee security training and background checks, 

‘‘(2) limitation and prevention of access to controls of specified agricultural chemicals stored at the facility, 

‘‘(3) tagging, locking tank valves, and chemical additives to 

prevent the theft of specified agricultural chemicals or to render 

such chemicals unfit for illegal use, 

‘‘(4) protection of the perimeter of specified agricultural 

chemicals, 

‘‘(5) installation of security lighting, cameras, recording 

equipment, and intrusion detection sensors, 

‘‘(6) implementation of measures to increase computer or 

computer network security, 

‘‘(7) conducting a security vulnerability assessment, 

‘‘(8) implementing a site security plan, and 

‘‘(9) such other measures for the protection of specified agricultural chemicals as the Secretary may identify in regulation. 

Amounts described in the preceding sentence shall be taken into account only to the extent that such amounts are paid or incurred for 

the purpose of protecting specified agricultural chemicals. 

‘‘(e) ELIGIBLE AGRICULTURAL BUSINESS.—For purposes of this 

section, the term ‘eligible agricultural business’ means any person in 

the trade or business of—

‘‘(1) selling agricultural products, including specified agricultural chemicals, at retail predominantly to farmers and 

ranchers, or 

‘‘(2) manufacturing, formulating, distributing, or aerially 

applying specified agricultural chemicals. 

‘‘(f) SPECIFIED AGRICULTURAL CHEMICAL.—For purposes of this 

section, the term ‘specified agricultural chemical’ means—

‘‘(1) any fertilizer commonly used in agricultural operations 

which is listed under—

‘‘(A) section 302(a)(2) of the Emergency Planning and 

Community Right-to-Know Act of 1986, 

‘‘(B) section 101 of part 172 of title 49, Code of Federal 

Regulations, or 

‘‘(C) part 126, 127, or 154 of title 33, Code of Federal 

Regulations, and 

‘‘(2) any pesticide (as defined in section 2(u) of the Federal 

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tive and inert ingredients thereof, which is customarily used on 

crops grown for food, feed, or fiber. 

‘‘(g) CONTROLLED GROUPS.—Rules similar to the rules of paragraphs (1) and (2) of section 41(f) shall apply for purposes of this 

section. ‘‘(h) REGULATIONS.—The Secretary may prescribe such regulations as may be necessary or appropriate to carry out the purposes 

of this section, including regulations which— ‘‘(1) provide for the proper treatment of amounts which are 

paid or incurred for purpose of protecting any specified agricultural chemical and for other purposes, and ‘‘(2) provide for the treatment of related properties as one 

facility for purposes of subsection (b). 

‘‘(i) TERMINATION.—This section shall not apply to any amount 

paid or incurred after December 31, 2012.’’. 

(b) CREDIT ALLOWED AS PART OF GENERAL BUSINESS CREDIT.—

Section 38(b) is amended by striking ‘‘plus’’ at the end of paragraph 

(30), by striking the period at the end of paragraph (31) and inserting ‘‘, plus’’, and by adding at the end the following new paragraph: 

‘‘(32) in the case of an eligible agricultural business (as defined in section 45O(e)), the agricultural chemicals security 

credit determined under section 45O(a).’’. 

(c) DENIAL OF DOUBLE BENEFIT.—Section 280C is amended by 

adding at the end the following new subsection: ‘‘(f) CREDIT FOR SECURITY OF AGRICULTURAL CHEMICALS.—No 

deduction shall be allowed for that portion of the expenses otherwise 

allowable as a deduction taken into account in determining the 

credit under section 45O for the taxable year which is equal to the 

amount of the credit determined for such taxable year under section 

45O(a).’’. (d) CLERICAL AMENDMENT.—The table of sections for subpart D 

of part IV of subchapter A of chapter 1 is amended by adding at 

the end the following new item: 

‘‘Sec. 45O. Agricultural chemicals security credit.’’. 

(e) EFFECTIVE DATE.—The amendments made by this section 

shall apply to amounts paid or incurred after the date of the enactment of this Act. 

SEC. 15344. 3-YEAR DEPRECIATION FOR RACE HORSES THAT ARE 2 

YEARS OLD OR YOUNGER. 

(a) IN GENERAL.—Clause (i) of section 168(e)(3)(A) (relating to 

3-year property) is amended to read as follows: 

‘‘(i) any race horse—

‘‘(I) which is placed in service before January 

1, 2014, and 

‘‘(II) which is placed in service after December 

31, 2013, and which is more than 2 years old at 

the time such horse is placed in service by such 

purchaser,’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to property placed in service after December 31, 2008. 

SEC. 15345. TEMPORARY TAX RELIEF FOR KIOWA COUNTY, KANSAS 

AND SURROUNDING AREA. 

(a) IN GENERAL.—Subject to the modifications described in this 

section, the following provisions of or relating to the Internal RevVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00643 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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enue Code of 1986 shall apply to the Kansas disaster area in addition to the areas to which such provisions otherwise apply: 

(1) Section 1400N(d) of such Code (relating to special allowance for certain property). 

(2) Section 1400N(e) of such Code (relating to increase in 

expensing under section 179). 

(3) Section 1400N(f) of such Code (relating to expensing for 

certain demolition and clean-up costs). 

(4) Section 1400N(k) of such Code (relating to treatment of 

net operating losses attributable to storm losses). 

(5) Section 1400N(n) of such Code (relating to treatment of 

representations regarding income eligibility for purposes of 

qualified rental project requirements). 

(6) Section 1400N(o) of such Code (relating to treatment of 

public utility property disaster losses). 

(7) Section 1400Q of such Code (relating to special rules for 

use of retirement funds). 

(8) Section 1400R(a) of such Code (relating to employee retention credit for employers). 

(9) Section 1400S(b) of such Code (relating to suspension of 

certain limitations on personal casualty losses). 

(10) Section 405 of the Katrina Emergency Tax Relief Act 

of 2005 (relating to extension of replacement period for nonrecognition of gain). 

(b) KANSAS DISASTER AREA.—For purposes of this section, the 

term ‘‘Kansas disaster area’’ means an area with respect to which 

a major disaster has been declared by the President under section 

401 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (FEMA–1699–DR, as in effect on the date of the enactment 

of this Act) by reason of severe storms and tornados beginning on 

May 4, 2007, and determined by the President to warrant individual or individual and public assistance from the Federal Government under such Act with respect to damages attributable to such 

storms and tornados. 

(c) REFERENCES TO AREA OR LOSS.—

(1) AREA.—Any reference in such provisions to the Katrina 

disaster area or the Gulf Opportunity Zone shall be treated as 

a reference to the Kansas disaster area. 

(2) LOSS.—Any reference in such provisions to any loss or 

damage attributable to Hurricane Katrina shall be treated as 

a reference to any loss or damage attributable to the May 4, 

2007, storms and tornados. 

(d) REFERENCES TO DATES, ETC.—

(1) SPECIAL ALLOWANCE FOR CERTAIN PROPERTY ACQUIRED

ON OR AFTER MAY 5, 2007.—Section 1400N(d) of such Code—

(A) by substituting ‘‘qualified Recovery Assistance property’’ for ‘‘qualified Gulf Opportunity Zone property’’ each 

place it appears, 

(B) by substituting ‘‘May 5, 2007’’ for ‘‘August 28, 

2005’’ each place it appears, 

(C) by substituting ‘‘December 31, 2008’’ for ‘‘December 

31, 2007’’ in paragraph (2)(A)(v), 

(D) by substituting ‘‘December 31, 2009’’ for ‘‘December 

31, 2008’’ in paragraph (2)(A)(v), 


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(E) by substituting ‘‘May 4, 2007’’ for ‘‘August 27, 

2005’’ in paragraph (3)(A), 

(F) by substituting ‘‘January 1, 2009’’ for ‘‘January 1, 

2008’’ in paragraph (3)(B), and 

(G) determined without regard to paragraph (6) thereof. 

(2) INCREASE IN EXPENSING UNDER SECTION 179.—Section 

1400N(e) of such Code, by substituting ‘‘qualified section 179 

Recovery Assistance property’’ for ‘‘qualified section 179 Gulf 

Opportunity Zone property’’ each place it appears. 

(3) EXPENSING FOR CERTAIN DEMOLITION AND CLEAN-UP

COSTS.—Section 1400N(f) of such Code—

(A) by substituting ‘‘qualified Recovery Assistance 

clean-up cost’’ for ‘‘qualified Gulf Opportunity Zone cleanup cost’’ each place it appears, and 

(B) by substituting ‘‘beginning on May 4, 2007, and 

ending on December 31, 2009’’ for ‘‘beginning on August 28, 

2005, and ending on December 31, 2007’’ in paragraph (2) 

thereof. 

(4) TREATMENT OF NET OPERATING LOSSES ATTRIBUTABLE

TO STORM LOSSES.—Section 1400N(k) of such Code— (A) by substituting ‘‘qualified Recovery Assistance loss’’ for ‘‘qualified Gulf Opportunity Zone loss’’ each place it appears, 

(B) by substituting ‘‘after May 3, 2007, and before on 

January 1, 2010’’ for ‘‘after August 27, 2005, and before 

January 1, 2008’’ each place it appears, 

(C) by substituting ‘‘May 4, 2007’’ for ‘‘August 28, 

2005’’ in paragraph (2)(B)(ii)(I) thereof, 

(D) by substituting ‘‘qualified Recovery Assistance 

property’’ for ‘‘qualified Gulf Opportunity Zone property’’ in 

paragraph (2)(B)(iv) thereof, and 

(E) by substituting ‘‘qualified Recovery Assistance casualty loss’’ for ‘‘qualified Gulf Opportunity Zone casualty 

loss’’ each place it appears. 

(5) SPECIAL RULES FOR USE OF RETIREMENT FUNDS.—Section 1400Q of such Code— (A) by substituting ‘‘qualified Recovery Assistance distribution’’ for ‘‘qualified hurricane distribution’’ each place 

it appears, 

(B) by substituting ‘‘on or after May 4, 2007, and before 

January 1, 2009’’ for ‘‘on or after August 25, 2005, and before January 1, 2007’’ in subsection (a)(4)(A)(i), 

(C) by substituting ‘‘May 4, 2007’’ for ‘‘August 28, 

2005’’ in subsections (a)(4)(A)(i) and (c)(3)(B), 

(D) disregarding clauses (ii) and (iii) of subsection 

(a)(4)(A), 

(E) by substituting ‘‘qualified storm distribution’’ for ‘‘qualified Katrina distribution’’ each place it appears, 

(F) by substituting ‘‘after November 4, 2006, and before 

May 5, 2007’’ for ‘‘after February 28, 2005, and before August 29, 2005’’ in subsection (b)(2)(B)(ii), 

(G) by substituting ‘‘the Kansas disaster area (as defined in section 15345(b) of the Food, Conservation, and 

Energy Act of 2008) but which was not so purchased or 


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constructed on account of the May 4, 2007, storms and tornados’’ for ‘‘the Hurricane Katrina disaster area, but not so 

purchased or constructed on account of Hurricane Katrina’’

in subsection (b)(2)(B)(iii), 

(H) by substituting ‘‘beginning on May 4, 2007, and 

ending on the date which is 5 months after the date of the 

enactment of the Heartland, Habitat, Harvest, and Horticulture Act of 2008’’ for ‘‘beginning on August 25, 2005, 

and ending on February 28, 2006’’ in subsection (b)(3)(A), 

(I) by substituting ‘‘qualified storm individual’’ for 

‘‘qualified Hurricane Katrina individual’’ each place it appears, 

(J) by substituting ‘‘December 31, 2008’’ for ‘‘December 

31, 2006’’ in subsection (c)(2)(A), 

(K) by substituting ‘‘beginning on the date of the enactment of the Food, Conservation, and Energy Act of 2008 

and ending on December 31, 2008’’ for ‘‘beginning on September 24, 2005, and ending on December 31, 2006’’ in subsection (c)(4)(A)(i), 

(L) by substituting ‘‘May 4, 2007’’ for ‘‘August 25, 2005’’

in subsection (c)(4)(A)(ii), and 

(M) by substituting ‘‘January 1, 2009’’ for ‘‘January 1, 

2007’’ in subsection (d)(2)(A)(ii). 

(6) EMPLOYEE RETENTION CREDIT FOR EMPLOYERS AFFECTED BY MAY 4 STORMS AND TORNADOS.—Section 1400R(a) of 

the Internal Revenue Code of 1986—

(A) by substituting ‘‘May 4, 2007’’ for ‘‘August 28, 2005’’

each place it appears, 

(B) by substituting ‘‘January 1, 2008’’ for ‘‘January 1, 

2006’’ both places it appears, and 

(C) only with respect to eligible employers who employed an average of not more than 200 employees on business days during the taxable year before May 4, 2007. 

(7) SUSPENSION OF CERTAIN LIMITATIONS ON PERSONAL

CASUALTY LOSSES.—Section 1400S(b)(1) of the Internal Revenue 

Code of 1986, by substituting ‘‘May 4, 2007’’ for ‘‘August 25, 

2005’’. 

(8) EXTENSION OF REPLACEMENT PERIOD FOR NONRECOGNITION OF GAIN.—Section 405 of the Katrina Emergency Tax Relief Act of 2005, by substituting ‘‘on or after May 4, 2007’’ for 

‘‘on or after August 25, 2005’’. 

SEC. 15346. COMPETITIVE CERTIFICATION AWARDS MODIFICATION AUTHORITY. 

(a) IN GENERAL.—Section 48A (relating to qualifying advanced 

coal project credit) is amended by adding at the end the following 

new subsection: 

‘‘(h) COMPETITIVE CERTIFICATION AWARDS MODIFICATION AUTHORITY.—In implementing this section or section 48B, the Secretary is directed to modify the terms of any competitive certification 

award and any associated closing agreement where such modification—

‘‘(1) is consistent with the objectives of such section, 

‘‘(2) is requested by the recipient of the competitive certification award, and 


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‘‘(3) involves moving the project site to improve the potential 

to capture and sequester carbon dioxide emissions, reduce costs 

of transporting feedstock, and serve a broader customer base, 

unless the Secretary determines that the dollar amount of tax credits available to the taxpayer under such section would increase as 

a result of the modification or such modification would result in 

such project not being originally certified. In considering any such 

modification, the Secretary shall consult with other relevant Federal 

agencies, including the Department of Energy.’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall take effect on the date of the enactment of this Act and is applicable to all competitive certification awards entered into under 

section 48A or 48B of the Internal Revenue Code of 1986, whether 

such awards were issued before, on, or after such date of enactment. 

PART IV—OTHER REVENUE PROVISIONS 

SEC. 15351. LIMITATION ON EXCESS FARM LOSSES OF CERTAIN TAXPAYERS. 

(a) IN GENERAL.—Section 461 (relating to general rule for taxable year of deduction) is amended by adding at the end the following new subsection: 

‘‘(j) LIMITATION ON EXCESS FARM LOSSES OF CERTAIN TAXPAYERS.—

‘‘(1) LIMITATION.—If a taxpayer other than a C corporation 

receives any applicable subsidy for any taxable year, any excess 

farm loss of the taxpayer for the taxable year shall not be allowed. 

‘‘(2) DISALLOWED LOSS CARRIED TO NEXT TAXABLE YEAR.—

Any loss which is disallowed under paragraph (1) shall be 

treated as a deduction of the taxpayer attributable to farming 

businesses in the next taxable year. 

‘‘(3) APPLICABLE SUBSIDY.—For purposes of this subsection, 

the term ‘applicable subsidy’ means—

‘‘(A) any direct or counter-cyclical payment under title 

I of the Food, Conservation, and Energy Act of 2008, or any 

payment elected to be received in lieu of any such payment, 

or 

‘‘(B) any Commodity Credit Corporation loan. 

‘‘(4) EXCESS FARM LOSS.—For purposes of this subsection—

‘‘(A) IN GENERAL.—The term ‘excess farm loss’ means 

the excess of—

‘‘(i) the aggregate deductions of the taxpayer for the 

taxable year which are attributable to farming businesses of such taxpayer (determined without regard to 

whether or not such deductions are disallowed for such 

taxable year under paragraph (1)), over 

‘‘(ii) the sum of—

‘‘(I) the aggregate gross income or gain of such 

taxpayer for the taxable year which is attributable 

to such farming businesses, plus 

‘‘(II) the threshold amount for the taxable year. 

‘‘(B) THRESHOLD AMOUNT.—


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‘‘(i) IN GENERAL.—The term ‘threshold amount’ means, with respect to any taxable year, the greater 

of— ‘‘(I) $300,000 ($150,000 in the case of married 

individuals filing separately), or ‘‘(II) the excess (if any) of the aggregate 

amounts described in subparagraph (A)(ii)(I) for 

the 5-consecutive taxable year period preceding the 

taxable year over the aggregate amounts described 

in subparagraph (A)(i) for such period. 

‘‘(ii) SPECIAL RULES FOR DETERMINING AGGREGATE

AMOUNTS.—For purposes of clause (i)(II)—

‘‘(I) notwithstanding the disregard in subparagraph (A)(i) of any disallowance under paragraph 

(1), in the case of any loss which is carried forward under paragraph (2) from any taxable year, 

such loss (or any portion thereof) shall be taken 

into account for the first taxable year in which a 

deduction for such loss (or portion) is not disallowed by reason of this subsection, and 

‘‘(II) the Secretary shall prescribe rules for the 

computation of the aggregate amounts described in 

such clause in cases where the filing status of the 

taxpayer is not the same for the taxable year and 

each of the taxable years in the period described in 

such clause. 

‘‘(C) FARMING BUSINESS.— ‘‘(i) IN GENERAL.—The term ‘farming business’ has 

the meaning given such term in section 263A(e)(4). ‘‘(ii) CERTAIN TRADES AND BUSINESSES IN- CLUDED.—If, without regard to this clause, a taxpayer 

is engaged in a farming business with respect to any 

agricultural or horticultural commodity— ‘‘(I) the term ‘farming business’ shall include 

any trade or business of the taxpayer of the processing of such commodity (without regard to 

whether the processing is incidental to the growing, raising, or harvesting of such commodity), and 

‘‘(II) if the taxpayer is a member of a cooperative to which subchapter T applies, any trade or 

business of the cooperative described in subclause 

(I) shall be treated as the trade or business of the 

taxpayer. 

‘‘(D) CERTAIN LOSSES DISREGARDED.—For purposes of 

subparagraph (A)(i), there shall not be taken into account 

any deduction for any loss arising by reason of fire, storm, 

or other casualty, or by reason of disease or drought, involving any farming business. 

‘‘(5) APPLICATION OF SUBSECTION IN CASE OF PARTNERSHIPS

AND S CORPORATIONS.—In the case of a partnership or S corporation—

‘‘(A) this subsection shall be applied at the partner or 

shareholder level, and ‘‘(B) each partner’s or shareholder’s proportionate share 

of the items of income, gain, or deduction of the partnership 


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or S corporation for any taxable year from farming businesses attributable to the partnership or S corporation, and 

of any applicable subsidies received by the partnership or 

S corporation during the taxable year, shall be taken into 

account by the partner or shareholder in applying this subsection to the taxable year of such partner or shareholder 

with or within which the taxable year of the partnership or 

S corporation ends. 

The Secretary may provide rules for the application of this 

paragraph to any other pass-thru entity to the extent necessary 

to carry out the provisions of this subsection. 

‘‘(6) ADDITIONAL REPORTING.—The Secretary may prescribe 

such additional reporting requirements as the Secretary determines appropriate to carry out the purposes of this subsection. 

‘‘(7) COORDINATION WITH SECTION 469.—This subsection 

shall be applied before the application of section 469.’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2009. 

SEC. 15352. MODIFICATION TO OPTIONAL METHOD OF COMPUTING 

NET EARNINGS FROM SELF-EMPLOYMENT. 

(a) AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986.—

(1) IN GENERAL.—The matter following paragraph (17) of 

section 1402(a) is amended—

(A) by striking ‘‘$2,400’’ each place it appears and inserting ‘‘the upper limit’’, and 

(B) by striking ‘‘$1,600’’ each place it appears and inserting ‘‘the lower limit’’. 

(2) DEFINITIONS.—Section 1402 is amended by adding at 

the end the following new subsection: 

‘‘(l) UPPER AND LOWER LIMITS.—For purposes of subsection 

(a)—

‘‘(1) LOWER LIMIT.—The lower limit for any taxable year is 

the sum of the amounts required under section 213(d) of the Social Security Act for a quarter of coverage in effect with respect 

to each calendar quarter ending with or within such taxable 

year. 

‘‘(2) UPPER LIMIT.—The upper limit for any taxable year is 

the amount equal to 150 percent of the lower limit for such taxable year.’’. 

(b) AMENDMENTS TO THE SOCIAL SECURITY ACT.—

(1) IN GENERAL.—The matter following paragraph (16) of 

section 211(a) of the Social Security Act is amended—

(A) by striking ‘‘$2,400’’ each place it appears and inserting ‘‘the upper limit’’, and 

(B) by striking ‘‘$1,600’’ each place it appears and inserting ‘‘the lower limit’’. 

(2) DEFINITIONS.—Section 211 of such Act is amended by 

adding at the end the following new subsection: 

‘‘(k) UPPER AND LOWER LIMITS.—For purposes of subsection 

(a)—

‘‘(1) The lower limit for any taxable year is the sum of the 

amounts required under section 213(d) for a quarter of coverage 

in effect with respect to each calendar quarter ending with or 

within such taxable year. 


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‘‘(2) The upper limit for any taxable year is the amount 

equal to 150 percent of the lower limit for such taxable year.’’. 

(3) CONFORMING AMENDMENT.—Section 212 of such Act is 

amended—

(A) in subsection (b), by striking ‘‘For’’ and inserting 

‘‘Except as provided in subsection (c), for’’; and 

(B) by adding at the end the following new subsection: 

‘‘(c) For the purpose of determining average indexed monthly 

earnings, average monthly wage, and quarters of coverage in the 

case of any individual who elects the option described in clause (ii) 

or (iv) in the matter following section 211(a)(16) for any taxable 

year that does not begin with or during a particular calendar year 

and end with or during such year, the self-employment income of 

such individual deemed to be derived during such taxable year 

shall be allocated to the two calendar years, portions of which are 

included within such taxable year, in the same proportion to the 

total of such deemed self-employment income as the sum of the 

amounts applicable under section 213(d) for the calendar quarters 

ending with or within each such calendar year bears to the lower 

limit for such taxable year specified in section 211(k)(1).’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2007. 

SEC. 15353. INFORMATION REPORTING FOR COMMODITY CREDIT CORPORATION TRANSACTIONS. 

(a) IN GENERAL.—Subpart A of part III of subchapter A of 

chapter 61 (relating to information concerning persons subject to 

special provisions) is amended by inserting after section 6039I the 

following new section: 

‘‘SEC. 6039J. INFORMATION REPORTING WITH RESPECT TO COMMODITY CREDIT CORPORATION TRANSACTIONS. 

‘‘(a) REQUIREMENT OF REPORTING.—The Commodity Credit 

Corporation, through the Secretary of Agriculture, shall make a return, according to the forms and regulations prescribed by the Secretary of the Treasury, setting forth any market gain realized by a 

taxpayer during the taxable year in relation to the repayment of a 

loan issued by the Commodity Credit Corporation, without regard 

to the manner in which such loan was repaid. 

‘‘(b) STATEMENTS TO BE FURNISHED TO PERSONS WITH RESPECT TO WHOM INFORMATION IS REQUIRED.—The Secretary of Agriculture shall furnish to each person whose name is required to be 

set forth in a return required under subsection (a) a written statement showing the amount of market gain reported in such return.’’. 

(b) CLERICAL AMENDMENT.—The table of sections for subpart A 

of part III of subchapter A of chapter 61 is amended by inserting 

after the item relating to section 6039I the following new item: 

‘‘Sec. 6039J. Information reporting with respect to Commodity Credit Corporation 

transactions.’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to loans repaid on or after January 1, 2007. 


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PART V—PROTECTION OF SOCIAL SECURITY 

SEC. 15361. PROTECTION OF SOCIAL SECURITY. 

To ensure that the assets of the trust funds established under 

section 201 of the Social Security Act (42 U.S.C. 401) are not reduced as a result of the enactment of this Act, the Secretary of the 

Treasury shall transfer annually from the general revenues of the 

Federal Government to those trust funds the following amounts: 

(1) For fiscal year 2009, $5,000,000. 

(2) For fiscal year 2010, $9,000,000. 

(3) For fiscal year 2011, $8,000,000. 

(4) For fiscal year 2012, $7,000,000. 

(5) For fiscal year 2013, $8,000,000. 

(6) For fiscal year 2014, $8,000,000. 

(7) For fiscal year 2015, $8,000,000. 

(8) For fiscal year 2016, $6,000,000. 

(9) For fiscal year 2017, $7,000,000. 

Subtitle D—Trade Provisions 

PART I—EXTENSION OF CERTAIN TRADE 

BENEFITS 

SEC. 15401. SHORT TITLE. 

This part may be cited as the ‘‘Haitian Hemispheric Opportunity through Partnership Encouragement Act of 2008’’ or the 

‘‘HOPE II Act’’. 

SEC. 15402. BENEFITS FOR APPAREL AND OTHER TEXTILE ARTICLES. 

(a) VALUE-ADDED RULE.—Section 213A(b) of the Carribean 

Basin Economic Recovery Act (19 U.S.C. 2703a(b)) is amended as 

follows: 

(1) The subsection heading is amended to read as follows: ‘‘APPAREL AND OTHER TEXTILE ARTICLES’’. 

(2) Paragraph (1) is amended to read as follows: 

‘‘(1) VALUE-ADDED RULE FOR APPAREL ARTICLES.—

‘‘(A) IN GENERAL.—Apparel articles described in subparagraph (B) of a producer or entity controlling production that are imported directly from Haiti or the Dominican 

Republic shall enter the United States free of duty during 

an applicable 1-year period, subject to the limitations set 

forth in subparagraphs (B) and (C), and subject to subparagraph (D).’’. 

(3) Paragraph (2) is amended—

(A) in subparagraph (A)—

(i) by moving such subparagraph 2 ems to the 

right; 

(ii) in clause (i), by striking ‘‘subparagraph (C)’’

and inserting ‘‘clause (iii)’’; 

(iii) in clause (ii), by striking ‘‘subparagraph (C)’’

and inserting ‘‘clause (iii)’’; 

(iv) in the matter following clause (ii), by striking 

‘‘subparagraph (E)(I)’’ and inserting ‘‘clause (v)(I)’’; 

(v) by redesignating clauses (i) and (ii) as subclauses (I) and (II), respectively; and 


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(vi) by redesignating subparagraph (A) as clause 

(i); 

(B) in subparagraph (B)—

(i) by moving such subparagraph 2 ems to the 

right; 

(ii) by striking ‘‘subparagraph (A)(i)’’ each place it 

appears and inserting ‘‘clause (i)(I)’’; 

(iii) by redesignating clauses (i) and (ii) as subclauses (I) and (II), respectively; and 

(iv) by redesignating subparagraph (B) as clause 

(ii); 

(C) in subparagraph (C)—

(i) by moving such subparagraph 2 ems to the 

right; 

(ii) in the matter preceding clause (i), by striking 

‘‘subparagraph (A)’’ and inserting ‘‘clause (i)’’; 

(iii) in clause (ii), by striking ‘‘that enters into 

force’’ and all that follows through ‘‘et seq.)’’ and inserting ‘‘that enters into force thereafter’’; 

(iv) by redesignating clauses (i) through (v) as subclauses (I) through (V), respectively; and 

(v) by redesignating subparagraph (C) as clause 

(iii); 

(D) in subparagraph (D)—

(i) by moving such subparagraph 2 ems to the 

right; 

(ii) in clause (i)—

(I) in the matter preceding subclause (I), by 

striking ‘‘subparagraph (A)’’ and inserting ‘‘clause 

(i)’’; 

(II) in subclause (I), by striking ‘‘clause (i) of 

subparagraph (A)’’ and inserting ‘‘subclause (I) of 

clause (i)’’; 

(III) in subclause (II), by striking ‘‘clause (ii) of 

subparagraph (A)’’ and inserting ‘‘subclause (II) of 

clause (i)’’; 

(IV) by redesignating subclauses (I) and (II) as 

items (aa) and (bb), respectively; and 

(V) by redesignating clause (i) as subclause (I); 

(iii) in clause (ii)—

(I) in the matter preceding subclause (I), by 

striking ‘‘subparagraph (A)’’ and inserting ‘‘clause 

(i)’’; 

(II) in subclause (I), by striking ‘‘clause (i) of 

subparagraph (A)’’ and inserting ‘‘subclause (I) of 

clause (i)’’; 

(III) in subclause (II), by striking ‘‘clause (ii) of 

subparagraph (A)’’ and inserting ‘‘subclause (II) of 

clause (i)’’; 

(IV) by redesignating subclauses (I) and (II) as 

items (aa) and (bb), respectively; and 

(V) by redesignating clause (ii) as subclause 

(II); 

(iv) in clause (iii)—


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(I) by striking ‘‘clause (i)(I) or (ii)(I)’’ each 

place it appears and inserting ‘‘subclause (I)(aa) or 

(II)(aa)’’; 

(II) by redesignating subclauses (I) and (II) as 

items (aa) and (bb), respectively; and 

(III) by redesignating clause (iii) as subclause 

(III); 

(v) by amending clause (iv) to read as follows: ‘‘(IV) INCLUSION IN CALCULATION OF OTHER

ARTICLES RECEIVING PREFERENTIAL TREATMENT.— Entries of apparel articles that receive preferential 

treatment under any provision of law other than 

this subparagraph or are subject to the ‘General’ column 1 rate of duty under the HTS are not included in the annual aggregation under subclause 

(I) or (II) unless the producer or entity controlling 

production elects, at the time the annual aggregation calculation is made, to include such entries in 

such aggregation.’’; and 

(vi) by redesignating subparagraph (D) as clause 

(iv); 

(E) in subparagraph (E)— (i) by moving such subparagraph 2 ems to the 

right; 

(ii) in clause (i)— (I) by redesignating subclauses (I) through 

(III) as items (aa) through (cc), respectively; and 

(II) by redesignating clause (i) as subclause (I); 

(iii) in clause (ii)— (I) by striking ‘‘subparagraph (C)’’ and inserting ‘‘clause (iii)’’; and 

(II) by redesignating clause (ii) as subclause 

(II); and 

(iv) by redesignating subparagraph (E) as clause 

(v); 

(F) in subparagraph (F)—

(i) by moving such subparagraph 2 ems to the 

right; 

(ii) in clause (i)—

(I) by striking ‘‘The Bureau of Customs and 

Border Protection’’ and inserting ‘‘U.S. Customs 

and Border Protection’’; 

(II) by striking ‘‘subparagraphs (A) and (D)’’

and inserting ‘‘clauses (i) and (iv)’’; and 

(III) by redesignating clause (i) as subclause 

(I); 

(iii) in clause (ii)—

(I) in the matter preceding subclause (I)—

(aa) by striking ‘‘the Bureau of Customs 

and Border Protection’’ and inserting ‘‘U.S. 

Customs and Border Protection’’; 

(bb) by striking ‘‘subparagraph (A)’’ each 

place it appears and inserting ‘‘clause (i)’’; and 

(cc) by striking ‘‘subparagraph (D)’’ and 

inserting ‘‘clause (iv)’’; 


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(II) in subclause (I), by striking ‘‘clause (i) of 

subparagraph (A)’’ and inserting ‘‘subclause (I) of 

clause (i)’’; 

(III) in subclause (II), by striking ‘‘clause (ii) of 

subparagraph (A)’’ and inserting ‘‘subclause (II) of 

clause (i)’’; 

(IV) in the matter following subclause (II), by 

striking ‘‘subparagraph (E)(i)’’ and inserting ‘‘clause (v)(I)’’; 

(V) by redesignating subclauses (I) and (II) as 

items (aa) and (bb), respectively; and 

(VI) by redesignating clause (ii) as subclause 

(II); 

(iv) in clause (iii)— (I) in subclause (I)— (aa) by striking ‘‘paragraph (1)’’ and inserting ‘‘subparagraph (A)’’; and 

(bb) by striking ‘‘subparagraph (A) or (D)’’ and inserting ‘‘clause (i) or (iv)’’; 

(II) in subclause (II), by striking ‘‘clause (ii) of 

this subparagraph’’ and inserting ‘‘subclause (II) of 

this clause’’; 

(III) in the matter following subclause (II)— (aa) by striking ‘‘the Bureau of Customs 

and Border Protection’’ each place it appears 

and inserting ‘‘U.S. Customs and Border Protection’’; and 

(bb) by striking ‘‘subclause (II)’’ and inserting ‘‘item (bb)’’; and 

(IV) in item (bb)— (aa) by striking ‘‘paragraph (1)’’ and inserting ‘‘subparagraph (A)’’; and 

(bb) by striking ‘‘subparagraph (A) or (D)’’ and inserting ‘‘clause (i) or (iv)’’; and 

(V) in the matter following item (bb), by striking ‘‘paragraph (1)’’ and inserting ‘‘subparagraph 

(A)’’; 

(VI) by redesignating items (aa) and (bb) as 

subitems (AA) and (BB), respectively; 

(VII) by redesignating subclauses (I) and (II) 

as items (aa) and (bb), respectively; and 

(VIII) by redesignating clause (iii) as subclause (III); and 

(v) by redesignating subparagraph (F) as clause 

(vi); 

(G) in subparagraph (G)—

(i) by moving such subparagraph 2 ems to the 

right; 

(ii) in clause (i)—

(I) in the matter preceding subclause (I), by 

striking ‘‘subparagraph (A) or (D)’’ and inserting 

‘‘clause (i) or (iv)’’; 

(II) in subclause (II)—

(aa) in item (dd), by striking ‘‘under the 

Bipartisan Trade Promotion Authority Act of 


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2002’’ and inserting ‘‘with respect to the 

United States’’; and 

(bb) by redesignating items (aa) through 

(dd) as subitems (AA) through (DD), respectively; 

(III) by redesignating subclauses (I) and (II) as 

items (aa) and (bb), respectively; and 

(IV) by redesignating clause (i) as subclause 

(I); 

(iii) in clause (ii)— (I) in subclause (I), by striking ‘‘clause (i)(I)’’ and inserting ‘‘subclause (I)(aa)’’; 

(II) in subclause (II), by striking ‘‘clause (i)(II)’’ and inserting ‘‘subclause (I)(bb)’’; 

(III) by redesignating subclauses (I) and (II) as 

items (aa) and (bb), respectively; and 

(IV) by redesignating clause (ii) as subclause 

(II); and 

(iv) by redesignating subparagraph (G) as clause 

(vii); and 

(H) by striking ‘‘(2) APPAREL ARTICLES DESCRIBED.—’’

and inserting the following: ‘‘(B) APPAREL ARTICLES DESCRIBED.—’’. (4) Paragraph (3) is amended— (A) by redesignating such paragraph as subparagraph 

(C) and moving it 2 ems to the right; 

(B) by striking ‘‘paragraph (1)’’ each place it appears 

and inserting ‘‘subparagraph (A)’’; and 

(C) in the table— (i) by striking ‘‘1.5 percent’’ and inserting ‘‘1.25 

percent’’; 

(ii) by striking ‘‘1.75 percent’’ and inserting ‘‘1.25 

percent’’; and 

(iii) by striking ‘‘2 percent’’ and inserting ‘‘1.25 percent’’. 

(5) The following is added after subparagraph (C), as redesignated by paragraph (4)(A) of this subsection: 

‘‘(D) OTHER PREFERENTIAL TREATMENT NOT AFFECTED

BY QUANTITATIVE LIMITATIONS.—Any apparel article that 

qualifies for preferential treatment under paragraph (2), 

(3), (4), or (5) or any other provision of this title shall not 

be subject to, or included in the calculation of, the quantitative limitations under subparagraph (C).’’. (b) SPECIAL RULE FOR WOVEN ARTICLES AND CERTAIN KNIT ARTICLES.—Section 213A(b) of the Carribean Basin Economic Recovery 

Act is amended by striking paragraph (4) and inserting the following: 

‘‘(2) SPECIAL RULE FOR WOVEN ARTICLES AND CERTAIN KNIT

ARTICLES.—

‘‘(A) SPECIAL RULE FOR ARTICLES OF CHAPTER 62 OF

THE HTS.—

‘‘(i) GENERAL RULE.—Any apparel article classifiable under chapter 62 of the HTS that is wholly assembled, or knit-to-shape, in Haiti from any combination 

of fabrics, fabric components, components knit-toVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00655 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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shape, or yarns and is imported directly from Haiti or 

the Dominican Republic shall enter the United States 

free of duty, subject to clauses (ii) and (iii), without regard to the source of the fabric, fabric components, 

components knit-to-shape, or yarns from which the article is made. ‘‘(ii) LIMITATION.—The preferential treatment described in clause (i) shall be extended, in the 1-year period beginning October 1, 2008, and in each of the 9 

succeeding 1-year periods, to not more than 70,000,000 

square meter equivalents of apparel articles described 

in such clause. ‘‘(iii) OTHER PREFERENTIAL TREATMENT NOT AFFECTED BY QUANTITATIVE LIMITATION.—Any apparel 

article that qualifies for preferential treatment under 

paragraph (1), (3), (4), or (5) or subparagraph (B) of 

this paragraph or any other provision of this title shall 

not be subject to, or included in the calculation of, the 

quantitative limitation under clause (ii). 

‘‘(B) SPECIAL RULE FOR CERTAIN ARTICLES OF CHAPTER

61 OF THE HTS.— ‘‘(i) GENERAL RULE.—Any apparel article classifiable under chapter 61 of the HTS that is wholly assembled, or knit-to-shape, in Haiti from any combination 

of fabrics, fabric components, components knit-toshape, or yarns and is imported directly from Haiti or 

the Dominican Republic shall enter the United States 

free of duty, subject to clauses (ii), (iii), and (iv), without regard to the source of the fabric, fabric components, components knit-to-shape, or yarns from which 

the article is made. ‘‘(ii) EXCLUSIONS.—The preferential treatment described in clause (i) shall not apply to the following: ‘‘(I) The following apparel articles of cotton, 

for men or boys, that are classifiable under subheading 6109.10.00 of the HTS: ‘‘(aa) All white T-shirts, with short 

hemmed sleeves and hemmed bottom, with 

crew or round neckline or with V-neck and 

with a mitered seam at the center of the V, 

and without pockets, trim, or embroidery. ‘‘(bb) All white singlets, without pockets, 

trim, or embroidery. ‘‘(cc) Other T-shirts, but not including 

thermal undershirts. 

‘‘(II) T-shirts for men or boys that are classifiable under subheading 6109.90.10. ‘‘(III) The following apparel articles of cotton, 

for men or boys, that are classifiable under subheading 6110.20.20 of the HTS: 

‘‘(aa) Sweatshirts. 

‘‘(bb) Pullovers, other than sweaters, vests, 

or garments imported as part of playsuits. 

‘‘(IV) Sweatshirts for men or boys, of manmade fibers and containing less than 65 percent by 


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weight of man-made fibers, that are classifiable 

under subheading 6110.30.30 of the HTS. 

‘‘(iii) LIMITATION.—The preferential treatment described in clause (i) shall be extended, in the 1-year period beginning October 1, 2008, and in each of the 9 

succeeding 1-year periods, to not more than 70,000,000 

square meter equivalents of apparel articles described 

in such clause. ‘‘(iv) OTHER PREFERENTIAL TREATMENT NOT AF- FECTED BY QUANTITATIVE LIMITATION.—Any apparel 

article that qualifies for preferential treatment under 

paragraph (1), (3), (4), or (5) or subparagraph (A) of 

this paragraph or any other provision of this title shall 

not be subject to, or included in the calculation of, the 

quantitative limitation under clause (iii).’’. (c) SINGLE TRANSFORMATION RULES NOT SUBJECT TO QUANTITATIVE LIMITATIONS.—Section 213A(b) of the Caribbean Basin 

Economic Recovery Act is amended by striking paragraph (5) and 

inserting the following: 

‘‘(3) APPAREL AND OTHER ARTICLES SUBJECT TO CERTAIN AS- SEMBLY RULES.— ‘‘(A) BRASSIERES.—Any apparel article classifiable 

under subheading 6212.10 of the HTS that is wholly assembled, or knit-to-shape, in Haiti from any combination of 

fabrics, fabric components, components knit-to-shape, or 

yarns and is imported directly from Haiti or the Dominican 

Republic shall enter the United States free of duty, without 

regard to the source of the fabric, fabric components, components knit-to-shape, or yarns from which the article is 

made. ‘‘(B) OTHER APPAREL ARTICLES.—Any of the following 

apparel articles that is wholly assembled, or knit-to-shape, 

in Haiti from any combination of fabrics, fabric components, components knit-to-shape, or yarns and is imported 

directly from Haiti or the Dominican Republic shall enter 

the United States free of duty, without regard to the source 

of the fabric, fabric components, components knit-to-shape, 

or yarns from which the article is made: 

‘‘(i) Any apparel article that is of a type listed in 

chapter rule 3, 4, or 5 for chapter 61 of the HTS (as 

such chapter rules are contained in section A of the 

Annex to Proclamation 8213 of the President of December 20, 2007) as being excluded from the scope of such 

chapter rule, when such chapter rule is applied to determine whether an apparel article is an originating 

good for purposes of general note 29(n) to the HTS, except that, for purposes of this clause, reference in such 

chapter rules to ‘6104.12.00’ shall be deemed to be a 

reference to ‘6104.19.60’. 

‘‘(ii)(I) Subject to subclause (II), any apparel article 

that is of a type listed in chapter rule 3(a), 4(a), or 5(a) 

for chapter 62 of the HTS, as such chapter rules are 

contained in paragraph 9 of section A of the Annex to 

Proclamation 8213 of the President of December 20, 

2007. 


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‘‘(II) Subclause (I) shall not include any apparel 

article to which subparagraph (A) of this paragraph 

applies. 

‘‘(C) LUGGAGE AND SIMILAR ITEMS.—Any article classifiable under subheading 4202.12, 4202.22, 4202.32, or 

4202.92 of the HTS that is wholly assembled in Haiti and 

is imported directly from Haiti or the Dominican Republic 

shall enter the United States free of duty, without regard 

to the source of the fabric, components, or materials from 

which the article is made. 

‘‘(D) HEADGEAR.—Any article classifiable under heading 6501, 6502, or 6504 of the HTS, or under subheading 

6505.90 of the HTS, that is wholly assembled, knit-toshape, or formed in Haiti from any combination of fabrics, 

fabric components, components knit-to-shape, or yarns and 

is imported directly from Haiti or the Dominican Republic 

shall enter the United States free of duty, without regard 

to the source of the fabric, fabric components, components 

knit-to-shape, or yarns from which the article is made. 

‘‘(E) CERTAIN SLEEPWEAR.—Any of the following apparel articles that is wholly assembled, or knit-to-shape, in 

Haiti from any combination of fabrics, fabric components, 

components knit-to-shape, or yarns and is imported directly 

from Haiti or the Dominican Republic shall enter the 

United States free of duty, without regard to the source of 

the fabric, fabric components, components knit-to-shape, or 

yarns from which the article is made: 

‘‘(i) Pajama bottoms and other sleepwear for 

women and girls, of cotton, that are classifiable under 

subheading 6208.91.30, or of man-made fibers, that 

are classifiable under subheading 6208.92.00. 

‘‘(ii) Pajama bottoms and other sleepwear for girls, 

of other textile materials, that are classifiable under 

subheading 6208.99.20.’’. 

(d) EARNED IMPORT ALLOWANCE RULES.—Section 231A(b) of the 

Caribbean Basin Economic Recovery Act is amended by adding at 

the end the following new paragraph: 

‘‘(4) EARNED IMPORT ALLOWANCE RULE.—

‘‘(A) IN GENERAL.—Apparel articles wholly assembled, 

or knit-to-shape, in Haiti from any combination of fabrics, 

fabric components, components knit-to-shape, or yarns and 

imported directly from Haiti or the Dominican Republic 

shall enter the United States free of duty, without regard 

to the source of the fabric, fabric components, components 

knit-to-shape, or yarns from which the articles are made, if 

such apparel articles are accompanied by an earned import 

allowance certificate that reflects the amount of credits 

equal to the total square meter equivalents of such apparel 

articles, in accordance with the program established under 

subparagraph (B). For purposes of determining the quantity of square meter equivalents under this subparagraph, 

the conversion factors listed in ‘Correlation: U.S. Textile 

and Apparel Industry Category System with the Harmonized Tariff Schedule of the United States of America, 


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2008’, or its successor publications, of the United States Department of Commerce, shall apply. ‘‘(B) EARNED IMPORT ALLOWANCE PROGRAM.— ‘‘(i) ESTABLISHMENT.—The Secretary of Commerce 

shall establish a program to provide earned import allowance certificates to any producer or entity controlling production for purposes of subparagraph (A), 

based on the elements described in clause (ii). ‘‘(ii) ELEMENTS.—The elements referred to in 

clause (i) are the following: ‘‘(I) One credit shall be issued to a producer or 

an entity controlling production for every three 

square meter equivalents of qualifying woven fabric or qualifying knit fabric that the producer or 

entity controlling production can demonstrate that 

it purchased for the manufacture in Haiti of articles like or similar to any article eligible for preferential treatment under subparagraph (A). The 

Secretary of Commerce shall, if requested by a producer or entity controlling production, create and 

maintain an account for such producer or entity 

controlling production, into which such credits 

shall be deposited. ‘‘(II) Such producer or entity controlling production may redeem credits issued under subclause (I) for earned import allowance certificates 

reflecting such number of earned credits as the 

producer or entity may request and has available. ‘‘(III) The Secretary of Commerce may require 

any textile mill or other entity located in the 

United States that exports to Haiti qualifying 

woven fabric or qualifying knit fabric to submit, 

upon such export or upon request, documentation, 

such as a Shipper’s Export Declaration, to the Secretary of Commerce—

‘‘(aa) verifying that the qualifying woven 

fabric or qualifying knit fabric was exported to 

a producer in Haiti or to an entity controlling 

production; and 

‘‘(bb) identifying such producer or entity 

controlling production, and the quantity and 

description of qualifying woven fabric or 

qualifying knit fabric exported to such producer or entity controlling production. 

‘‘(IV) The Secretary of Commerce may require 

that a producer or entity controlling production 

submit documentation to verify purchases of qualifying woven fabric or qualifying knit fabric. 

‘‘(V) The Secretary of Commerce may make 

available to each person or entity identified in documentation submitted under subclause (III) or (IV) 

information contained in such documentation that 

relates to the purchase of qualifying woven fabric 

or qualifying knit fabric involving such person or 

entity. 


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‘‘(VI) The program under this subparagraph 

shall be established so as to allow, to the extent 

feasible, the submission, storage, retrieval, and 

disclosure of information in electronic format, including information with respect to the earned import allowance certificates required under subparagraph (A)(i). 

‘‘(VII) The Secretary of Commerce may reconcile discrepancies in information provided under 

subclause (III) or (IV) and verify the accuracy of 

such information. 

‘‘(VIII) The Secretary of Commerce shall establish procedures to carry out the program under 

this subparagraph and may establish additional 

requirements to carry out this subparagraph. Such 

additional requirements may include—

‘‘(aa) submissions by textile mills or other 

entities in the United States documenting exports of yarns wholly formed in the United 

States to countries described in paragraph 

(1)(B)(iii) for the manufacture of qualifying 

knit fabric; and 

‘‘(bb) procedures imposed on producers or 

entities controlling production to allow the 

Secretary of Commerce to obtain and verify information relating to the production of qualifying knit fabric. 

‘‘(iii) QUALIFYING WOVEN FABRIC DEFINED.—For 

purposes of this subparagraph, the term ‘qualifying 

woven fabric’ means fabric wholly formed in the 

United States from yarns wholly formed in the United 

States, except that—

‘‘(I) fabric otherwise eligible as qualifying 

woven fabric shall not be ineligible as qualifying 

woven fabric because the fabric contains nylon filament yarn to which section 213(b)(2)(A)(vii)(IV) applies; 

‘‘(II) fabric that would otherwise be ineligible 

as qualifying woven fabric because the fabric contains yarns not wholly formed in the United States 

shall not be ineligible as qualifying woven fabric if 

the total weight of all such yarns is not more than 

10 percent of the total weight of the fabric; and 

‘‘(III) fabric otherwise eligible as qualifying 

woven fabric shall not be ineligible as qualifying 

fabric because the fabric contains yarns covered by 

clause (i) or (ii) of paragraph (5)(A). 

‘‘(iv) QUALIFYING KNIT FABRIC DEFINED.—For purposes of this subparagraph, the term ‘qualifying knit 

fabric’ means fabric or knit-to-shape components wholly formed or knit-to-shape in any country or any combination of countries described in paragraph (1)(B)(iii), 

from yarns wholly formed in the United States, except 

that—


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‘‘(I) fabric or knit-to-shape components otherwise eligible as qualifying knit fabric shall not be 

ineligible as qualifying knit fabric because the fabric or knit-to-shape components contain nylon filament yarn to which section 213(b)(2)(A)(vii)(IV) applies; ‘‘(II) fabric or knit-to-shape components that 

would otherwise be ineligible as qualifying knit 

fabric because the fabric or knit-to-shape components contain yarns not wholly formed in the 

United States shall not be ineligible as qualifying 

knit fabric if the total weight of all such yarns is 

not more than 10 percent of the total weight of the 

fabric or knit-to-shape components; and ‘‘(III) fabric or knit-to-shape components otherwise eligible as qualifying knit fabric shall not be 

ineligible as qualifying knit fabric because the fabric or knit-to-shape components contain yarns covered by clause (i) or (ii) of paragraph (5)(A). ‘‘(C) REVIEW BY UNITED STATES GOVERNMENT ACCOUNT- ABILITY OFFICE.—The United States Government Accountability Office shall review the program established under 

subparagraph (B) annually for the purpose of evaluating 

the effectiveness of, and making recommendations for improvements in, the program. ‘‘(D) ENFORCEMENT PROVISIONS.— ‘‘(i) FRAUDULENT CLAIMS OF PREFERENCE.—Any 

person who makes a false claim for preference under 

the program established under subparagraph (B) shall 

be subject to any applicable civil or criminal penalty 

that may be imposed under the customs laws of the 

United States or under title 18, United States Code. ‘‘(ii) PENALTIES FOR OTHER FRAUDULENT INFORMA- TION.—The Secretary of Commerce may establish and 

impose penalties for the submission to the Secretary of 

Commerce of fraudulent information under the program established under subparagraph (B), other than 

a claim described in clause (i).’’. 

(e) SHORT SUPPLY RULES.—Section 213A(b) of the Caribbean 

Basin Economic Recovery Act is amended by adding at the end the 

following: ‘‘(5) SHORT SUPPLY PROVISION.—

‘‘(A) IN GENERAL.—Any apparel article that is wholly 

assembled, or knit-to-shape, in Haiti from any combination 

of fabrics, fabric components, components knit-to-shape, or 

yarns and is imported directly from Haiti or the Dominican 

Republic shall enter the United States free of duty, without 

regard to the source of the fabrics, fabric components, components knit-to-shape, or yarns from which the article is 

made, if the fabrics, fabric components, components knit-toshape, or yarns comprising the component that determines 

the tariff classification of the article are of any of the following: ‘‘(i) Fabrics or yarns, to the extent that apparel articles of such fabrics or yarns would be eligible for prefVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00661 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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erential treatment, without regard to the source of the 

fabrics or yarns, under Annex 401 of the NAFTA. 

‘‘(ii) Fabrics or yarns, to the extent that such fabrics or yarns are designated as not being available in 

commercial quantities for purposes of—

‘‘(I) section 213(b)(2)(A)(v) of this Act; 

‘‘(II) section 112(b)(5) of the African Growth 

and Opportunity Act; 

‘‘(III) clause (i)(III) or (ii) of section 

204(b)(3)(B) of the Andean Trade Preference Act; or 

‘‘(IV) any other provision, relating to determining whether a textile or apparel article is an 

originating good eligible for preferential treatment, 

of a law that implements a free trade agreement 

entered into by the United States that is in effect 

at the time the claim for preferential treatment is 

made. 

‘‘(B) REMOVAL OF DESIGNATION OF FABRICS OR YARNS

NOT AVAILABLE IN COMMERCIAL QUANTITIES.—If the President determines that—

‘‘(i) any fabric or yarn described in clause (i) of 

subparagraph (A) was determined to be eligible for 

preferential treatment, or 

‘‘(ii) any fabric or yarn described in clause (ii) of 

subparagraph (A) was designated as not being available in commercial quantities, 

on the basis of fraud, the President is authorized to remove 

the eligibility or designation (as the case may be) of that 

fabric or yarn with respect to articles entered after such removal.’’. 

(f) MISCELLANEOUS PROVISIONS.—

(1) RELATIONSHIP TO OTHER PREFERENTIAL PROGRAMS.—

Section 213A(b) of the Caribbean Basin Economic Recovery Act 

is amended by adding at the end the following: 

‘‘(6) OTHER PREFERENTIAL TREATMENT NOT AFFECTED.—The 

duty-free treatment provided under this subsection is in addition to any other preferential treatment under this title.’’. 

(2) DEFINITIONS.—Section 213A(a) of the Caribbean Basin 

Economic Recovery Act (19 U.S.C. 2703a(a)) is amended by 

adding at the end the following: 

‘‘(3) IMPORTED DIRECTLY FROM HAITI OR THE DOMINICAN REPUBLIC.—Articles are ‘imported directly from Haiti or the Dominican Republic’ if—

‘‘(A) the articles are shipped directly from Haiti or the 

Dominican Republic into the United States without passing 

through the territory of any intermediate country; or 

‘‘(B) the articles are shipped from Haiti or the Dominican Republic into the United States through the territory of 

an intermediate country, and—

‘‘(i) the articles in the shipment do not enter into 

the commerce of any intermediate country, and the invoices, bills of lading, and other shipping documents 

specify the United States as the final destination; or 


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‘‘(ii) the invoices and other documents do not specify the United States as the final destination, but the 

articles in the shipment—

‘‘(I) remain under the control of the customs 

authority in the intermediate country; 

‘‘(II) do not enter into the commerce of the intermediate country except for the purpose of a sale 

other than at retail; and 

‘‘(III) have not been subjected to operations in 

the intermediate country other than loading, unloading, or other activities necessary to preserve 

the articles in good condition. 

‘‘(4) KNIT-TO-SHAPE.—A good is ‘knit-to-shape’ if 50 percent 

or more of the exterior surface area of the good is formed by 

major parts that have been knitted or crocheted directly to the 

shape used in the good, with no consideration being given to 

patch pockets, applique ́s, or the like. Minor cutting, trimming, 

or sewing of those major parts shall not affect the determination of whether a good is ‘knit-to-shape’. 

‘‘(5) WHOLLY ASSEMBLED.—A good is ‘wholly assembled’ in 

Haiti if all components, of which there must be at least two, 

pre-existed in essentially the same condition as found in the finished good and were combined to form the finished good in 

Haiti. Minor attachments and minor embellishments (for example, applique ́s, beads, spangles, embroidery, and buttons) not 

appreciably affecting the identity of the good, and minor subassemblies (for example, collars, cuffs, plackets, and pockets), 

shall not affect the determination of whether a good is ‘wholly 

assembled’ in Haiti.’’. 

(g) TERMINATION.—Section 213A of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703a) is amended by adding at the 

end the following new subsection: 

‘‘(g) TERMINATION.—Except as provided in subsection (b)(1), the 

duty-free treatment provided under this section shall remain in effect until September 30, 2018.’’. 

(h) CONFORMING AMENDMENTS.—Subsection (e)(1) of section 

213A of the Caribbean Basin Economic Recovery Act (19 U.S.C. 

2703a(e)(1)) is amended by striking ‘‘the Bureau of Customs and 

Border Protection’’ each place it appears and inserting ‘‘U.S. Customs and Border Protection’’. 

SEC. 15403. LABOR OMBUDSMAN AND TECHNICAL ASSISTANCE IMPROVEMENT AND COMPLIANCE NEEDS ASSESSMENT AND 

REMEDIATION PROGRAM. 

Section 213A of the Caribbean Basin Economic Recovery Act 

(19 U.S.C. 2703a), as amended by section 15402 of this Act, is 

amended—

(1) in subsection (a)—

(A) by redesignating paragraph (5) as paragraph (8): 

(B) by redesignating paragraphs (2) through (4) as 

paragraphs (4) through (6), respectively; 

(C) by inserting after paragraph (1) the following new 

paragraphs: 

‘‘(2) APPROPRIATE CONGRESSIONAL COMMITTEES.—The term 

‘‘appropriate congressional committees’’ means the Committee 


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on Finance of the Senate and the Committee on Ways and 

Means of the House of Representatives. ‘‘(3) CORE LABOR STANDARDS.—The term ‘‘core labor standards’’ means— ‘‘(A) freedom of association; 

‘‘(B) the effective recognition of the right to bargain collectively; ‘‘(C) the elimination of all forms of compulsory or 

forced labor; ‘‘(D) the effective abolition of child labor and a prohibition on the worst forms of child labor; and ‘‘(E) the elimination of discrimination in respect of employment and occupation.’’; and 

(D) by inserting after paragraph (6) (as redesignated) 

the following new paragraph: 

‘‘(7) TAICNAR PROGRAM.—The term ‘TAICNAR Program’

means the Technical Assistance Improvement and Compliance 

Needs Assessment and Remediation Program established pursuant to subsection (e).’’; 

(2) by redesignating subsections (e), (f), and (g) as subsections (f), (g), and (h), respectively; and 

(3) by inserting after subsection (d) the following new subsection: 

‘‘(e) TECHNICAL ASSISTANCE IMPROVEMENT AND COMPLIANCE

NEEDS ASSESSMENT AND REMEDIATION PROGRAM.— ‘‘(1) CONTINUED ELIGIBILITY FOR PREFERENCES.— ‘‘(A) PRESIDENTIAL CERTIFICATION OF COMPLIANCE BY

HAITI WITH REQUIREMENTS.—Upon the expiration of the 16- 

month period beginning on the date of the enactment of the 

Haitian Hemispheric Opportunity through Partnership Encouragement Act of 2008, Haiti shall continue to be eligible 

for the preferential treatment provided under subsection (b) 

only if the President determines and certifies to the Congress that—

‘‘(i) Haiti has implemented the requirements set 

forth in paragraphs (2) and (3); and 

‘‘(ii) Haiti has agreed to require producers of articles for which duty-free treatment may be requested 

under subsection (b) to participate in the TAICNAR 

Program described in paragraph (3) and has developed 

a system to ensure participation in such program by 

such producers, including by developing and maintaining the registry described in paragraph (2)(B)(i). 

‘‘(B) EXTENSION.—The President may extend the period 

for compliance by Haiti under subparagraph (A) if the 

President—

‘‘(i) determines that Haiti has made a good faith 

effort toward such compliance and has agreed to take 

additional steps to come into full compliance that are 

satisfactory to the President; and ‘‘(ii) provides to the appropriate congressional committees, not later than 6 months after the last day of 

the 16-month period specified in subparagraph (A), 

and every 6 months thereafter, a report identifying the 

steps that Haiti has agreed to take to come into full 


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compliance and the progress made over the preceding 

6-month period in implementing such steps. 

‘‘(C) CONTINUING COMPLIANCE.— ‘‘(i) TERMINATION OF PREFERENTIAL TREATMENT.— If, after making a certification under subparagraph 

(A), the President determines that Haiti is no longer 

meeting the requirements set forth in subparagraph 

(A), the President shall terminate the preferential treatment provided under subsection (b), unless the President determines, after consulting with the appropriate 

congressional committees, that meeting such requirements is not practicable because of extraordinary circumstances existing in Haiti when the determination is 

made. ‘‘(ii) SUBSEQUENT COMPLIANCE.—If the President, 

after terminating preferential treatment under clause 

(i), determines that Haiti is meeting the requirements 

set forth in subparagraph (A), the President shall reinstate the application of preferential treatment under 

subsection (b). 

‘‘(2) LABOR OMBUDSMAN.— ‘‘(A) IN GENERAL.—The requirement under this paragraph is that Haiti has established an independent Labor 

Ombudsman’s Office within the national government 

that— ‘‘(i) reports directly to the President of Haiti; 

‘‘(ii) is headed by a Labor Ombudsman chosen by 

the President of Haiti, in consultation with Haitian 

labor unions and industry associations; and ‘‘(iii) is vested with the authority to perform the 

functions described in subparagraph (B). 

‘‘(B) FUNCTIONS.—The functions of the Labor Ombudsman’s Office shall include— ‘‘(i) developing and maintaining a registry of producers of articles for which duty-free treatment may be 

requested under subsection (b), and developing, in consultation and coordination with any other appropriate 

officials of the Government of Haiti, a system to ensure 

participation by such producers in the TAICNAR Program described in paragraph (3); ‘‘(ii) overseeing the implementation of the 

TAICNAR Program described in paragraph (3); ‘‘(iii) receiving and investigating comments from 

any interested party regarding the conditions described 

in paragraph (3)(B) in facilities of producers listed in 

the registry described in clause (i) and, where appropriate, referring such comments or the result of such 

investigations to the appropriate Haitian authorities, 

or to the entity operating the TAICNAR Program described in paragraph (3); 

‘‘(iv) assisting, in consultation and coordination 

with any other appropriate Haitian authorities, producers listed in the registry described in clause (i) in 

meeting the conditions set forth in paragraph (3)(B); 

and 


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‘‘(v) coordinating, with the assistance of the entity 

operating the TAICNAR Program described in paragraph (3), a tripartite committee comprised of appropriate representatives of government agencies, employers, and workers, as well as other relevant interested 

parties, for the purposes of evaluating progress in implementing the TAICNAR Program described in paragraph (3), and consulting on improving core labor 

standards and working conditions in the textile and 

apparel sector in Haiti, and on other matters of common concern relating to such core labor standards and 

working conditions. 

‘‘(3) TECHNICAL ASSISTANCE IMPROVEMENT AND COMPLIANCE NEEDS ASSESSMENT AND REMEDIATION PROGRAM.—

‘‘(A) IN GENERAL.—The requirement under this paragraph is that Haiti, in cooperation with the International 

Labor Organization, has established a Technical Assistance 

Improvement and Compliance Needs Assessment and Remediation Program meeting the requirements under subparagraph (C)—

‘‘(i) to assess compliance by producers listed in the 

registry described in paragraph (2)(B)(i) with the conditions set forth in subparagraph (B) and to assist 

such producers in meeting such conditions; and 

‘‘(ii) to provide assistance to improve the capacity 

of the Government of Haiti—

‘‘(I) to inspect facilities of producers listed in 

the registry described in paragraph (2)(B)(i); and 

‘‘(II) to enforce national labor laws and resolve 

labor disputes, including through measures described in subparagraph (E). 

‘‘(B) CONDITIONS DESCRIBED.—The conditions referred 

to in subparagraph (A) are—

‘‘(i) compliance with core labor standards; and 

‘‘(ii) compliance with the labor laws of Haiti that 

relate directly to core labor standards and to ensuring 

acceptable conditions of work with respect to minimum 

wages, hours of work, and occupational health and 

safety. 

‘‘(C) REQUIREMENTS.—The requirements for the 

TAICNAR Program are that the program—

‘‘(i) be operated by the International Labor Organization (or any subdivision, instrumentality, or designee 

thereof), which prepares the biannual reports described 

in subparagraph (D); 

‘‘(ii) be developed through a participatory process 

that includes the Labor Ombudsman described in 

paragraph (2) and appropriate representatives of government agencies, employers, and workers; 

‘‘(iii) assess compliance by each producer listed in 

the registry described in paragraph (2)(B)(i) with the 

conditions set forth in subparagraph (B) and identify 

any deficiencies by such producer with respect to meeting such conditions, including by—


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‘‘(I) conducting unannounced site visits to 

manufacturing facilities of the producer; ‘‘(II) conducting confidential interviews separately with workers and management of the facilities of the producer; ‘‘(III) providing to management and workers, 

and where applicable, worker organizations in the 

facilities of the producer, on a confidential basis— ‘‘(aa) the results of the assessment carried 

out under this clause; and ‘‘(bb) specific suggestions for remediating 

any such deficiencies; ‘‘(iv) assist the producer in remediating any deficiencies identified under clause (iii); ‘‘(v) conduct prompt follow-up site visits to the facilities of the producer to assess progress on remediation of any deficiencies identified under clause (iii); 

and ‘‘(vi) provide training to workers and management 

of the producer, and where appropriate, to other persons or entities, to promote compliance with subparagraph (B). 

‘‘(D) BIANNUAL REPORT.—The biannual reports referred 

to in subparagraph (C)(i) are a report, by the entity operating the TAICNAR Program, that is published (and available to the public in a readily accessible manner) on a biannual basis, beginning 6 months after Haiti implements 

the TAICNAR Program under this paragraph, covering the 

preceding 6-month period, and that includes the following: ‘‘(i) The name of each producer listed in the registry described in paragraph (2)(B)(i) that has been 

identified as having met the conditions under subparagraph (B). ‘‘(ii) The name of each producer listed in the registry described in paragraph (2)(B)(i) that has been 

identified as having deficiencies with respect to the 

conditions under subparagraph (B), and has failed to 

remedy such deficiencies. 

‘‘(iii) For each producer listed under clause (ii)—

‘‘(I) a description of the deficiencies found to 

exist and the specific suggestions for remediating 

such deficiencies made by the entity operating the 

TAICNAR Program; 

‘‘(II) a description of the efforts by the producer to remediate the deficiencies, including a description of assistance provided by any entity to assist in such remediation; and 

‘‘(III) with respect to deficiencies that have not 

been remediated, the amount of time that has 

elapsed since the deficiencies were first identified 

in a report under this subparagraph. 

‘‘(iv) For each producer identified as having deficiencies with respect to the conditions described under 

subparagraph (B) in a prior report under this subparagraph, a description of the progress made in remediVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00667 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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ating such deficiencies since the submission of the prior 

report, and an assessment of whether any aspect of 

such deficiencies persists. 

‘‘(E) CAPACITY BUILDING.—The assistance to the Government of Haiti referred to in subparagraph (A)(ii) shall 

include programs— ‘‘(i) to review the labor laws and regulations of 

Haiti and to develop and implement strategies for 

bringing the laws and regulations into conformity with 

core labor standards; ‘‘(ii) to develop additional strategies for facilitating 

protection of core labor standards and providing acceptable conditions of work with respect to minimum 

wages, hours of work, and occupational safety and 

health, including through legal, regulatory, and institutional reform; ‘‘(iii) to increase awareness of worker rights, including under core labor standards and national labor 

laws; ‘‘(iv) to promote consultation and cooperation between government representatives, employers, worker 

representatives, and United States importers on matters relating to core labor standards and national labor 

laws; ‘‘(v) to assist the Labor Ombudsman appointed 

pursuant to paragraph (2) in establishing and coordinating operation of the committee described in paragraph (2)(B)(v); ‘‘(vi) to assist worker representatives in more fully 

and effectively advocating on behalf of their members; 

and ‘‘(vii) to provide on-the-job training and technical 

assistance to labor inspectors, judicial officers, and 

other relevant personnel to build their capacity to enforce national labor laws and resolve labor disputes. 

‘‘(4) COMPLIANCE WITH ELIGIBILITY CRITERIA.— ‘‘(A) COUNTRY COMPLIANCE WITH WORKER RIGHTS ELI- GIBILITY CRITERIA.—In making a determination of whether 

Haiti is meeting the requirement set forth in subsection 

(d)(1)(A)(vi) relating to internationally recognized worker 

rights, the President shall consider the reports produced 

under paragraph (3)(D). ‘‘(B) PRODUCER ELIGIBILITY.—

‘‘(i) IDENTIFICATION OF PRODUCERS.—Beginning in 

the second calendar year after the President makes the 

certification under paragraph (1)(A), the President 

shall identify on a biennial basis whether a producer 

listed in the registry described in paragraph (2)(B)(i) 

has failed to comply with core labor standards and 

with the labor laws of Haiti that directly relate to and 

are consistent with core labor standards. ‘‘(ii) ASSISTANCE TO PRODUCERS; WITHDRAWAL, ETC., OF PREFERENTIAL TREATMENT.—For each producer that the President identifies under clause (i), the 

President shall seek to assist such producer in coming 


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into compliance with core labor standards and with 

the labor laws of Haiti that directly relate to and are 

consistent with core labor standards. If such efforts 

fail, the President shall withdraw, suspend, or limit 

the application of preferential treatment under subsection (b) to articles of such producer. 

‘‘(iii) REINSTATING PREFERENTIAL TREATMENT.—If 

the President, after withdrawing, suspending, or limiting the application of preferential treatment under 

clause (ii) to articles of a producer, determines that 

such producer is complying with core labor standards 

and with the labor laws of Haiti that directly relate to 

and are consistent with core labor standards, the President shall reinstate the application of preferential 

treatment under subsection (b) to the articles of the 

producer. 

‘‘(iv) CONSIDERATION OF REPORTS.—In making the 

identification under clause (i) and the determination 

under clause (iii), the President shall consider the reports made available under paragraph (3)(D). 

‘‘(5) REPORTS BY THE PRESIDENT.—

‘‘(A) IN GENERAL.—Not later than one year after the 

date of the enactment of the Haitian Hemispheric Opportunity through Partnership Encouragement Act of 2008, 

and annually thereafter, the President shall transmit to the 

appropriate congressional committees a report on the implementation of this subsection during the preceding 1-year 

period. 

‘‘(B) MATTERS TO BE INCLUDED.—Each report required 

by subparagraph (A) shall include the following: 

‘‘(i) An explanation of the efforts of Haiti, the President, and the International Labor Organization to 

carry out this subsection. 

‘‘(ii) A summary of each report produced under 

paragraph (3)(D) during the preceding 1-year period 

and a summary of the findings contained in such report. 

‘‘(iii) Identifications made under paragraph 

(4)(B)(i) and determinations made under paragraph 

(4)(B)(iii). 

‘‘(6) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection the sum of 

$10,000,000 for the period beginning on October 1, 2008, and 

ending on September 30, 2013.’’. 

SEC. 15404. PETITION PROCESS. 

Section 213A(d) of the Caribbean Basin Economic Recovery Act 

(19 U.S.C. 2703A(d)) is amended by adding at the end the following 

new paragraph: 

‘‘(4) PETITION PROCESS.—Any interested party may file a request to have the status of Haiti reviewed with respect to the eligibility requirements listed in paragraph (1), and the President 

shall provide for this purpose the same procedures as those that 

are provided for reviewing the status of eligible beneficiary developing countries with respect to the designation criteria listed 


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in subsections (b) and (c) of section 502 of the Trade Act of 1974 

(19 U.S.C. 2642 (b) and (c)).’’. 

SEC. 15405. CONDITIONS REGARDING ENFORCEMENT OF CIRCUMVENTION. 

Section 213A(f) of the Caribbean Basin Economic Recovery Act, 

as redesignated by section 15403(2) of this Act, is amended by adding at the end the following new paragraph: ‘‘(3) LIMITATION ON GOODS SHIPPED FROM THE DOMINICAN

REPUBLIC.—

‘‘(A) LIMITATION.—Notwithstanding subsection (a)(5), 

relating to the definition of ‘imported directly from Haiti or 

the Dominican Republic’, articles described in subsection 

(b) that are shipped from the Dominican Republic, directly 

or through the territory of an intermediate country, whether 

or not such articles undergo processing in the Dominican 

Republic, shall not be considered to be ‘imported directly 

from Haiti or the Dominican Republic’ until the President 

certifies to the Congress that Haiti and the Dominican Republic have developed procedures to prevent unlawful 

transshipment of the articles and the use of counterfeit documents related to the importation of the articles into the 

United States. ‘‘(B) TECHNICAL AND OTHER ASSISTANCE.—The Commissioner responsible for U.S. Customs and Border Protection shall provide technical and other assistance to Haiti 

and the Dominican Republic to develop expeditiously the 

procedures described in subparagraph (A).’’. 

SEC. 15406. PRESIDENTIAL PROCLAMATION AUTHORITY. 

The President may exercise the authority under section 604 of 

the Trade Act of 1974 to proclaim such modifications to the Harmonized Tariff Schedule of the United States as may be necessary 

to carry out this part and the amendments made by this part. 

SEC. 15407. REGULATIONS AND PROCEDURES. 

The President shall issue such regulations as may be necessary 

to carry out the amendments made by sections 15402, 15403, and 

15404. Regulations to carry out the amendments made by section 

15402 shall be issued not later than September 30, 2008. The Secretary of Commerce shall issue such procedures as may be necessary 

to carry out the amendment made by section 15402(d) not later than 

September 30, 2008. 

SEC. 15408. EXTENSION OF CBTPA. 

Section 213(b) of the Caribbean Basin Economic Recovery Act 

(19 U.S.C. 2703(b)) is amended—

(1) in paragraph (2)(A)—

(A) in clause (iii)—

(i) in subclause (II)(cc), by striking ‘‘2008’’ and inserting ‘‘2010’’; and 

(ii) in subclause (IV)(dd), by striking ‘‘2008’’ and 

inserting ‘‘2010’’; and 

(B) in clause (iv)(II), by striking ‘‘6’’ and inserting ‘‘8’’; 

and 

(2) in paragraph (5)(D)—

(A) in clause (i), by striking ‘‘2008’’ and inserting 

‘‘2010’’; and 


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(B) in clause (ii), by striking ‘‘108(b)(5)’’ and inserting 

‘‘section 108(b)(5)’’. 

SEC. 15409. SENSE OF CONGRESS ON INTERPRETATION OF TEXTILE 

AND APPAREL PROVISIONS FOR HAITI. 

It is the sense of the Congress that the executive branch, particularly the Committee for the Implementation of Textile Agreements (CITA), U.S. Customs and Border Protection of the Department of Homeland Security, and the Department of Commerce, 

should interpret, implement, and enforce the provisions of section 

213A(b) of the Caribbean Basin Economic Recovery Act, as amended 

by section 15402 of this Act, relating to preferential treatment of textile and apparel articles, broadly in order to expand trade by maximizing opportunities for imports of articles eligible for preferential 

treatment under such section 213A(b). 

SEC. 15410. SENSE OF CONGRESS ON TRADE MISSION TO HAITI. 

It is the sense of the Congress that the Secretary of Commerce, 

in coordination with the United States Trade Representative, the 

Secretary of State, and the Commissioner responsible for U.S. Customs and Border Protection of the Department of Homeland Security, should lead a trade mission to Haiti, within 6 months after the 

date of the enactment of this Act, to promote trade between the 

United States and Haiti, to promote new economic opportunities afforded under the amendments made by section 15402 of this Act, 

and to help educate United States and Haitian business concerns 

about such opportunities. 

SEC. 15411. SENSE OF CONGRESS ON VISA SYSTEMS. 

It is the sense of the Congress that Haiti, and other countries 

that receive preferences under trade preference programs of the 

United States that require effective visa systems to prevent transshipment, should ensure that monetary compensation for such visas 

is not required beyond the costs of processing the visa, including ensuring that such monetary compensation does not violate an applicable system to combat corruption and bribery. 

SEC. 15412. EFFECTIVE DATE. 

(a) IN GENERAL.—Except as provided in subsection (b), this part 

and the amendments made by this part shall take effect on the date 

of the enactment of this Act. 

(b) EXCEPTION.—The amendments made by section 15402 shall 

take effect on October 1, 2008, and shall apply to articles entered, 

or withdrawn from warehouse for consumption, on or after that 

date. 

PART II—MISCELLANEOUS TRADE PROVISIONS 

SEC. 15421. UNUSED MERCHANDISE DRAWBACK. 

(a) IN GENERAL.—Section 313(j)(2) of the Tariff Act of 1930 (19 

U.S.C. 1313(j)(2)) is amended by adding at the end the following: 

‘‘For purposes of subparagraph (A) of this paragraph, wine of the 

same color having a price variation not to exceed 50 percent between 

the imported wine and the exported wine shall be deemed to be commercially interchangeable.’’. 

(b) EFFECTIVE DATE.—The amendment made by subsection (a) 

shall apply with respect to claims filed for drawback under section 


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313(j)(2) of the Tariff Act of 1930 on or after the date of the enactment of this Act. 

SEC. 15422. REQUIREMENTS RELATING TO DETERMINATION OF 

TRANSACTION VALUE OF IMPORTED MERCHANDISE. 

(a) REQUIREMENT ON IMPORTERS.— (1) IN GENERAL.—Pursuant to sections 484 and 485 of the 

Tariff Act of 1930 (19 U.S.C. 1484 and 1485), the Commissioner responsible for U.S. Customs and Border Protection shall 

require each importer of merchandise to provide to U.S. Customs and Border Protection at the time of entry of the merchandise the information described in paragraph (2). 

(2) INFORMATION REQUIRED.—The information referred to 

in paragraph (1) is a declaration as to whether the transaction 

value of the imported merchandise is determined on the basis 

of the price paid by the buyer in the first or earlier sale occurring prior to introduction of the merchandise into the United 

States. 

(3) EFFECTIVE DATE.—The requirement to provide information under this subsection shall be effective for the 1-year period 

beginning 90 days after the date of the enactment of this Act. 

(b) REPORT TO INTERNATIONAL TRADE COMMISSION.— (1) IN GENERAL.—The Commissioner responsible for U.S. 

Customs and Border Protection shall submit to the United 

States International Trade Commission on a monthly basis for 

the 1-year period specified in subsection (a)(3) a report on the 

information provided by importers under subsection (a)(2) during the preceding month. The report required under this paragraph shall be submitted in a form agreed upon between U.S. 

Customs and Border Protection and the United States International Trade Commission. 

(2) MATTERS TO BE INCLUDED.—The report required under 

paragraph (1) shall include— (A) the number of importers that declare the transaction value of the imported merchandise is determined on 

the basis of the method described in subsection (a)(2); 

(B) the tariff classification of such imported merchandise under the Harmonized Tariff Schedule of the United 

States; and 

(C) the transaction value of such imported merchandise. 

(c) REPORT TO CONGRESS.—

(1) IN GENERAL.—Not later than 90 days after the submission of the final report under subsection (b), the United States 

International Trade Commission shall submit to the appropriate congressional committees a report on the information 

contained in all reports submitted under subsection (b). 

(2) MATTERS TO BE INCLUDED.—The report required under 

paragraph (1) shall include—

(A) the aggregate number of importers that declare the 

transaction value of the imported merchandise is determined on the basis of the method described in subsection 

(a)(2), including a description of the frequency of the use of 

such method; 

(B) the tariff classification of such imported merchandise under the Harmonized Tariff Schedule of the United 


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States on an aggregate basis, including an analysis of the 

tariff classification of such imported merchandise on a sectoral basis; 

(C) the aggregate transaction value of such imported 

merchandise, including an analysis of the transaction 

value of such imported merchandise on a sectoral basis; 

and 

(D) the aggregate transaction value of all merchandise 

imported into the United States during the 1-year period 

specified in subsection (a)(3). 

(d) SENSE OF CONGRESS REGARDING PROHIBITION ON PROPOSED INTERPRETATION OF THE TERM ‘‘SOLD FOR EXPORTATION TO

THE UNITED STATES’’.—

(1) IN GENERAL.—It is the sense of Congress that the Commissioner responsible for U.S. Customs and Border Protection 

should not implement a change to U.S. Customs and Border 

Protection’s interpretation (as such interpretation is in effect on 

the date of the enactment of this Act) of the term ‘‘sold for exportation to the United States’’, as described in section 402(b) of 

the Tariff Act of 1930 (19 U.S.C. 1401a(b)), for purposes of applying the transaction value of the imported merchandise in a 

series of sales, before January 1, 2011. 

(2) EXCEPTION.—It is the sense of Congress that beginning 

on January 1, 2011, the Commissioner responsible for U.S. 

Customs and Border Protection may propose to change or 

change U.S. Customs and Border Protection’s interpretation of 

the term ‘‘sold for exportation to the United States’’, as described in paragraph (1), only if U.S. Customs and Border Protection—

(A) consults with, and provides notice to, the appropriate congressional committees—

(i) not less than 180 days prior to proposing a 

change; and 

(ii) not less than 90 days prior to publishing a 

change; 

(B) consults with, provides notice to, and takes into 

consideration views expressed by, the Commercial Operations Advisory Committee—

(i) not less than 120 days prior to proposing a 

change; and 

(ii) not less than 60 days prior to publishing a 

change; and 

(C) receives the explicit approval of the Secretary of the 

Treasury prior to publishing a change. 

(3) CONSIDERATION OF INTERNATIONAL TRADE COMMISSION

REPORT.—It is the sense of Congress that prior to publishing a 

change to U.S. Customs and Border Protection’s interpretation 

(as such interpretation is in effect on the date of the enactment 

of this Act) of the term ‘‘sold for exportation to the United 

States’’, as described in section 402(b) of the Tariff Act of 1930 

(19 U.S.C. 1401a(b)), for purposes of applying the transaction 

value of the imported merchandise in a series of sales, the Commissioner responsible for U.S. Customs and Border Protection 

should take into consideration the matters included in the reVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00673 Fmt 6659 Sfmt 6603 E:\HR\OC\HR627.XXX HR627

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port prepared by the United States International Trade Commission under subsection (c). 

(e) DEFINITIONS.—In this section: 

(1) APPROPRIATE CONGRESSIONAL COMMITTEES.—The term ‘‘appropriate congressional committees’’ means the Committee 

on Ways and Means of the House of Representatives and the 

Committee on Finance of the Senate. 

(2) COMMERCIAL OPERATIONS ADVISORY COMMITTEE.—The 

term ‘‘Commercial Operations Advisory Committee’’ means the 

Advisory Committee established pursuant to section 9503(c) of 

the Omnibus Budget Reconciliation Act of 1987 (19 U.S.C. 2071 

note) or any successor committee. 

(3) IMPORTER.—The term ‘‘importer’’ means one of the parties qualifying as an ‘‘importer of record’’ under section 

484(a)(2)(B) in the Tariff Act of 1930 (19 U.S.C. 1484(a)(2)(B)). 

(4) TRANSACTION VALUE OF THE IMPORTED MERCHANDISE.—

The term ‘‘transaction value of the imported merchandise’’ has 

the meaning described in section 402(b) of the Tariff Act of 

1930 (19 U.S.C. 1401a(b)). 

And the Senate agree to the same. 

From the Committee on Agriculture, for consideration of 

the House bill (except title XII) and the Senate amendment (except secs. 12001, 12201–12601, and 12701–12808), 

and modifications committed to conference: 

COLLIN C. PETERSON, TIM HOLDEN, MIKE MCINTYRE, BOB ETHERIDGE, LEONARD L. BOSWELL, 

JOE BACA, 

DENNIS L. CARDOZA, DAVID SCOTT, 

BOB GOODLATTE, ROBIN HAYES, 

MARILYN MUSGRAVE, RANDY NEUGEBAUER, From the Committee on Education and Labor, for consideration of secs. 4303 and 4304 of the House bill, and secs. 

4901–4905, 4911, and 4912 of the Senate amendment, and 

modifications committed to conference: 

GEORGE MILLER, 

CAROLYN MCCARTHY, 

TODD PLATTS, 

From the Committee on Energy and Commerce, for consideration of secs. 6012, 6023, 6024, 6028, 6029, 9004, 9005, 

and 9017 of the House bill, and secs. 6006, 6012, 6110–

6112, 6202, 6302, 7044, 7049, 7307, 7507, 9001, 11060, 

11072, 11087, and 11101–11103 of the Senate amendment, 

and modifications committed to conference: 

JOHN D. DINGELL, FRANK PALLONE, From the Committee on Financial Services, for consideration of sec. 11310 of the House bill, and secs. 6501–6505, 

11068, and 13107 of the Senate amendment, and modifications committed to conference: 


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PAUL E. KANJORSKI, MAXINE WATERS, From the Committee on Foreign Affairs, for consideration 

of secs. 3001–3008, 3010–3014, and 3016 of the House bill, 

and secs. 3001–3022, 3101–3107, and 3201–3204 of the 

Senate amendment, and modifications committed to conference: 

HOWARD L. BERMAN, BRAD SHERMAN, ILEANA ROS-LEHTINEN, From the Committee on the Judiciary, for consideration of 

secs. 11102, 11312, and 11314 of the House bill, and secs. 

5402, 10103, 10201, 10203, 10205, 11017, 11069, 11076, 

13102, and 13104 of the Senate amendment, and modifications committed to conference: 

JOHN CONYERS, 

BOBBY SCOTT, 

From the Committee on Natural Resources, for consideration of secs. 2313, 2331, 2341, 2405, 2607, 2607A, 2611, 

5401, 6020, 7033, 7311, 8101, 8112, 8121–8127, 8204, 

8205, 11063, and 11075 of the Senate amendment, and 

modifications committed to conference: 

NICK RAHALL, MADELEINE Z. BORDALLO, CATHY MCMORRIS RODGERS, From the Committee on Oversight and Government Reform, for consideration of secs. 1501 and 7109 of the House 

bill, and secs. 7020, 7313, 7314, 7316, 7502, 8126, 8205, 

and 10201 of the Senate amendment, and modifications 

committed to conference: 

EDOLPHUS TOWNS, From the Committee on Science and Technology, for consideration of secs. 4403, 9003, 9006, 9010, 9015, 9019, and 

9020 of the House bill, and secs. 7039, 7051, 7315, 7501, 

and 9001 of the Senate amendment, and modifications 

committed to conference: 

BART GORDON, MICHAEL T. MCCAUL, From the Committee on Small Business, for consideration 

of subtitle D of title XI of the Senate amendment, and 

modifications committed to conference: 

NYDIA M. VELA ́ ZQUEZ, 

HEATH SHULER, 

From the Committee on Transportation and Infrastructure, for consideration of secs. 2203, 2301, 6019, and 6020 

of the House bill, and secs. 2604, 6029, 6030, 6034, and 

11087 of the Senate amendment, and modifications committed to conference: 

JAMES L. OBERSTAR, ELEANOR H. NORTON, SAM GRAVES, From the Committee on Ways and Means, for consideration of sec. 1303 and title XII of the House bill, and secs. 

12001–12601, and 12701–12808 of the Senate amendment, 

and modifications committed to conference: 


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CHARLES B. RANGEL, EARL POMEROY, For consideration of House bill (except title XII) and the 

Senate amendment (except secs. 12001, 12201–12601, and 

12701–12808), and modifications committed to conference: 

ROSA L. DELAURO, ADAM H. PUTNAM, Managers on the Part of the House. 

TOM HARKIN, 

PATRICK LEAHY, 

KENT CONRAD, 

MAX BAUCUS, 

BLANCHE L. LINCOLN, 

DEBBIE STABENOW, 

SAXBY CHAMBLISS, 

THAD COCHRAN, 

PAT ROBERTS

(For purposes of Title XV 

only), 

CHUCK GRASSLEY, 

Managers on the Part of the Senate. 


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JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF 

CONFERENCE 

The Managers on the part of the House and the Senate at the 

conference on the disagreeing votes of the two Houses on the 

amendment of the Senate to the bill (H.R. 2419) to provide for the 

continuation of agricultural programs through fiscal year 2012, and 

for other purposes, submit the following joint statement to the 

House and the Senate in explanation of the effect of the action 

agreed upon by the managers and recommended in the accompanying conference report: 

The Senate amendment struck out all of the House bill after 

the enacting clause and inserted a substitute text. 

The House recedes from its disagreement to the amendment of 

the Senate with an amendment which is a substitute for the House 

bill and the Senate amendment. The differences between the House 

bill, the Senate amendment, and the substitute agreed to in conference are noted below, except for clerical corrections, conforming 

changes made necessary by agreements reached by the conferees, 

and minor drafting and clarifying changes. 

SHORT TITLE; TABLE OF CONTENTS 

(1) Short title 

The House bill refers to this Act as the ‘‘Farm, Nutrition, and 

Bioenergy Act of 2007’’. (Section 1) 

The Senate amendment states that this Act may be cited as 

the ‘‘Food and Energy Security Act of 2007’’. (Section 1) 

The Conference substitute cites this Act as the ‘‘Food, Conservation, and Energy Act of 2008’’. (Section 1) 

TITLE I—COMMODITY PROGRAMS 

(2) Definitions 

The House bill defines various terms used in the bill; most 

terms are defined as they were in the 2002 farm bill. The definitions of ‘‘Far East price’’ and two definitions regarding the cotton 

quality and premiums, ‘‘United States Premium Factor’’ and ‘‘Comparable United States Quality’’ are added. (Section 1001) 

The Senate amendment defines various terms used in the bill; 

most terms are defined as they were in the 2002 farm bill. The 

definitions of average crop revenue payment, medium grain rice, 

and pulse crop are added. (Section 1001) The definition of Secretary applies to the entire bill. Section 2) The definitions that are 

relevant to the peanuts subtitle are found in that part. (Section 

1301) 

The Conference substitute defines terms necessary for implementation of this Act: Secretary, average crop revenue election payVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00677 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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ment, base acres, counter-cyclical payment, covered commodity, direct payment, effective price, extra long staple cotton, loan commodity, medium grain rice, other oilseed, payment acres, payment 

yield, producer, pulse crop, State, target price, United States, and 

United States premium factor. The Conference substitute adopts 

the Senate structure for the peanut program. (Sections 2, 1001, and 

1301) 

8(3) Adjustments to base acres 

The House bill provides that producers are generally not given 

a choice of updating base acres or payment yields under this bill. 

However, it requires the Secretary to provide base acre adjustments when a conservation reserve contract ends. Peanut base 

acres are no longer specified because peanuts are included as a covered commodity. (Section 1101) 

The Senate amendment provides for an adjustment in base 

acres to include pulse crop, camelina, or newly designated oilseed 

acreage; applies the limit on acreage enrolled in a conservation program only to acreage enrolled in Federal conservation programs; 

references base acres for peanuts; and requires the Secretary to reduce base acres for land that is no longer used for farming, specifically land that has been developed for commercial or industrial use 

or has been subdivided and developed for multiple residential units 

or other nonfarming uses unless the producer demonstrates that 

the land remains devoted exclusively to agricultural production. 

Section 1302 applies the base acre provisions for covered commodities under Section 1101 to peanuts. (Sections 1101 and 1301) 

The Conference substitute provides for the adjustment of base 

acres when a conservation reserve contract expires or is terminated; the producer has eligible pulse crop acreage or eligible oilseed acreage as a result of the designation of additional oilseeds; 

provides for base acres for peanuts in the determination of excess 

base acres; provides for the reduction of base acres for land that 

has been subdivided and developed for multiple residential units; 

provides that direct payments, counter-cyclical payments, or average crop revenue election payments are prohibited if the sum of the 

base acres of the farm is 10 acres or less unless the farm is owned 

by a socially disadvantaged or limited resource farmer or rancher; 

and includes authority for data collection and evaluation. The Conference substitute adopts the Senate structure for the peanut program. (Sections 1101 and 1302) 

The Managers intend that the Department accommodate requests for adjustments in base acres for producers on different 

farms or tracts who have agreed on a voluntary basis to redistribute base acres between tracts, if base acreage was previously 

transferred to or from a tract because of participation in the Conservation Reserve Program. 

The Managers expect Section 1101(b)(1) and Section 1302(b)(1) 

to be administered in the same manner as Section 1101(g)(1) and 

Section 1302(f)(1) of the Farm Security and Rural Investment Act 

of 2002 as implemented in 7 CFR 1412.204(a). 

The Managers recognize the importance of assessing the impact of the suspension of payments for small base acres of covered 

commodities upon specialty crop producers. For greater efficiency, 


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the Managers expect the Secretary to include the information and 

evaluations derived from Section 1101(d)(3) and Section 1302(d)(3) 

into the report required under Section 1107(d)(7)(C) prior to its 

submission to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition and Forestry of the Senate. 

The Managers intend for the Department to allow for aggregation of farms for purposes of determining the suspension of payments on farms with 10 base acres or less. The Managers expect 

for the Department to review farms in this category on an annual 

basis rather than prohibiting payments to these farms for the life 

of the farm bill. 

(3A) Payment yields 

The Senate amendment provides for the establishment of a 

payment yield for any designated oilseed, camelina, or eligible 

pulse crop for the purpose of making direct payments and countercyclical payments. It also provides a formula for calculating payment yields that is similar to the provisions used in 2002. (Section 

1102) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision, but deletes all references to camelina. (Section 1102) 

(4) Availability of direct payments 

The House bill reflects current law for the 2008–2012 crop 

years, except it includes peanuts; terminates advance direct payments starting with the 2012 crop year; and prohibits a direct payment if the payment for all covered commodities would be less than 

$25. (Section 1102) 

The Senate amendment reflects current law for the 2008–2012 

crop years, except it terminates advance direct payments starting 

with the 2012 crop year; specifies separate rates for long grain rice 

and medium grain rice; and excludes participants in the average 

crop revenue program. (Sections 1103 and 1303) 

The Conference substitute provides direct payments at current 

rates with an exception for participants in the average crop revenue election program; specifies separate but identical rates for 

long grain rice and medium grain rice; and terminates advance direct payments starting with the 2012 crop year. The Conference 

substitute adopts the Senate structure for the peanut program. 

(Sections 1103 and 1303) 

(5) Availability of counter-cyclical payments 

The House bill extends current provisions to the 2008–2012 

crop years with the following exceptions: includes peanuts as a covered commodity; clarifies that the Secretary shall establish national average loan rates for all rice and all barley for the purpose 

of calculating counter-cyclical payments; rebalances target prices 

for wheat, barley, oats, upland cotton, soybeans, and other oilseeds; 

eliminates partial counter-cyclical payments beginning with the 

2011 crop year; and prohibits a counter-cyclical payment if the 

total counter-cyclical payments for all covered commodities on the 

farm would be less than $25. (Section 1103) 


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The Senate amendment extends the counter-cyclical program 

for the 2008–2012 crop years, except for participants in average 

crop revenue program, and with the following modifications: for 

long grain rice and medium grain rice, the effective price is determined using the same calculation, but by the type or class of rice, 

as determined by the Secretary; rebalances target prices for wheat, 

grain sorghum, barley, oats, upland cotton, soybeans, and other oilseeds; establishes target prices for dry peas, lentils, small chickpeas, and large chickpeas; eliminates partial counter-cyclical payments beginning with the 2011 crop year; prohibits the Secretary 

from establishing a target price for a covered commodity that is different from the target price specified. (Sections 1104 and 1304) 

The Conference substitute adopts the Senate provision regarding long grain rice and medium grain rice. The Conference substitute provides that the revised target price for upland cotton and 

counter-cyclical program payment by class of rice will be effective 

beginning with the 2008 crop year; establishes target prices for 

pulse crops beginning with the 2009 crop year; and rebalances target prices for wheat, grain sorghum, barley, oats, soybeans and 

other oilseeds effective for the 2010 crop year; and eliminates partial counter-cyclical payments beginning with the 2011 crop year. 

The Conference substitute adopts the Senate structure for the peanut program. (Sections 1104 and 1304) 

(6) Availability of revenue-based counter-cyclical payments 

The House bill requires the Secretary to offer producers the option to receive revenue-based counter-cyclical payments for the 

2008–2012 crop years, as an alternative to receiving counter-cyclical payments under section 1103. Producers will have only one opportunity to elect to receive revenue-based counter cyclical payments as soon as practicable after enactment. If a producer fails to 

make such election in a timely manner, the producer will receive 

counter-cyclical payments pursuant to section 1103. The Secretary 

is required to make revenue-based counter-cyclical payments to 

such producers if the Secretary determines that the national actual 

revenue per acre for the covered commodity is less than the national target revenue per acre for the covered commodity. The Secretary shall establish a national actual revenue per acre by multiplying the national average yield for the given year by the higher 

of: the national average market price received by producers during 

the 12-month marketing year; or the loan rate for the covered commodity under section 1202, except that for rice and barley, the Secretary shall establish national average all rice and all barley loan 

rates. The House bill establishes the national target revenue per 

acre as follows: wheat, $149.92; corn, $344.12; grain sorghum, 

$131.28; barley, $153.30; oats, $92.10; upland cotton, $496.93; rice, 

$548.06; soybeans, $231.87; other oilseeds, $129.18; and peanuts, 

$683.83. The House bill establishes the national payment yield for 

each covered commodity and the formula for the national payment 

rate. The House bill provides that if revenue-based counter-cyclical 

payments are required for any of the covered commodities, the 

amount of the payment shall be equal to the product of: the national payment rate; the payment acres; and the payment yield. 

(Section 1104) 


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The Senate amendment contains no comparable provision. 

The Conference substitute provides an optional revenue-based 

counter-cyclical program that will be available beginning with the 

2009 crop year. As an alternative to receiving counter-cyclical payments under section 1104, and with an agreement to forgo 20 percent of the direct payment rate and 30 percent of the marketing 

assistance loan rates for covered commodities and peanuts, producers on a farm can elect to participate in the average crop revenue election (ACRE) program for all covered commodities and peanuts on the farm. Once they elect to participate in ACRE, the producers on the farm will remain in the program for the duration of 

the farm bill. Participants in ACRE will be eligible for state-based 

coverage with a revenue guarantee equal to 90 percent of the 5- 

year state average yield per planted acre (excluding the years with 

the highest and lowest yields) times the 2-year national average 

price for the covered commodity. Once the ACRE guarantee is established, it cannot vary by more than 10 percent from the previous year’s guarantee. If the actual State revenue (yield per planted acre times the national price) is less than the revenue guarantee, and if the producers suffer a loss on their farm, then they 

will receive an ACRE payment equal to the difference between the 

State revenue guarantee and the actual revenue for the crop year 

up to 25 percent of the revenue guarantee. ACRE revenue payments are made on 85 percent of the acreage planted or considered 

planted to the covered commodity or peanuts. For the 2009, 2010 

and 2011 crop years, ACRE payment acres are reduced to 83.3 percent of planted or considered planted acres. (Section 1105) 

(7) Producer agreement required as condition of provision of direct 

payments and counter-cyclical payments 

The House bill is similar to current law, except it includes peanuts and omits the reference to noncultivation with regard to the 

control of noxious weeds. (Section 1105) 

The Senate amendment is similar to current law, except it includes an additional provision that land cannot be used for a residential use (including land subdivided and developed into residential units or other nonfarming uses, or that is otherwise no longer 

intended to be used in conjunction with a farming operation) and 

provides that no penalty with respect to benefits can be assessed 

against the producers on a farm for an inaccurate acreage report 

unless the producers on the farm knowingly and willfully falsified 

the acreage report. (Section 1105) 

The Conference substitute adopts the Senate provision with an 

amendment that provides that participants in ACRE provide both 

acreage and production reports and that no penalty with respect to 

benefits can be assessed against the producers on a farm for an inaccurate report unless the producers on the farm knowingly and 

willfully falsified the report. The Conference substitute adopts the 

Senate structure for the peanut program. (Sections 1106 and 1305) 

The Managers intend that if a transfer or change in interest 

of producers on a farm occurs, and the transferee or owner of the 

acres does not agree to assume all obligations under section 

1106(a), then direct payments, counter-cyclical payments, and average crop revenue election payments will be terminated. However, 


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the references to average crop revenue election payments in sections 1106(b)(1)(A) and 1305(b)(1)(A) refer only to the limitation described in section 1105(a)(2), not the actual payment acres for the 

average crop revenue election program. 

(8) Planting flexibility 

The House bill is the same as current law, but it includes peanuts and establishes a pilot Farm Flex project in Indiana for the 

2008–2012 crop years, under which tomatoes for processing may be 

planted on up to 10,000 base acres. (Section 1106) 

The Senate amendment is the same as current law, except provides an exception for mung beans and pulse crops and provides a 

pilot flexibility project in Indiana for the 2008 and 2009 crop years. 

(Section 1106) 

The Conference substitute provides that mung beans and pulse 

crops can be planted on base acres, and provides a pilot project to 

allow the production of specified fruits or vegetables for processing 

for the 2009–2012 crop years on up to 9,000 base acres in the State 

of Illinois; 9,000 base acres in the State of Indiana; 1,000 base 

acres in the State of Iowa; 9,000 base acres in the State of Michigan; 34,000 base acres in the State of Minnesota; 4,000 base acres 

in the State of Ohio; and 9,000 base acres in the State of Wisconsin; that base acres will be protected; and that the Secretary 

will evaluate the effects of the pilot project on the supply and demand of fresh fruits and vegetables and fruits and vegetables for 

processing. The Conference substitute adopts the Senate structure 

for the peanut program. (Sections 1107 and 1306) 

The Managers expect the Secretary to establish a process to 

ensure that the quantity of fruits or vegetables delivered for processing under the pilot project does not exceed the quantity reflected 

in the original contract between the producer and the processor. 

The Managers further expect the Secretary to seek evidence that 

the amount of fruits or vegetables planted for processing under this 

pilot project is delivered to the processing facility or in the case of 

crop loss is determined by the Secretary to have been destroyed. 

In evaluating the effects of the program on the supply of and 

price of fresh fruits and vegetables and fruits and vegetables for 

processing, the Managers encourage the Secretary to examine the 

impact of the program on bonus buys under the authority of Section 46 of the Agricultural Act of 1949 and surplus removal under 

the authority of Section 32 of the Act of August 24, 1935. 

The Managers recognize the importance of assessing the impact of the expansion of the planting flexibility pilot program upon 

specialty crop producers. For greater efficiency, the Managers expect the Secretary to include the information and evaluations derived from Section 1101(d)(3) and Section 1302(d)(3) into the report 

required under this Section prior to its submission to the Committee on Agriculture of the House of Representatives and the 

Committee on Agriculture, Nutrition and Forestry of the Senate. 

(8A) Special rule for long grain and medium grain rice 

The Senate amendment provides that for the purposes of making counter-cyclical payments for long grain and medium grain 

rice, base acres on the farm shall be apportioned based on acreage 


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planted to long grain rice and medium grain rice during the 2003– 2006 crop years. The Senate amendment requires that base acres, 

payment acres, and payment yields established with respect to rice 

are maintained. (Section 1107) 

The House bill does not contain a comparable provision. 

The Conference substitute adopts the Senate provision. (Section 1108) 

(9) Period of effectiveness 

The House bill authorizes Subtitle A of Title I for the 2008– 2012 crop years. (Section 1107) 

The Senate amendment authorizes Part I of Subtitle A of Title 

I for each covered commodity for the 2008–2012 crop years. (Section 1108) 

The Conference substitute adopts the Senate provision with an 

amendment. (Section 1109) 

(10) Availability of nonrecourse marketing assistance loans for loan 

commodities 

The House bill is similar to current law; but authorizes that, 

for peanuts, a marketing assistance loan or loan deficiency payments may be obtained through a marketing association or marketing cooperative of producers that is approved by the Secretary, 

or through the Farm Service Agency; stipulates that as a condition 

for an individual or entity to provide storage for peanuts for which 

a marketing assistance loan is made, the individual or entity shall 

agree to provide storage on a non-discriminatory basis and to comply with additional requirements as the Secretary deems appropriate in order to promote fairness in the administration of this 

section; and authorizes a marketing association or cooperative to 

market peanuts for which a loan is made under this section, including by separating peanuts by type and quality. (Section 1201) 

The Senate amendment is the same as current law; except for 

participants in average crop revenue program. (Sections 1201 and 

1307) 

The Conference substitute adopts the Senate provision. (Sections 1201 and 1307) 

(10A) Peanuts storage and handling costs 

The Senate amendment replaces the payment of storage, handling and associated costs under the 2002 farm bill with a mechanism that ensures handling and associated costs are not deducted 

from a producer’s marketing loan. USDA would advance the payment for handling and associated costs for peanuts placed under 

loan and the advanced costs would be repaid when the peanuts are 

redeemed. (Section 1307(a)(7)) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to begin coverage for handling and associated costs 

with the 2008 crop of peanuts. (Section 1307) 

In order to provide adequate storage and handling for peanuts 

in the marketing loan program, FSRIA used funds of the Commodity Credit Corporation (CCC) to provide payments for storage, 

handling, and associated costs for peanuts in the loan. However, 


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these payments expired before the 2007 crop year for peanuts. The 

budgetary constraints made it impossible to continue the storage 

and handling payments established under FSRIA in this bill. In 

order to continue to ensure the adequate storage and handling for 

peanuts in the loan program, this bill instructs the Secretary to 

pay any handling and associated costs incurred at the time the 

peanuts are placed under loan for the 2008 through 2012 peanut 

crop years. These payments would be repaid when the loan peanuts 

are redeemed. The Secretary would pay the storage, handling, and 

associated costs for peanuts under the loan that are forfeited. The 

purpose of this provision is to not only ensure proper and adequate 

storage and handling of peanuts in the loan but also to guarantee 

that these costs are not taken out of a producer’s loan proceeds at 

the time the peanuts are placed in the loan. 

(11) Loan rates for nonrecourse marketing assistance loans 

The House bill establishes loan rates for marketing assistance 

loans, including two loan rates for rice (one for long grain rice; one 

for medium and short grain rice) and two for barley (one for feed 

barley; one for malt barley), as follows: wheat, $2.94 per bushel; 

corn, $1.95 per bushel; grain sorghum, $1.95 per bushel; malt barley, $2.50 per bushel; feed barley, $1.90 per bushel; oats, $1.46 per 

bushel; base quality upland cotton, $0.52 per pound; extra long staple cotton, $0.7977 per pound; long grain rice, $6.50 per hundredweight; medium grain rice and short grain rice, $6.50 per hundredweight; soybeans, $5.00 per bushel; other oilseeds, $0.1070 per 

pound for each of the following—sunflower seed, rapeseed, canola, 

safflower, flaxseed, mustard seed, crambe, sesame seed, and other 

oilseeds designated by the Secretary; dry peas, $5.40 per hundredweight; lentils, $11.28 per hundredweight; small chickpeas, $8.54 

per hundredweight; peanuts, $355.00 per ton; graded wool, $1.10 

per pound; nongraded wool, $0.40 per pound; honey, $0.60 per 

pound; and mohair, $4.20 per pound. The House bill requires the 

Secretary to establish a single county loan rate for corn and grain 

sorghum in each county; and to administer the applicable loan, 

marketing loan, counter-cyclical and related programs using an 

identical loan rate for corn and grain sorghum in each county. (Section 1202) 

The Senate amendment establishes loan rates for the 2008–

2012 crop years; includes similar provisions to the House bill for 

corn and grain sorghum; and establishes grading basis for marketing loans for pulse crops using a grade not less than grade number 2 or other grade factors, including the fair and average quality 

of the crop in any year; and may be adjusted by the Secretary to 

reflect the normal market discounts for grades less than number 2 

quality. (Sections 1202, 1210, and 1307) 

The Conference substitute establishes loan rates for the 2008–

2012 crop years. The Conference substitute adopts the Senate 

structure for the peanut program. (Sections 1202 and 1307) 

The Managers have included in Section 1202 revisions to the 

marketing loan rates for dry peas, lentils, and small chickpeas and 

established a marketing loan program for large chickpeas, herein 

after referred to collectively as pulse crops. The Managers intend 

that the Secretary establish grade factors for pulse crop loan eligiVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00684 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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bility that reflects the established U.S. grades for #2 or better used 

in commercial domestic and export sales transactions and that the 

Secretary establish a commodity marketing loan grade discount 

schedule that is comparable to, and reflects the prevailing average 

grade discounts that apply to commercial pulse crop sales transactions. 

(12) Terms of loans 

The House bill provides the same loan term as current law. 

(Section 1203) 

The Senate amendment provides the same loan term as current law, and it establishes the same loan term for peanuts as current law. (Sections 1203 and 1307) 

The Conference substitute adopts the House provision and the 

Senate structure for the peanut program. (Sections 1203 and 1307) 

(13) Repayment of loans 

The House bill provides the same as current law, except it 

specifies long grain rice, medium grain rice, and short grain rice; 

includes peanuts; and for upland cotton, it specifies that USDA use 

price quotes from Far East market to determine the prevailing 

world market price for upland cotton; provides for adjustments to 

the prevailing world market price; and requires the prevailing 

world market price be adjusted to U.S. quality and location; and 

authorizes further adjustment in the prevailing world market price. 

The House bill requires repayment rates for dry peas, lentils and 

small chickpeas to be based on quality grades for those commodities. (Section 1204) 

The Senate amendment is similar to current law, except it 

specifies long grain rice and medium grain rice, provides similar 

provisions for upland cotton, and requires the loan repayment rate 

for pulse crops to be based on the specified quality grades for the 

applicable commodity. (Sections 1204 and 1307) 

The Conference substitute provides that the Secretary calculate a loan repayment rate for loan commodities (other than upland cotton, long grain rice, medium grain rice, extra long staple 

cotton, and confectionery and each other kind of sunflower seed 

(other than oil sunflower seed)) based on the average market prices 

for the loan commodity during the preceding 30-day period. The 

Conference substitute adopts the Senate provisions with respect to 

upland cotton with an amendment to provide an adjustment for average transportation costs and adjustments related to U.S. premium factor. (Section 1204) 

The Managers have included section 1204(h) which grants authority to the Secretary to modify repayment rates under the marketing loan program in the event of a severe disruption to marketing, transportation, or related infrastructure. The purpose of 

this provision is to grant the Secretary the authority to manage the 

marketing loan program in a manner that protects the taxpayer in 

the event of a major market disruption similar to the disruption 

that followed Hurricane Katrina. The Managers intend for the actions taken under this provision to be used on a short-term and 

temporary basis that should not extend beyond the duration of the 

disruption that gives rise to the exercise of this authority. Further, 


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the Secretary should not exercise this authority if the disruption 

can be foreseen, such as, routine or announced maintenance on infrastructure, but rather should reserve this authority for extraordinary circumstances. 

The Managers authorize the Department of Agriculture to 

make significant adjustments in the marketing loan program for 

upland cotton in sections 1204 and 1210. The Managers recognize 

that the upland cotton marketing loan program will undergo another significant change in the next marketing year when the Department is expected to modify its determination of the adjusted 

world price (AWP) in the absence of a North European A index. 

The Managers understand from the Department that it has the authority to make appropriate adjustments for determining and calculating the AWP for upland cotton. The Managers request that 

the Department ensure that an accurate world price is discovered 

in the absence of a North European index and appreciate communication from the Department about any changes that may be 

made. The Managers encourage the Department to make any 

changes in a manner that ensures a seamless transition for the 

program, for the Department, and for the entire cotton industry. 

The Managers also encourage the Department to ensure that such 

AWP calculation achieves the statutory goal of allowing upland cotton produced in the United States to be competitive both domestically and internationally. 

(14) Loan deficiency payments 

The House bill provides the same as current law for 2008–2012 

crop years and includes peanuts. (Section 1205) 

The Senate amendment provides the same as current law for 

2009–2012 crop years. For the 2008 crop year, the Senate amendment establishes the effective date for payment rate determination 

as the date on which the producers on the farm lost beneficial interest and requires the Secretary to establish procedures for consumption on the farm. (Sections 1205 and 1307) 

The Conference substitute adopts the House provision and the 

Senate structure for the peanut program. (Sections 1205 and 1307) 

(15) Payments in lieu of loan deficiency payments for grazed acreage 

The House bill provides the same as current law. (Section 

1206) 

The Senate bill provides the same as current law. (Section 

1206) 

The Conference substitute adopts the House provision. (Section 

1206) 

(16) Special marketing loan provisions for upland cotton 

The House bill requires the President to carry out a special import quota program for upland cotton whenever the Secretary determines that for a consecutive 4-week period, the price of American cotton exceeds the price of cotton delivered in the Far East 

markets. The term ‘‘special import quota’’ is defined as a quantity 

of imports that is not subject to the over-quota tariff rate of a tariff-rate quota. The House bill provides that the amount of cotton 

that can come into the U.S. under the special import quota during 


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any marketing year is limited to the equivalent of 10 week’s consumption of upland cotton by domestic mills. (Section 1207(a)) 

Subsection (b) of the House bill provides the same as current 

law. (Section 1207(b)) 

Subsection (c) of the House bill requires the Secretary, beginning on the date of enactment through July 31, 2013, to issue marketing certificates or cash payments to domestic users of upland 

cotton for uses of all cotton regardless of origin. The payments or 

certificates will equal 4 cents per pound. Assistance can only be 

used for acquisition, construction, installation, modernization, development, conversion, or expansion of land, plant, buildings, 

equipment, facilities, or machinery. No end date is specified. (Section 1207(c)) 

The Senate amendment provides the same as the House measure except it specifies the price of American cotton delivered to a 

definable and significant international market. (Section 1207(a)) 

Subsection (b) of the Senate amendment is the same as current 

law, except it provides additional discretion on the quantity of 

quota. (Section 1207(b)) 

Subsection (c) of the Senate amendment requires the Secretary, beginning August 1, 2008 through June 30, 2013, to provide 

economic adjustment assistance equal to 4 cents per pound to domestic users of upland cotton for all documented use of cotton during the previous month regardless of the origin of the cotton. The 

payment rate is reduced to 0 cents per pound on July 1, 2013, terminating the funding for the program. It specifies the same uses 

for the assistance as in the House bill. (Section 1207(c)) 

The Conference substitute adopts the Senate provision with an 

amendment in subsection (c) to provide assistance equal to 4 cents 

per pound during the period August 1, 2008, through July 31, 2012 

and reduced to 3 cents per pound beginning on August 1, 2012. 

(Section 1207) 

(17) Special competitive provisions for extra long staple cotton 

The House bill provides the same as current law. (Section 

1208) 

The Senate amendment provides the same as current law, except that it does not specify the form of payments (cash or certificates). (Section 1208) 

The Conference substitute adopts the Senate provision. (Section 1208) 

(18) Availability of recourse loans for high moisture feed grains and 

seed cotton 

The House bill provides the same as current law. (Section 

1209) 

The Senate amendment provides the same as current law. 

(Section 1209) 

The Conference substitute adopts the Senate provision. (Section 1209) 


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(19) Deadline for repayment of marketing assistance loan for peanuts 

The House bill requires that marketing assistance loans for 

peanuts be redeemed no later than June 30 of the year subsequent 

to the year in which the peanuts were harvested. Such loans not 

redeemed by the deadline shall be deemed forfeited to the Commodity Credit Corporation. (Section 1210) 

The Senate amendment contains no comparable provision. 

The Conference substitute drops this provision. 

(19A) Reimbursable agreements and payments of administrative expenses 

The Senate amendment provides that the Secretary may implement any reimbursable agreements or provide for the payment 

of administrative expenses for peanuts only in a manner that is 

consistent with such activities in regard to other commodities. (Section 1307) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 1307(g)) 

(19B) Adjustments of loans for peanuts 

The Senate amendment provides authority to the Secretary to 

adjust loan rates for peanuts based on differences in grade, type, 

quality, location, and other factors. (Section 1308) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 1308) 

(20) Commodity quality incentive payments for healthy oilseeds 

The House bill, subject to the availability of funds, requires the 

Secretary to provide commodity quality incentive payments during 

the 2009–2013 crop years for the production of oilseeds with specialized traits that enhance human health. Requires the Secretary 

to issue a request for proposals for payments under this section. 

(Section 1211) 

The Senate amendment is similar to House provision, except it 

has fewer requirements for proposals; does not specify multi-year 

contracts; provides protection for proprietary information; and authorizes $400 million for the period of fiscal years 2008–2012 subject to appropriations. (Section 1705) 

The Conference substitute adopts the Senate provision with an 

amendment that provides, subject to the availability of funds, for 

a quality incentive program for oilseeds demonstrated to improve 

the health profile of the oilseed for use in human consumption for 

the period of fiscal years 2009–2012. The provision sets forth the 

requirements for posals, protects proprietary information, and provides for program compliance and penalties. (Section 1605) 

(20A) Availability of average crop revenue payments 

The Senate amendment requires the Secretary to give producers the opportunity to make a one-time election to receive average crop revenue payments for the 2010, 2011, and 2012 crop 

years; the 2011 and 2012 crop years; or the 2012 crop year in lieu 


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of participating in the direct and counter-cyclical program and the 

marketing assistance loan program. Producers who elect to participate in the average crop revenue program are eligible to receive 

fixed payments equal to not less than the product of $15 per acre 

and the quantity of base acres on the farm for all covered commodities and peanuts. The Secretary is required to make revenue payments available if the actual state revenue for a covered commodity 

or peanuts is less than the average crop revenue guarantee for that 

commodity. Average crop revenue payments are made beginning 

October 1, or as soon as practicable thereafter, after the end of the 

applicable marketing year (compared to direct payments, this provision delays fixed ACR payments by one year with no provision for 

advance payments). The Senate amendment establishes actual 

state revenue as the product of the actual state yield (the quantity 

of the covered commodity or peanuts produced in the State during 

the crop year divided by the number of planted acres) and the average crop revenue harvest price (the harvest price used to calculate 

revenue under revenue plans offered by the Federal Crop Insurance program). The average crop revenue program guarantee 

equals 90 percent of the product of the expected state yield per 

planted acre and the pre-planting price (the price used to calculate 

revenue under revenue coverage plans offered by the Federal Crop 

Insurance program) for the crop year and the preceding 2 crop 

years. The pre-planting price cannot decrease or increase more 

than 15 percent from the pre-planting price for the preceding year. 

The payment amount, in addition to the amount under section 

1401(b)(2) is equal to the product of: the difference between the average crop revenue program guarantee and the actual state revenue; 85 percent of the base acres on the farm for the covered commodity; the ratio of APH on the farm to the expected state yield; 

and 90 percent. The Secretary is required to make recourse loans 

available to producers who participate in this program. (Section 

1401) 

The House bill contains no comparable provision. 

The Conference substitute deletes this provision. 

(21) Sugar program 

The House bill maintains many provisions of current law as it 

relates to the sugar program. However, the loan rate for raw cane 

sugar is increased to 18.5 cents per pound and the loan rate for refined beet sugar is increased to 23.5 cents per pound. The House 

bill eliminates the authorization of the Secretary to reduce loan 

rates if there were negotiated reductions in export and domestic 

subsidies of other major sugar producing countries. (Section 1301) 

The House bill extends current law with regard to the term of 

the loan and the nonrecourse nature of the loan. Processors are to 

make adequate assurances that payments to growers will be proportional to the loan values, and the Secretary is authorized to set 

minimums for such payments. 

The Secretary is required to operate the sugar program, to the 

maximum extent practicable, at no cost to the Federal government. 

If the producer agrees to reduce production under an inventory disposition program, and such reduced production involves sugar beets 

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duced on diverted acres may not be used for any commercial purpose other than as a bioenergy feedstock. 

The House bill requires the Secretary to collect information on 

the production, consumption, stocks and trade of sugar in Mexico, 

including United States exports of sugar to Mexico; and publicly 

available information on Mexican production, consumption, and 

trade of high fructose corn syrups, including United States exports 

of high fructose corn syrups to Mexico. 

The sugar program is extended through the 2012 crop year, 

and the program for the 2007 crop will be operated as under current law. 

The Senate amendment also maintains many provisions of current law as it relates to the sugar program. However, the loan rate 

for raw cane sugar is increased to 18.25 cents per pound for 2009, 

18.50 cents per pound for 2010, 18.75 cents per pound for 2011, 

and 19.00 cents per pound for 2012; and the loan rate for refined 

beet sugar is set at 128.5 percent of the loan rate for raw cane 

sugar. (Section 1501) 

The Senate amendment requires that the Secretary collect information on the production, consumption, stocks and trade of 

sugar in Mexico, including United States exports of sugar to Mexico; and publicly available information on Mexican production, consumption, and trade of high fructose corn syrups. 

All other provisions of the Senate amendment are the same as 

the House bill. 

The Conference substitute adopts the Senate provision with a 

modification to the loan rate. The loan rate for raw cane sugar will 

increase to 18.25 cents per pound for 2009, 18.50 cents per pound 

for 2010, 18.75 cents per pound for 2011, and 18.75 cents per 

pound for 2012. The marketing loan rate for refined beet sugar is 

set equal to 128.5 percent of the loan rate for raw cane sugar beginning with the 2009 crop year. 

The Conference amendment retains a requirement that the 

Secretary collect information on the production, consumption, 

stocks and trade of sugar in Mexico, including United States exports of sugar to Mexico; and publicly available information on 

Mexican production, consumption, and trade of high fructose corn 

syrups. The Managers expect such information on Mexican trade of 

high fructose corn syrups to include both imports and exports. (Section 1401) 

(22) United States membership in the International Sugar Organization 

The House bill requires the Secretary of Agriculture to work 

with the Secretary of State to restore U.S. membership within the 

International Sugar Organization within one year from date of enactment of this bill. (Section 1302) 

The Senate amendment requires the Secretary of Agriculture 

to work with the Secretary of State to restore, to the maximum extent practicable, U.S. membership within the International Sugar 

Organization within one year from date of enactment of this bill. 

(Section 1504(l)) 

The Conference substitute adopts the House provision. (Section 

1402) 


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(23) Flexible marketing allotments for sugar 

The House bill extends and amends the provisions of the Agricultural Adjustment Act of 1938 requiring the Secretary to establish marketing allotments for the 2008 through 2012 crops of domestically produced sugar to balance supply and demand and avoid 

loan forfeitures. (Section 1303) 

The House bill adds a definition of ‘‘human consumption’’ in 

the context of sugar for human consumption, as meaning sugar in 

human food, beverages, or similar products. The House bill defines 

the term ‘‘market’’ as meaning to sell or otherwise dispose of including the forfeiture of sugar under the loan program, the movement of raw cane sugar into the refining process, and the sale of 

sugar for the production of ethanol or other bioenergy product, if 

the disposition of the sugar is administered by the Secretary. 

The Secretary is required to establish at the beginning of each 

crop year marketing allotments at a level to maintain raw and refined sugar prices above forfeiture levels. The overall allotment 

quantity is to be not less than 85 percent of the estimated quantity 

of sugar for domestic human consumption. The marketing allotments are to apply to the marketing by processors of sugar intended for domestic human consumption, with exceptions to facilitate the export of sugar, to enable another processor to fulfill an 

allocation established for that processor, or for uses other than domestic human consumption. Processors are prohibited from marketing for domestic human consumption a quantity in excess of the 

allocation, with the same exceptions as current law. 

The House bill strikes the provision requiring the Secretary to 

suspend allotments when the level of imports will exceed 1.532 million short tons and retains the procedures for the Secretary to reassign allotments if processors cannot fulfill the allocations, and 

specifies that any resulting imports must be in the form of raw 

cane sugar. 

The House bill includes the definition of ‘‘seed’’ for purposes of 

allotments in proportionate share States. The House bill authorizes 

the Secretary to transfer the acreage base history of a sugarcane 

farm to any other parcels of land of the applicant, in order to establish proportionate shares. Sugarcane base acreage that has been, or 

is, converted to non-agricultural use may be transferred to other 

land suitable for the production of sugarcane that can be delivered 

to a processor in a proportionate share State. 

The House bill includes transfers of mill allocations under the 

procedures for appeals to the Secretary regarding allotments, and 

eliminates an obsolete special appeal procedure regarding beet 

sugar allocations. 

The House bill extends the sugar allotments through the 2012 

crop year. Current law shall apply to flexible marketing allotments 

for the 2007 crop year for sugar. 

The Senate amendment is similar to the House bill, with technical changes with regard to definitions and a modification to indicate that the exception for uses other than domestic human consumption does not include the sale of sugar for the production of 

ethanol or other bioenergy under the Feedstock Flexibility Program. (Section 1504) 


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The Conference substitute adopts the Senate provision with a 

modification to clarify that should there be a sale of a factory possessing an allocation of beet sugar, then the Secretary is to transfer 

to the buyer the allocation that has been agreed upon by the buyer 

and seller, assuming such an agreement has been reached. Additionally, it clarifies that following a conversion of sugarcane base 

acreage to a nonagricultural use in a proportionate share state, the 

Secretary is to notify the affected landowners of the transferability 

of the applicable base not later than 90 days after the agency becomes aware of the conversion. (Section 1403) 

(23A) Administration of tariff rate quotas 

The House bill provides that the Secretary is to establish at 

the beginning of the quota year, the tariff-rate quotas for raw cane 

sugar and refined sugars at the minimum level necessary to comply 

with obligations under international trade agreements approved by 

Congress. The Secretary may take action to increase the supply of 

sugar on or after April 1 of each fiscal year, with certain constraints on that action. Before April 1, the Secretary is to take action to increase the supply of sugar only if there is an emergency 

shortage of sugar in the United States market that is caused by 

war, flood, hurricane, or other natural disaster or other similar 

event. The House bill would also require the Secretary to establish 

orderly shipping patterns for sugar imports. (Section 1303) 

The Senate amendment is similar to the House bill except the 

Senate amendment does not contain the provision requiring the 

Secretary to establish shipping patterns. (Section 1504) 

The Conference substitute adopts the Senate provision. (Section 1403) 

(23B) Storage facility loans 

The Senate amendment prohibits penalties for prepayment of 

sugar storage facility loans. (Section 1502) 

The House contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 1404) 

(23C) Commodity Credit Corporation storage payments 

The Senate amendment establishes rates for the storage of forfeited sugar for each of the 2008 through 2011 crop years in an 

amount that is not less than 15 cents per hundredweight of refined 

sugar per month or 10 cents per hundredweight of raw cane sugar 

per month. For each of the 2012 and subsequent crop years, establishes storage payments at rates in effect at the time of enactment. 

(Section 1503) 

The House contains no comparable provision. 

The Conference substitute [adopts the Senate provision]. (Section 1405) 

(23D) Sense of the Senate regarding NAFTA sugar coordination 

The Senate amendment provides a sense of the Senate that the 

United States and Mexico should coordinate their respective sugar 

policies and that the United States should consult with Mexico on 


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policies to maximize benefits for growers, processors and consumers. (Section 1505) 

The House contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(24) Dairy Product Price Support Program 

The House bill requires the Secretary to support the price of 

cheddar cheese, butter, and nonfat dry milk by purchasing such 

products at specified prices: cheddar cheese in blocks at not less 

than $1.13 per pound; cheddar cheese in barrels at not less than 

$1.10 per pound; butter at not less than $1.05 per pound; and nonfat dry milk at not less than $0.80 per pound. If net removals of 

cheese, butter or nonfat dry milk exceed specific limits for 12 consecutive months, the Secretary may reduce the purchase prices of 

that commodity during the month that immediately follows. The 

prices that the Secretary pays under this section for the commodities must be uniform across the country. The Secretary may sell 

cheese, butter, or nonfat dry milk for unrestricted use from inventories of the Commodity Credit Corporation at prevailing market 

prices, but not less than 110 percent of the prices specified in the 

Purchase Price subsection. (Section 1401) 

The Senate amendment requires the Secretary to support the 

price of cheddar cheese, butter, and nonfat dry milk by purchasing 

such products at specified prices: cheddar cheese in blocks at not 

less than $1.13 per pound; cheddar cheese in barrels at not less 

than $1.10 per pound; butter at not less than $1.05 per pound; and 

nonfat dry milk at not less than $0.80 per pound. The prices that 

the Secretary pays under this section for the commodities must be 

uniform across the country. The Secretary may sell cheese, butter, 

or nonfat dry milk for unrestricted use from inventories of the 

Commodity Credit Corporation at prevailing market prices, but not 

less than 110 percent of the prices specified in the Purchase Price 

subsection. (Section 1601) 

The Conference substitute adopts the House provision with an 

amendment to delete an unnecessary reference to Commodity Credit Corporation funding. (Section 1501) 

(25) Dairy Forward Pricing Program 

The House bill requires the Secretary to establish the dairy 

forward pricing program, which authorizes milk producers to voluntarily enter into forward price contracts with milk handlers for 

milk that is not Class I. Under such forward price contracts, prices 

received by milk producers and cooperatives will be deemed to satisfy all regulated minimum milk price requirements. Milk handlers 

will be prohibited from requiring participation in a forward price 

contract, and the Secretary is required to investigate complaints 

and to take appropriate action if evidence of coercion is found. No 

forward price contract can be entered into after September 30, 

2012, or extend beyond September 30, 2015. (Section 1402) 

The Senate amendment amends the former dairy forward pricing pilot program to establish a program that allows milk producers and cooperative associations to voluntarily enter into forward price contracts with milk handlers with protections for proVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00693 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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ducers that are similar to the protections provided in the House 

bill. (Section 1606) 

The Conference substitute adopts the House provision. (Section 

1502) 

(26) Dairy Export Incentive Program 

The House bill reauthorizes the dairy export incentive program 

until December 31, 2012, and authorizes the Secretary to issue 

rules to ensure that each year the maximum volume of dairy product exports allowable within the United States’ obligations under 

the Uruguay Round Agreements is exported. (Section 1403) 

The Senate amendment reauthorizes the dairy export incentive 

program until December 31, 2012. (Section 1603) 

The Conference amendment adopts the House provision. 

(27) Revision of Federal marketing order amendment procedures 

The House bill requires the Secretary, upon receiving a written 

request for a hearing to amend a milk marketing order, issue a denial of the request or issue a notice of the hearing, and stipulates 

the timeframe for a hearing. Notice for a hearing on a proposed 

amendment to a marketing order must be provided not less than 

three days before the date of the hearing. The Secretary is required 

to issue a recommended decision on a proposed amendment to a 

milk marketing order no more than 90 days after the date set for 

the submission of post-hearing findings, conclusions and written arguments. Further, the House provision requires the final decision 

to be issued no more than 60 days after the recommended decision 

was issued. If the Secretary receives a request for a hearing on a 

proposed amendment to a milk marketing order within 90 days 

after announcing a decision on a previously proposed amendment 

to the same order, and the two proposed amendments are essentially the same, the Secretary is not required to call a hearing. 

(Section 1404) 

The Senate amendment requires the Secretary to issue supplemental rules of practice within 60 days of enactment and establishes 5 provisions to be included in the rules of practice. The Secretary, upon receiving a proposal for a hearing regarding a milk 

marketing order, is required to issue an action plan and expected 

timeframes for completion of the hearing not more than 180 days 

after the date of the notice; issue a request for additional information regarding the proposal; or issue a denial of the request. The 

Senate amendment establishes a time limit of 90 days after the 

deadline for submitting post-hearing briefs for USDA to issue a recommended decision on proposed amendments to milk marketing orders and to issue a final decision within 60 days after the deadline 

for submission of comments and exceptions to the recommended decision. The Senate amendment authorizes industry assessments to 

supplement appropriated funds if necessary to improve or expedite 

rulemaking; and authorizes the use of informal rulemaking to 

amend orders, other than provisions of orders that directly affect 

milk prices. The Secretary is required, as part of any hearing to adjust make allowances, to determine the average monthly prices of 

feed and fuel incurred by dairy producers in the relevant marVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00694 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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keting area and to consider those prices in determining whether or 

not to adjust make allowances. (Section 1605) 

The Conference substitute adopts the Senate provision with 

amendments to reduce the amount of time allowed for completion 

of a hearing to 120 days, provide a limit of up to 60 days for submission of post-hearing briefs, delete specific requirements related 

to the content of the hearing action plan; and adopt the House language designed to avoid duplicative hearings for similar petitions 

received within 90 days of the announcement of a decision on a 

previously proposed amendment. The conference substitute also 

sunsets the applicability of the Senate provision related to hearings 

involving adjustments to make-allowances coincident with the 

Food, Conservation, and Energy Act of 2008. 

(28) Dairy Indemnity Program 

The House bill reauthorizes the dairy indemnity program 

through September 30, 2012. (Section 1405) 

The Senate amendment reauthorizes the dairy indemnity program through September 30, 2012. (Section 1603) 

The Conference substitute adopts the House provision. 

(29) Extension of Milk Income Loss Contract Program 

The House bill reauthorizes the MILC program through 2012, 

under the same terms as current law. (Section 1406) 

The Senate amendment amends the MILC program for the period October 1, 2008 through August 31, 2012 by increasing the 

payment factor from 34 percent to 45 percent and by increasing the 

annual eligible payment quantity from 2.4 million pounds to 4.15 

million pounds. (Section 1602) 

The Conference substitute provides for the continuation of the 

program. For the period from October 1, 2008 through August 31, 

2012, the payment factor is increased to 45 percent, the annual eligible payment quantity is increased to 2,985,000 pounds, and the 

$16.94 per hundredweight price is adjusted whenever the National 

Average Dairy Feed Ration Cost for a month is greater than $7.35 

per hundredweight by 45 percent of the percentage increase in the 

feed ration cost. Beginning September 1, 2012, the trigger for the 

adjustment in the price used to determine the payment rate is set 

at $9.50 per hundredweight. (Section 1506) 

FEED PRICE RATIOS: UNITED STATES, MARCH 2008 WITH COMPARISONS 

Feed Price Ratio 1

2007 2008 

Mar Feb Mar 

Broiler-Feed: Pounds of Broiler Grower Feed equal in value to 1 pound of broiler, live weight 2 .................................................................................................. 5.9 * 3.9 3.8 

Market Egg Feed: Pounds of Laying Feed equal in value to 1 dozen eggs 3 ....... 9.1 * 11.1 11.4 

Hog-Corn: Bushels of Corn equal in value to 100 pounds of hog, live weight ... 13.1 * 9.3 8.5 

Milk-Feed: Pounds of 16% Mixed Dairy Feed equal in value to 1 pound of 

Whole Milk 4 ........................................................................................................ 2.39 * 2.24 2.05 

Steer & Heifer-Corn: Bushels of Corn equal in value to 100 pounds of Steer & 

Heifers, live weight ............................................................................................ 28.5 * 20.8 19.4

Turkey-Feed: Pounds of Turkey Grower equal in value to 1 pound of Turkey, live 

weight 5 ............................................................................................................... 5.5 * 3.6 3.8 

1 Effective January 1995, prices of commercial prepared feeds are based on current U.S. prices received for corn, soybeans, alfalfa hay, and all wheat. 


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2 The price of commercial prepared broiler feed is based on current U.S. prices received for corn and soybeans. The modeled feed uses 58 

percent corn and 42 percent soybeans. 3 The price of commercial prepared layer feed is based on current U.S. prices received for corn and soybeans. The modeled feed uses 75 percent corn and 25 percent soybeans. 4 The price of commercial prepared dairy feed is based on current U.S. prices received for corn, soybeans, and alfalfa. The modeled feed 

uses 51 percent corn, 8 percent soybeans, and 41 percent alfalfa. 5 The price of commercial prepared turkey feed is based on current U.S. prices received for corn, soybeans, and wheat. The modeled feed used 51 percent corn, 28 percent soybeans, and 21 percent wheat. 

* Revised. 

PRICES USED TO CALCULATE FEED PRICE RATIOS: UNITED STATES, MARCH 2008 WITH 

COMPARISONS 

Commodity Unit 

Entire Month Preliminary 

Mar 2007 Feb 2008 Mar 2008 

Broilers, Live ............................................................................. Lb ................... 0.500 0.500 0.510 

Eggs, Market ............................................................................. Doz ................. 0.681 1.220 1.300 

Hogs, All .................................................................................... Cwt ................. 44.90 42.20 41.20 

Milk, All ..................................................................................... Cwt ................. 15.60 19.10 18.30 

Steers and Heifers .................................................................... Cwt ................. 97.70 94.20 93.80 

Turkeys, Live .............................................................................. Lb ................... 0.443 0.475 0.529 

Corn ........................................................................................... Bu ................... 3.43 4.53 4.83 

Hay, Alfalfa, Baled .................................................................... Ton ................. 121.00 138.00 143.00

Soybeans ................................................................................... Bu ................... 6.95 11.70 11.90 

Wheat, All .................................................................................. Bu ................... 4.75 9.98 11.70 

FEEDER LIVESTOCK: PRICES PAID, UNITED STATES, MARCH 2008 WITH COMPARISONS 

Commodity Unit 

2007 2008 

Mar Feb Mar 

Feeders and Stockers Cattle and Calves ................................. Cwt ................. $105.40 * $103.90 $101.60 

Feeder Pigs ................................................................................ Cwt ................. 157.00 113.00 115.00 

* Revised. 

(30) Dairy Promotion and Research Program 

The House bill extends the authority to expend funds to develop foreign markets through fiscal year 2012; amends the definition of ‘‘United States’’ to include Alaska, Hawaii, the District of 

Columbia, and the Commonwealth of Puerto Rico for both promotion and research programs; and provides for a refund of assessments for importers on contracts in effect prior to July 26, 2007, 

for a period of one year after the date of enactment. (Section 1407) 

The Senate amendment extends the authority to expend funds 

to develop foreign markets through fiscal year 2012. (Section 1604) 

The Conference substitute adopts the House provision with an 

amendment to reduce the rate of assessment on imported dairy 

products to 7.5 cents per hundredweight. The substitute also 

amends the Dairy Promotion Stabilization Act of 1983 to authorize 

the Secretary to establish by regulation the time and method of importer payments under the Act. (Section 1507) 

The Farm Security and Rural Investment Act of 2002 amended 

Section 112 of the Dairy Promotion Stabilization Act of 1983 (7 

U.S.C. 4503(d)) to require that, ‘‘The Secretary, in consultation 

with the United States Trade Representative, shall ensure that the 

order is implemented in a manner consistent with the international 

trade obligations of the Federal Government.’’ The Managers expect the Secretary to consult with the United States Trade Representative to ensure that any action taken pursuant to this section 


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is consistent with the bilateral, regional and multilateral trade obligations of the Federal Government. 

(31) Report on Department of Agriculture reporting procedures for 

nonfat dry milk 

The House bill requires the Secretary to submit a report to 

Congress within 90 days of enactment of this Act regarding 

USDA’s reporting procedures for nonfat dry milk and the impact of 

those procedures on Federal milk marketing order minimum prices 

during the period July 1, 2006, through the date of enactment of 

this Act. (Section 1408) 

The Senate amendment is the same as the House provision except it requires the Secretary to submit the report to the House 

Committee on Agriculture and the Senate Committee on Agriculture, Nutrition, and Forestry. (Section 1607) 

The Conference substitute adopts the Senate provision. (Section 1508) 

The Managers are encouraged by the corrective action agreed 

to by the Department in connection with a prior misreporting of 

nonfat dry milk prices and encourage the Secretary to submit periodic implementation progress reports to the House Committee on 

Agriculture and the Senate Committee on Agriculture, Nutrition, 

and Forestry. While the Senate provision to require USDA to formally designate an official to be in charge of coordinating dairy 

oversight was not included in the conference report, the Managers 

intend that USDA continue with the steps to improve coordination 

of dairy oversight within the Department and with other relevant 

agencies as necessary to ensure accurate price determinations. 

(32) Federal Milk Marketing Order Review Commission 

The House bill, subject to the availability of funds, establishes 

the Federal Milk Marketing Order Review Commission to conduct 

a comprehensive review and evaluation of the current Federal milk 

marketing order system and non-Federal milk marketing order systems. The House bill provides for the appointment of 18 Commission members; requires the commission to issue a report to Congress and the Secretary of Agriculture with the results of the review and evaluation conducted under this section; and stipulates 

that the Commission is wholly advisory in nature, and the recommendations it issues are non-binding. (Section 1608) 

The Senate amendment is similar to the House provision except it provides additional areas for the Commission to evaluate 

and modifies the appointment of Commission members. (Section 

1608) 

The Conference substitute adopts the House provision except 

the objectives of the Commission are modified, the number of commission members is reduced to 14 and all Commission members 

will be appointed by the Secretary. 

The Managers are aware of a number of dairy reform proposals 

being advocated at the State, regional and National level to simplify and improve the Federal milk marketing order system. The 

Managers intend that the Commission should evaluate as many of 

these proposals as practicable. Specifically, the Commission should 

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lishing a 2-class system of classified milk consisting of a fluid milk 

class and a manufacturing grade milk class with the price of both 

classes determined using similar component prices of butterfat, 

protein, and other solids. The Commission should also evaluate the 

economic impacts of proposals to eliminate advance pricing that is 

currently used to calculate the prices of Class I and Class II skim 

milk and instead use 4-week component prices that are used to calculate prices for Class III and Class IV milk. 

(32A) Mandatory reporting of dairy commodities 

The Senate amendment amends current law to require corporate officers or officially-designated representatives of each dairy 

processor (other than those that process less than 1 million pounds 

of dairy products a year) to report to the Secretary on each daily 

reporting day such price, quantity, and product characteristics as 

the Secretary determines appropriate with respect to those package 

sizes used to establish minimum prices for Class III or Class IV 

milk under Federal milk marketing orders. The Senate amendment 

requires the Secretary to make the information reported available 

to the public on the same day as the information is reported, and 

requires dairy manufacturers to report, at periodic intervals, the 

quantities of dairy products in storage. (Section 1609) 

The House bill has no comparable provision. 

The Conference substitute provides authority for the Secretary 

to establish an electronic reporting system, subject to the availability of funds; and requires the Secretary to increase the frequency of mandatory reporting of sales of dairy products once the 

electronic reporting system is in place. (Section 1510) 

(32B) Additional mandatory dairy reporting 

The Senate amendment amends current law as amended by 

section 1609 to require regular audits and comparisons with other 

related dairy market statistics on at least a quarterly basis. (Section 1610) 

The House bill has no comparable provision. 

The Conference substitute provides for quarterly audits of information submitted or reported and comparison of such information with related dairy market statistics, and incorporates this requirement in the previous section. (Section 1510) 

(33) Administration generally 

The House bill authorizes the use of the Commodity Credit 

Corporation in carrying out the provisions of title I, and, generally, 

continues other administrative provisions of the 2002 farm bill. 

(Section 1501) 

The Senate amendment includes the same provisions as the 

House measure, and includes an additional provision to exempt 

producers who have an option to receive advance direct and partial 

counter-cyclical payments from constructive receipt of those payments. (Section 1701) 

The Conference substitute adopts the Senate provision with an 

amendment to provide for interim regulations to implement the 

payment limitations and adjusted gross income provisions. (Section 

1601) 


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Beginning with the 2009 crop, the Conference substitute includes significant reforms to payment limitation and adjusted gross 

income provisions. This is a complex and long-standing area of the 

law and regulations, many of which have been in effect for decades. 

The continuity and predictability of these regulations is important 

to the economic stability of farm operators, the lenders that finance 

them, the input suppliers who provide their seed, feed, fertilizer 

and other inputs, and indeed for the agricultural economy as a 

whole. In order to avoid undue disruption of all of these sectors of 

the agricultural economy, the Managers expect USDA to provide 

adequate notice and opportunity for comment, consistent with the 

interim rule process, for Sections 1603 and 1604, to ensure these 

changes are implemented in a manner that is least disruptive to 

producers and other stakeholders, and that allows the programs to 

continue to achieve their objectives. 

The Managers further expect that in the rulemaking process, 

USDA will give priority to addressing matters within the scope of 

these legislative changes and guidance in this Statement in order 

to minimize program and regulatory disruption, to maximize continuity and predictability, and to focus the scarce resources of the 

Department of Agriculture on implementing these and other specific regulatory requirements in this bill. 

The Managers also expect that during the interim rule process 

USDA will amend the regulations as necessary or appropriate to 

implement these statutory changes consistent with the intent and 

guidance provided by the Managers throughout this Statement. 

The Managers expect the notice and comment period regarding the 

implementation of the AGI and payment limitation provisions to 

include issues such as, family definitions, denial of program benefits, notification of interests in operation, changes in farming operations, actively engaged, schemes and devices, apportionment of income for joint filers, and spousal eligibility. The Managers expect 

the Secretary to implement the AGI provision in a manner that 

provides equitable treatment, to the maximum extent practicable, 

to all producers. 

(34) Suspension of permanent price support authority 

The House bill provides the same as current law for 2008–2012 

crops and for milk through December 31, 2012. (Section 1502) 

The Senate amendment provides the same as the House measure except does not include peanuts. (Section 1702) 

The Conference substitute adopts the House provision. (Section 

1602) 

(35) Payment limitations 

The House bill extends payment limitations in the 2002 farm 

bill, with revisions including the elimination of limitations on marketing loan benefits and loan deficiency payments. It amends the 

Food Security Act of 1985 to limit the total amount of direct payments that a person or legal entity may receive in a crop year to 

$60,000, excluding peanuts; and counter-cyclical payments that a 

person or legal entity may receive in a crop year to $65,000, excluding peanuts. For peanuts, a person or entity may not receive more 

than $60,000 for direct payments, and no more than $65,000 for 


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counter-cyclical payments. The House bill defines the term ‘‘legal 

entity’’ as an entity that owns land or an agricultural commodity, 

or produces an agricultural commodity; and the term ‘‘person’’ as 

a natural person, and does not include a legal entity. The House 

bill provides for direct attribution for payments, by requiring the 

Secretary to promulgate regulations to ensure that the total 

amount of payments are attributed to a person, by taking into account the direct and indirect ownership interests of the person in 

a legal entity. It provides that every payment made directly to a 

person will be combined with the person’s pro rata interests in payments received by a legal entity in which the person has an ownership interest. It further provides that for every payment made to 

a legal entity, the payment will be attributed to those persons with 

an ownership interest in the entity traced through four levels of 

ownership in the entities, and includes a framework for that attribution. (Section 1503) 

The Senate amendment is similar to the House measure, except it establishes payment limitations under the new act at 

$40,000 for a combination of both traditional direct and average 

crop revenue fixed payments, and $60,000 for counter-cyclical payments and the revenue portion of average crop revenue payments. 

It strikes the definition of ‘‘loan commodity, thereby also terminating the limitations on marketing loan gains and loan deficiency 

payments,’’ adds definitions for ‘‘family member’’, ‘‘legal entity’’, and ‘‘person,’’ and includes spouses in the definition of family member. The Senate amendment provides similar direct attribution requirements, except payments made to a legal entity shall be reduced proportionately by an amount that represents the direct or 

indirect ownership in the legal entity that has otherwise exceeded 

the applicable payment limitation. (Section 1703) 

The Conference substitute adopts the Senate provision with an amendment that provides a $65,000 payment limit for counter-cyclical payments, a reduced direct payment limit for participants in 

the ACRE program to reflect the amount the direct payment is cut 

as a condition to participate in ACRE, and a limit in the amount 

of counter-cyclical and ACRE payments that reflects the $65,000 

limit plus the amount of that the direct payment limit is reduced. 

The counter-cyclical limits and ACRE limits are combined for those 

producers who participate in ACRE because producers would be eligible to participate in the counter-cyclical program on one farm and 

the average crop revenue election on a separate farm. (Section 

1603) 

The change in the administration of the payment limit provisions from one based on separate ‘‘person’’ determinations to one 

that attributes income among persons and entities, based upon 

their share of participation, is, by design, less susceptible to manipulation by changing the farming structure to introduce multiple 

farming entities. 

With this change, many farming operations that had been approved under current law, may wish to reorganize such operations 

for estate or tax purposes or for other reasons. It is the intent of 

the Managers that, consistent with the action taken by the Congress with the passage of the significant changes in farm program 

participation in 1987, that during the 2008 and 2009 program 


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years, persons should not be penalized for changing their farming 

operation structure given such a significant change in the law administering payment limitations. 

(35A) Special rules 

The House bill amends section 1001 of the Food Security Act 

of 1985 by inserting a new subsection (e) to essentially continue 

current rules for minor children, marketing cooperatives, trusts 

and estates, cash rent tenants, and federal agencies. For state, 

local governments, and their political subdivisions, it prohibits 

them from receiving direct and counter-cyclical payments unless 

they are the producer of all crops on the farm and the proceeds of 

the production benefits a public school or they have an existing 

share crop lease. If the state, local government, or political subdivision is the producer, all such qualified entities in a state have a 

combined limit of one entity for the payments they receive. For 

share crop leases, if the land is used to maintain a public school, 

the state, local government, or political subdivision may continue 

to receive payments under current law until the lease expires. It 

provides for a 2–5 year denial of benefits for evasion of payment 

limits, including the failure to disclose material information, and 

that benefits be denied on a pro-rata basis according to ownership. 

In addition, the language provides that the addition of a family 

member under the provisions of section 1001A will be considered 

to be a bona fide and substantive change. This language encompasses the addition of a spouse to a farming operation, given the 

new provisions in section 1001A concerning spouses. (Section 1503) 

The Senate amendment provides the same as the House measure, except it maintained current law with regard to production on 

land owned by state and local governments when the proceeds are 

used to maintain a public school. The Senate amendment expands 

the enforcement capability of the Secretary and provides for extended penalties for individuals or entities that perpetuate a fraud 

or a scheme or device in order to exceed the applicable limit on 

payments. Persons or entities that commit fraud or equally serious 

actions can be subjected to a five-year denial of program benefits. 

Any member of a legal entity that participates in a scheme or device to evade the limitations shall be jointly and severally liable for 

any amounts determined to be payable to the Secretary. The Secretary may partially or fully release from liability any person who 

cooperates with the Secretary in enforcing payment limitation provisions. (Section 1703) 

The Conference amendment adopts the Senate provision with 

an amendment to provide a single, combined statewide payment 

limit of $500,000 upon all state and local governments and political 

subdivisions that receive farm program payments. This limit would 

not apply to states with populations less than 1.5 million. (Section 

1603) 

It is the intent of the Managers that the addition of a spouse 

(also a family member) will be considered to be bona fide and substantive—just as with the addition of any family member. 


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(35B) Three-entity rule; actively engaged in farming; denial of program benefits 

The House bill amends the Food Security Act of 1985 to repeal 

the three-entity rule and to require notification of interests. Each 

entity or person receiving payments is to provide the Secretary the 

name and social security number of each individual, or the name 

and tax ID number of each entity, that holds or acquires an ownership interest; and for each person, provide such information for 

each entity in which the person holds an ownership interest. (Section 1503) 

The Senate amendment provides the same as the House measure. (Section 1703) 

The Conference amendment adopts the Senate provision with 

an amendment to replace ‘‘presented false information that was 

material’’ with ‘‘failed to disclose material information’’ and to 

specify that the provisions apply to any legal entity and any member of any legal entity. (Section 1603) 

(35C) Actively engaged in farming 

The House bill amends the Food Security Act of 1985 to essentially continue the provisions that recipients be ‘‘actively engaged’’

in farming. Existing special classes of actively engaged participants 

are continued, with the exception that as long as one spouse is determined to be actively engaged, the other spouse shall be determined to have met the requirements of personal labor or active 

personal management. (Section 1503) 

The Senate amendment provides the same as the House measure. (Section 1703) 

The Conference substitute adopts the Senate provision. (Section 1603) 

Current law concerning spouses made it very difficult for a 

spouse to be considered to be a separate person for the purpose of 

the application of the payment limits. In adopting the provision 

that if one spouse has been determined to be ‘‘actively engaged,’’

then the other spouse will be deemed to have made a significant 

contribution of active labor or active personal management to the 

operation as required by section 1001A(b)(2)(A)(i)(II), it is the intent of the Managers that this provision recognize the valuable contributions made by the spouse in a family farming operation as 

well as the significant value of these contributions to the overall 

success of family farming operations in America. It is further the 

intent of the Managers that in implementing this section, the Secretary shall consider such automatic ‘‘significant’’ contribution of 

active labor or active personal management to be commensurate 

with at least a 50% share in the profits and losses of the farming 

operation and to be at risk. It is the intent of the Managers to end 

the discrimination against spouses of farming families and reflect 

their true value to the farming operation. By assigning a ‘‘significant’’ level of contribution of labor or active management, the Conference Substitute requires the spouse only to make a significant 

contribution of capital, equipment, or land in order to be considered 

actively engaged. 


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(35D) Transition 

The House bill provides that the current provisions of Section 

1001 of the Food Security Act of 1985 will remain applicable to the 

2007 crop. (Section 1503) 

The Senate amendment provides the same as the House measure. (Section 1703) 

The Conference substitute provides that the current provisions 

of sections 1001, 1001A, and 1001B of the Food Security Act of 

1985 will remain applicable to the 2007 and 2008 crops. (Section 

1603) 

(36) Adjusted gross income limitation 

The House bill extends the adjusted gross income limitation to 

programs under this Act and extends the effective period through 

the 2012 crop year. (Section 1504(a)) 

It also amends section 1001D of the Food Security Act of 1985, 

beginning with the 2008 crop year, to require that individuals or 

entities have an average adjusted gross income (AGI) not exceeding 

$1 million in order to receive program payments. Further provides 

that an individual or entity with an AGI in excess of $500,000 shall 

not be eligible for benefits, unless at least 66.66 percent of the AGI 

is derived from farming, ranching, or forestry operations, as determined by the Secretary. (Section 1504(b)) 

Modified AGI limits applicable to the 2008 through 2012 crop 

years. (Section 1504) 

The Senate amendment extends the effective period through 

the 2012 crop year. (Section 1704(a)) 

It amends section 1001D the Food Security Act of 1985 to 

lower the applicable average adjusted gross income (AGI) limit for 

recipients of direct or counter-cyclical payments, marketing loan 

gain or loan deficiency payments and average crop revenue payments from the current level of $2.5 million to $1,000,000 for the 

2009 crop year and to $750,000 for the 2010 and subsequent crop 

years. Individuals or entities that receive 66.66% of their income 

from farming, ranching or forestry operations are exempted from 

this restriction. The Senate amendment establishes the income limitation for conservation programs at the current level of $2.5 million, unless not less than 75 percent of the AGI is derived from 

farming, ranching, or forestry operations. (Section 1704(c)) 

The Senate amendment provides that existing adjusted gross 

income provisions of the Food Security Act shall continue to apply 

with respect to the 2007 and 2008 crops. (Section 1704(d)) 

Authorizes the allocation of adjusted gross income among the 

individuals filing joint returns provided the allocation is supported 

by a certified public accountant or attorney. (Section 1704(b)) 

The Conference substitute provides an average adjusted gross 

nonfarm income cap of $500,000. If the average AGI for nonfarm 

income of a person or legal entity exceeds $500,000, they become 

ineligible for a host of farm programs, including the non-insured 

assistance program and the new disaster program. The Substitute 

also provides for an average adjusted gross farm income cap of 

$750,000. If a person’s or legal entity’s average farm AGI exceeds 

$750,000, then they become ineligible for direct payments. 


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The Conference substitute provides an average adjusted gross nonfarm income cap of $1,000,000 for conservation programs unless 

two-thirds or more of the income of the person or legal entity is average adjusted gross farm income. The Secretary is authorized to 

waive the limitation on a case-by-case basis if the Secretary determines that environmentally sensitive land of special significance 

would be protected. (Section 1604) 

New section 1001D(a)(3) provides that married couples filing 

joint returns may allocate appropriately their income among themselves for the purposes of applying both the new $750,000 adjusted 

gross farm income test and the new $500,000 nonfarm income test 

to each individual spouse. The section requires that to secure this 

allocation married couples must provide a professional third party 

certification of the method used to apportion the income, and the 

Secretary must determine that the submission is appropriate. The 

Managers expect the Secretary to apply this provision carefully and 

that its impact should be limited to the unique and special circumstances of each individual case. 

The new provisions under section 1001D will take effect in 

2009 and will be based on the 3 tax years preceding the most immediate preceding tax year. Since these tax years occur in the past 

and income decisions regarding them were based on past circumstances the Managers expect the Secretary to allow modifications to the allocation of income in these past years in order to implement the new income requirements in as least disruptive manner as possible. 

The Conference substitute strengthens the certification requirements and ensures the Secretary can take appropriate action 

against a person or legal entity that fails to provide certifications 

concerning their average adjusted gross income, average adjusted 

gross farm income and average adjusted gross nonfarm income. 

Certifications are required to be provided at least once every three 

years. The Managers intend for the Secretary to deny program benefits to a person or legal entity that does not provide the certifications required in section 1001D, as amended, until such time as 

the certifications are actually provided. The Secretary is also to establish audit procedures that are designed to ensure that audits 

are directed toward those persons or legal entities that are most 

likely to exceed the adjusted gross income ceilings set out in section 

1001D, but is not designed to authorize the Secretary to conduct 

repeated audits of operations based upon size alone. 

(36A) Income derived from farming, ranching or forestry 

The House bill amends section 1001D of the FSA by adding a 

new paragraph (3) to delineate income that is to be included in the 

portion of average adjusted gross income derived from farming, 

ranching, or forestry to include the following: the production of 

crops, livestock, or unfinished raw forestry products; the sale, including the sale of easements and development rights, of farm, 

ranch, or forestry land or water rights; the sale, but not as a dealer, of equipment purchased to conduct farm, ranch, or forestry operations when the equipment is otherwise subject to depreciation 

expense; the rental of land used for farming, ranching, or forestry 

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ers, ranchers, and foresters; the processing, storing, and transporting of farm, ranch, and forestry commodities; and the sale of 

land that has been used for agriculture.’’ (Section 1504(b)(3)) 

The Senate amendment provides the same as the House measure, except the Senate does not limit the sale of equipment to those 

other than dealers and does not include the provision regarding 

equipment subject to depreciation; includes income from water or 

hunting rights; includes packing in processing and shedding in 

storage; and includes payment or other income attributable to benefits received under any Title I or Title II program. (Section 

1704(c)) 

The Conference amendment adopts the Senate provision with 

an amendment to clarify and expand upon the items included in 

the Senate amendment. Newly specified categories of farm income 

include the feeding, rearing or finishing of livestock and payments 

received under the noninsured assistance program (NAP), and 

under the Federal Crop Insurance Act. Income received from the 

sale of farm equipment or production inputs or services to farmers 

can be considered farm income if two-thirds of a person’s or legal 

entity’s average adjusted gross income comes from the other 

sources of farm income. (Section 1604) 

The Managers intend for the Secretary to create a method for 

determining a person’s average adjusted gross farm income by including all income reported on IRS Schedule F (or other schedule 

for reporting farm or farm-related income), farming, ranching, or 

forestry related income specifically listed in the statute, and other 

income as determined by the Secretary to be income related to 

farming, ranching, or forestry activities. The items described in section 1001D(c) to be included in average adjusted gross farm income 

are intended to be illustrative and by no means an exclusive list. 

The Managers expect the Secretary to interpret, implement, and 

expand the sources of income derived from farming, ranching, or 

forestry to include the income or benefits from farming and farmrelated activities other activities that the Secretary determines are 

derived directly or indirectly from farm or farm-related activities. 

Many of these activities may be in addition to those items reported 

on IRS Schedule F, Form 4853 (farm rental income), farm partnership returns, or other schedules or forms. As farming practices, 

farming enterprises, and farm-related activities continue to evolve 

and modernize, the Managers intend that the Secretary will expand the sources of income derived from farming, ranching, or forestry for these purposes to reflect these developments. 

(37) Adjustments of loans 

The House bill amends section 162 of the 1996 farm bill by inserting ‘‘except for cotton and long grain, medium grain, and short 

grain rice’’ after ‘‘commodity’’; extending the provisions; and adding 

provisions for cotton and rice. 

The House bill authorizes the Secretary to make adjustments 

in the loan rate for cotton for differences in quality factors, and requires the Secretary to revise the marketing assistance loan program for cotton to better reflect market values for cotton. The 

House bill requires revisions, including: eliminating or revising 

warehouse location differentials to reflect market conditions; 


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changing the way premiums and discounts are calculated by using 

a three-year weighted moving average of spot market data, weighted by each region’s share of production; eliminating gaps between 

premium and discount differentials based on certain fiber lengths; 

and further capping premiums based on leaf and color considerations. 

The House bill provides for discretionary revisions in—adjusting the loan rates schedule using non-spot market price data in addition to spot market data for cotton; and eliminating gaps between 

premium and discount differentials based on certain longer fiber 

lengths. 

The House bill encourages USDA consultation with the private 

cotton industry when making the mandatory and discretionary adjustments. 

The House bill amends section 162(e) of the 1996 farm bill to 

provide that ‘‘with respect to long grain rice and medium and short 

grain rice, the Secretary shall not make adjustments in the loan 

rates for such commodities, except for differences in grade and 

quality (including milling yields)’’. 

The House bill provides the same as section 162(c) of the 1996 

farm bill, which allows the Secretary to establish county loan rates 

in a manner that results in the lowest loan rate being 95% of the 

national average loan rate, if those loan rates do not result in an 

increase in outlays. Prohibits any adjustment resulting in an increase in the national average loan rate for any year. 

The House bill provides the same as section 162 of the 1996 

farm bill. (Section 1505) 

The Senate amendment provides for adjustments in loan rates 

for loan commodities other than cotton for differences in grade, 

type, location, and other factors. (Section 1210(a)) 

Subsection (b) of the Senate amendment provides the same as 

current law. (Section 1210(b)) 

Subsection (d) of the Senate amendment provides the same as 

the House measure, except with respect to mandatory revisions, 

the Senate amendment eliminates warehouse location differentials. 

With respect to discretionary revisions, the Senate amendment 

provides the same as the House measure. 

With respect to consultation, the Senate amendment provides 

the same as the House provision, except that it requires consultation with the private cotton industry. (Section 1210(d)) 

With respect to rice, the Senate amendment prohibits the Secretary from making adjustments in the loan rates for long grain 

rice and medium grain rice, except for differences in grade and 

quality (including milling yields). (Section 1210(f)) 

Subsection (c) of the Senate amendment provides the same as 

current law. (Section 1210(c)) 

The Senate amendment provides the same as current law specifically for peanuts. (Section 1308) 

The Conference substitute adopts the Senate provision with an 

amendment to simplify language related to the requirement to consult with the cotton industry. (Section 1210) 


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(38) Personal liability of producers for deficiencies 

The House bill provides the same as current law. (Section 

1506) 

The Senate amendment provides the same as current law. 

(Section 1709) 

The Conference substitute adopts the Senate provision. (Section 1606) 

(39) Extension of existing administrative authority regarding loans 

The House bill provides the same as current law. (Section 

1507) 

The Senate amendment provides the same as current law. 

(Section 1710). 

The Conference adopts the Senate provision with an amendment. (Section 1607) 

(40) Assignment of payments 

The House bill provides the same as current law. (Section 

1508) 

The Senate amendment provides the same as current law. 

(Section 1711) 

The Conference substitute adopts the House provision with an 

amendment. (Section 1608) 

(41) Tracking of benefits 

The House bill requires the Secretary to track the benefits provided under titles I and II directly or indirectly to individuals and 

entities. (Section 1509) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to give the Secretary discretionary authority to track 

benefits. (Section 1609) 

(42) Upland cotton storage payments 

The House bill ends the practice of paying for upland cotton 

storage, handling and other costs associated with cotton going into 

the loan starting with the 2011 crop. (Section 1510) 

The Senate amendment requires payment of cotton storage 

costs in the same manner and at the same rates as the Secretary 

provided for the 2006 crop of cotton effective for the 2008–2012 

crop years. (Section 1204(h)) 

The Conference substitute adopts the Senate provision with an 

amendment to limit the payments to a percentage of the actual 

storage rates. (Section 1204(g)) 

(43) Government publication of cotton price forecasts 

The House bill strikes the current prohibition on the publication of cotton price forecasts. (Section 1511) 

The Senate amendment provides the same as the House measure. (Section 1714) 

The Conference substitute adopts the Senate provision. (Section 1610) 


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(44) Prevention of deceased persons receiving payments under farm 

commodity programs 

The House bill requires the Secretary to submit a report to 

Congress which identifies any estate of a deceased person that received payments under this title for more than two crop years following the death of the person. The Secretary is required to promulgate regulations specifying deadlines by which a legal entity 

that receives payments or other benefits under this title must notify the Secretary of any change in ownership of the entity, including the death of a person with direct ownership interest. Any entity 

that fails to comply may be denied such payments or benefits. The 

Secretary is required to recoup erroneous payments made on behalf 

of a deceased person, and to withhold payments that otherwise 

would be made to farming operations in which the deceased person 

was actively engaged until the funds have been recouped. The Secretary is required to biannually reconcile individual tax identification numbers with the Internal Revenue Service for recipients of 

payments under this title to determine recipients’ living status. 

(Section 1512) 

The Senate amendment prohibits the Secretary from providing 

any agricultural payment under this Act or Act amended by this 

Act to any deceased individual or estate of such individual after 2 

program years after the date of death of the individual. The Secretary is required to submit reports to the respective committees on 

agriculture that describes the number of payments and the aggregate amount of payments to deceased individuals and estates of deceased individuals; and to specify for each such payment, the 

length of time the estate of the deceased individual has been open. 

(Section 11073) 

The Conference substitute adopts the House provision with an 

amendment that provides for the Secretary to issue regulations to 

allow for the settlement of estates and to preclude payments on behalf of deceased individuals that were not eligible for payment. The 

Secretary is directed to reconcile Social Security numbers of program participants with the Social Security Administration at least 

twice annually. (Section 1611) 

(45) Hard White Wheat Development Program 

The Senate amendment creates a program to compensate producers of hard white wheat. It establishes acreage limitation and 

payment rates and provides $35 million for the period of fiscal 

years 2008–2012. (Section 1706) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to make the program subject to appropriations and to 

modify the period of effectiveness to fiscal years 2009–2012. (Section 1612) 

(46) Durum Wheat Quality Program 

The Senate amendment authorizes compensation to producers 

of durum wheat in an amount not to exceed 50% of the actual cost 

of fungicides applied to a crop of durum wheat of the producers to 

control wheat scab. It provides $10 million for each of fiscal years 

2008 through 2012 subject to appropriations. (Section 1707) 


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The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to modify the period of effectiveness to fiscal years 

2009–2012. (Section 1613) 

(47) Storage facility loans 

The Senate amendment establishes a storage facility loan program to provide funds for producers of grains, oilseeds, pulse crops, 

hay, renewable biomass, and other storable commodities (other 

than sugar) to construct or upgrade storage and handling facilities 

for the commodities. It provides the terms of loans, amounts, and 

security requirements. (Section 1708) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment. (Section 1614) 

(48) State, county, and area committees 

The Senate amendment provides for producer representation 

on county or area committees that are combined or consolidated. 

The provision requires that minority representation of socially disadvantaged farmers and ranchers is maintained. The Senate 

amendment provides that the producer is eligible to serve only as 

a member of the county or area committee that the producer elects 

to administer the farm records of the producer. (Section 1715) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to require the Secretary to develop procedures for the 

purpose of maintaining representation of socially disadvantaged 

farmers and ranchers on combined or consolidated committees. 

(Section 1615) 

(49) Prohibition on charging certain fees 

The Senate amendment prohibits the Secretary from charging 

fees or related costs for the collection of commodity assessments. 

(Section 1716) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 1616) 

(50) Signature authority 

The Senate amendment provides that if the Secretary approves 

a document containing signatures of program applicants, the Secretary shall not subsequently determine the document is inadequate or invalid because of the lack of authority of any applicant 

signing the document on behalf of the applicant unless the applicant knowingly and willfully falsified the evidence of signature authority or a signature. (Section 1717) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment ensuring that the Secretary can still seek proper documentation despite the Senate provision and that third party producers who relied upon the prior approval of documents by the Secretary in good faith and substantially complied with farm program 


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requirements are not denied benefits due to erroneous representations of authority. (Section 1617) 

The Managers intend for the Secretary to continue to seek 

proper affirmation of signature authority from appropriate parties 

even as this section upholds prior document approval by the Secretary despite inadequate or invalid signature authority. 

(51) Modernization of Farm Service Agency 

The Senate amendment requires the Secretary to modernize 

the Farm Service Agency information technology and communication systems to ensure timely and efficient program delivery at national, state, and county offices. (Section 1718) 

The House bill contains no comparable provision. 

The Conference substitute provides for a report addressing the 

needs of the Department and a detailed plan to fulfill the Department’s needs. (Section 1618) 

(52) Geospatial systems 

The Senate amendment requires the Secretary to ensure that 

all agencies of the Department of Agriculture consolidate the 

geospatial systems of the agencies into a single enterprise system 

that ensures that geospatial data is shareable, portable, and standardized. (Section 1719) 

The House bill contains no comparable provision. 

The Conference substitute provides that the Secretary shall ensure that all geospatial data of the agencies of the Department of 

Agriculture are portable and standardized. (Section 1619) 

(53) Leasing of office space 

The Senate amendment allows the Secretary to use Commodity 

Credit Corporation funds to lease space for use by agencies of the 

Department of Agriculture use provided the space is jointly occupied by the agencies. (Section 1720) 

The House bill contains no comparable provision. 

The Conference substitute provides for a report on the costs 

and time associated with complying with U.S. General Services Administration (GSA) leasing procedures. (Section 1620) 

(53A) Geographically disadvantaged farmers and ranchers 

The Senate amendment establishes a new program to provide 

geographically disadvantaged farmers and ranchers direct reimbursement payments to cover the cost to transport agricultural 

commodities or inputs used to produce agricultural commodities. 

The Secretary may spend up to $15,000,000 per fiscal year from 

funds appropriated to carry out this program. (Section 6021) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment. (Section 1621) 

The Managers recognize the barriers to competition associated 

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pect the Secretary to consult with eligible areas on administration 

of the program. 

(53B) Implementation 

The conference substitute provides $50,000,000 to the Farm 

Service Agency to implement title I. (Section 1622) 

(54) Repeals 

The Senate amendment repeals section 1605 of the 2002 farm 

bill authorizing a Commission on Application of Payment Limitations; repeals section 1617 of the 2002 farm bill renewing availability of market loss assistance and certain emergency assistance 

to persons that failed to receive assistance under earlier authorities. (Section 1721) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 1623) 

TITLE II—CONSERVATION 

(1) Definitions (Section 1201 of 1985 Food Security Act (FSA)) 

The Senate amendment adds definitions in the 1985 FSA for 

‘‘beginning farmer or rancher’’, ‘‘Indian tribe’’, ‘‘socially disadvantaged farmer or rancher’’, ‘‘nonindustrial private forest land’’, and 

‘‘technical assistance’’. The amendment authorizes the Secretary to 

employ a reasonable test of net worth or other measure to further 

qualify a beginning farmer or rancher. (Section 2001 of the Senate 

amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment that removes the test of net worth for a beginning 

farmer or rancher. The Conference substitute further adopts the 

definition of a socially disadvantaged farmer or rancher as defined 

in Section 2501 of the Food, Agriculture, Conservation, and Trade 

Act of 1990 (7 U.S.C. 2279) and adds a definition of farm, integrated pest management, person and legal entity, and livestock. 

The definition of livestock is intended to include alpaca and bison. 

(Section 2001 of Conference substitute) 

(2) Review of good faith determinations (Section 1212 of FSA) 

The Senate amendment maintains the good faith exemption 

and provides for a second level review of highly erodible land compliance decisions by the Farm Service Agency State Executive Director with the technical concurrence of the Natural Resources 

Conservation Service State Conservationist or the Farm Service 

Agency District Director with the technical concurrence of the Natural Resources Conservation Service Area Conservationist or his or 

her equivalent. The amendment allows for graduated penalties for 

compliance violations. (Section 2101 of the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. Conservation compliance was created in the 1985 FSA. It requires that 

individuals who farm highly erodible land to develop and apply a 

conservation plan or lose eligibility for farm program benefits. It 


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has resulted in reductions in soil erosion but has often been inconsistently applied. Under current law, even a small compliance infraction requires the complete denial of farm program benefits. 

The Conference substitute creates a system of graduated penalties, to be based on the severity of the violation. The amendment 

also creates a process to ensure that the Farm Service Agency Area 

Director or the Farm Service Agency State Director will review 

local compliance decisions. The Natural Resources Conservation 

Service will be involved to provide concurrence on technical issues. 

The Managers believe this approach resolves a long-standing 

problem and provides for increased oversight of the violation process. The Managers are aware however, that current market conditions are encouraging commodity production on additional land and 

also changing cropping patterns. In light of the increase in new 

crop production, as well as changes in cropping systems, the Managers expect that the Secretary will increase whatever technical assistance, planning, monitoring, investigation, and enforcement activities may prove necessary to ensure that producers receiving 

farm program benefits continue to meet the applicable conservation 

compliance requirements. (Section 2002 of Conference substitute) 

(3) Review of good faith determinations (Section 1222 of FSA) 

The Senate amendment maintains the good faith exemption 

and provides for a second level review of wetland compliance by the 

Farm Service Agency State Executive Director (with the technical 

concurrence of the NRCS State Conservationist) or the Farm Service Agency district director (with the technical concurrence of the 

Natural Resources Conservation Service area conservationist or 

his/her equivalent). (Section 2201 of the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. 

The Managers intend for this provision to provide for better review and enforcement of wetlands compliance provisions. It requires a second level of review of wetlands violations by the Farm 

Service Agency with the concurrence of the Natural Resources Conservation Service on technical issues. The Managers intend for the 

Farm Service Agency to continue its primary role in compliance determinations. (Section 2003 of Conference substitute) 

(4) Comprehensive Conservation Enhancement Program (Section 

1230 of FSA) 

The Senate amendment extends the program through 2012 

and adds the Healthy Forests Reserve Program. The Environmental Quality Incentives Program (EQIP) is moved to the Comprehensive Stewardship Incentives Program (CSIP). (Section 2341) 

It exempts land enrolled in the Conservation Reserve Enhancement 

Program (CREP), land affected by State or local regulations that 

prohibit water use for agricultural production, and land in the 

State of Washington where enrollment is essential to Federal or 

State plans for sustainable wildlife habitat from the 25 percent 

county acreage cap. (Section 2301 of the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute does not reauthorize the program. 

The Healthy Forest Reserve Program is retained in the Forestry 


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Title, and the county acreage cap is addressed in ‘‘Administrative 

Requirements for Conservation Programs’’. (Section 1244 of the 

FSA). The Conference adopts a provision to exclude CREP acreage 

and continuous Conservation Reserve Program (CRP) acreage from 

the 25 percent cap if the county government concurs. This provision is separate and distinct from the existing waiver authority. As 

such, the Managers do not intend for the Secretary to survey producers, businesses, and other entities as is required by the existing 

waiver authority to implement this new provision. 

The Managers recognize that a loss of access to water by agricultural producers can significantly impact conservation needs and 

local economies, and that producers need access to a wide range of 

conservation programs to help comply with a State or local law, 

order, or regulation prohibiting water use for agricultural production. 

In making any determination on the applicability of the 25 percent county cropland CRP enrollment limitation, the Managers encourage the Secretary to maintain maximum flexibility for the enrollment of acreage in CRP that cannot be used for an agricultural 

purpose or is precluded from planting as a result of a State or local 

law, order, or regulation prohibiting water use for agricultural production. 

(5) Conservation Reserve Program (Sections 1231, 1232, 1234, and 

1235 of FSA) 

(a) Conservation reserve (Section 1231 of FSA) 

The House bill extends CRP until 2012 and gives the Secretary 

authority to address issues raised by State, regional, and national 

conservation initiatives. It amends the land eligibility provision to 

include land the Secretary determines had been planted for 4 of the 

6 years preceding the enactment of the Farm, Nutrition, and Bioenergy Act of 2007 (except for land enrolled in CRP as of that 

date). It maintains the existing maximum enrollment of 39,200,000 

acres. It strikes specific enumeration of Pennsylvania, Maryland 

and Virginia, but maintains the Chesapeake Bay Region as a Conservation Priority Area. The House bill also provides that alfalfa 

grown as part of a rotation practice is a commodity for cropping 

history criteria in determining whether land is eligible to be enrolled. It extends the Pilot Program for Enrollment of Wetland and 

Buffer Acreage in CRP to 2012. (Section 2101 of the House bill) 

The Senate amendment extends CRP until 2012 and adds pollinator habitat to the resources to be conserved and improved 

through the program. The Senate amendment also expands eligible 

land to include marginal pastureland if native vegetation is grown 

and the land contributes to the restoration of the long-leaf pine forest or similar rare and declining forest ecosystem. The Senate 

amendment modifies eligibility of land that would facilitate a net 

savings in groundwater or surface water to apply only to alfalfa 

and other forage crops. The section expands eligible land to include 

land enrolled in the flooded farmland program. The Senate amendment maintains the existing maximum enrollment of 39,200,000 

acres. The Senate amendment expands the Chesapeake Bay Priority Area to include all parts in the Chesapeake Bay Watershed 


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and adds the Prairie Pothole Region, Grand Lake St. Mary’s Watershed, and Eastern Snake Plain Aquifer region as Conservation 

Priority Areas. 

The Senate amendment expands the lands eligible for the Pilot 

Program for Enrollment of Wetland and Buffer Acreage to include 

shallow water areas that were devoted to a commercial pond-raised 

aquaculture and agricultural drainage water treatment areas that 

provide nitrogen removal and other wetland functions. The Secretary, in consultation with the State technical committee, shall establish the maximum size of the buffer acreage to be enrolled along 

with eligible lands, taking into consideration the farming practices 

used with respect to the cropland that surrounds the wetland or 

shallow water area. The section increases the maximum wetland 

size to 40 contiguous acres and makes all acres eligible for payment. (Section 2311 of the Senate amendment) 

The Conference substitute adopts the Senate provision with an 

amendment. The substitute extends CRP until 2012 and provides 

the Secretary authority to address issues raised by State, regional, 

and national conservation initiatives. These ‘‘State, regional and 

national conservation initiatives’’ may include such things as the 

North American Waterfowl Management Plan, the National Fish 

Habitat Action Plan, the Greater Sage-Grouse Conservation Strategy, the State Comprehensive Wildlife Conservation Strategies 

(also referred to as the State Wildlife Action Plans), the Northern 

Bobwhite Conservation Initiative, and State forest resource strategies. The Managers intend for the Secretary to consider the goals 

and objectives identified in relevant fish and wildlife conservation 

initiatives when establishing State and national program priorities, 

scoring criteria, focus areas, or other special initiatives. The Managers expect the Department to work with conservation partners 

and State and Federal agencies, to the extent practicable, to complement the goals and objectives of these additional plans through 

its programs. 

Regarding pollinators, the Managers have placed a provision in 

‘‘Administrative Requirements for Conservation Programs’’ (Section 

1244 of the FSA), which applies to all applicable conservation programs and encourages the Secretary to give priority to applications 

that provide pollinator habitat. 

The Conference substitute adopts the House provision on land 

eligibility and updates the provision to include land the Secretary 

determines has been planted for 4 of the 6 years preceding the enactment of the Food, Conservation, and Energy Act of 2008. 

While the Managers agreed to an overall reduction in CRP enrollment to 32,000,000 acres, this should not serve as an indicator 

of declining or reduced support for CRP. The Managers intend that 

CRP be implemented at authorized levels, and that the program 

continue as one of USDA’s key conservation programs. USDA shall 

update rental rates and use incentive payments for continuous 

CRP practices to make the program competitive with other programs and more economically viable for producers. The Managers 

support the use of partnership agreements with State wildlife 

agencies and nongovernmental organizations to assist in program 

promotion and implementation. Additionally, as general CRP contracts expire, the Managers encourage the enrollment of those 


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acres in the Conservation Stewardship Program (CSP), Grassland 

Reserve Program (GRP) and the continuous CRP. The Managers 

expect that the Department will use incentive payments, promotional efforts, and agreements with the third parties mentioned 

above to ensure that the portions of general signup acreages that 

can be maintained in the program will be enrolled through continuous CRP. 

The Conference substitute adopts the House language and 

makes a technical correction to include all States that make up the 

Chesapeake Bay Region as the Conservation Priority Area. 

The substitute clarifies that alfalfa grown as part of a rotation 

practice is a commodity for cropping history purposes. The Managers encourage the Secretary to enroll irrigated alfalfa lands into 

ongoing CREP projects that address water quantity and quality 

issues. (Section 2101 of Conference substitute) 

(b) Duties of owner and operators (Section 1232 of FSA) 

The House bill maintains current law regarding managed 

haying and grazing outside of nesting seasons and expands the provision to allow a producer to conduct prescribed grazing for the control of invasive species on CRP lands. It allows for managed grazing and requires the Secretary to reduce the rental payment and 

require a management plan. It allows dryland crop production and 

grazing on CREP acres where CREP is initiated to address declining water resources. The Secretary is required to develop a conservation plan, determine eligibility of dryland crop production and 

grazing for crop insurance, reduce the rental payment, and renegotiate the agreement to allow for dryland crop production and grazing at the request of the State. Such lands shall be considered 

‘‘noncropland’’ for crop insurance purposes. (Section 2101 of the 

House bill) 

The Senate amendment adds that approved vegetative cover 

shall encourage the planting of native species and the restoration 

of biodiversity. It requires contract holders to actively manage the 

land throughout the term of the contract and clarifies that managed harvesting and grazing outside of nesting and brood rearing 

season is permitted if it is part of the conservation plan. The Senate amendment allows prescribed grazing for control of invasive 

species. The Senate amendment requires that the practices in the 

conservation plan be compatible with wildlife and wildlife habitat, 

clearly described and applicable through the duration of the contract, consistent with the Secretary’s priorities for local conservation management priorities, and actively managed. (Section 2311 of 

the Senate amendment) 

The Conference substitute adopts the House provision with an 

amendment. The substitute allows routine grazing, including prescribed grazing for the control of invasive species, with appropriate 

restrictions. The Managers expect that routine grazing will be performed in a manner that is consistent with the underlying purposes of the program and conducted under a site-specific vegetation 

plan that provides for grazing frequency (duration of time throughout the year, when authorized, and the number of years during the 

life of the CRP contract). The Managers further expect that guideVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00715 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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lines for the vegetation plan and grazing use be developed in consultation with the State technical committee. 

The Managers understand that there has been some concern 

over the current rules related to haying and grazing on CRP land 

and insufficient flexibility for forage use across varied landscapes 

while still achieving the purposes of the program. The Managers 

expect USDA to review rules developed to implement routine grazing and to provide for appropriate flexibility in grazing periods consistent with the conservation goals of the program based on sitespecific natural resource conditions. 

The Managers understand that there has been some complication in local areas with restricting access to buffers while gleaning 

the crop residue in a field. The Managers intend that short-term 

access to buffers that are adjacent to fields be allowed post-harvest 

without a reduction in payment. While grazing of the buffer is not 

intended in this action, the proximity to the field crop residue 

makes restricting access difficult. Due to the short term nature of 

this activity (60 days maximum), it should not result in a reduced 

payment and should be done in accordance with the contract. (Section 2107 of Conference substitute) 

(c) Payments (Section 1234 of FSA) 

The House bill requires the National Agricultural Statistics 

Service to survey annually the per-acre estimates of county average 

market dryland and irrigated cash rental rates for all counties with 

20,000 acres or more of crop and pastureland. These surveys will 

be kept on the Department’s website and made available to the 

public. (Section 2101 of the House bill) 

The Senate amendment contains a similar provision. In accepting new enrollments, the section requires that if land provides 

equivalent environmental benefit to a competing offer then the Secretary shall, to the maximum extent practicable, accept an offer 

from an owner or operator who is a local resident. (Section 2311 

of the Senate amendment) 

The Conference substitute adopts the Senate provision regarding the NASS survey. In accepting contract offers (Section 1234(c)), 

the substitute adds a new requirement that the Secretary provide 

priority to offers from local residents if the offer provides equivalent conservation benefits when compared to other offers. (Section 

2110 of Conference substitute) 

(d) Contracts (Section 1235 of FSA) 

The House bill allows the Secretary to modify a CRP contract 

to facilitate the transition of CRP land from a retiring owner to a 

beginning, socially disadvantaged, limited resource farmer or 

rancher in order to return some or all of the land to sustainable 

grazing or crop production. It allows the beginning, socially disadvantaged, or limited resource farmer or rancher to make land 

improvements and to begin the organic certification process one 

year before the CRP contract expires. The House bill: requires the 

retiring landowner to sell or lease the CRP land to the beginning, 

socially disadvantaged, or limited resource farmer for production 

purposes; requires a conservation plan; allows the farmer to enroll 

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ship of the land; and provides CRP payments to the retiring owner/ 

operator for an additional two years after the contract terminates. 

The House bill allows the beginning, socially disadvantaged, or limited resource farmer or rancher purchasing the CRP land to reenroll a partial field that is eligible for continuous sign-up and is 

part of a conservation plan. 

The House bill requires the Secretary to allow an operator to 

terminate a contract that has been in effect for 5 years at any time. 

The section also provides that land enrolled in continuous sign-up 

is ineligible for early termination. (Section 2101 of the House bill) 

The Senate amendment has no comparable provision to the 

House language on CRP transition options for beginning, socially 

disadvantaged, or limited resource farmers. The Senate amendment retains current language on early termination by an owner 

or operator but expands current law to permit contract termination 

if the participant is disabled or retired from farming and has endured financial hardship as a result of taxation from rental payments received. (Section 2311 of the Senate amendment) 

The Conference substitute adopts the House provision with an 

amendment regarding the transition of CRP land from a retiring 

farmer or rancher to a beginning or socially disadvantaged farmer 

or rancher. In implementing the CRP transition option, the Managers encourage the Department to publicize the availability of the 

transition option widely, including publicity aimed at CRP landowners who are not extending contracts or re-enrolling in the program and at beginning and socially disadvantaged farmers or 

ranchers. (Section 2111 of Conference substitute) 

(6) Flooded Farmland Program (Section 1235B of FSA) 

The Senate amendment adds a new flooded farmland program 

within CRP, which allows for the enrollment of flooded crop and 

grazing land or land rendered inaccessible because of flooding 

caused by the natural overflow of a closed basin in the Northern 

Great Plains region. The section requires that land enrolled must 

be at least 5 acres in size, flooded, and rendered incapable of production during the preceding three crop years and have no natural 

outlet. It provides for enrollment through the continuous sign-up 

process and requires that land enrolled have a consistent history 

of being used for the production of crops or used as grazing lands. 

The Senate amendment allows enrollment of adjoining land 

that would enhance the conservation or wildlife value of the tract 

with reduction in rental payment. During participation in the program, owners are not eligible to participate in or receive federal 

crop insurance, noninsured crop disaster assistance, or any other 

federal agricultural crop disaster assistance program benefits for 

land included in the contract. The section also directs the Secretary 

to preserve the cropland base, allotment history, and payment 

yields applicable to the enrolled land and to adjust these values 

upon contract termination to ensure equitable treatment of the enrolled land relative to comparable land remaining in production in 

the county. The owner shall take actions as necessary to avoid degrading any wildlife habitat that has developed as a result of the 

natural overflow on the land covered by the contract. (Section 2312 

of the Senate amendment) 


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The House bill has no comparable provision. 

The Conference substitute deletes this section and makes 

modifications to CRP and the Wetlands Reserve Program (WRP) to 

accomplish the intent of the Senate amendment. 

The pilot program for enrollment of wetland and buffer acreage 

in CRP is expanded to include land that had been cropped during 

3 of 10 crop years prior to 2002 and after 1990 and is subject to 

a natural overflow of a prairie wetland. Wetlands and adjacent 

buffer areas are enrolled under the continuous sign-up process and 

are limited to no more than 40 acre tracts. The Managers expect 

the Secretary to require these enrollments in the CRP wetland 

pilot program to have ratios of at least two-to-one in upland buffer 

areas, or greater where practicable, in order to maximize wildlife 

benefits. Participants must agree to restore wetland hydrology, establish appropriate vegetation, and refrain from commercial use of 

the land, among other duties during the term of the contract. (Section 2101 of the Conference substitute) 

Eligible land in WRP is expanded to include cropland or grassland that was used for agricultural production prior to flooding 

from the natural overflow of a closed basin lake or pothole. These 

wetland areas along with functionally dependent uplands, as practicable, are to be enrolled in 30-year easements. In determining the 

compensation, the Secretary is expected to base the value on the 

use of the land prior to flooding and the corresponding value of 

such land in the county where the eligible land is located. The 

Managers expect that enrolling these permanently and temporarily 

flooded lands in the program will provide long term benefits for 

wildlife habitat and water management. To ensure that enrollment 

opportunity exists for these lands, the Secretary is directed to conduct an annual survey of the demand for enrollment in the Prairie 

Pothole Region and adjust annual allocation of program funds in 

these interested States. The Managers intend the allocations made 

available through this adjustment process to be subject to any annual pooling and reallocation of funds that the Secretary applies to 

the entire program. (Section 2201 of the Conference substitute) 

(7) Wildlife Habitat Program (Sec 1235C of FSA) 

The Senate amendment creates, for the years 2008 through 

2012, a Wildlife Habitat Program within the CRP. The program 

would be available to CRP contract holders who have established 

softwood pine stands. It provides for agreements that shall have 

management strategies and practices that benefit wildlife, such as 

thinning, establishing wildlife food plots, burning, and seeding. 

Contracts are up to 5 years in term. The Secretary shall encourage 

cooperative arrangements among program participants, State and 

local government entities, and nongovernmental organizations to 

achieve the purposes of the program. The section provides costsharing and technical assistance to carry out the program. The program terminates on September 30, 2011. (Section 2313 of the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute deletes this section and makes 

modification in CRP to accommodate the intent of the Senate 

amendment. In providing funding and clarifying the availability of 


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cost-sharing payments related to trees, the Managers encourage 

the Department to take this opportunity to improve the condition 

of resources on land enrolled in CRP and planted to trees. The 

Managers are especially interested in improving wildlife habitat on 

land in the Southeast in CRP planted to softwood pines. The Managers expect the Department to work with partners to identify 

areas with the greatest need and potential for improvement. The 

Managers encourage the use of all appropriate forest-management 

practices, including thinning and prescribed fire, to achieve the 

purposes of the program. 

(8) Wetland Reserve Program (Section 1237 of FSA) 

(a) Establishment (Section 1237(a-f) of FSA) 

The House bill authorizes WRP through fiscal year 2012. The 

section adds wetland creation to the purposes of WRP and authorizes the Secretary to purchase floodplain easements. The section increases the maximum enrollment to 3,605,000 acres; provides for 

an annual enrollment goal of 250,000 acres, of which up to 10,000 

acres may be enrolled as floodplain easements; and changes the 

program to operate on fiscal year basis. The section amends eligible 

lands to include riparian areas and floodplains. Flood plain lands 

are eligible if the land has been damaged by flooding at least once 

in the preceding calendar year or has been damaged by flooding at 

least twice in the past 10 years or if the enrollment of other land 

within the floodplain would aid in flood storage, flow, or erosion 

control. (Section 2401(a) and Section 2102 (a-c) of the House bill) 

The Senate amendment authorizes WRP through fiscal year 

2012. The section allows enrollment of 250,000 acres per fiscal year 

with no enrollments beginning in fiscal year 2013. Indian Tribes 

may enroll land through 30-year contracts, which shall be equivalent in value to a 30-year easement. The section includes riparian 

areas and riparian and adjacent areas that are linked to other parcels of wetlands protected under a wetlands reserve agreement or 

similar device. (Section 2321(1–3) of the Senate amendment) 

The Conference substitute adopts the House language with an 

amendment. The substitute extends WRP to 2012, adds purposes 

to the establishment section, caps enrollment at 3,041,200, and focuses the program on private land. The substitute changes the program to a fiscal year basis. Enrollment conditions are modified to 

allow 30-year Tribal contracts. The substitute stipulates that values of such contracts shall be equivalent to 30-year easements. 

The substitute does not include the expansion of riparian 

areas. The Managers recognize that riparian areas often provide 

extremely important habitat for wildlife, and that restored and protected riparian areas also help improve water quality, reduce sedimentation, and help manage floodwaters. Riparian areas are already eligible lands under WRP and may be enrolled either as uplands that are functionally dependent on a wetland or where they 

link wetlands that are otherwise protected by easements or a similar mechanism. (Section 2201 of Conference substitute) 


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(b) Easements and agreements (Section 1237A of FSA) 

The House bill states that compensation for easements shall be 

based on compensation formulas resulting in the lowest cost: percentage of fair market value according to the USPAP or a percentage of the market value determined by an area-wide survey; a geographic cap; or the landowners offer. Non-federal funds may be accepted to administer this program. (Section 2102(e) of the House 

bill) 

The Senate amendment adds a requirement that spraying or 

mowing is allowed if necessary to meet habitat needs of specific 

wildlife species. The amendment requires that the Secretary pay 

the lowest compensation for an easement among several alternative valuation methods. The compensation for easements may be 

provided to landowners in up to 30 payments of equal or unequal 

size. The section also adds a Wetlands Reserve Enhancement Program with the authority to enter into unique wetlands reserve 

agreements that may include compatible uses as reserved rights in 

the warranty easement deed restriction. (Section 2322(a-c) of the 

Senate amendment) 

The substitute adopts the House provision with an amendment. It revises the process for determining the value of easements 

and contracts by requiring the Secretary to provide the lowest 

amount of compensation based on a comparison of the fair market 

value of the land (as determined by either an appraisal based on 

the Uniform Standards for Professional Appraisals or an area-wide 

market survey), a geographic cap, or an offer made by the landowner. 

The Managers intend for the Department to develop guidelines 

and provide direction for States regarding the method for determining the value of easements. The Managers do not intend for the 

Department to require States to use a specific appraisal process, 

such as the ‘‘Yellow Book’’ process or an appraisal rather than a 

market wide survey or analysis. The Department should grant 

flexibility to State conservationists who, in consultation with State 

technical committees, should determine the method that best fits 

the needs of their State. 

The substitute provides the Secretary authority to accept nonFederal funds to assist in implementing the program but places 

this new authority in ‘‘Administrative Requirements for Conservation Programs’’ (Section 1244 of the FSA) so it applies to all conservation programs. 

The substitute includes authority for a Wetlands Reserve Enhancement Program (WREP). The WREP authority is intended to 

allow the Secretary to enter into agreements with States similar to 

what is done under CREP. It is not intended as a way to enroll 

State-owned lands in the program. It is the intent of the Managers 

that the Secretary will implement WREP projects in order to provide focused, targeted resource benefits and to leverage federal 

funds. 

The substitute provides authority for a Reserved Rights Pilot. 

The Managers intend for the Secretary to explore different warranty easement deeds consistent with the purposes of the program, 

while allowing a landowner to retain the right to use the land for 

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ring under a reserved right easement be covered by a conservation 

plan developed and approved by the Secretary. 

The substitute provides that easements with values less than 

$500,000 be paid out over 1 to 30 years. Easements with values 

greater than $500,000 are to be paid out over 5 to 30 years. The 

Secretary is granted authority to waive that requirement and make 

lump sum payments if necessary to carry out the purposes of the 

program. For land to be eligible for the WRP, the land must have 

remained under the same ownership for a minimum of 7 years. 

(Section 2208 of Conference substitute) 

(c) Duties of Secretary (Section 1237C of FSA) 

The House bill adds criteria for the Secretary to use when 

evaluating easement offers from landowners for wetlands or 

floodplains. The Secretary may consider the conservation benefits, 

the cost effectiveness, and whether the landowner or someone else 

is offering to contribute to the cost of the easement or other interest in the land to leverage Federal funds. In determining the acceptability of easement offers for flood plains, the Secretary may 

take into consideration the extent to which the purpose of the program would be achieved on the land, whether the land has flooded 

repeatedly in the past 10 years, whether the easement would contribute to restoration of surrounding lands, and other factors. (Section 2102(f) of the House bill) 

The Senate has no comparable provision. 

The Conference substitute adopts the House language for evaluating wetlands. (Section 2207 of Conference substitute) 

(d) Payments (Section 1237D of FSA) 

The House bill is the same as current law with technical 

changes. It also changes the paragraph heading ‘‘State wetland and 

environmental enhancement’’ to ‘‘Wetlands Reserve Enhancement’’. 

(Section 2102(g) of the House bill) 

The Senate amendment makes a conforming change to allow 

payments for 30-year contracts. (Section 2323 of the Senate amendment) 

The Conference substitute adopts the Senate amendment. (Section 2205 of Conference substitute) 

(3) Reports (Section 1237G of FSA) 

The Senate amendment directs the Secretary to evaluate and 

report to Congress on the implications of long-term easements on 

Department of Agriculture resources by January 1, 2010. (Section 

2322(d)) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. The 

Managers are concerned with the long-term implications of managing and monitoring wetland easements. The substitute requires 

the Secretary to provide a report on the number and location of 

conservation easements acquired under the WRP and an assessment of the extent to which the oversight of conservation easement 

agreements impacts the availability of USDA resources, including 

technical assistance. (Section 2210 of Conference substitute) 


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(9) Comprehensive Stewardship Incentives Program 

The Senate amendment creates a new CSIP to coordinate the 

two primary working lands programs: EQIP and the Conservation 

Stewardship Program (CSP). The section defines resources of concern and requires the Secretary to manage EQIP and CSP in a coordinated manner. The Secretary shall ensure that resources of 

concern are identified at the State level and shall identify not more 

than 5 resources of concern within a watershed or region within a 

State. The section directs the Secretary to issue regulations to implement the CSIP, CSP, and EQIP no later than 180 days after the 

date of enactment of the 2007 Farm bill. (Section 2341 of the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute does not include CSIP. The substitute includes a provision in ‘‘Administrative Requirements for 

Conservation Programs’’ (Section 1244 of the FSA) that requires 

the Secretary to ensure that there is a streamlined application 

process for all conservation programs. 

(10) Conservation Security Program 

(a) Conservation Security Program (Section 1238 FSA) 

The House bill states that no new contracts may be entered 

into under the Conservation Security Program after October 1, 

2007. However, payments and modifications to existing contracts 

may be continued to be made until those contracts expire. (Section 

2103(b) of the House bill) 

The Senate amendment reauthorizes the Conservation Security 

Program for existing contracts only. The section provides 

$2,317,000,000 for current contracts to remain available until expended and prohibits new contracts or renewals after enactment of 

the Farm Bill. (Section 2391 of the Senate amendment) 

The Conference substitute adopts the Senate provision and 

provides such sums as necessary to carry out existing contracts. 

(a) Definitions 

The House bill defines conservation plan, conservation practice, management intensity, nondegradation standard, priority resource of concern, resource specific index, and socially disadvantaged farmer or rancher. (Section 2103(a) of the House bill) 

The Senate amendment defines comprehensive conservation 

plan, stewardship contract, contract offer, enhancement payment, 

eligible land, livestock, management intensity, payment, practice, 

producer, program, resource conserving crop, resource conserving 

crop rotation, stewardship contract, and stewardship threshold. 

(Section 2391 of the Senate amendment) 

The Conference substitute renames the program as the Conservation Stewardship Program (CSP) and defines conservation activities, conservation measurement tools, conservation stewardship 

plan, priority resource concern, resource concern, and stewardship 

threshold. (Section 1238D of the Conference substitute) 

The Managers recognize that agricultural drainage systems 

are valuable conservation practices that can be carried out under 

the CSP and, in particular, that the installation of drainage manVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00722 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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agement systems can provide benefits to water quality by reducing 

nitrogen loading from subsurface drainage as well as managing 

wildlife habitat. Thus, these practices are included as conservation 

activities. 

The Conference substitute includes planning needed to address 

a resource concern as a conservation activity. Since CSP is intended to address multiple resource concerns in a coordinated manner, the Managers encourage the Secretary to implement the program in a manner that encourages comprehensive conservation 

planning through technical and financial assistance under this program. The Managers encourage the Secretary to use site-specific 

conservation planning as outlined in the National Planning Procedures Handbook and implement the program in a manner that encourages comprehensive conservation planning on all applicable resources through technical and financial assistance under the program. 

The Managers are aware of the effort made by NRCS to develop resource-specific indices for implementing CSP and other conservation assistance programs and encourage this development. 

Where such indices are not available or practical, the Managers 

urge the Secretary to use substitute tools that measure the degree, 

scope, and range of conservation activities adopted by a producer 

to improve and sustain the condition of a resource. 

The term stewardship threshold refers to the level of conservation and environmental management required to improve and conserve a resource. The Managers intend the Secretary to set the 

threshold at a level that ensures substantial and lasting conservation benefits. 

(b) Conservation Security Program/Conservation Stewardship Program and duties of the producer 

The House bill states that a new Conservation Security Program shall go into effect for fiscal years 2012 through 2017, and 

that the purpose of the Conservation Security Program is to assist 

producers in improving environmental quality by addressing priority resources of concern. To be eligible, a producer must already 

be addressing at least one priority resource of concern to the minimum level of management intensity and have an approved conservation offer. Eligible land includes private agricultural land, forest land, and land owned by Tribes. (Section 2103 of the House bill) 

The Senate amendment identifies the purposes of the program 

as promoting agricultural production and environmental quality as 

compatible goals and to optimize environmental benefits by assisting producers to promote natural resource conservation. To be eligible, a producer must address priority resources of concern relating 

to both soil and water to at least the stewardship threshold, adequately address other resources of concern applicable to the operation, and meet or exceed the stewardship threshold for at least 1 

additional priority resource of concern by the end of the contract. 

The Senate amendment clarifies that eligible land includes 

cropland, pasture land, rangeland, other agricultural land used for 

the production of livestock, land used for agroforestry, land used 

for aquaculture, riparian areas adjacent to eligible land, Tribal 

lands, public land (if failure to enroll would defeat the purposes of 


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the program), and State and school owned land. The Senate 

amendment states that all acres of all agricultural operations within a watershed or region that constitute a cohesive management 

unit shall be covered by the contract. 

The Senate amendment includes provisions on contract offers, 

contract renewal, contract termination, and optimal crop rotations. 

(Section 2391 of the Senate amendment) 

The Conference substitute establishes the program purpose of 

encouraging producers to address resource concerns in a comprehensive manner by installing and adopting new conservation activities, and by improving, maintaining and managing conservation 

activities in place at the operation. The Managers encourage the 

Secretary to place emphasis on improving and adding conservation 

activities. 

The Conference substitute allows nonindustrial private forest 

land to be eligible with the limitation that not more than 10 percent of annual acres made available under the program can be forest land. 

Under the program, land used for cropland that had not been 

planted, considered to be planted, or devoted to crop production for 

4 of the 6 years prior to the date of enactment of this act shall not 

be the basis of any payment under the program, unless the reason 

the land did not meet the requirement is that: it had previously 

been enrolled in CRP; had been maintained in a long term crop rotation; or was incidental land needed for efficient operation, such 

as an area of a farm or ranch that had been used for structures 

that had been subsequently removed. The exceptions only apply if 

they were the direct cause of the producer’s inability to meet the 

4-of-6 year requirement. 

The Managers want to clarify that the ‘‘additional criteria’’ authority provided in Section 1238F(b)(3) may not supersede or be 

more heavily weighted than the five required evaluation criteria in 

section 1238F(b)(1). Instead, the additional criteria may provide 

extra ranking points to help address specific priorities. Contracts 

shall permit all economic uses of the land that maintain the agricultural nature of the land and are consistent with the conservation purposes of the program. The Managers intend for this to 

apply to conservation buffers or any other partial field conservation 

practice that may be included in the contract. 

A producer may renew a CSP contract for an additional 5-year 

period, provided the terms of the existing contract have been 

achieved to the satisfaction of the Secretary and the producer 

agrees to adopt new conservation activities. The Secretary is provided authority to require new conservation activities as part of the 

contract renewal process. It is the intent of the Managers that this 

could include expanding the degree, scope, and comprehensiveness 

of conservation activities adopted by a producer to address the 

original priority resource concerns or addressing one or more additional priority resource concerns. 

The Secretary may allow for contract modification if the Secretary determines that a modification is consistent with achieving 

the purposes of the program. Modifications envisioned by the Managers include instances in which a producer enrolls a portion of the 

farm in a land retirement or easement program, gains or loses a 


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lease, or has a change in production due to market or weather conditions. The Managers also intend for the Secretary to issue guidance for cases in which a producer has a change in production that 

requires a change to scheduled conservation practices and activities. The Managers expect the Secretary to approve the contract 

modification only as long as net conservation benefits will be maintained or improved as a result. 

Supplemental payments are authorized for producers who 

adopt a beneficial crop rotation. The Managers intend for the supplemental payment to encourage producers to adopt new, additional beneficial crop rotations that provide significant conservation 

benefits. The payments are to be available to producers across the 

country and should not be limited to a particular crop, cropping 

system, or region of the country. In the Southeast, peanuts are an 

example of a crop that responds well to increased rotation lengths. 

Increased rotation lengths help peanut producers conserve water, 

more effectively control disease, reduce inputs to control disease 

and increase productivity. 

On-farm conservation research and demonstration activities 

and pilot-testing projects can be approved as part of contract offers 

under the program. The Managers expect the Secretary to establish 

and publicize design protocols and application and contract offer 

procedures for individual producer and collaborative on-farm research and demonstration activities and for pilot testing projects so 

producers have a clear understanding of how to participate in either of these two options. 

The substitute requires the Secretary to provide a transparent 

means by which producer may initiate organic certification under 

the National Organic Program while also participating in CSP. The 

Managers expect the Secretary to coordinate this program and the 

organic certification process to the maximum extent practicable. 

(c) Duties of the Secretary 

Under the House bill, the Secretary shall identify not more 

than 5 priority resources of concern for a watershed or area within 

a State. The House bill states that the payment amount shall be 

based on a portion of the actual costs, income forgone, and resource 

specific indices. The payment limitation on the Conservation Security Program is $150,000 for the 5-year term of the contract. 

Under the Senate amendment, an acreage allocation is specified, and contracts are limited to $240,000 for all contracts entered 

into during any 6-year period. The Senate amendment enrolls 

13,273,000 acres annually at a national average cost of $19 per 

acre. (Section 2391 and 2341 of the Senate amendment) 

The conference substitute provides that the allocation of acres 

to each State shall be based primarily on each State’s proportion 

of eligible acres to the total number of eligible acres in all States. 

The Secretary shall also consider the extent and magnitude of conservation needs associated with agricultural production in each 

State, the degree to which implementation of the program is or will 

be effective in helping producers address those needs and other 

considerations in order to achieve equitable geographic distribution 

of funds. 


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In carrying out the program on a continuing enrollment basis, 

a producer can apply at any time during the year for the program, 

but the application will only be ranked at the time determined by 

the Secretary. The Managers intend for the program to be available 

nationwide to all agricultural producers, not only in specific watersheds or geographic regions within a State. The Managers specifically intend that the program not be restricted to particular watershed enrollments. 

The Conference substitute requires the Secretary to undertake 

outreach activities and provide appropriate technical assistance to 

specialty crop and organic producers and to ensure they can effectively compete in the program. In providing outreach and technical 

assistance, the Managers encourage the Secretary to provide appropriate training to field staff to enable them to work with these producers and to utilize cooperative agreements and contracts with 

nongovernmental organizations with expertise in delivering organic 

educational and technical assistance to these producers. 

Payments under the program are limited to $200,000 for all 

contracts entered into by a producer in any 5-year period. This provision requires direct attribution to real persons. The Managers 

emphasize that direct attribution is a mandatory requirement. The 

Managers do not intend for the Secretary to pay for no-till or other 

common practices that have no cost to the producer. 

The Managers encourage the Secretary to conduct outreach to 

encourage producers who are transitioning land out of the conservation reserve program to protect conservation values by enrolling in CSP. As part of this transition from land retirement to working lands conservation, the Managers urge the Secretary to encourage producers to maintain the land in a grass-based production 

system with appropriate wildlife protections through CSP or to 

adopt advanced resource-conserving cropping systems through CSP 

in tandem with placing conservation buffers and other appropriate 

partial field conservation practices, farmed wetlands, or special 

wildlife habitat practices in the continuous CRP. (Section 2301 of 

Conference substitute) 

(11) Grassland Reserve Program (Section 1238N–1238Q of FSA) 

(a) Establishment and purpose (Section 1238N) 

The House bill establishes an enrollment goal of 1,340,000 

acres by 2012. It revises the enrollment process to be based on 

acreage rather than funding and requires that at least 60 percent 

of program acreage be in long term easements and agreements. It 

adds a priority for enrolling CRP acres, except that no more than 

10 percent of the acreage enrolled in any year may be from CRP; 

and prohibits duplicate payments for such land enrolled in GRP. It 

establishes that the method for determining the fair market value 

of enrolled land will be an appraisal, a market survey, a geographic 

cap, or the landowner offer; whichever results in the lowest amount 

of compensation to be paid. It authorizes the Secretary to enter 

into agreements with States and their subdivisions to advance the 

purposes of the program through a grassland reserve enhancement 

option. (Section 2104 of the House bill) 


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The Senate amendment eliminates short-term rental agreements and the requirement for enrollment of at least 40 contiguous 

acres. It provides for enrollment of land through 30-year contracts 

and easements and permanent easements. The 30-year contract option is included to encourage tribal participation in the program. A 

new authority is added for the Secretary to enter into cooperative 

agreements with eligible entities for the purpose of purchasing, 

holding, monitoring, and enforcing easements. The Senate amendment adds a definition of eligible entity, expands eligible land to 

include land that contains historical or archeological resources or 

would further goals of certain fish and wildlife plans or initiatives, 

and specifies that easements of the maximum duration by State 

law are equivalent to permanent easements. (Section 2381 of the 

Senate amendment) 

The Conference substitute adopts an acreage enrollment goal 

of an additional 1,220,000 acres by 2012. The Conference substitute 

includes 10-, 15-, and 20-year rental contracts and permanent easements. Easements of the maximum duration allowed by State law 

are considered as permanent easements. The Managers expect that 

the 20-year rental contracts will be used to encourage tribal group 

participation in the program. 

The Conference substitute strikes the House priority for 60 

percent of acreage in long term contracts and retains current law 

that 60 percent of the funds would be dedicated to easements, 

while 40 percent of the funds would be dedicated to short term contracts. In addition, the Conference substitute adopts a priority for 

enrollment of CRP land with a modification to clarify that the priority applies upon expiration of the CRP contract. 

The Conference substitute adopts the Senate additions to eligible land with technical corrections. It does not include a Grassland 

Reserve Enhancement provision. It adopts the Senate definition of 

eligible entity and authority for the Secretary to enter cooperative 

agreements with entities to purchase easements. It also adopts the 

House bill provision in regard to the method for determining fair 

market value with a technical correction. 

(b) Requirements relating to easements and contracts (Section 

1238O) 

The Senate amendment modifies terms and conditions of easements and agreements to permit fire presuppression and addition 

of grazing-related activities, such as fencing and livestock watering. 

Criteria for evaluating applications for enrollment are expanded to 

provide additional flexibility to the Secretary, and in the case of 

agreements with eligible entities, to provide a priority to applications that include a cash contribution or leverage other resources 

toward the purchase price of easements. 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate amendment. The 

Managers expect these additions to encourage improved management of enrolled acreage, particularly where breaking of the soil 

surface may be required to manage invasive species or improve 

grazing systems, and to leverage additional resources for the protection of grasslands. 


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The Conference substitute adds implementation of a grazing 

management plan as a new general requirement of landowners enrolling in the program. With the inclusion of a grazing management plan, the Managers emphasize the conservation purpose of 

the program, but further clarify that once established these plans 

are modified only by mutual agreement of the involved parties. 

(c) Payments (Section 1238P) 

The Senate amendment strikes rental agreement payments 

and modifies the rate of compensation for restoration agreements. 

Permanent easements will be paid at a rate of not less than 90 nor 

more than 100 percent of the eligible restoration costs. Thirty-year 

easements and contracts will be at the rate of not less than 50 nor 

more than 75 percent of the eligible restoration costs. The compensation schedule is lengthened to allow for up to 30 annual payments, corresponding to the newly established 30-year contract 

agreement. 

The House bill has no comparable provision. 

The Conference substitute adopts the cost-share rate for restoration agreements of not more than 50 percent of the costs of carrying out restoration activities. 

(d) Delegation to private organizations (1238Q) 

The House bill expands on the authority of the Secretary to 

transfer easement titles to private organizations and to also allow 

entities to own and write easements under this section, subject to 

periodic inspections by the Secretary. 

The Senate amendment provides authority for the Secretary to 

enter into cooperative agreements with eligible entities for those 

entities to purchase, own, enforce, and monitor easements. Terms 

and conditions of cooperative agreements require entities to demonstrate qualifications, specify parcels to be enrolled, allow substitutions as agreed to by the parties, specify entity reporting on fund 

use, allow entities to use their own easement instruments, require 

appraisals using an industry approved method, allow a landowner 

contribution as a share of the purchase price, and specify a payment schedule. The Secretary shall require easements to contain a 

contingent right to protect the public investment. 

The Conference substitute adopts the Senate amendment provision for cooperative agreements between the Secretary and eligible entities with a modification to the language specifying that eligible entities shall assume costs of administering and enforcing 

easements. 

The Conference substitute adopts a requirement for a contingent right of enforcement. In selecting offers from eligible entities 

for funding, the Managers expect the Secretary to consider the sufficiency of the offer regarding effective monitoring and enforcement, 

reversionary interest, or other such factors that will affect the longterm integrity of easement being acquired under the program. The 

Conference establishes that eligible entities shall provide a share 

of the easement purchase price that is equal to the share provided 

by the Secretary. (Section 2403 of Conference substitute) 


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(12) Environmental Quality Incentives Program 

(a) Purposes (Section 1240 of FSA) 

The House bill adds forest management and organic transition 

as purposes of the program. It adds forest land and conserving energy to the list of purposes for installing conservation practices. Energy use, organic transition, and forest management are added to 

the list activities for which the Secretary will assist producers in 

making cost-effective changes. (Section 2105(a) of the House bill) 

The Senate amendment adds forest management as a purpose 

of the program and adds forest land conservation and pollinators 

to the list of purposes for installing conservation practices. Fuels 

management and forest management are added to the list activities 

for which the Secretary will assist producers in making cost-effective changes. (Section 2351 of the Senate amendment) 

The Conference substitute adopts the House bill with amendment. Forest management is added to the program purpose, and 

forest land and energy conservation are added to the resources to 

benefit from the installation of conservation practices. Fuels management and forest management are added to the list activities for 

which the Secretary will assist producers in making cost-effective 

changes. The Managers recognize the significance of the changes 

made to the program to reflect new needs and concerns. The Managers expect the Secretary to continue to help producers address 

conservation needs on their land while promoting agricultural production and environmental quality as compatible goals. 

(b) Definitions (Section 1240A) 

The House bill adds definitions for integrated pest management, socially disadvantaged farmer or rancher, and adds alpaca 

and bison to the definition of livestock. It also adds forest management and silviculture to land management practices for purposes 

of the program. 

The Senate amendment adds a definition of producer that includes custom feeders and contract growers. It modifies eligible 

land to include private nonindustrial forest land and lands used for 

pond-raised aquaculture production. The amendment adds forest 

and fuels management and conservation planning to practices for 

purposes of the program. 

The Conference substitute adopts the Senate amendment with 

an amendment to modify eligible land. The Managers intend for 

the Department to continue to provide assistance to custom feeders 

and contract growers through this program. 

(c) Establishment (Section 1240B) 

The House bill adds organic certification as a practice eligible 

for cost share payments; amends the exception to establish a 90- 

percent cost-share rate for beginning and socially disadvantaged 

farmers or ranchers and provides 90-percent cost-share for use of 

gasifier technology. It allows for the use of an approved third party 

for technical assistance. Energy efficient improvements and renewable energy systems are added to practices eligible for incentive 

payments. Promotion of pollinator habitat is added to the Special 

Rule for determining incentive payment rates. The Secretary is diVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00729 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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rected to reserve for 90 days not less than 5 percent of program financial assistance for each of beginning farmers or ranchers and 

socially disadvantaged farmers or ranchers. It makes market agencies and custom feeding businesses eligible for technical and financial assistance. (Section 2105(c) through (h) of the House bill) 

The Senate amendment adds conservation plans to practices 

eligible for incentive payments, reduces the maximum contract 

term to 5 years, and strikes the provision on bidding down. The 

cost-share rate exception for beginning and socially disadvantaged 

farmers or ranchers is amended to allow variable payment, not to 

exceed 90 percent, and authority to provide advance payments up 

to 30 percent for the purchase of materials or contracting. A guaranteed loan eligibility provision is included for eligible applicants 

that are not accepted into the program. Predator deterrence practices are added to the Special Rule for determining incentive payment rates. The Senate amendment authorizes assistance for water 

conservation and irrigation efficiency practices, air quality improvement practices and establishes a minimum eligibility requirement 

for program participation. (Section 2353 of the Senate amendment) 

The Conference substitute extends the program through 2012 

and maintains the 60 percent livestock funding allocation through 

2012. It deletes the Senate provision on contract terms 

(1240B(b)(2)(B)) and bidding down (1240B(c)). 

The Conference substitute does not include the Senate provision on the Special Rule (1240B(e)(2)). The Managers recognize 

that proactive, non-lethal options to deter predators protected by 

the Endangered Species Act of 1973, as well as delisted populations 

of gray wolves, grizzly bears, and black bears, are consistent with 

the purposes of EQIP. 

The Conference substitute deletes the House provision on costshare for gasifier technology. The Managers recognize the merits of 

new technologies, including gasification, as a means of safely disposing animal carcasses, thereby minimizing environmental impacts and threat of disease. As such, the Managers encourage the 

Secretary to consider EQIP applications involving poultry gasification and offer cost-share assistance of up to 75 percent. 

The Conference substitute adopts the Senate provision for advance payments for beginning, socially disadvantaged and limited 

resource farmers or ranchers and deletes the Senate provision for 

guaranteed loan eligibility. The Conference substitute adopts the 

Senate provision with an amendment for cost-share rates and advance payments for beginning, socially disadvantaged, and limited 

resource farmers or ranchers. 

The Managers expect EQIP to be available to organic producers for conservation activities related to organic transition and 

production. The Managers expect EQIP to be available to producers 

who are transitioning their operations to certified organic production and organic producers who may be transitioning additional 

acres or animal herds. The Managers are aware that organic conversion is a management-intensive activity and therefore encourage 

the Secretary to provide levels of technical and education assistance for organic conversion commensurate to the need. 


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(d) Evaluation of offers (Section 1240C) 

The House bill adds criteria to prioritize applications more 

completely and to evaluate applications in logical groupings relative to similar crop, livestock, or operation types. The Secretary is 

directed to ensure that the evaluation process is streamlined for 

applicants that have an environmental management system in 

place or seek to complete an existing system. (Section 2105(i) of the 

House bill) 

The Senate amendment adds a priority for applications that 

propose to improve existing practices or to complete a conservation 

system. (Section 2354 of the Senate amendment) 

The Conference substitute adopts the House bill with an 

amendment on priority for applications. The Managers intend this 

evaluation process to prioritize State, regional, or local resource 

concerns, as well as allow for the grouping of applications of similar agriculture operations to allow for more equitable consideration. 

(e) Duties of producers (Section 1240D) 

The House bill and Senate amendment modify the duties of 

producers to prohibit owners of enrolled forest land from conducting practices that may defeat the program purposes. (Section 

2105(j) of the House bill and Section 2355 of the Senate amendment) 

The Conference substitute adopts the House bill provision. 

(f) Environmental Quality Incentives Program plan (Section 

1240E) 

The House bill adds a forest provision to allow a forest management plan, forest stewardship plan, or similar plan to serve as 

a plan of operations. The House bill authorizes the Secretary to 

consider a permit required under a regulatory program to serve as 

a plan of operations in order to avoid duplication in planning. (Section 2105(k) of the House bill) 

The Senate amendment allows a producer organization to act 

on behalf of its membership in submitting applications or conducting similar activities to facilitate program participation. The 

Senate amendment includes a provision for forest plans similar to 

the House bill. (Section 2356 of the Senate amendment) 

The Senate amendment establishes a Chesapeake Bay Watershed Conservation Program under EQIP to assist producers in applying conservation practices on agricultural and nonindustrial private forestland in the Bay watershed to address natural resource 

concerns related to agriculture. (Section 2361 of the Senate amendment) 

The Conference substitute adopts the House provision regarding forest land. 

The Conference substitute strikes the Senate amendment provision on producer organizations. The Managers intend for the Secretary to allow producer associations and farmer cooperatives to act 

on behalf of their members in submitting applications, plans, or 

other program materials for their members to participate in this 

program. The Managers expect the Secretary to clarify this option 

in any rule or procedure related to this program. 


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The Conference substitute adopts a modification to the House 

bill provision to consider a permit required under a regulatory program to serve as a plan of operations. The Managers intend this 

addition to reduce duplication in planning but expect that the plan 

developed for a regulatory permit should contain the elements 

equivalent to those required in a Plan of Operations, including 

practices to be implemented, objectives of the plan, and any relevant terms and conditions to carry out the plan. 

(g) Duties of the Secretary (Section 1240F) 

The House bill requires the Secretary to provide assistance for 

a practice intended to conserve water if it will result in a reduction 

in consumptive water use, saved water remains in the source, and 

the practice will not result in increased consumptive use on the 

producer’s operation. (Section 2105(l) of the House bill) 

The Senate amendment has no comparable provision. 

The Conference substitute retains current law. The Managers 

address the intent of the House bill under modifications made in 

Section 1240B to provide assistance for water conservation or irrigation efficiency improvements. 

(h) Limitation on payments (Section 1240G) 

The House bill moves the limitation on payments to Section 

2409. (Section 2409(b) of the House bill) 

The Senate amendment includes a provision to require direct 

attribution of payments. (Section 2357 of the Senate amendment) 

The Conference substitute provides for a payment limit of $300,000 over 6 years. The Secretary is provided with the authority 

to waive that limit to $450,000 in cases of special environmental 

significance. Projects of special environmental significance include 

methane digesters, other innovative technologies, and projects that 

will result in significant environmental improvement. The Secretary is expected to utilize this waiver to achieve the purposes of 

the program. (Section 2508 of Conference substitute) 

(12) Conservation Innovation Grants (Section 1240H of FSA) 

The House bill adds forest resource management as an eligible 

grant activity and adds eligible projects to include those that ensure the efficient and effective transfer of technologies. The House 

bill provides mandatory funding for a comprehensive conservation 

planning project in the Chesapeake Bay Watershed, incentive and 

cost-share payments for air quality concerns, and increased benefits for specialty crop producers. 

The Senate amendment clarifies the purpose of the grants are 

to develop and transfer innovative conservation technology. The 

amendment seeks to increase participation by specialty crop producers. 

The Conference substitute adopts the House provisions related 

to forest resource management and air quality. 

The Conference substitute provides $150,000,000 to help producers address air quality concerns. The Managers expect funds 

will be used to provide financial assistance to producers for air 

quality improvements that help them comply with Federal, State, 

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ations. The funds should be used for cost-effective methods in addressing air quality and to reduce emissions and pollutants from 

operations, including making improvements in mobile or stationary 

equipment such as engines. 

The Managers believe conservation programs as implemented 

by USDA should recognize the use of innovative technology such as 

enhanced efficiency fertilizers. Enhanced efficiency fertilizers, 

which can protect water quality and reduce greenhouse emissions, 

include slow and controlled-release fertilizers (absorbed, coated, occluded or reacted) and stabilized nitrogen fertilizers (urease and nitrification inhibitors and nitrogen stabilizers) and are recognized by 

State regulators of fertilizers. (Section 2509 of Conference substitute) 

(13) Ground and surface water conservation (Section 1240I of FSA) 

The House bill modifies the purpose of the existing Ground and 

Surface Water Conservation Program (GSWCP) to allow cooperative agreements between the Secretary, producers, government entities, and Tribes to achieve regional water quality or quantity 

goals in water quality priority areas. (Section 2106(a) of the House 

bill) 

The House bill requires the Secretary to invite prospective 

partners to submit competitive grant proposals for a Regional 

Water Enhancement Program. Proposals will be competitively 

awarded based on the inclusion of the most lands and producers; 

the most activities versus costs; contribution to sustaining or enhancing agricultural production or rural economic development; development of performance measures to measure long term effectiveness; the capture of surface water runoff; the participation of multiple interested persons in improving issues of concern; and the assistance provided to producers to meet regulatory requirements 

that reduce the economic scope of their operation. The House bill provides $60,000,000 to be available for each of 

fiscal years 2008 through 2012. 

The Senate amendment maintains the existing GSWCP and 

provides an increase in funding from $60,000,000 to $65,000,000 

per year. The provision provides funding for each State that received funding under the program in previous years in an amount 

that is the simple average of funds provided for fiscal years 2002–

2007 or the amount provided in 2007, whichever is greater. For 

States over the Ogallala Aquifer, not less than the greater of 

$3,000,000 or the average of funds provided for fiscal years 2002–

2007 is provided. 

The Conference substitute adopts the House provision with an 

amendment. The substitute creates the Agricultural Water Enhancement Program (AWEP) and provides an additional 

$40,000,000 in mandatory funding for the program. 

The purpose of AWEP is to address water quality and water 

quantity concerns on agricultural land. The Managers expect the 

Department to balance its resources among the needs of producers 

in performing water quantity and quality activities. The Managers 

intend for producers to participate in the program directly or with 

other producers who have come together with a partner. The Managers intend for the Department to manage the program so that a 


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producer who chooses to participate as an individual has the same 

opportunities as one who chooses to participate with a partner. 

The purpose of authorizing partners in AWEP is to leverage 

federal funds and to encourage producers to collectively address 

specific water quality or quantity concerns. The Managers intend 

for the program to be delivered according to applicable program 

rules. Any federal funding must be delivered to producers; no federal funding may be used to cover the administrative expenses of 

partners. 

The Managers expect the Department to require partners to 

clearly state their objectives and describe how they intend to leverage federal funds and the water quantity or water quality issues 

they intend to address. The Managers encourage the Department 

to require the measurement and quantification of actual resource 

outcomes as part of AWEP projects. 

The Managers recognize that water quantity conservation is a 

significant nation-wide concern. The Ogallala Aquifer is a critical 

source of groundwater for agricultural and municipal uses. Due to 

the scope and significance of the aquifer, there is a need for regional efforts to address groundwater management in the region. 

The Managers urge the Department to work with States and agricultural producers in the Ogallala region to coordinate Federal assistance with State programs and to encourage cooperation among 

States in implementing conservation programs and water reduction 

practices. 

The Managers recognize that water use efficiency projects are 

an important means to encourage water conservation and expect 

the Department to continue to support such activities. The Managers intend that additional significance should be placed on water 

conservation practices that convert irrigated farming to dryland 

farming to encourage substantial water savings. 

To ensure the effectiveness of proposals that convert irrigated 

farming to dryland farming, the Managers have included provisions 

to allow the Department to fund proposals for an extended period 

of five years. In setting the payment rate, the Secretary should 

take into account the change in the land value of converting an irrigated farming operation to a dryland farming operation. 

The Managers intend for the Department to make the construction of small, on-farm reservoirs or irrigation ponds eligible for 

assistance through AWEP in drought- stricken areas. The Managers intend the Department to use the Drought Monitor as a 

guide to determine the areas eligible. Any area that has received 

a D4 drought designation for a month-long period during the previous two years should be eligible. The Managers intend the ponds 

to be no more than 40 acres in size. 

The Managers believe these ponds and related activities will 

benefit wildlife and demonstrate the potential to capture on-farm 

surface water runoff in an environmentally beneficial manner. The 

Managers do not intend for any State water regulation or law to 

be waived. 

In utilizing the authority to waive the eligibility provisions in 

Section 1001D, the Managers expect the Secretary to take into account the need to accomplish the purposes of the program by enVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00734 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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rolling land that would be ineligible to participate in other conservation programs. 

The Managers intend for the Secretary to give priority to producers in six priority areas: The Eastern Snake Plain Aquifer region, Puget Sound, the Ogallala Aquifer, the Sacramento River watershed, Upper Mississippi River Basin, the Red River of the North 

Basin, and the Everglades. (Section 2510 of Conference substitute) 

(14) Grassroots Source Water Protection Program (Section 1240O of 

FSA) 

The House bill increases the appropriations authorization from 

$5,000,000 each fiscal year to $20,000,000 each fiscal year through 

2012. The provision provides a one-time infusion of $10,000,000 in 

mandatory funding to be available until expended. (Section 2107 of 

the House bill) 

The Senate amendment is similar but does not include the onetime infusion of $10,000,000 in mandatory funding. (Section 2394 

of the Senate amendment) 

The Conference substitute adopts the Senate provision. (Section 2603 of Conference substitute) 

(15) Conservation private grazing land (Section 1240M of FSA) 

The House bill (Section 2108) and the Senate amendment (Section 2392) extend the program through 2012. 

The Conference substitute adopts the Senate provision. (Section 2601 of Conference substitute) 

(16) Great Lakes Basin Program for Soil Erosion and Sediment 

Control (Section 1240P of FSA) 

The House bill extends the program through 2012. (Section 

2109 of the House bill) 

The Senate amendment extends the program through 2012 

and clarifies that the purpose of the program is to assist in implementing the recommendations of the Great Lakes Regional Collaboration Strategy to Restore and Protect the Great Lakes. (Section 2395 of the Senate amendment) 

The Conference substitute adopts the Senate provision with an 

amendment that includes using the recommendations of the Great 

Lakes Regional Collaboration Strategy as a basis for soil erosion 

and sediment control projects. (Section 2604 of Conference substitute) 

(17) Discovery Watershed Demonstration Program (Section 1240Q of 

FSA) 

The Senate amendment establishes that the Secretary shall 

carry out a demonstration program in not less than 30 small watersheds in States of the Upper Mississippi River basin to identify and 

promote the most cost effective and efficient ways of reducing nutrient loss to surface waters from agricultural lands. It allows for 

the Secretary to establish or identify appropriate partnerships to 

select the watersheds and to encourage cooperative efforts among 

the Secretary and State, local, and nongovernmental organizations. 

The amendment provides criteria for the selection of watersheds 


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and prohibits the use of funds for administrative expenses. (Section 

2397 of the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the House provision and does 

not include the program. 

The Managers recognize that the loss of nitrogen and other nutrients from agricultural land impacts water quality in many parts 

of the nation. This is of particular concern in the States of the 

Upper Mississippi River basin. 

The Discovery Watershed Demonstration Program was intended to address this loss of nutrients in these States through 

management projects operating on a watershed scale. The projects 

were to be based on agriculture-related water quality problems and 

include widespread participation from local producers in the selected watershed. 

In Section 2707, the substitute provides for the Cooperative 

Conservation Partnership Initiative (CCPI), which is designed to 

encourage these types of activities. Given the cooperative nature of 

the proposed Discovery Watershed program, the Managers encourage the Secretary to consider locally developed projects for funding 

under CCPI. 

(18) Emergency Landscape Restoration Program (Section 1240R of 

FSA) 

The Senate amendment replaces the Emergency Conservation 

Program (ECP) and the Emergency Watershed Program (EWP) 

with a new Emergency Landscape Restoration Program. The purpose of the Emergency Landscape Restoration Program is to rehabilitate watersheds, nonindustrial private forest lands, and working 

agricultural lands adversely affected by natural catastrophic 

events. 

The amendment authorizes such sums as necessary, provides 

for the temporary administration of ECP and EWP until final regulations are formulated, and repeals ECP and EWP. (Section 2398 

of the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the House provision and does 

not include the program. 

(19) Farm and Ranchland Protection Program (Section 1238I of 

FSA) 

The House bill establishes a certification process for States. It 

allows grants to be made to certified States based on the demonstrated need for farm and ranch land protection. Up to 10 percent of those funds may be used for the costs of purchasing and enforcing easements. The bill states that the Secretary may also 

enter into agreements with eligible entities. The terms and conditions of the agreements must be consistent with the purposes of the 

program, as well as include a requirement consistent with agricultural activities regarding impervious surfaces. It also requires the 

use of a conservation plan for highly erodible cropland. 

The House bill provides for the Federal Government to retain 

a Federal contingent right of enforcement or executory limitation 


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in an easement to ensure its enforcement. This right is not considered an acquisition of property. 

The House bill provides cost-share assistance for purchasing an 

easement, but the assistance may not exceed 50 percent of the appraised fair market value of the easement. The fair market value 

is determined by an appraisal using an industry-approved method. 

(Section 2110 of the House bill) 

The Senate amendment modifies the definition of eligible forest 

land to include land that contributes to the economic viability of an 

operation or serves as a buffer. It also amends the definition to include land that is incidental to other eligible land to ensure efficient administration of the program. The provision requires the 

Secretary to enter into cooperative agreements with eligible entities as long as the terms and conditions of the cooperative agreement include: entity qualifications, specific projects, substitution of 

projects, use of funds, flexibility to use unique terms and conditions 

for easements, impervious surface limitation, appraisal method, 

and charitable contributions. 

The Senate amendment requires the protection of Federal investment through an executory limitation, but specifies that the executory limitation is not a Federal acquisition of real property and 

will not trigger any Federal appraisal or other real property requirements. 

The amendment limits the amount the Secretary can share in 

the costs of purchasing the easement to 50 percent of the appraised 

fair market value and establishes minimum amounts entities pay 

based on the amount of landowner contributions. The Senate 

amendment requires appraisals based on Uniform standards of 

Professional Appraisal Practice or any other industry-approved 

standard. (Section 2371 of the Senate amendment) 

The Conference substitute adopts the House provision with 

amendment. 

The Managers expect the changes to the Farmland Protection 

Program (FPP) will provide flexibility and certainty to program 

participants. The substitute makes changes to the administrative 

requirements, appraisal methodology, and terms and conditions of 

cooperative agreements which shall make the overall program more 

user-friendly. 

The substitute clarifies the purpose of the program as protecting land for agricultural use by limiting nonagricultural uses of 

the land. The substitute adopts the Senate provision to modify the 

definition of eligible land to include forestland and other land that 

contributes to the economic viability of an operation. 

The substitute establishes a certification process similar to the 

House bill for all eligible entities. To become certified, entities must 

have the authority and resources to enforce easements, polices in 

place that are consistent with the purposes of the program, and 

clear procedures to protect the integrity of the program. 

The substitute adopts terms and conditions for cooperative 

agreements similar to the Senate amendment. The cooperative 

agreement sets forth the working relationship between the Department and the entity in carrying out the program. The terms and 

conditions will stipulate the length of the agreement; allow for the 

substitution of qualified projects; and maintain, at a minimum, 


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that the agreement is consistent with the purpose of the program, 

provide for adequate enforcement of the easement, and include a 

limit on impervious surfaces. Once an entity is certified, it may 

enter into an agreement for a minimum of five years with the Department. Non-certified entities may enter into agreements of not 

less than 3, but not more than 5 years. In selecting offers from eligible entities for funding, the Managers expect the Secretary to 

consider the sufficiency of the offer regarding effective monitoring 

and enforcement, reversionary interest, or other such factors that 

will affect the long-term integrity of easement being acquired under 

the program. 

The Managers intend any violation of the terms and conditions 

will result in a penalty to the eligible entity and the agreement will 

remain in place. It is the expectation that the violation and penalty 

terms will be outlined in all cooperative agreements between the 

eligible entity and the Secretary. 

The substitute provides for the Federal Government to retain 

a Federal contingent right of enforcement in an easement to ensure 

its enforcement. The Managers do not intend this right to be considered to be an acquisition of real property, but in the event an 

easement cannot be enforced by the eligible entity the Federal Government shall ensure the easement remains in force. (Section 2401 

of Conference substitute) 

(20) Farm Viability Program (Section 1238J of FSA) 

The House bill reauthorizes the program through 2012. (Section 2111 of the House bill) 

The Senate amendment reauthorizes the program through 

2012. (Section 2396 of the Senate amendment) 

The Conference substitute adopts the House provision. (Section 

2402 of Conference substitute) 

(21) Wildlife Habitat Incentive Program (Section 1240N of FSA) 

The House bill reauthorizes the program through 2012. The 

bill raises the cost-share limitation for long-term projects from 15 

percent to 25 percent. It also increases the cost-share rate for longterm agreements and activities that assist producers in meeting a 

regulatory requirement that impacts the economic scope of their 

operation from 15 to 25 percent. (Section 2111 of the House bill) 

The Senate amendment authorizes Secretary to make incentive 

payments and increases the percentage of funds that can be used 

for projects longer than 15 years from 15 percent to 25 percent. The 

Senate amendment requires the Secretary to give priority to 

projects that would further the goals and objectives of State, regional, and national fish and wildlife conservation plans and initiatives. (Section 2393 of the Senate amendment) 

The Conference substitute adopts the House provision with an 

amendment. The substitute increases the limitation on cost-share 

payments for long-term projects to 25 percent and focuses the program on agricultural and nonindustrial private forest lands. 

The substitute allows the Secretary to provide priority to 

projects that address issues raised by State, regional, and national 

conservation initiatives. These ‘State, regional and national conservation initiatives’ may include such things as the North AmerVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00738 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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ican Waterfowl Management Plan, the National Fish Habitat Action Plan, the Greater Sage-Grouse Conservation Strategy, the 

State Comprehensive Wildlife Conservation Strategies (also referred to as the State Wildlife Action Plans), the Northern Bobwhite Conservation Initiative, and State forest resource strategies. 

The Managers intend for the Secretary to consider the goals and 

objectives identified in relevant fish and wildlife conservation initiatives when establishing State and national program priorities, 

scoring criteria, focus areas, or other special initiatives. The Managers expect the Department to work with conservation partners 

and State and Federal agencies, to the extent practicable, to complement the goals and objectives of these additional plans through 

USDA programs. (Section 2602 of Conference substitute) 

(22) Agricultural Management Assistance Program (Section 

524(b)(1) of Federal Crop Insurance Act) 

The House bill adds Virginia and Hawaii as eligible States. It 

requires that 50 percent of available funds shall be used for construction or improvement of watershed management or irrigation 

structures, planting trees for windbreaks or improving water quality, and mitigating risk through diversification or various conservation practices; 40 percent may be used for any activity relating to 

risk management activities, including entering agriculture trade 

options, futures, or hedging; and 10 percent shall be used for organic certification cost-share assistance. (Section 2201 of the House 

bill) 

The Senate adds Idaho as a participating State, extends the program through 2012, and provides an additional $10,000,000 per 

year to the program (Section 524(b)(4)(B)(ii)) through 2012. (Section 

2601 of the Senate amendment) 

The Conference substitute adopts the House provision with an 

amendment and includes Hawaii as an eligible State. The Conference substitute provides an additional $25,000,000 in mandatory 

funding for fiscal years 2008 through 2012. (Section 2801 of Conference substitute) 

(23) Resource Conservation and Development Program (Section 

1528 of Agriculture and Food Act of 1981) 

The House bill clarifies that an area plan must be developed 

through a locally led process, and that the planning process must 

be conducted by a local council. It also provides that the Secretary 

shall designate a coordinator to provide technical assistance to 

councils. (Section 2202 of the House bill) 

The Senate amendment is comparable to the House. (Section 

2605 of the Senate amendment) 

The Conference substitute adopts the Senate provision. (Section 2805 of Conference substitute) 

(24) Small watershed rehabilitation (Section 14 of the Watershed 

Protection and Flood Prevention Act) 

The House bill provides $50,000,000 in mandatory funding for 

fiscal years 2009 through 2012. It authorizes appropriations for fiscal years 2007 through 2012 at the current funding level of 

$85,000,000 per year. (Section 2203 of the House bill) 


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The Senate amendment extends program to 2012 and authorizes appropriations for fiscal years 2008 through 2012 as such sums 

as necessary. (Section 2604 of the Senate amendment) 

The Conference substitute adopts the House provision and pro- vides $100,000,000 in mandatory funding for fiscal year 2009 to remain available until expended. (Section 2803 of Conference substitute) 

(25) Chesapeake Bay Program for Nutrient Reduction and Sediment 

Control (Section 1240Q of FSA) 

The House bill creates a new program at the Department to 

provide financial assistance to producers to minimize excess nutrients and sediments in order to restore, preserve, and protect the 

Chesapeake Bay. The program directs the Secretary to develop and 

implement a comprehensive plan to provide for innovative approaches to advance the improvement of water quality and enhance 

wildlife habitat. Critical projects include those in the Susquehanna, 

Shenandoah, Potomac and Patuxent River basins. The House bill 

includes a Sense of Congress that the Department is authorized 

and should be a member of the Chesapeake Bay Executive Council. 

The Senate bill has no comparable provision. 

The Conference substitute adopts the House provision with 

amendment. 

The Chesapeake Bay is the nation’s largest estuary. In 2000, 

Chesapeake Bay partners agreed to target water quality and habitat restoration as goals to improve the health of the Bay and its 

living resources. According to current estimates, the Bay will not 

meet the 2012 agreement without a better coordinated plan and 

greater targeting of resources. 

Farmers in the Chesapeake Bay region are under some of the 

most stringent environmental regulations in the country. Despite 

the desire and demand that exists among farmers in the region to 

participate in conservation programs, current funding levels and 

program allocations leave many behind. While the reliance upon 

conservation programs and the need for funding may not be unique 

to the Chesapeake, it is nonetheless uniquely critical to the success 

of the Bay restoration strategy and the ability of farmers to meet 

regulatory requirements. 

The Managers intend the Chesapeake Bay Watershed Program 

be carried out on agriculture and forestlands in the Chesapeake 

Bay through the use of all conservation programs available to producers in the region. It is the expectation this program will be carried out through existing program mechanisms in coordination with 

other relevant Federal agencies working in the Bay watershed, 

such as the Chesapeake Bay Program Office. 

The special consideration given to the rivers under this section 

are areas of critical need to the overall health of the Chesapeake 

Bay. The Managers intend that the Secretary focus initial program 

resources in these key basins and build upon successful implementation elsewhere in the Chesapeake Bay Watershed, as appropriate. These funds should be used to install practices to help control erosion and nutrient loading before it reaches the Bay, and 

that assessments will be made using existing models and information to evaluate the most cost-effective strategies for reducing 


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nonpoint source nutrient inputs. This program provides 

$438,000,000 in mandatory funding for fiscal year 2009 through fiscal year 2012. (Section 2605 of Conference substitute) 

(26) Voluntary Public Access and Habitat Incentive Program (Section 1240R [House] or 1240S [Senate] of FSA) 

The House bill establishes a voluntary public access program 

under which States and Tribes may apply for grants to encourage 

owners and operators of privately held farm, ranch, and forest land 

to make that land available for wildlife-dependent recreation. The 

Secretary shall give priority to States and tribal governments that 

have consistent opening dates for migratory bird hunting for both 

residents and non residents. The House bill authorizes $20,000,000 

in discretionary funding for each of fiscal years 2008 through 2012. 

The program does not preempt a State or tribal government law, 

including liability law. (Section 2303 of the House bill) 

The Senate amendment is comparable to the House bill. It includes a priority to States where the location of participating lands 

would be available to the public and provides $20,000,000 per year 

in mandatory funding for each of fiscal years 2008 through 2012. 

(Section 2399 of the Senate amendment) 

The Conference substitute adopts the Senate provision with an 

amendment. The Conference substitute provides $50,000,000 in 

mandatory funds for this program. The Conference substitute includes a 25 percent reduction for the total grant amount if the 

opening dates for migratory bird hunting in the State are not consistent for residents and non-residents. (Section 2606 of Conference 

substitute) 

(27) Muck soils conservation (Section 2303) 

The House bill establishes a new program under which owners 

or operators of eligible land shall receive payments to conserve soil, 

water, and wildlife resources. Eligible land must be comprised of 

muck soil, be in agricultural production, have a spring cover crop, 

a winter crop, and year-round ditch banks seeded with grass. Payments are authorized for between $300 and $500 per acre per year. 

Appropriations are authorized at $50,000,000 for each of fiscal 

years 2008 through 2012. (Section 2303 of the House bill) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the Senate provision and the 

provision is deleted. The Managers recognize the unique soils 

throughout the Hudson Valley of New York that are classified as 

muck soils. These soils are former wetlands that have been drained 

with ditches years ago to allow for crop production. Due to the extensive networking of drainage ditches, normal buffer setback requirements associated with current conservation programs take a 

large percentage of these highly productive lands out of production. 

The Managers encourage the Secretary to work through the State 

Conservationist to address the needs of muck soil farmers in the 

Hudson Valley, using existing conservation programs to conserve 

soil, water, and wildlife resources on these lands. 


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(28) Funding for programs under the Food Security Act of 2985 

(Section 1241 of FSA) 

The House bill provides $1,454,000,000 for fiscal years 2007 

through 2012 and $1,927,000,000 for fiscal years 2007 through 

2017 for Conservation Security Program contracts entered into before Oct. 1, 2007. Conservation Security Program contracts entered 

into on or after Oct. 1, 2011, shall be funded in the amount of 

$5,01,000,000 for fiscal year 2012 and $4,646,000,000 for the period 

of fiscal years 2013 through 2017. 

The Farm and Ranchland Protection Program is funded at 

$125,000,000 in fiscal year 2008; $150,000,000 in fiscal year 2009; 

$200,000,000 in fiscal year 2010; $240,000,000 in fiscal year 2011; 

and $280,000,000 in fiscal year 2012. 

EQIP is funded at $1,250,000,000 in fiscal year 2008; 

$1,600,000,000 in fiscal year 2009; $1,700,000,000 in fiscal year 

2010; $1,800,000,000 billion in fiscal year 2011; and $2,000,000,000 

in fiscal year 2012. 

WHIP is authorized at $85,000,000 each of fiscal years 2008 

through 2012. (Section 2401 of the House bill) 

The Senate amendment funds programs in title XII of the FSA 

for each of F 2008–2012 as follows: 

Conservation Security Program—$2,317,000,000 for current contracts to remain available until expended; 

Conservation Stewardship Program—13,273,000 acres for 

each of fiscal years 2008–2012; 

FPP—$97,000,000 for each of fiscal years 2008–2012; 

EQIP—for fiscal years 2008 and 2009: $1,270,000,000; for 

fiscal years 2010–2012: $1,300,000,000; 

WHIP—Same as House; 

Voluntary Public Access and Habitat Incentives Program—

$20,000,000 for each of fiscal years 2008–2012; and 

GRP—$240,000,000 for fiscal years 2008–2012. (Section 

2401 of the Senate amendment) 

The Conference substitute provides the following in additional 

new budget authority for these programs: 

CSP—$1,100,000,000 

EQIP—$3,393,000,000 

FPP—$773,000,000 (Section 2701of Conference substitute) 

(29) Conservation access (Section 1241 of FSA) 

The Senate amendment creates a new Conservation Access 

program. The provision requires 10 percent of conservation program funds and 10 percent of CRP and WRP acreage enrolled in 

any year be used to assist beginning and socially disadvantaged 

farmers and ranchers with annual gross sales of $15,000 or more. 

Any unused funds are to be re-pooled back to the original program 

and made available to all persons eligible for assistance. 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment. The Conference substitute provides that 5 percent of 

CSP acres and 5 percent of EQIP funds will be used to assist beginning farmers or ranchers, and an additional 5 percent of each to 

assist socially disadvantaged farmers or ranchers. 


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The Managers recognize the importance of providing intensive 

technical assistance to beginning and socially disadvantaged farmers or ranchers participating in farm bill conservation programs. 

The Managers encourage the Department to provide rates of technical assistance to beginning and socially disadvantaged farmers or 

ranchers commensurate with the special needs to ensure high participation levels and substantial and lasting conservation benefits. 

In implementing the conservation access provisions, the Managers encourage the Secretary to develop, implement, and support 

cooperative agreements with entities, including community-based 

and nongovernmental organizations and educational institutions 

that have expertise in comprehensive conservation planning and 

assistance needs of beginning and socially disadvantaged farmers 

or ranchers. 

The Managers recognize that off-farm employment is a necessity for most beginning farmers or ranchers, and that transition to 

a full-time agricultural occupation is a substantial challenge. The 

Managers also recognize the value that sound conservation can 

contribute to an enduring agricultural operation and a successful 

farming or ranching livelihood. The Managers intend for the Secretary to give priority to Conservation Access resources to beginning farmers or ranchers who are, or who are working toward, increasing their participation in the farming or ranching operation. 

(Section 2704 of Conference substitute) 

(30) Improved provision of technical assistance under conservation 

programs (Section 1242 of FSA) 

The House bill adds authority for contracting with third party 

providers to provide technical assistance to program participants, 

requires that the payment level for third party providers be established based on prevailing market rates where available, and directs the Secretary to consult with producers, extension and others 

in a review and revision of conservation practice standards to ensure that they are complete and relevant. (Section 2402 of the 

House bill) 

The Senate amendment adds the purpose of technical assistance, provides authority for contracting with third party providers 

for technical assistance, and defines entities eligible to receive technical assistance under this title. The Secretary is directed to provide technical assistance to all conservation and Agriculture Management Assistance program participants. Where financial assistance is not required, the Secretary may enter technical services 

contracts with program participants. (Section 2404 of the Senate 

amendment) 

The Conference substitute adopts the Senate amendment with 

modifications. The Conference substitute reflects the Managers’ two 

priorities for improving the delivery of technical assistance: 1) increasing the availability of technical assistance, and 2) ensuring 

that conservation technical standards and resources are locally relevant. 

The demand for technical assistance exceeds the present supply of technical resources, and the private sector cadre envisioned 

in the 2002 Farm Bill has not developed. The modifications made 

in the substitute are intended to correct these deficiencies through 


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authority for use of mandatory funds and multi-year contracts with 

third party providers, establishment of fair and reasonable payment rates, and a nationally consistent certification process. The 

requirement for approval of State-level certification criteria is intended to address the criticism that current requirements, particularly those added at the State level, result in a complicated and 

overly burdensome process that discourages participation. 

The Managers expect that these changes will provide the certainty needed to encourage the development of a successful, skilled, 

and accountable third party provider sector, diminish the tension 

caused by tradeoffs between public and private sector resources, 

and make locally relevant conservation technical assistance from 

public and private sources increasingly available and accessible to 

producers. (Section 2706 of Conference substitute) 

(31) Cooperative Conservation Partnership Initiative (Section 1243 

of FSA) 

The House bill requires the Secretary to enter into 2- to 5-year 

agreements with eligible entities to preferentially enroll producers 

in specified conservation programs. This will allow multiple producers and others to cooperate on improving specific resources of 

concern related to farming on a local, State or regional scale. Eligible partners are States, State agencies, State subdivisions including counties and conservation districts, Tribes, and nongovernmental organizations and associations with histories of working 

with farmers on agriculture conservation issues. 

The Conservation Security Program, EQIP, and WHIP are the 

programs covered by the provision. Not less than 75 percent shall 

be used for State projects and not more than 25 percent for multiState projects. It prohibits use of funds to pay for partner overhead 

or administrative costs. (Section 2403 of the House bill) 

The Senate amendment includes ‘‘Special Rules Applicable to 

Regional Water Enhancement Projects’’ that adds a section to the 

Partnerships and Cooperation section for Regional Water Enhancement Projects. This section requires the Secretary to identify priority areas and names the following as priority areas: Chesapeake 

Bay, Upper Mississippi River basin, Everglades, Klamath River 

basin, Sacramento/San Joaquin River watershed, Mobile River 

basin, Puget Sound, Ogallala Aquifer, Illinois River watershed (of 

Arkansas and Oklahoma), Champlain Basin, Platte River watershed (note: drafting error, this should be the Platte River Basin), 

Republican River Watershed, Chattahoochee River watershed, and 

the Rio Grande watershed. 

The Senate amendment requires proposals to describe geographical location, identification of issues, baseline assessment, activities to be undertaken, and performance measures. It requires 

competitive awards of multi-year contracts for proposals that have 

the highest likelihood of success, involve multiple stakeholders, 

highest percentage of working agricultural lands, highest percentage of on-the-ground activities, the greatest contribution to sustaining agriculture, and suitable performance measures. (Section 

2405 of the Senate amendment) 


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The Conference substitute adopts the House provision with an 

amendment and names the initiative the Cooperative Conservation 

Partnership Initiative (CCPI). 

The Managers intend that resources made available under 

CCPI be delivered in accordance with the basic program rules and 

mechanisms relating to basic program functions, such as appeals, 

payment limitations, and conservation compliance. The Conference 

substitute allows the Secretary to make certain programmatic adjustments better fit the local circumstances and goals and objectives of the special project identified for funding under the initiative. Proposed adjustments may be part of the application from the 

conservation partnership and forwarded to the State Conservationist or the Secretary for consideration. The Conference substitute provides for adjustments to provide producers preferential 

enrollment in the applicable program as part of the special project. 

The Mangers include the following as an example of a CCPI 

partnership: A cannery has closed and nearby orchards are going 

out of business. A local watershed council pulls together several 

partners such as a State university, a wildlife organization, and an 

organic growers’ cooperative. They agree to work together to improve water quality and wildlife habitat while working with interested local producers to transition their orchards to organic grassbased cattle operations. 

The watershed council files an application with the Department proposing to conduct local producer outreach; provide training 

on transitioning to a new agricultural sector, including organic certification and cattle management workshops; assist with tree removal; and assist in implementing habitat diversity practices with 

workshops, labor, and seed. The council asks for designation of 

$10,000,000 in EQIP and $250,000 in WHIP. 

The State Conservationist agrees with the proposal and sets 

aside the approved resources, which will go to producers participating in the project. When the producer applies for the programs, 

they certify that they are a project participant. If they are qualified, they bypass the regular program ranking processes and enter 

into a contract in the identified program(s). Each program in this 

example stands on its own and all program rules apply. The difference is the streamlined application and the process that works 

to make the programs seamless in application. 

The Conference substitute applies to all of the Department’s 

conservation programs except CRP, WRP, FPP and GRP. The Managers intend that applications may propose projects for consideration by the State Conservationist or the Secretary that include innovative combinations of covered initiative programs, if such combinations aid significantly in meeting the goals and objectives of 

the project. It is also the intent of the Managers that applicants 

may propose projects for consideration by the State conservationist 

or the Secretary that might work in tandem with the enhancement 

programs under CRP or WRP. (Section 2707 of Conference substitute) 

(32) Regional equity and flexibility (Section 1241 of FSA) 

The House bill raises the base amount of conservation funds 

that a State must receive in order to receive priority funding for 


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conservation programs from $12,000,000 to $15,000,000. (Section 

2404 of House bill) 

The Senate amendment also increases the funding from $12,000,000 to $15,000,000 and adds CSP and the Agricultural 

Management Assistance Program to the programs considered in determining funding. It instructs the Secretary to conduct a review 

of conservation program allocation formulas to determine the sufficiency of the formulas in accounting for State-level economic factors, level of agricultural infrastructure, or related factors that affect conservation program costs. (Section 2402 of the Senate 

amendment) 

The Conference substitute adopts the Senate provision with an 

amendment. (Section 2703 of Conference substitute) 

(33) Administrative requirements for conservation programs (Section 1244 of FSA) 

The House bill authorizes that for socially disadvantaged farmers to be added as a group, the Secretary must provide incentives 

to encourage participation in conservation programs. The Secretary 

must establish a single, simplified application process for initial requests of assistance under the conservation programs administered 

by NRCS. Applicants should not be required to provide information 

that is already available to the Secretary, and the process itself 

must minimize complexity and redundancy. (Section 2405 of the 

House bill) 

The Senate amendment requires the Secretary to develop a 

streamlined application process for conservation programs and provide written notification of completion to Congress not later than 

1 year after enactment. It requires the Secretary, at the request of 

the landowner, to cooperate with the Secretary of the Interior and 

Secretary of Commerce to make Safe Harbor assurances available 

to the landowner under the Endangered Species Act. The provision 

allows producers to apply for conservation programs through a producer organization and that any applicable payment limits shall 

apply to individuals and not the organization. 

The Senate amendment requires the Secretary to immediately 

implement policies and procedures to ensure proper payment to 

producers participating in conservation programs and correct other 

management deficiencies identified in the OIG report 50099–11–

SF. It requires the Secretary to monitor and measure performance 

of conservation programs; to demonstrate the long-term benefits of 

the programs; and to coordinate program activities with the Soil 

and Water Resources Conservation Act. (Section 2405 of the Senate 

amendment) 

The Conference substitute adopts the House provision with an 

amendment to include a pollinator provision. Despite their value, 

native pollinators such as bees, butterflies, moths, flies, beetles, 

bats, or hummingbirds often are under-appreciated in terms of 

their contributions to the U.S. agricultural sector. Insect-pollinated 

crops directly contributed $20,000,000,000 to the United States 

economy in 2000 alone. The Managers recognize that many native 

pollinator groups, particularly those important to agriculture, are 

facing a serious risk of decline as a result of habitat loss, degradation, and fragmentation, among other factors. 


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The Managers see conservation programs as an important tool 

for creating, restoring, and enhancing pollinator habitat quantity 

and quality. The Managers expect the Secretary to encourage, 

within appropriate conservation programs, measures to benefit pollinators and their habitat, such as using plant species mixes in conservation plantings to provide pollinator food and shelter; establishing field borders, hedgerows, and shelterbelts to provide habitat 

in proximity to crops; establishing corridors that can expand and 

connect important pollinator habitat patches; and encouraging related pollinator-friendly production practices. (Section 2708 of Conference substitute) 

(34) Annual report on participation by specialty crop producers in 

conservation programs (Section 12512 of FSA) 

The House bill requires the Secretary to submit a report to the 

House and Senate Agriculture Committees regarding specialty crop 

producer participation in conservation programs, that tracks participation by crop and livestock type, includes a plan to improve access of specialty crop producers to conservation programs, and describes the results of this plan. (Section 2406 of the House bill) 

The Senate amendment had no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to modify the compliance and performance provisions 

of Section 1244 of FSA to accommodate the intent of the House bill. 

(Section 1244 of FSA) 

(35) Promotion of market based approaches to conservation/conservation programs in environmental service markets (Section 

1245 of FSA) 

The House bill directs the Secretary to research, analyze and 

enter into contracts and agreements to promote the development of 

uniform standards for quantifying environmental benefits, promoting the establishment of credit registries and third party 

verification, and facilitating private sector market based approaches for agriculture and forest conservation activities. An Environmental Services Standards Board is established to develop uniform standards for quantifying environmental services in order to 

help develop credit markets, agriculture and forest conservation activities. (Section 2407 of the House bill) 

The Senate amendment directs the Secretary to establish a 

framework to develop uniform standards, design accounting procedures, and establish a protocol to report environmental services 

benefits. It also directed the Secretary to establish a registry to report and maintain the benefits and verify that a farmer, rancher 

or forest land owner has implemented the conservation or land 

management activity. The Secretary is directed to focus first on 

carbon markets. (Section 2406 of the Senate amendment) 

The Conference substitute adopts the House provision with an 

amendment. The Secretary is directed to establish technical guidelines, including a verification process that considers the role of 

third parties. The Secretary is instructed to consult with Federal 

and State agencies and nongovernmental interests, such as producers, academia, and financial institutions. The Secretary is directed to focus initially on carbon markets, as the Managers recogVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00747 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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nize that this is the most pressing emerging market in which agriculture may be involved. The Secretary is expected to fulfill the intent of this section with resources available to the Department. 

The adoption of this provision recognizes the growing opportunities for agriculture to participate in emerging environmental 

services markets. The Managers observe that the largest barrier to 

participation is the lack of standards and accounting procedures 

that make transparent the benefits that are being produced and 

marketed. The Managers believe that the most appropriate Federal 

lead for developing these common standards is the Secretary and 

expect the Secretary to move expeditiously to accomplish this task. 

(Section 2709 of Conference substitute) 

(36) Establishment of state technical committees (Section 1261 of 

FSA) 

The House bill changes the existing composition of State technical committees to include at least 12 producers representing a variety of crops, livestock, or poultry grown in the State. 

The House bill states that State technical committees shall 

convene subcommittees to provide technical guidance and implementation recommendations. The topics subcommittees must address include: establishing priorities and criteria for State initiatives; private forestland protection issues; water quality and quantity issues; air quality, wildlife habitat, wetland protection, and 

other issues. (Section 2408 of the House bill) 

The Senate amendment requires the Secretary to develop 

standard operating procedures to be used by the State technical 

committee in the development of technical guidelines for the implementation of the conservation provisions of this title. It makes local 

work groups subcommittees of the State technical committee, 

which exempts them from the Federal Advisory Committee Act. 

(Section 2501 of the Senate amendment) 

The Conference substitute adopts the House provision with an 

amendment. The substitute requires the Secretary to develop 

standard operating procedures for the committees, updates the 

names of participating agencies, and deletes the requirement for 

establishing specific issue-area subcommittees. The substitute requires that public notice be given for meetings of the State technical committee and adds local working groups as subcommittees. 

The Managers expect that other relevant Federal agencies will also 

be invited to participate as needed. (Section 2711 of Conference 

substitute) 

(37) Payment limitation (Section 1246(a-c), 1244(i), 1238C(d), and 

1240G of FSA) 

The House bill imposes payment limitation of $60,000 per fiscal year for any single program; $125,000 for payments from more 

than one program. This limitation does not apply to WRP, FPP, or 

GRP. The House bill requires the Secretary to issue regulations ensuring direct attribution. Further, the Secretary shall issue such 

regulations as necessary to ensure that the total amount of payments are attributed to an individual by taking into account the individual’s direct and indirect ownership interests in a legal entity 

that receives payments. Payments to individuals shall be combined 


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with the individual’s pro rata share of payments received by an entity in which the individual has a direct or indirect ownership interest. Likewise, payments made to an entity shall be attributed to 

those individuals with a direct or indirect ownership interest in the 

entity. (Section 2409 of the House bill) 

The Senate amendment requires the Secretary to use direct attribution for all conservation programs. In the case of a producer 

organization, the limitation on payments on applicable programs 

shall apply to each participating producer and not to the entity. 

(Section 2405 and Section 2357 of the Senate amendment) 

The Conference substitute moves the payment limitations into 

each individual program and deletes this Section. 

(38) Inclusion of income from affiliated packing and handling operations as income derived from farming for application of adjusted gross income limitation on eligibility for conservation 

programs (Section 1001D(b)(1) of FSA) 

The House bill allows income from packing and handling operations to be included as income derived from farming for purposes 

of payment eligibility. (Section 2501 of the House bill) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the Senate provision and deletes this section. 

(39) Encouragement of voluntary sustainability practices guidelines 

The House bill provides that the Secretary may encourage the 

development of voluntary sustainable practices guidelines for producers and processors of specialty crops. (Section 2502 of the House 

bill) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the Senate provision and 

does not include the provision. 

(40) Farmland resource information (Section 1544 of Agriculture 

and Food Act of 1981) 

The House bill provides that the Secretary shall design and 

implement educational programs emphasizing the importance of 

farming. One or more farmland information centers shall be designated to provide technical assistance and serve as central depositories for information on farmland issues. The centers shall be 

funded using no more than 0.05 percent of FPP funds per year but 

no less than $400,000 annually and must be matched with non-federal funds or in-kind contributions. (Section 2503 of the House bill) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the Senate provision and 

does not include the provision. 

(41) Pilot program for four-year crop rotation for peanuts 

The House bill directs the Secretary to enter into contracts 

with peanut producers to implement a four-year crop rotation for 

peanuts. Funding for this pilot shall not exceed $10,000,000 of 

mandatory funds for each of fiscal years 2008 through 2012. (Section 2504 of the House bill) 


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The Senate amendment provides that within CSP the Secretary shall provide additional payments to producers who agree to 

adopt resource-conserving crop rotations to achieve optimal crop rotations. (Section 2341 of the Senate amendment) 

The Conference substitute adopts the Senate provision with an 

amendment. 

(42) Agriculture Conservation Experienced Services Program (Section 307(a) of the Department of Agriculture Reorganization Act 

of 1994) 

The Senate amendment authorizes the Secretary to enter into 

agreements with organizations to hire individuals 55 and older to 

provide assistance in administering conservation related programs. 

Funding for the program is authorized from EQIP, the Soil Conservation and Domestic Allotment Act (16 U.S.C. 590a et seq.), and 

the Older Americans Act (42 U.S.C. 3056). The provision stipulates 

that agreements may not displace individuals employed by the Department. It allows the Secretary to provide tools, including agency 

vehicles, necessary to carry out the program. (Section 2602 of the 

Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment that limits individuals employed under this authority 

to providing only technical assistance. The Managers intend that 

the program be used solely for technical assistance and not for administrative tasks. (Section 2710 of Conference substitute) 

(43) Technical assistance (16 U.S.C 590(a) of Soil Conservation and 

Domestic Allotment Act and 16 U.S.C. 2001 of Soil and Water 

Resources Conservation Act) 

In the Soil Conservation and Domestic Allotment Act, the Senate amendment clarifies that it is the policy of the United States 

to preserve soil, water, and related resources and to promote soil 

and water quality. It defines technical assistance to mean technical 

expertise, information and tools necessary for the conservation of 

natural resources on land active in agricultural, forestry or related 

uses. 

In the Soil and Water Resources Conservation Act of 1977, the 

Senate amendment expands on existing appraisal requirements to 

include data on conservation plans, conservation practices planned 

or implemented, environmental outcomes, economic costs, and related matters. The national conservation program’s evaluation of 

existing conservation programs is amended to emphasize monitoring of specific program components in order to encourage further 

development and adoption of practices and performance-based 

standards. 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate amendment to 

the Soil Conservation and Domestic Allotment Act. The Managers 

intend to clarify that it is the role of USDA to provide technical assistance to farmers, ranchers, and other eligible entities to assist 

in the conservation of soil, water, and related resources. The Managers recognize that the natural resource concerns that producers 


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face are dynamic and preclude an inclusive list as responsibilities 

for USDA. 

The Conference substitute adopts the Senate amendment to 

the Soil and Water Resources Conservation Act with an amendment. The Act is extended to 2018. The Managers expect the delivery of appraisals and programs to be tied more closely to the Farm 

bill cycle, with the intent that these evaluations will inform development of future farm policy. (Section 2802 of Conference substitute) 

(44) National Natural Resources Conservation Foundation (Section 

351 of Federal Agriculture Improvement and Reform Act of 

1996) 

The Senate amendment updates existing foundation language 

and expands granting authority of the foundation to include making grants to individuals, entering into agreements with the Federal government, and making gifts to the foundation tax exempt. 

(Section 2606 of the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the House provision and does 

not include the provision. 

(45) Desert terminal lakes (Sec 2507 of the Farm Security and 

Rural Investment Act of 2002) 

The Senate amendment extends and reauthorizes through 

2012. It allows funds to be used to lease or to purchase land, water 

appurtenant to the land, and related interests in the Walker River 

Basin from willing sellers. 

The section provides $200,000,000 in mandatory funds for fiscal years 2008 through fiscal year 2012. (Section 2607 in the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to provide $175,000,000 in mandatory funding. (Section 2807 of Conference substitute) 

(46) High Plains water study 

The Senate amendment requires that program benefits under 

the 2007 Farm bill will not be denied to eligible individuals solely 

on the basis of participation in a one-time study of aquifer recharge 

potential in the high plains of Texas. (Section 2609 of the Senate 

amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. The 

Managers recognize that the ongoing depletion of the Ogallala Aquifer is an acute concern for the eight States that depend on it for 

agricultural, domestic, industrial uses, and other uses. This provision will allow agricultural producers to participate in a one-time 

study of aquifer recharge potential that will help inform State and 

local water conservation investment and policy to aid in managing 

this critical aquifer. The study is narrowly focused on a small number of playa lakes situated on agricultural land over the Ogallala 

Aquifer. 


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Playas are temporary wetlands unique to the High Plains of 

North America, numbering more than 60,000. Playas not only serve 

as the primary source of recharge for the Ogallala Aquifer, they are 

the most important wetland type for wildlife in this region. The 

Managers encourages the Department to further recognize the importance of playas through increased communication to landowners 

of the benefits of playas and conservation programs available. The 

Managers encourage the Department to work with the Playa Lakes 

Joint Venture to enhance the use of such programs like CRP to 

help ensure the protection of playas. (Section 2901 of Conference 

substitute) 

(47) Payment of expenses (Section 17(d) of the Federal Insecticide, 

Fungicide, and Rodenticide Act) 

The Senate amendment amends the Federal Insecticide, Fungicide, and Rodenticide Act (7 USC 136 et seq.) to require that the 

Department of State shall cover expenses incurred by Environmental Protection Agency staff participating on an international 

technical, economic, or policy review board, committee, or other official body with respect to a related international treaty. (Section 

2610 of the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 14209 of Conference substitute) 

(48) Use of funds for salinity control activities upstream of Imperial 

Dam (Sec202(a) of the Colorado River Basin Salinity Control 

Act) 

The Senate amendment amends Section 202(a) of the Colorado 

River Basin Salinity Control Act (43 U.S.C. 1592(a)) to create a 

Basin States Program to allow the Bureau of Reclamation, to carry 

out salinity control activities in the Colorado River basin. The provision requires the Secretary of Interior to consult with the Colorado River Basin Salinity Control Advisory Council when providing 

assistance in the form of grants, grant commitments, or the advancement of funds to Federal or non-Federal entities. It requires 

a planning report to Congress that describes the proposed implementation of the program and stipulates that no funds may be expended to implement the program until 30 days after the report is 

submitted to Congress. (Section 2611 of the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. The 

Managers intend for this provision to be fiscally neutral both as to 

appropriations and as to draws on the basin funds. It does not 

change the cost share ratios already established in Section 205(a) 

of the Act, nor does it change the percentage split between the two 

funds or the requirement that no more than 15 percent of the basin 

States cost share is to come from the Upper Colorado River Basin 

Fund. It is only intended to clarify the authority through which 

Reclamation expends the required cost share dollars. (Section 2806 

of Conference substitute) 


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(49) Technical corrections to the Federal Insecticide Fungicide, and 

Rodenticide Act (Section 33 of FIFRA) 

The Senate amendment makes technical corrections to the pesticide registration service fee program in the Federal Insecticide, 

Fungicide, and Rodenticide Act. (Section 2612 of the Senate amendment) 

The House bill has no comparable provision. 

The Conference substitute adopts the House provision and does 

not include the provision. However, the Conference substitute includes a container recycling provision. (Section 14109 of Conference 

substitute) 

The Managers have received concerns from numerous agricultural interests concerning pest resistance to first generation anticoagulant rodenticide products and the importance of low-cost, 

widely available effective rodenticides. The Managers encourage 

the Administrator of the Environmental Protection Agency to continue to classify second-generation rodenticides as general use 

products so as to minimize the potential consequences of reclassifying these materials as restricted use on target species resistance 

to first-generation rodenticides, potential non-target species poisoning, and cost and availability of rodenticides to the general public. 

TITLE III—TRADE 

(1) Agricultural Trade Development and Assistance Act of 1954 

(a) Short title (Section 1 of the Agricultural Trade Development and Assistance Act of 1954) 

The Senate amendment changes the title of the underlying legislation to the Food for Peace Act. It also includes numerous conforming amendments. (Section 3001) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision on 

changing the title of the underlying legislation to the Food for 

Peace Act. (Section 3001) 

(b) United States policy (Section 2 of the Food for Peace Act) 

The Senate amendment deletes a paragraph describing market 

development as one of the objectives of the programs under this 

Act. This modification is made to reflect the approach taken in operating the program in recent years. (Section 3002) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision that deletes a paragraph in Section 2 describing market development as 

one of the objectives of the programs under this Act. (Section 3002) 

(c) Food aid to developing countries (Section 3(b) of the Food 

for Peace Act) 

The Senate amendment modifies the Sense of Congress in current law to (1) require the President to seek commitments from 

other donors; reinforces the need to keep recipient governments, 

non-governmental organizations, and private voluntary organizations involved in conducting needs assessment and implementing 


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programs and ensure that a variety of options are available to provide needs-based emergency and non-emergency aid and (2) that 

the United States should increase food aid contributions consistent 

with the Uruguay Round Agreement on Agriculture. (Section 3003) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with a 

minor modification. (Section 3003) 

(d) Trade and development assistance (Title I of the Food for 

Peace Act) 

The Senate amendment renames Title I of the newly renamed 

Food for Peace Act from Development and Trade Assistance to Economic Assistance and Food Security. (Section 3004) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision that renames Title I of the newly renamed Food for Peace Act from Development and Trade Assistance to Economic Assistance and Food Security. (Section 3004) 

(e) Agreements regarding eligible countries and private entities (Section 102 of the Food for Peace Act). 

The Senate amendment strikes references to potential recipient countries becoming commercial markets and strikes a requirement that organizations seeking funding under the Act prepare 

and submit agricultural market development plans. (Section 3005) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision that 

strikes references to potential recipient countries becoming commercial markets and strikes a requirement that organizations seeking funding under the Act prepare and submit agricultural market 

development plans. (Section 3005) 

(f) Use of local currency payments (Section 104 of the Food 

for Peace Act). 

The Senate amendment adds the objective of improving trade 

capacity of the recipient country to the set of goals to be achieved 

under agricultural development. It removes authority for specific 

agricultural development activities such as business development 

loans, facilities loans, and private sector agricultural development. 

It also specifies that private voluntary organizations and cooperatives may implement agreements under this title. (Section 3006) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision on modifying language governing the use of local currencies, with the following changes: rather than striking paragraphs (3), (4), (5), and 

(6), the substitute modifies paragraphs (3), (4), and (5) to update 

obsolete references and leaves paragraph (6) intact. (Section 3006) 

(g) General Authority (Section 201 of the Food for Peace Act) 

The House bill amends the purposes of the Title II program to 

clarify that food deficits to be addressed include those resulting 

from man made and natural disasters. (Section 3001(a)) 

The Senate amendment clarifies the objectives for assistance 

under Title II commodity donations. It adds the promotion of food 


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security and support of sound environmental practices in paragraph (5); removes feeding programs as an objective in paragraph 

(6); and adds a new paragraph specifying the protection of livelihoods, provision of safety nets for food insecure populations and to 

encourage participation in educational, training, and other productive activities. (Section 3007) 

The Conference substitute adopts both the House and Senate 

provisions, with a modification to paragraph (6) of the Senate provision to keep Section 201(6) intact and add a new paragraph (7) 

to reflect the need to promote economic and nutritional security for 

food insecure populations. (Section 3007) 

The Managers recognize that humanitarian emergencies frequently occur due to a combination of factors, typically encompassing natural disasters, resource mismanagement and poor government policymaking. In most cases, the United States government ought to respond to such catastrophes with emergency assistance. However, if a disaster results mostly from poorly devised or 

discriminatory governmental policies in the recipient country, the 

Managers requests that the Administrator brief the relevant Congressional Committees before responding with assistance. 

(h) Provision of agricultural commodities (Section 202 of the 

Food for Peace Act) 

The House bill increases the percentage of Title II funding 

(currently at a range of 5 to 10 percent) that the Administrator 

may make available to eligible organizations for administrative and 

distribution costs to a range of 7 to 12 percent. 

The House provision also expands the purposes for which such 

funds may be used to include developing monitoring systems for 

Title II programs. (Section 3001(b)) 

The Senate amendment revises current language to clarify that 

the fact that a project is being proposed in a country that does not 

have a U.S. Agency for International Development mission or is not 

part of an overall development plan for the country cannot be used 

as the sole rationale for denying the proposal. 

It modifies the share of Title II funds which can be used to 

cover logistical expenses incurred by the eligible organizations that 

carry out Title II programs from between 5 and 10 percent to not 

less than 7.5 percent. 

It clarifies that such funds can be used to cover management, 

personnel, programmatic, operational activities, internal transportation, and distribution costs for new and existing programs. These 

funds can also be used to cover the costs of needs assessment and 

monitoring and evaluation. (Section 3008) 

It also strikes language on streamlining program management 

included in the 2002 farm bill. It also inserts new language which 

permits the Administrator to use Title II funds to address food aid 

quality issues, and requires that regular reports on progress on 

these quality issues be made to the relevant Congressional Committees. 

The Conference substitute adopts Senate language on paragraph (1) and paragraph (3) with modifications, providing $4.5 million for fiscal years 2009 through 2011 to be used to study and improve food aid quality for fiscal 2009–2011 from funds made availVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00755 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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able under Section 3012. It adopts House language on paragraph 

(2) with the modifications that the range of Title II funding available for administrative and distributional expenses is increased to 

between 7.5 percent and 13 percent. (Section 3008) 

The Managers urge the Administrator to explore the practicality of allowing Title II recipients to enrich or fortify Title II commodities overseas and produce high-value and processed products 

to support local manufacturing of food products in recipient countries. Such local products could include ready-to-use therapeutic 

and therapeutic and supplemental products and other fortified and 

processed foods that can be used successfully to treat severe and 

moderate malnutrition among children and provide nutritional support for people living with HIV/AIDS and other vulnerable groups. 

(i) Generation and use of currencies by private voluntary organizations and cooperatives (Section 203 of the Food for 

Peace Act) 

The House bill makes a technical correction. (Section 3001(c)) 

The Senate amendment adds activities involving micro-enterprises and village banking as a valid use of proceeds generated by 

monetization of commodities donated under Title II. (Section 3009) 

The Conference substitute adopts the House provision. (Section 

3009) 

The Managers recognize that microfinance and village banking, which relies on low dollar loans and collective responsibility, 

has flourished throughout the developing world for more than 30 

years. 

The Managers believe that similar activities such as micro-enterprise lending, village banking, and microfinance can be a valuable complement to development assistance projects under Title II 

of the Food for Peace Act, and encourages the Administrator to 

view micro-enterprise microfinance, and village banking projects as 

valid uses of local currency generated by monetization under this 

Act. 

(j) Levels of assistance (Section 204 of the Food for Peace Act) 

The House bill extends requirements on overall minimum tonnage and minimum tonnage for non-emergency assistance provided 

under Title II through 2012. (Section 3001(d)) 

The Senate amendment extends only the overall minimum tonnage requirement for Title II programs through 2012. (Section 

3010). 

The Conference substitute adopts the House provision. (Section 

3010) 

(k) The Food Aid Consultative Group (Section 205 of the Food 

for Peace Act) 

The House bill extends the authority for the Food Aid Consultative Group (FACG). (Section 3001(e)) 

The Senate amendment requires that a representative of the 

maritime transportation sector be included in the Group. 

It also requires the Administrator to consult with the FACG in 

developing regulations for the pilot local cash purchase program esVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00756 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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tablished in Section 3014, and extends the authority for the FACG 

through 2012. (Section 3011) 

The Conference substitute adopts the House provision, and 

paragraph (1) of the Senate provision. (Section 3011) 

(l) Administration (Section 207 of the Food for Peace Act) 

The House bill deletes a requirement that if the U.S. Agency 

for International Development denies a proposal for a Title II 

project, it must specify conditions that must be met for the approval of such proposal. 

It also adds a new provision that requires the U.S. Agency for 

International Development to establish and report on systems to 

improve and evaluate Title II assistance, including early warning 

systems to prevent famines. (Section 3001(f) and (g)) The Senate 

amendment provides more flexibility to the Administrator in terms 

of the time available to evaluate and determine whether to accept 

a proposal for assistance under Title II, and clarifies the intent of 

the law with respect to notifying an applicant why their proposal 

was rejected. 

It deletes a requirement for handbooks which are no longer 

used within the Title II program. Information previously contained 

in such handbooks is now available through other outlets, such as 

the U.S. Agency for International Development website. 

It deletes a specific deadline for submitting commodity orders, 

which on occasion can have the effect of slowing down the process, 

and substitutes a requirement that orders should be provided on a 

timely basis and it pushes back the date from December 1 to June 

1 for a report on the programs, countries, and commodities approved to date within a fiscal year under Title II. 

It adds language that allows the Administrator to use Title II 

funds to pay for assessment, data collection and management, and 

monitoring activities, and to hire contract workers to undertake 

such work in recipient or neighboring countries, without limiting 

existing authority to hire contractors to help address emergency 

food needs. 

The Senate amendment also adds language allowing the Administrator to pay the World Food Program of the United Nations 

for indirect support costs of the commodities donated under Title 

II, requiring that the Administrator report to relevant Congressional committees on such payments. It also clarifies the authority 

of the Administrator to pay indirect costs associated with funds received or generated for programs to PVO’s and cooperatives. It also 

requires that project reports should be submitted in such a form as 

can be readily displayed for public use on the U.S. Agency for 

International Development website. (Section 3012) 

The Conference substitute adopts House language to require 

specific oversight, monitoring, and assessment activities and provides up to $22 million annually of Title II funds for monitoring 

and assessment activities for non-emergency programs. It provides 

that no more than $8 million of these funds may be used for the 

Famine Early Warning Systems Network, but only if at least $8 

million is provided for this system from accounts funded pursuant 

to the Foreign Assistance Act of 1961. It also provides up to $2.5 

million of the $22 million to upgrade the information technology 


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systems associated with the food aid program in fiscal year 2009, 

to enhance the monitoring of these programs. 

The Conference substitute also adopts Senate language on 

paragraphs (2) and (3), and provides contracting authority for personal service in order to undertake monitoring and assessments for 

non-emergency programs, as part of paragraph (5). It does not provide for additional authority to pay indirect support costs to the 

World Food Program or to private voluntary organizations. (Section 

3012). 

The Managers recognize the use of handbooks in Title II is no 

longer an efficient method of providing information to foster development of programs under this title by eligible organizations. Realizing the need for clear communication of guidelines and regulations to eligible organizations, the Managers expect the Administrator to ensure the accessibility and clarity of information previously dispensed in the handbooks such as in an electronic form 

readily available to the public, in addition to other means as determined appropriate by the Administrator. 

The Managers believe that the provision of commodities overseas must be carried out in a timely manner and in a manner that 

is consistent with planned delivery schedules. 

The Managers are aware that the U.S. Agency for International Development has received significant cuts in operating expenses in the President’s budget and in Congressional appropriations over the last several years to carry out their operating expense which increasingly affects the Agency’s ability to monitor its 

programs. Although the Managers appreciate these constraints, it 

expects the Administrator to make every effort to improve the monitoring and evaluation of U.S. food assistance programs. Therefore, 

the Managers provide the Administrator with the authority to contract for personal services from persons not employed by the U.S. 

Government to carry out monitoring and oversight activities. The 

Managers have been concerned that, in the past, the U.S. Agency 

for International Development has not had the authority or the resources for monitors for non-emergency food aid programs. The 

April 2007 Government Accountability Office report on U.S. food 

assistance programs found that monitoring of food assistance programs in-country by the U.S. Agency for International Development has been insufficient due to various factors, including limited 

staff, competing priorities, and legal restrictions on the use of food 

assistance resources. The Managers are concerned about the significant gaps in monitoring and evaluation of U.S. international 

food assistance programs and expects the Administrator to address 

this problem immediately by establishing a system to monitor food 

assistance programs. The language in this new subsection will 

allow the Administrator to address this criticism by employing nonemergency food aid monitors. 

The Managers expect the Administrator to continue to use existing authority to pay those expenses required and agreed upon to 

the World Food Program. 


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(m) Assistance for stockpiling and rapid transportation, delivery, and distribution of shelf-stable, prepackaged foods 

(Section 208 of the Food for Peace Act) 

The House bill extends the authorization and increases annual 

funding for such grants from $3 million to $7 million. (Section 

3001(h)) 

The Senate amendment reauthorizes this program and also increases the level that can be appropriated to assist in the development of shelf-stable, prepackaged foods for use in food aid programs from $3 million to $8 million. (Section 3013) 

The Conference substitute adopts the Senate provision (Section 

3013) 

The Managers recognize the value added to U.S. food aid programs through cost sharing by implementing partners and recognize that preference is given to organizations that are able to provide such additional program funds. The Managers are supportive 

of the Administrator evaluating the inclusion of in-kind contributions when administering guidelines for cost sharing by non-profit 

organizations. 

(n) General authorities and requirements (Section 401 of the 

Food for Peace Act) 

The Senate amendment strikes the requirement that the Secretary make a determination about domestic supply of the commodity before releasing commodities for the food aid program. (Section 3015) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision (Section 

3014). 

(o) Definitions (Section 402 of the Food for Peace Act) 

The Conference substitute consolidates several references to 

the appropriate committees of Congress with respect to reporting 

activities under the Food for Peace Act. (Section 3015). 

(p) Use of Commodity Credit Corporation (Section 406 of the 

Food for Peace Act). 

The Senate amendment clarifies that costs incurred to improve 

food aid quality to the list of activities and functions can be covered 

by the Commodity Credit Corporation through advance appropriations acts. (Section 3016) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision (Section 

3016). 

(q) Administrative provisions (section 407 of the Food for 

Peace Act) 

The House bill extends the authorization for prepositioning of 

commodities and increases the limit on funding available for 

prepositioning such commodities overseas from $2 million to $8 

million. The bill also authorizes assessment and possible establishment of additional prepositioning sites. (Section 3001(i)) 

The Senate amendment reauthorizes pre-positioning of U.S. 

commodities abroad and increases the limit on funding available 


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for prepositioning in foreign countries from $2 million to $4 million. 

It also requires that resource requests for multi-year or ongoing 

non-emergency assistance agreements be approved by October 1 of 

the fiscal year when the commodities will be delivered. 

It also pushes the completion date for an annual report concerning the programs and activities of this Act from January 15 to 

April 1, and requires the Administrator to make the report available to the public by electronic and other means. (Section 3017) 

The Conference substitute adopts the Senate provision, but in- creases funding for prepositioning to $10 million, and adds the 

House language on studying the need for additional prepositioning 

sites (Sections 3017 and 3018(a)). 

(r) Consolidation and modification of annual reports regarding agricultural trade issues (Section 407 of the Food for 

Peace Act) 

The House bill amends requirements of the report the President must prepare on food aid programs that are carried out under 

the Act. (Section 3001(j)) 

The Senate amendment has no comparable provision. 

The Conference substitute consolidates a number of reporting 

requirements and date changes for reports from both Senate and 

House bills (Section 3018). 

(s) Expiration of assistance (Section 408 of the Food for Peace 

Act) 

The House bill reauthorizes agreements under the Act through 

2/31/12. (Section 3001(k)) 

The Senate amendment reauthorizes agreements under the Act 

through December 31, 2012. (Section 3018) 

The Conference substitute adopts the House provision (Section 

3019). 

(t) Authorization of Appropriations (Section 412 of the Food 

for Peace Act). 

The House bill extends the Act through 2012, and sets authorization levels for Title II to $2.5 billion. (Section 3001(l)) 

The Senate amendment reauthorizes appropriations for the Act 

through 2012. It also strikes subsection (b) and removes the President’s authority to transfer funds between the programs under this 

Act. (Section 3019) 

The Conference substitute adopts the House provision, modifying it with technical changes. (Section 3020). 

(u) Micronutrient Fortification Programs (Section 415 of the 

Food for Peace Act) 

The House bill extends authorization for the program through 

2012 and amends the purposes. (Section 3001(m)) 

The Senate amendment reauthorizes the Micronutrient Fortification Program from the Farm Security and Rural Investment 

Act of 2002 and adds new authority to assess and apply technologies and systems to improve food aid. It also strikes subsection 

(b), which limits the number of countries in which this program 

can be implemented. (Section 3020) 


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The Conference substitute adopts the Senate provision (Section 

3023). 

(v) John Ogonowski and Doug Bereuter Farmer-to-Farmer 

Program (Section 501 of the Food for Peace Act) 

The House bill provides a floor level of funding for the Farmer- to-Farmer program of $10 million and extends the program 

through 2012. The House bill also increases authorization of appropriations for specific regions from $10 million to $15 million. (Section 3001(n)) 

The Senate bill reauthorizes the Farmer-to-Farmer program. 

(Section 3022) 

The Conference substitute adopts the House provision (Section 

3024). 

The Managers recognize that organizations such as the Foods 

Resource Bank provide vital financial and technical assistance to 

agricultural production in developing countries in areas of financing, market access and knowledge, and development assistance. 

This assistance is generated through sale of crops grown in a cooperative effort between members of urban and rural churches and 

other organizations. These growing projects are an outstanding example of harnessing the grass-roots energy and generosity of Americans. Through use of these proceeds, these members of churches 

and organizations help to increase the technical knowledge and 

available capital, for farmers and others in targeted developing 

countries. These efforts enhance food security and increase productivity in these countries. 

The Managers understand that in the recent years, the Foods 

Resource Bank has received matching funds through the Global 

Development Alliance established by the U.S. Agency for International Development. The Managers encourage the Administrator 

to continue this funding and consider entering into longer term 

agreements with these organizations to provide for more certainty 

in project planning. 

The Managers believe that providing funds to match such contributions leverage the government’s investment and provide an incentive to expand the effort of growing projects working in the 

United States to raise money. Such an action would also increase 

public awareness of the plight of farmers in developing countries. 

(2) Export Credit Guarantee Program (Sections 203 and 211 of the 

Agricultural Trade Act of 1978) 

The House bill reduces the tenor of the GSM–102 Export Credit 

Guarantee Program to six months beginning in fiscal year 2008. 

(Section 3002) 

The House bill and the Senate amendment both repeal authority for the Supplier Credit program, which provides guarantees to 

buyers of U.S. commodities in foreign countries for a period of not 

more than 180 days. 

Both bills repeal authority for the GSM–103 Intermediate 

Credit Guarantee Program which provides guarantees for loans to 

purchase U.S. agricultural commodities with duration of between 

three years and ten years, and repeal the one percent cap on loan 

origination fees for the GSM–102 export credit guarantee program. 


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The Senate amendment reduces the tenor of the GSM–102 export credit guarantee program to no more than six months beginning in fiscal year 2012. The Senate amendment also clarifies how 

the U.S. Department of Agriculture should conduct evaluations of 

the creditworthiness of countries participating in export credit 

guarantee programs, and reduces the minimum amount that can 

be allocated to the export credit programs from its current $5.5 billion to $5 billion. (Section 3101) 

The Conference substitute adopts the Senate provision, with 

the following modification: in lieu of the reduction in tenor for the 

GSM–102 program beginning in fiscal year 2012, the conference 

amendment includes a cap on the credit subsidy for the program 

of $40 million annually (Section 3101). 

The Managers eliminated proposals to limit the tenor of export 

credit guarantees to periods shorter than 3 years in length. In 

order to garner budget savings while preserving the 3 year tenor 

and effectiveness of the program to support U.S. agricultural exports, subsection (b) limits the available budget authority for the 

cost of the program, as determined on a net present value basis 

under the Federal Credit Reform Act of 1990. 

Specifically, the Commodity Credit Corporation must make 

available each year GSM–102 guarantees in an amount not less than $5.5 billion, or the amount of guarantees that can be supported by $40 million in budget authority (plus any budget authority carried over from prior years)—whichever amount is less. It is 

expected that the U.S. Department of Agriculture can make available approximately $4 billion annually in export credit guarantees 

on $40 million in budget authority. 

The Managers remain concerned that the U.S. Department of 

Agriculture has consistently failed to meet its statutory obligation 

to make available at least $5.5 billion in export credit guarantees, 

to the detriment of U.S. agricultural exports and the ability of food 

importing countries to meet their food, feed, and fiber needs. 

The Managers expect the U.S. Department of Agriculture to 

use this authority to design and operate the export credit guarantee program to maximize the export sales of agricultural commodities and to assist food importing countries’ efforts to meet 

their food, feed, and fiber needs, by making available and utilizing 

guarantees equal to at least the statutory minimum, and more as 

necessary to meet program demand. 

Finally, the Managers believe that the changes in this section 

satisfy U.S. commitments to comply with the Brazil cotton case 

with regard to the export credit programs. 

(3) Market Access Program (Sections 203 and 211 of the Agricultural Trade Act of 1978) 

The House bill extends the program and makes organic commodities eligible for the program. It increases funding by $25 million annually. (Section 3003) 

The Senate amendment makes organic commodities eligible for 

the program. It also increases funding for the program from its current level of $200 million for fiscal year 2007, raising it by $10 million annually until fiscal year 2011, when it returns to baseline levels. (Section 3102) 


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The Conference substitute adopts the Senate provision, without the increase in funding above baseline levels (Section 3102). 

(4) Food for Progress Act of 1985 

The House bill extends the Food for Progress Act (7 United 

States Code 1736o) through 2012. (Section 3004) 

The Senate amendment reauthorizes the program through 

2012, and makes recipient governments, intergovernmental organizations, and private entities ineligible for the program. It also increases the amount that can be spent transporting commodities 

under Food for Progress from $40 million to $48 million for fiscal 

years 2008–through 2010. This figure is the effective cap on this 

program. (Section 3106) 

The Conference substitute adopts the House provision and 

adds a provision requiring the Secretary to establish a project in 

Malawi under this program (Section 3105). 

(5) McGovern-Dole International Food for Education and Child Nutrition Program 

The House bill extends program through 2012, requires the 

Secretary of Agriculture to carry out the program, and provides 

mandatory funds of: $0 for fiscal year 2008; $140,000,000 for fiscal 

year 2009; $170,000,000 for fiscal year 2010; $230,000,000 for fiscal 

year 2011; $300,000,000 for fiscal year 2012; and $0 for fiscal year 

2013. (Section 3005) 

The Senate amendment establishes the U.S. Department of 

Agriculture as the permanent home for this program and reauthorizes the program through fiscal year 2012. Up to $300 million may 

be appropriated annually to fund this program. (Section 3107) 

The Conference substitute adopts the Senate provision, except it provides $84 million in mandatory money for this program for 

fiscal year 2009, to be available until expended (Section 3106). 

(6) Bill Emerson Humanitarian Trust 

The House bill extends the Bill Emerson Humanitarian Trust 

through 2012. (Section 3006) 

The Senate amendment specifies that the Trust can be held as 

a combination of commodities and cash, not to exceed the equivalent of 4 million metric tons and allows the commodities to be exchanged for funds available under Title II or the McGovern-Dole 

program. The Secretary may sell commodities in the Trust onto the 

market if such sales will not disrupt the domestic market. It permits the Secretary to manage the funds held under the Trust to 

maximize its value. 

The Senate amendment further clarifies the rules under which 

commodities or funds can be released from the Trust, and defines 

the term ‘‘emergency’’ for the purpose of release. It also clarifies the 

rules by which the Trust is managed by the Secretary, including 

specifying that price risks must be managed and allowing the 

funds held in the Trust to be invested in low-risk short-term securities or instruments. Instructs the Secretary to maximize the value 

of the Trust and instructs the Secretary to transfer saved storage 

costs back to the Trust from the CCC. The Senate amendment replaces the word ‘‘replenish’’ with the word ‘‘reimburse’’ throughout 


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the language, reinforcing the notion that resources can be held 

through cash as well as commodities under this program. The program is reauthorized through fiscal year 2012. (Section 3201) 

The Conference substitute adopts the Senate provision, with 

the following modifications: it removes the 4 million ton cap entirely, and no longer allows the Secretary to engage in futures market transactions with funds in the Trust. It also does not allow the 

exchange of funds available under Title II or the McGovern-Dole 

International Food for Education and Child Nutrition program, nor 

require transfer of foregone storage charges into the Trust (Section 

3201). 

The Managers expect the Trust to be used in a manner that 

recognizes its unique availability as a resource for food emergencies 

worldwide. The sale of commodities in the Trust should be undertaken in such a way as to prevent market disruptions and dramatic 

price fluctuations in the domestic market. 

(7) Technical assistance for specialty crops 

The House bill extends the Technical Assistance for Specialty Crops through fiscal year 2012 and increases funding from $2 million annually to $4 million in 2008, ramping up to $10 million for 

fiscal years 2011 and 2012. (Section 3007) 

The Senate amendment extends Technical Assistance for Spe- cialty Crops through fiscal 2012 and increases funding by $19 million over the baseline. (Section 1833) 

The Conference substitute adopts the House provision with an- nual funding ramped up to $9 million in fiscal years 2011 and 

2012, and adds a report (Section 3203). 

(8) Representation by the United States at international standardsetting bodies 

The House bill authorizes the Secretary to enhance U.S. Department of Agriculture staff support for international standardsetting bodies, such as the Codex Alimentarius, the International 

Plant Protection Convention, and the World Animal Health Organization. (Section 3009) 

The Senate amendment has no comparable provision. 

The Conference substitute strikes this provision. 

(9) Foreign Market Development Cooperator Program (Section 702 

of the Agricultural Trade Act of 1978) 

The House bill extends the program through fiscal year 2012. 

(Section 3010) 

The Senate amendment increases funding for the Foreign Market 

Development Program from its current level of $34.5 million annually for fiscal year 2007 by $5 million for fiscal years 2008 and 

2009, by $10 million in fiscal year 2010, and returns to baseline 

levels in fiscal year 2011. (Section 3105) 

The Conference substitute adopts the House provision (Section 

3104). 

(10) Emerging Markets and Facilities Loan Guarantee Program 

The House bill extends the program through fiscal year 2012. 

(Section 3011) 


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The Senate amendment reauthorizes the Emerging Markets 

and Facilities Guarantee Loan Program through fiscal year 2012. 

It permits the Secretary to waive requirements that U.S. goods 

be used in the construction of a facility under this program, if such 

goods are not available or their use is not practicable. It also permits the Secretary to provide a guarantee for this program for the 

term of the depreciation schedule for the facility, not to exceed 20 

years. (Section 3202) 

The Conference substitute adopts the Senate provision (Section 

3204). 

(11) Export Enhancement Program (Section 301 of the Agricultural 

Trade Act of 1978) 

The House bill extends the program through fiscal year 2012. 

(Section 3012) 

The Senate amendment repeals authority for the program. 

(Section 3103) 

The Conference substitute adopts the Senate provision (Section 

3103). 

(12) Minimum level of nonemergency food assistance 

The House bill provides that of Title II funds, the U.S. Agency for International Development must use at least $450 million for 

non-emergency programs unless Congress provides otherwise with 

new legislation. (Section 3014) 

The Senate amendment establishes a ‘‘safe box’’ for non-emergency, development assistance projects under Title II of $600 million annually to be obligated and expended each fiscal year. (Section 3019) 

The Conference substitute adopts the House provision, modi- fied to reflect a phasing in of the safe box level beginning at $375 

million in fiscal year 2009 and ending at $450 million in fiscal year 

2012. It also provides an exception to the safe box designation, allowed to be exercised only if the President determines that an extraordinary food emergency exists and that resources available 

from the Bill Emerson Humanitarian Trust have been exhausted, 

and if the President has submitted a request for additional appropriations to Congress equal to the reduction in safe box and Emerson Trust levels (Section 3022). 

(13) Global Crop Diversity Trust 

The House bill requires the U.S. Agency for International Development to make a contribution on behalf of the United States 

to the Global Crop Diversity Trust of up to $60 million over 5 

years. United States contributions may not exceed one fourth of the 

total of funds contributed to the Trust from all sources. (Section 

3014) 

The Senate amendment requires the U.S. Agency for International Development to make contributions to the Global Crop Diversity Trust to assist in conservation of genetic diversity of key 

food crops around the world. Appropriations of $60 million are authorized for the period of the fiscal year 2008 through 2012 for this 

purpose, with a cap equal to 25 percent of all funds contributed to 

the Trust from all sources. (Section 3021) 


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The Conference substitute adopts the House provision, with a 

title change for the section (Section 3202). 

(14) Report on Efforts to improve procurement planning 

The House bill requires that not later than 90 days after the 

date of the enactment the U.S. Agency for International Development and the U.S. Department of Agriculture shall submit to Congress a report on efforts taken to improve planning for food and 

transportation procurement, including efforts to eliminate bunching 

of food purchases. (Section 3015) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision (Section 

3022). 

(15) International disaster 

The House bill requires that for each of fiscal year 2008 through 2012, $40 million of amounts made available to carry out 

Section 491 of the Foreign Assistance Act of 1961 shall be made 

available for famine prevention. (Section 3016) 

The Senate amendment authorizes a pilot program for local/regional cash purchase. Subsection (a) provides several key definitions for the section. Subsection (b) establishes authority for the 

pilot program. Subsection (c) establishes the purposes for which the 

pilot program can be used. Subsection (d) establishes criteria for 

local or regional procurement. Subsection (e) requires the Administrator to initiate an external review of prior local/regional cash purchase activities by other donor countries, PVO’s and intergovernmental organizations within 30 days of enactment. A report detailing the results of this review is also to be provided to the relevant 

Congressional Committees. This information would be used to assist in developing guidelines for the request for proposals. Subsection (f) authorizes the Administrator to request and approve applications for grants from eligible organizations under this section, 

and requires any projects authorized under this section to be completed by Sept. 30, 2011, to allow time to complete study of pilot 

results before expiration of authorized appropriations in subsection 

(k). Subsection (g) establishes requirements for specific projects in 

selecting proposals for grants. Subsection (h) lists information that 

would need to be included in grant applications. Subsection (i) requires the Administrator to arrange for independent evaluation of 

the pilot program results, and a report to the relevant Congressional Committees. It also lays out the factors that would have to 

be examined in the report. Subsection (j) requires the Administrator to promulgate guidelines for the operation of this pilot program. Subsection (k) authorizes appropriations of $25 million for 

each year between fiscal 2009 and fiscal 2011 for this program, to 

be available until expended. (Section 3014) 

The Conference substitute adopts the Senate provision, modified to provide that the project be conducted by the Secretary with 

$60 million in mandatory funding between fiscal 2009 and 2012. It 

establishes requirements for undertaking such activities and requires the Secretary to promulgate rules or guidelines in order to 

award grants or cooperative agreements to conduct field-based 

projects using local or regional procurement. It also requires entiVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00766 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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ties receiving grants or entering into agreements under this section 

to provide data about market parameters and methodologies used 

to acquire eligible commodities locally or regionally, intended to be 

used to evaluate the effectiveness of local or regional procurement 

(Section 3206). 

(16) Importation of agricultural products made with child labor 

The Senate amendment requires the Secretary of Agriculture, 

in cooperation with the Secretary of Labor, to develop standards 

that importers of agricultural products into the United States could 

choose to use to certify that those products were not produced with 

the use of abusive forms of child labor. (Section 3104) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision, modified to establish a consultative group of interested stakeholders 

charged with developing recommendations on practices that would 

enable companies to monitor and verify whether the food products 

they import are made with the use of child or forced labor. Guidelines developed from these recommendations would be released 

after a public comment period (Section 3205). 

The Managers strongly support efforts to reduce and eliminate 

the use of child and forced labor. The Managers expect the Secretary of Agriculture to work with the multi-stakeholder Consultative Group to develop the recommendations for best practices for 

the voluntary, third-party certification initiative that will provide 

producers, importers, retailers and consumers with reasonable assurances as to what measures have been taken to ensure that the 

products are not produced with child labor. After the Consultative 

Group has issued its recommendations, the Managers expect the 

Secretary to develop guidelines for such best practices and release 

the guidelines for public comment. The outcome expected by the 

Managers is a voluntary, third-party certification effort is designed 

to reduce the likelihood that products produced with forced labor 

or child labor are imported into the United States as directed in 

the Trafficking Victims Protection Act of 2005. 

The Managers recommend that the Secretary select officials 

from the Foreign Agricultural Service and the Agricultural Marketing Service to serve on the consultative group as the representatives of the U.S. Department of Agriculture. Additionally, the Managers recommend that the Department of Labor be represented by 

an individual from the Bureau of International Labor Affairs, and 

that the Department of State be represented by the Director of the 

Office to Monitor and Combat Trafficking in Persons of the Department of State. 

(17) Biotechnology and Agricultural Trade Program 

The Senate amendment reauthorizes the Biotechnology and 

Agricultural Trade Program through 2012. (Section 3203) 

The House bill has no comparable provision. 

The Conference substitute does not include this provision. 

(18) Technical assistance for international trade disputes 

The House bill and the Senate amendment both authorize the 

Secretary to provide technical assistance for limited resource 


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groups involved in trade disputes. This program is subject to appropriations. (House Section 3008 and Senate Section 3204) 

The Conference substitute does not include this provision. 

The Managers understand that the U.S. Department of Agriculture currently possesses the authority to provide technical advice, analytical support, and other assistance to help limited resource organizations and others involved in exporting U.S. agricultural commodities. The Managers encourage the U.S. Department 

of Agriculture to provide such assistance, particularly to entities 

that both face unfair trading practices and do not possess adequate 

internal resources to address these practices given the size of their 

domestic industry or membership. The Department is encouraged 

to seek appropriations for this purpose as needed. 

(19) Importation of high protein food ingredients 

The Senate amendment requires the Secretary of Health and 

Human Services to report to Congress on the importation and use 

of high protein food ingredients. (Section 3206) 

The House bill contains no comparable provision. 

The Conference substitute does not include this provision. 

(20) U.S.-Canada Softwood Lumber Agreement 

The Senate amendment expresses the Sense of the Senate with 

respect to ensuring that imports of Canadian softwood lumber are 

consistent with the Softwood Lumber Agreement with Canada. 

(Section 11093) 

The House bill contains no comparable provision. 

The Conference substitute includes a softwood lumber importer 

declaration program. The purpose of the program is to assist in the 

enforcement of any international obligations that the United States 

and our trading partners assume with respect to trade in softwood 

lumber and softwood lumber products. 

The Managers are concerned that existing U.S. importer declaration requirements are not sufficient to ensure compliance with 

such obligations. If the issue is not addressed, imports of noncompliant softwood lumber and softwood lumber products can harm 

U.S. producers. 

The section amends the Tariff Act of 1930 by adding a new 

Title VIII, the ‘‘Softwood Lumber Act of 2008’’. The Act directs the 

President to establish a softwood lumber importer declaration program. The program requires U.S. importers of softwood lumber and 

softwood lumber products to take certain steps to help the United 

States and its trading partners ensure that trade in these products 

is consistent with the terms of any relevant international agreement. 

As part of the program, U.S. importers must provide certain 

information about each shipment of softwood lumber or softwood 

lumber products at the time the importer files the entry summary 

documentation. The importer must also declare that the importer 

has made appropriate inquiries about the shipment and that, to 

the best of the importer’s knowledge and belief, the imports of 

softwood lumber are consistent with certain terms of any relevant 

international agreement entered into by the country of export and 

the United States. The Act requires the Secretary of Treasury to 


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reconcile the transaction-specific information provided by the U.S. 

importer with transaction-specific information provided by the 

country of export to the United States, if any. Such reconciliation 

is to include any revised transaction-specific export prices provided 

by the country of export. The Secretary of Treasury must also periodically verify the accuracy of the importer declarations. The Act 

provides for the assessment of penalties against any person who 

knowingly violates the Act. The Act, however, holds harmless importers who have made appropriate inquiries and who maintain 

and produce substantiating documentation. 

The Managers intend that the requirement for the importer to 

provide the estimated export charges, if any, is meant to apply to 

export charges estimated to be due at the time of shipment, recognizing that the exporter’s final liability could increase or decrease 

at the time of final assessment. 

The Managers intend that, in implementing the program, the 

President or his designee avoid placing an unnecessary burden on 

U.S. importers. In this respect, the Managers note that the statutory language creating the program neither includes nor references 

any authority for the President or his designee to establish user 

fees, processing fees, or any other fees of any kind. It is the intention of the Managers that any expenses associated with the administration of this program be covered with appropriated funds. 

The Managers intend that this program meet all bilateral and 

multilateral obligations of the United States, including adherence 

to international rules and procedures regarding trade in softwood 

lumber. The Managers intend the program to be consistent with 

U.S. obligations under the Uruguay Round Agreements, including 

the General Agreement on Tariffs and Trade 1994, and any other 

bilateral or multilateral trade agreements to which the United 

States is a Party. 

The Managers recognize the subject matter set forth in the Act 

falls under the jurisdiction of the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives. 

TITLE IV—NUTRITION PROGRAMS 

(1) Renaming the Food Stamp Program 

The House bill amends the Food Stamp Act of 1997 (FSA) by 

renaming the Food Stamp Program the Secure Supplemental Nutrition Assistance Program (SSNAP). Conforming amendments are 

made to other laws, documents, and records that reference either 

the Food Stamp Act or Food Stamp Program. (Section 4001) 

The Senate amendment amends the short title of the FSA by 

renaming the Act the Food and Nutrition Act of 2007. It amends 

the renamed Food and Nutrition Act of 2007 to change the term 

‘‘food stamp program’’ each place it appears to ‘‘food and nutrition 

program’’. 

The Senate amendment also makes conforming amendments to 

other laws that reference the Food Stamp Act/program. (Section 

4001, Section 4909) 

The Conference substitute adopts the Senate provisions with 

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mental Nutrition Assistance Program’’ and to incorporate these 

changes into section 4001; and to incorporate technical changes and 

conforming amendments necessary to reflect the new title of the 

program and Act into section 4002. (Section 4001; Section 4002) 

(2) Definition of Drug Addition or Alcoholic Treatment and Rehabilitation Program 

The House bill amends section 3(f) of the FSA by mandating 

that drug addiction or alcoholic treatment and rehabilitation programs meet the FSA’s definition regarding such programs if the 

State Title XIX agency certifies that: the program is eligible to receive funds under Part B of Title XIX of the Public Health Service 

Act (even if no funds are being received); or is operating to further 

the purposes of Part B. 

This section also provides that nothing in the FSA’s definition 

of a drug addiction or alcoholic treatment and rehabilitation program is to be construed as requiring State or Federal licensure. 

(Section 4002) 

The Senate amendment has no comparable provision. 

The Conference substitute deletes the House provision. 

(3) Nutrition education 

The House bill amends section 4(a) of the FSA by authorizing 

the Secretary, subject to appropriated funds, to administer the food 

stamp nutrition education program to eligible households. 

Section 11(f) of the FSA is amended by specifically giving State 

agencies the discretion to implement nutrition education programs 

that promote healthy food choices that are consistent with the Dietary Guidelines for individuals who receive, or are eligible to receive program benefits. 

States are given the discretion to deliver nutrition education 

directly to eligible recipients through agreements with the Cooperative State Research, Education and Extension Service and other 

State and community health and nutrition providers and organizations. 

States wishing to provide nutrition education must submit a 

plan that identifies the uses of the funding for local projects and 

conforms to standards set forth by the Secretary in regulations or 

guidance. 

States must, whenever practicable, notify applicants, participants, and eligible program participants of the availability of nutrition education. 

The federal matching funds requirement is continued. (Section 

4003) 

The Senate amendment is the same as the House bill, with 

technical differences. (Section 4213) 

The Conference substitute adopts the Senate provision. (Section 4111) 

(4) Food distribution on Indian reservations 

The House bill amends section 4 of the FSA by permitting the 

distribution of commodities, with or without the Secure Supplemental Nutrition Assistance Program, on Indian reservations 


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whenever a request is made for concurrent or separate food program operations by a tribal organization. 

Tribal organizations are permitted to be responsible for the 

commodity distribution, should the Secretary determine that they 

are capable of doing so. The prohibition from approving plans that 

permit households to simultaneously participate in the SSNAP and 

FDPIR programs is continued. An appropriation of $5,000,000 is authorized for fiscal years 

2008 through 2012 for a traditional and local foods fund to distribute traditional and locally-grown foods, designated by region, on 

Indian reservations. At least 50 percent of the food distributed 

through the fund must be produced by Native American farmers, 

ranchers, and producers. 

The Secretary is required to submit a report to Congress on 

the FDPIR food package. The report is to include: a description of 

the process for determining the contents of the food package; the 

extent to which the package conforms to the 2005 Dietary Guidelines for Americans; the extent to which the food package addresses 

nutritional and health challenges specific to Native Americans and 

the nutritional needs of Native Americans; and plans to revise the 

food package (or any rationale for not revising it). (Section 4004) 

The Senate amendment is similar to the House bill with technical differences but: (1) provides that, subject to the availability of 

appropriations, the Secretary may purchase bison meat for distribution through FDPIR, and (2) requires the Secretary to survey 

participants to determine which traditional foods are most desired. 

(Section 4501) 

The Conference substitute adopts the Senate provision with 

amendments to require that, where practicable, at least 50 percent 

of the food distributed through the traditional and locally grown 

foods fund be produced by Native American farmers, ranchers, and 

producers, and to require a report describing the activities carried 

out under the traditional and locally grown foods fund. (Section 

4211) 

(5) Excluding combat related pay from countable income 

The House bill amends section 5(d) of the FSA by specifically 

excluding combat-related military pay when determining income 

for program eligibility and benefits. (Section 4005) 

The Senate amendment is the same as the House bill, with 

technical differences. (Section 4101) 

The Conference substitute adopts the Senate provision with an 

amendment to specify that the exclusion of combat-related military 

pay becomes effective on October 1, 2008. (Section 4101) 

(6) Increasing the standard deduction 

The House bill amends section 5(e)(1) of the FSA by increasing 

the minimum standard deduction and indexing it for inflation as 

measured by the Consumer Price Index (CPI–U). 

The minimum standard deduction is raised to: 

$145 (for the 48 contiguous States and the District of Columbia); 

$248 (for Alaska); 

$205 (for Hawaii); 


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$128 (for the Virgin Islands); 

and $291 (for Guam). 

The alternative minimum of 8.31 percent of the poverty guidelines is not changed. 

On October 1, 2008 (and each October thereafter) the minimum dollar-denominated standard deductions (noted above) would 

be adjusted by the CPI–U change (for all items other than food) 

over the 12 months ending the previous June 30th (and rounded 

down to the nearest whole dollar). (Section 4006) 

The Senate amendment amends section 5(e)(1) to increase the 

minimum standard deduction and index it for inflation as measured by the CPI–U. 

The minimum standard deduction is raised to: 

$140 (for the 48 contiguous States and the District of Columbia); 

$239 (for Alaska); 

$197 (for Hawaii); 

$123 (for the Virgin Islands); and 

$281 (for Guam). 

As in the House bill, the alternative minimum of 8.31% of the 

poverty guidelines is not changed, and the amounts specified for 

the standard deduction would be adjusted for annual changes in 

the CPI–U and rounded down. (Section 4102) 

The Conference substitute adopts the Senate provision with an 

amendment to increase the minimum standard deduction to: 

$144 (for the 48 contiguous States and the District of Columbia); 

$246 (for Alaska); 

$203 (for Hawaii); 

$127 (for the Virgin Islands); and 

$289 (for Guam). 

The Conference substitute indexes these amounts for inflation 

as measured by the CPI–U, rounded down and specifies that these 

increases become effective on October 1, 2008. (Section 4102) 

(7) Deducting dependent care expenses 

The House bill amends section 5(e)(3) of the FSA by removing 

the caps on dependent care deductions. (Section 4007) 

The Senate amendment is the same as the House bill. 

The Conference substitute adopts the House provision with an 

amendment to make the removal of the caps on dependent care deductions effective on October 1, 2008. (Section 4103) 

(8) Adjusting countable resources for inflation 

The House bill amends section 5(g) of the FSA by requiring 

that the resource (asset) dollar limits for SSNAP households be indexed. Limits are to be indexed annually for inflation (measured by 

the CPI–U) and adjusted to the nearest $100. (Section 4008) 

The Senate amendment amends section 5(g) by increasing the 

dollar limits on financial resources that an eligible household may 

own to $3,500 (or $4,500 for households with elderly or disabled 

members), and requiring that they be indexed annually for inflation (measured by the CPI–U) rounded down and adjusted down to 

the nearest $250. (Section 4101(a)) 


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The Conference substitute adopts the Senate provision with 

amendments to specify that the existing asset dollar limits be indexed annually for inflation as measured by the CPI–U and adjusted down to the nearest $250, to specify that such policy become 

effective on October 1, 2008, and to make other technical changes. 

(Section 4104) 

(9) Excluding education accounts from countable income 

The House bill amends section 5(g) of the FSA by excluding 

tax-qualified education savings as countable financial resources. 

(Section 4009) 

The Senate amendment is the same as the House bill, with 

technical differences. (Section 4104(c)) 

The Conference substitute adopts the Senate provision with an 

amendment to specify that such exclusions become effective on October 1, 2008, and to make other technical changes. (Section 4104) 

(10) Excluding retirement accounts 

The House bill amends section 5(g) of the FSA by excluding all 

tax-qualified retirement accounts/savings as countable financial resources. (Section 4010) 

The Senate amendment is the same as the House bill with 

technical differences. (Section 4104(b)) 

The Conference substitute adopts the Senate provision with an 

amendment to specify that such exclusions become effective on October 1, 2008; and to make other technical changes. (Section 4104) 

(11) Simplified reporting 

The Senate amendment amends section 6(c)(1) to allow States 

to require periodic reporting of changes in household circumstances 

(as opposed to reporting changes when they occur) by households 

with elderly/disabled members, migrant/seasonal farmworker 

households, and households in which all members are homeless. 

This provision limits the frequency with which these households 

must report changes (other than changes whereby they exceed the 

program’s gross monthly income eligibility limits). Elderly/disabled 

households with no earned income are required to report no more 

often than once a year; migrant/seasonal farmworker and homeless 

households could be required to report no more often than once 

every 4 months. (Section 4105) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to specify that the simplified reporting policy change 

becomes effective on October 1, 2008. (Section 4105) 

(12) Deobligate food stamp coupons 

The House bill amends the FSA by prohibiting States from 

issuing coupons, stamps, certificates or authorization cards, effective upon enactment of the Farm Bill. 

The House bill provides that, effective one year after enactment 

of this Act, only Electronic Benefit Transfer (EBT) cards will be eligible for exchange at retail food stores that participate in the 

SSNAP. 


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The House bill also provides that coupons will no longer be an 

obligation of the Federal government, effective one year after enactment of the Farm Bill, thereby requiring that coupons be redeemed 

within that one-year period. (Section 4011) 

The Senate amendment is similar to House bill with technical 

differences but: (1) directs the Secretary to require a state agency 

to issue or deliver benefits using alternative methods if the Secretary determines, in consultation with the Inspector General, that 

it would improve the integrity of the food and nutrition program; 

and (2) provides that no interchange fees shall apply to electronic 

benefit transfer transactions under the food and nutrition program. 

It also makes necessary conforming amendments as in the House 

bill. (Section 4202, 4001) 

The Conference substitute adopts the Senate provision with 

amendments to strike the study relating to the use of program benefits and to make other technical changes. While this provision 

does generally prohibit the use of coupons in the Supplemental Nutrition Assistance Program (SNAP), it is not the Managers’ intention to prohibit States from issuing benefits in a form other than 

EBT cards as part of efforts through SNAP to provide food assistance to eligible individuals affected by a disaster. (Section 4115) 

(13) Eligibility for single unemployed adults 

The Senate amendment amends section 6(o) to lengthen the 

eligibility period for ABAWDs who are not working or in an employment/training or workfare program to 6 months in every 36- 

month period. 

The Senate amendment eliminates the current provision of law 

under which an ABAWD who gains eligibility by meeting one of the 

3 work-related tests, but subsequently fails to meet any of them, 

may remain eligible for an added 3 months. (Section 4107) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. 

(14) Transitional benefits 

The Senate amendment amends section 11(s) to permit States 

to provide transitional food assistance benefits to households with 

children that cease to receive cash assistance under a state-funded 

public assistance program. (Section 4108) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to make the transitional benefits policy change effective on October 1, 2008. (Section 4106) 

(15) Allow for the accrual of benefits 

The House bill amends section 7(i) of the FSA by authorizing 

States to establish procedures for recovering electronically issued 

benefits from a household due to inactivity in the household’s EBT 

account. 

The House bill provides States with the discretion to recover 

benefits if an EBT account has been inactive for: (1) 3 months during which it continuously had a balance greater than $1,000 (adjusted for inflation); or (2) 12 months, whichever is less. 


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The House bill also provides that a household whose benefits 

are recovered must receive notice, and have its benefits made available again, upon request not less than 12 months after the recovery 

of the benefits. (Section 4012) 

The Senate amendment amends section 7(i) of the FSA to (1) 

require that States establish procedures for recovering electronically issued benefits from inactive benefit accounts and allow them 

to store recovered benefits off-line if the household has not accessed 

the account after 6 months and (2) require States to expunge benefits that have not been accessed by a household for 12 months. 

States would also be required to notify households of stored 

benefits and make them available not later than 48 hours after a 

household’s request. (Section 4106) 

The Conference substitute adopts the Senate provision. (Section 4114) 

(16) Increasing the minimum benefit 

The House bill amends section 8(a) of the FSA by increasing 

the amount of the minimum benefit for 1 and 2-person households 

to 10 percent of the inflation-indexed ‘‘Thrifty Food Plan’’ for a 1- 

person household. (Section 4013) 

The Senate amendment is the same as the House bill except 

that the effective date is stipulated as October 1, 2008. 

The Conference substitute adopts the House provision with an 

amendment to specify that the minimum benefit shall be equal to 

8 percent of the maximum benefit for a household of one, and to 

make the increase in the minimum benefit effective on October 1, 

2008. The Managers understand that the Thrifty Food Plan 

changes on a monthly basis, and expect that the minimum benefit, 

as amended by this provision, will be calculated on an annual 

basis. (Section 4107) 

(17) State option for telephonic signature 

The House bill amends Section 11(e)(2)(C) of the FSA by authorizing State agencies to establish a system for applicant households to sign an application by providing a recorded, verbal assent 

over the telephone. 

The system must record the applicant’s verbal assent, as well 

as the information to which the assent was given. 

The State system is required to include safeguards against impersonation and identity theft. 

The provision specifies that a household’s right to apply for 

food stamps in writing not be precluded. 

The provision further specifies that if there are any errors in 

the application, the applicant must return a copy of the application 

with instructions for correcting such errors. 

Applicants must satisfy all the requirements associated with a 

written signature on an application to ensure that the verbal assent triggers the effective date of the submission of the application. 

(Section 4014) 

The Senate amendment is the same as the House bill with 

technical differences. 

The Conference substitute adopts the Senate provision. (Section 4119) 


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(18) Technical clarification regarding eligibility 

The Senate amendment amends section 6(k) to require that the 

Secretary establish procedures to ensure that States use consistent 

procedures that disqualify individuals whom law enforcement authorities are actively seeking for the purpose of holding criminal 

proceedings. (Section 4201) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 4112) 

(19) Split issuance 

The Senate amendment amends section 7(h) to require that 

any method for staggering the issuance of benefits throughout a 

month not include splitting any household’s monthly benefit into 

multiple issuances—unless a benefit correction is necessary. (Section 4203) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. The 

Managers recognize that there may be situations in which individuals that leave a group home before the end of the month will still 

be eligible to receive program benefits. The Managers intend that, 

in such a situation, the Secretary interpret the term ‘‘benefit correction’’ to allow a second issuance of program benefits in a month. 

(Section 4113) 

(20) Privacy protection 

The Senate amendment amends section 11(e)(8) to clarify rules 

pertaining to the disclosure of information obtained from applicant 

households. The provision bars use of this information by persons 

having access for any purpose other than program administration/ 

enforcement activities, and also makes clear that applicants’ information may be used to comply with requirements for certifying 

schoolchildren as eligible for free school meals based on their family’s eligibility for food and nutrition assistance program benefits. 

(Section 4205) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 4120) 

(21) Civil rights compliance 

The Senate amendment amends section 11(c) to specify in law 

that administration of the program must be consistent with the 

rights of households under the Age Discrimination Act, section 504 

of the Rehabilitation Act, the Americans with Disabilities Act, and 

title VI of the Civil Rights Act. (Section 4207) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 4117) 

(22) Employment and training 

The Senate amendment amends section 6(d)(4) to include—as 

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ment) to individuals who have received other employment/training 

services under the program. 

The Senate amendment also modifies section 6(d)(4) to permit 

individuals voluntarily participating in employment and training 

programs to participate beyond the required maximum of 20 hours 

a week (or a number of hours based on their benefit divided by the 

minimum wage). (Section 4208) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to make the changes authorized by this provision effective on October 1, 2008. (Section 4108) 

(23) Codification of access rules 

The Senate amendment amends section 11(e)(1) to clarify that 

States must comply with the Secretary’s regulations requiring the 

use of appropriate bilingual personnel and materials. (Section 

4209) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 4118) 

(24) Expanding the use of EBT at farmers markets 

The Senate amendment requires the Secretary to make grants 

to carry out projects to expand the number of farmers’ markets 

that accept Food and Nutrition program electronic benefit transfer 

(EBT) cards. Grants may not be made for ongoing costs and may 

only be provided to entities that demonstrate a plan to continue to 

provide EBT card access. Mandatory funding of $5 million is provided for these grants. (Section 4210) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. Language incorporating the goals and objectives of the Senate provision appears in Section 10106 of the Horticulture and Organic Agriculture title. 

(25) Review of major changes in program design 

The House bill amends section 11(e)(6) of the FSA by specifying that only State agency Merit System employees are authorized to: 

(1) represent the State in any communications with prospective food stamp applicants, food stamp applicants, or recipient households regarding their application or participation 

in the food stamp program; 

(2) participate in making determinations regarding a 

household’s compliance with the requirements of the FSA or its 

implementing regulations; or 

(3) make any other determinations required under this 

section. 

The provision specifies that non-profit agencies that assist lowincome individuals and households in applying for SSNAP benefits 

by helping the individuals and households complete and submit applications are exempted. The non-profit exemption applies to general application assistance, which is currently allowed as a food 


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stamp outreach activity, and specialized projects that are operating 

under a waiver of the FSA and its implementing regulations. 

State agencies are not prohibited from contracting for automated systems or issuance services or for assistance in verifying an 

applicant’s identity. 

Funds from any appropriations act are prohibited from being 

used for implementing or continuing any contract that fails to meet 

the specifications regarding State Merit System employees. 

State agencies are prohibited from using Federal funds to: (1) 

perform or carry out contracts that fail to comply with the specifications regarding Merit System employees; or (2) pay any cost associated with the termination, breach, or full or partial abrogation 

of any contact that does not comply with the specifications regarding State Merit System employees. 

State agencies are prohibited from conducting projects that fail 

to comply with the specifications regarding State agency Merit System employees. 

State agencies are prohibited from privatizing food stamp eligibility determinations via the simplified food stamp program. 

The Secretary of Agriculture may authorize a State agency, on 

a temporary basis, to use non-Merit State employees to determine 

eligibility for a disaster SSNAP program. 

States have 120 days to bring any activities inconsistent with 

this section into compliance. (Section 4015) 

The Senate amendment amends section 11(a) to clarify State 

responsibility for program administration (including cases where 

the program is operated on a state or locally-administered basis) 

and to require that program records kept to determine whether the 

State is in compliance with the Act/regulations, that such records 

be available for review in any action filed by a household to enforce 

the Act/regulations, and to specify that inspection and audit requirements are subject to privacy requirements contained elsewhere in the Food and Nutrition Act. 

The provision also amends section 11(a) to require the Secretary to develop standards for identifying major changes in State 

agency operations—such as substantial increases in reliance on 

automated systems, or potential increases in administrative burdens placed on applicant or recipient households. It further mandates that, if a State implements a major change in operations, it 

must notify the Secretary and collect any information the Secretary 

needs to identify and correct any adverse effects on program integrity or access. (Section 4211) 

The Conference substitute adopts the Senate provision. (Section 4116) 

(26) Preservation of access and payment accuracy 

The Senate amendment amends section 16(g) of the FSA to require that computerized systems for State program operations receiving federal matching payments must (1) be tested adequately 

before and after implementation (including through pilot projects 

evaluated by the Secretary), and (2) be operated under a plan for 

continuous updating (to reflect changed policy and circumstances) 

and testing (for effects on households and payment accuracy). (Section 4212) 


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The House bill has no comparable provision. 

The Conference substitute accepts the Senate provision. (Section 4121) 

(27) Grants for simple application and eligibility determination systems and improved access to benefits 

The House bill provides no changes to the Secretary’s authority 

to make grants and amends section 11(t)(1) of the FSA by extending the grant program through Fiscal Year 2012. 

The Senate amendment amends section 11(t) of the Food and 

Nutrition Act to permanently extend the authority provided under 

that section. (Section 4801) 

The Conference substitute adopts the Senate provision with an 

amendment to make technical changes and to link the authority for 

grants for simple application and eligibility determination systems 

and improved access to benefits to the availability of appropriations 

provided through section 18(a) of the Supplemental Nutrition Assistance Program (SNAP). The language for this provision is incorporated into a single section reauthorizing SNAP and other domestic nutrition assistance programs. (Section 4406) 

(28) Civil money penalties and disqualification of retail food stores 

and wholesale food concern 

The House bill amends section 12 of the FSA by increasing the 

civil money penalties for retail stores and wholesale food concerns 

to $100,000 for each violation of the FSA or its regulations. The requirement that a determination as to the assessment of civil money 

penalties be based on whether there would be hardship for recipient households is removed. 

The provision stipulates that the period of disqualification: 

(1) for a first violation is not to exceed 5 years; and 

(2) for a second violation is not to exceed 10 years. 

The provision does not change the permanent disqualification 

rules, or other requirements, governing applications containing 

false information. 

The House bill requires the Secretary, in consultation with 

USDA’s Inspector General, to establish procedures whereby participating food concerns may be immediately suspended for ‘‘flagrant 

violations,’’ pending administrative and judicial appeal. Unsettled 

benefit claims would be subject to forfeiture—or returned to the 

food concern if the disqualification action is not upheld (without interest). (Section 4017) 

The Senate amendment is the same as the House bill, with 

technical differences. (Section 4017) It also amends section 12 to 

generally ease the conditions under which bonds are required of 

violating food concerns wishing to be re-approved for participation. 

The Secretary would be permitted to require bonds from food concerns disqualified for 180+ days (or subjected to a civil money penalty in lieu of a 180+ day disqualification). Bonds could be required 

for a period of not more than 5 years. Where a food concern has 

been sanctioned and commits a subsequent violation, the Secretary 

may require a collateral bond or irrevocable letter of credit regardless of the length of the disqualification period. (Section 4303) 


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The Conference substitute adopts the Senate provision with an 

amendment to make technical changes. (Section 4132) 

(29) Major systems failures 

The House bill provides that no changes are made to the methods by which a State agency is authorized to collect overissuances 

of coupons. 

The prohibition on the amount of the reduction in a household’s monthly allotment that a State agency is allowed to collect 

in the instance where overissuance of coupons has occurred is continued. 

Section 13(b) of the FSA is amended by providing the Secretary 

with the discretion to determine that a State agency has overissued 

benefits to a substantial number of households as the result of a 

‘‘major systemic error’’ by the State. 

A State agency is given the option to appeal the Secretary’s determination. However, if the State agency fails to appeal the Secretary’s determination, or, in the case of an appeal, if the State 

agency is held liable, the State agency is required to reimburse to 

the Secretary the amount for which the State agency is liable. 

The Secretary is authorized to prohibit, upon making a determination that over-issuances have occurred, the State agency from 

collecting the over-issuances from some or all of the affected households. (Section 4018) 

The Senate amendment is the same as the House bill, with 

technical differences. 

The Conference substitute adopts the House provision. The 

Managers have provided the Secretary with discretionary authority 

to determine when it is appropriate to prohibit a State agency from 

collecting overissuances from households that have been affected by 

a major system failure. In certain instances, it may be appropriate 

for the Secretary to allow the State to collect overissuances from 

households. The Managers expect that the Secretary will exercise 

this authority judiciously, and further expect that in circumstances 

where a major systems failure is attributable to a specific and deliberate action by the State, that states will not be allowed to pass 

along the costs associated with such systems failures to households. 

(Section 4133) 

(30) Funding for employment and training programs 

The House bill provides no program changes. The funding level 

remains the same and is extended for each of the fiscal years 2008 

through 2012. (Section 4019) 

The Senate amendment amends section 16(h)(1) to limit the 

time unspent unmatched federal funding for employment and 

training program expenses may remain available to 2 years (as opposed to until expended). Also rescinds unspent employment and 

training program funds for any fiscal year before fiscal year 2008. 

It also provides permanent authorization for funding of employment and training programs. (Section 4304; Section 4801) 

The Conference substitute adopts the Senate provisions with 

amendments to allow funds to remain available for 15 months 

rather than two years, to strike the requirement that any unobligated employment and training funds be rescinded, and to link the 


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authority for funding for employment and training programs to the 

availability of appropriations provided through section 18(a) of the 

Supplemental Nutrition Assistance Program (SNAP). The language 

from subsection (b) of section 4801 of the Senate amendment is incorporated into a single section reauthorizing SNAP and other domestic nutrition assistance programs. (Section 4122) 

(31) Reductions in payments for administrative costs 

The House bill amends section 16(k) of the FSA by extending 

the requirement to reduce State administrative cost payments 

through fiscal year 2012. (Section 4020) 

The Senate amendment amends section 16(k) to permanently 

extend the requirement to reduce State administrative cost payments. (Section 4801) 

The Conference substitute adopts the Senate provision with an 

amendment to make technical changes. The language for this provision is incorporated into a single section reauthorizing SNAP and 

other domestic nutrition assistance programs. (Section 4406) 

(32) Performance standards for bio-metric identification technology 

The Senate amendment amends section 16 of the FSA to establish the conditions under which the Secretary may pay States the 

federal share (50%) of costs associated with the acquisition and use 

of biometric identification technology (e.g., fingerprints, retinal 

scans). In order to gain federal cost-sharing, States must provide 

a statistically valid and otherwise appropriate analysis of the cost 

effectiveness of using biometric identification technology to detect 

program fraud, demonstrate that the proposed technology is cost effective in reducing fraud and that no other fraud-detection methods 

are at least as cost-effective, and demonstrate that the system will 

comply with privacy protection rules. (Section 4302) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. 

(33) Cash payment pilot projects 

The House bill amends section 17(b)(1)(B)(vi) of the FSA by extending the authority for cash-payment pilot projects through October 1, 2012. (Section 4021) 

The Senate amendment amends section 17(b)(1)(B)(vi) by permanently extending existing authority for cash-payment pilot 

projects to households whose members are 65 years old or entitled 

to SSI benefits. (Section 4801) 

The Conference substitute adopts the Senate provision with an 

amendment for technical changes. The language for this provision 

is incorporated into a single section reauthorizing SNAP and other 

domestic nutrition assistance programs. (Section 4406) 

(34) Findings of Congress regarding Secure Supplemental Nutrition 

Assistance Program education 

The House bill contains Congressional findings regarding the 

Food Stamp Program noting that the FSA ‘‘plays an essential role 

in improving the dietary and physical activity practices of low-income Americans, [by] helping to reduce food insecurity, 

prevent[ing] obesity, and reduc[ing] the risks of chronic disease.’’


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The Secretary is encouraged to support the most effective 

interventions for nutrition education under the FSA, including public health approaches and traditional education, to increase the 

likelihood that recipients and potential recipients of benefits under 

the SSNAP program choose diets and physical activity practices 

that are consistent with the Dietary Guidelines for Americans. 

(Section 4022) 

The Senate amendment is the same as the House bill with 

technical differences. 

The Conference substitute deletes both the House and Senate 

provisions. The Managers recognize that nutrition education plays 

an essential role in improving the dietary and physical activity 

practices of low-income individuals in the United States, helping to 

reduce food insecurity, prevent obesity, and reduce the risks of 

chronic disease. Expert organizations, such as the Institute of Medicine, indicate that dietary and physical activity behavior change is 

more likely to result from the combined application of public health 

approaches and education than from education alone. 

The Managers expect that the Secretary will support and encourage implementation of the most effective methods, informed by 

current science, for nutrition education under the Food and Nutrition Act, including those that are consistent with recommendations 

and actions of expert bodies to promote healthy eating and physical 

activity behavior change. Funds provided under the Food and Nutrition Act should be used for activities that promote the most effective implementation of programs to increase the likelihood that 

recipients of, and those potentially eligible for, supplemental nutrition assistance program benefits will choose diets and physical activity practices consistent with the Dietary Guidelines for Americans. The Managers recognize that state nutrition education activities under the Food and Nutrition Act work best when coordinated 

with other federally funded food assistance and public health programs and when policies are implemented to leverage public/private partnerships to maximize the resources and impact of the programs. 

(35) Eligibility disqualification 

The Senate amendment amends section 6 of the FSA to disqualify (for a period determined by the Secretary) persons found by 

a court or administrative agency to have intentionally obtained 

cash by misusing program benefits to obtain money for return of 

deposits on containers. It also modifies section 6 to disqualify (for 

a period determined by the Secretary) persons found by a court or 

administrative agency to have intentionally sold any food that was 

purchased using program benefits. (Section 4305) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. The 

Managers do not intend for this provision to include inadvertent de 

minimis actions such as an individual who purchases a brownie 

mix with program benefits, then makes brownies and sells them at 

a school bake sale. (Section 4131) 


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(36) Definition of staple foods 

The Senate amendment amends section 3 to (1) add dietary 

supplements to the list of accessory food items that are not classified as staple foods for the purpose of approving the participation 

of food concerns in the program, and (2) require the Secretary to 

issue regulations to ensure that adequate stocks of staple foods are 

available on a continuous basis in approved food concerns. (Section 

4401) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. 

(37) Accessory food items 

The Senate amendment amends section 9 of the FSA to require 

that, within 1 year of enactment, the Secretary issue proposed regulations defining dietary supplements: multivitamin-mineral supplements providing prescribed minimum amounts of essential vitamins and minerals that do not exceed prescribed daily upper limits 

and certain prescribed amounts of folic acid or calcium. Final regulations as to dietary supplements must be issued within 2 years of 

enactment. No dietary supplements may be purchased with program benefits until the earlier of (1) the date of final regulations 

with regard to dietary supplements, or (2) the date the Secretary 

certifies a voluntary system of labeling for identification of eligible 

dietary supplements. (Section 4402) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. 

(38) Nutrition education and promotion initiative to address obesity 

The House bill amends section 17 of the FSA by adding a new 

section that authorizes the Secretary to establish a demonstration 

program, to be known as the ‘‘Initiative to Address Obesity Among 

Low-Income Americans,’’ to develop and implement strategies to reduce obesity among low-income Americans. 

The Secretary is authorized to enter into competitively awarded contracts, cooperative agreements, or grants with public or private organizations or agencies. 

Agencies are required to submit applications to the Secretary, 

and the Secretary is to evaluate demonstration proposals using a 

variety of criteria, including: (1) identifying a low-income target audience that corresponds to individuals living with incomes at or 

below 185 percent of the poverty level; (2) incorporating scientifically-based strategies that are designed to improve diet quality 

through more healthful food purchases, preparation, or consumption; and (3) a commitment to a demonstration plan that allows for 

rigorous outcome evaluation, including data collection. 

Projects that limit the use of SSNAP program benefits are prohibited from receiving funding. The Secretary is authorized to use 

funds to pay costs associated with monitoring, evaluating, and disseminating the Initiative’s findings. 

An appropriation of $10,000,000 is authorized for fiscal years 

2008 through 2012. No new grants are to be made after September 

30, 2012. (Section 4023) 

The Senate amendment amends section 17 to require and fund 

pilot projects to develop and test methods of using the Food and 


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Nutrition program to improve the dietary and health status of participants and to reduce overweight, obesity, and associated comorbidities. Among other initiatives, projects may include those 

providing increased program benefits, increased access to farmers’

markets, incentives to participating vendors to increase the availability of healthy foods, adding vendor approval requirements with 

respect to carrying healthy foods, point-of-purchase incentives to 

encourage program participants to buy fruits, vegetables, and other 

healthy foods, and providing integrated communication and education programs (including school-based nutrition coordinators). 

These pilot health and nutrition promotion projects would include independent evaluations and annual reports on their status. 

Mandatory funding of $50 million is provided, and up to $25 

million must be used for point-of-purchase incentive projects. (Section 4403) 

The Conference substitute adopts the House provision with 

amendments to specify that the purpose of the section is to carry 

out pilot projects to develop and test methods for improving the dietary and health status of households in the Supplemental Nutrition Assistance Program, as well as to reduce obesity and other 

diet-related diseases in the United States; specify the types of pilot 

projects that the Secretary may consider; include a requirement relating to evaluations and reports of the pilot projects; specify mandatory funding amounts and require that the Secretary use not 

more than $20 million of that mandatory funding to carry out a 

point-of-purchase pilot project to encourage households to purchase 

fruits, vegetables, or other healthy foods. (Section 4141) 

(39) Hunger free communities 

The Senate amendment requires the Secretary to conduct and 

periodically update a study of major matters relating to hunger in 

the United States. The study would assess data on hunger and food 

insecurity and measures that have been carried out or could be carried out to achieve goals of reducing domestic hunger. It also would 

contain recommendations for removing obstacles to domestic hunger goals and otherwise reducing domestic hunger. 

The Senate amendment authorizes grants to food program 

service providers and local nonprofit organizations (like emergency 

feeding organizations) for the federal share (up to 80%) of projects 

that assess community hunger problems and meet, or develop new 

resources/programs to meet, goals for achieving hunger-free communities. 

The provision authorizes matching grants to emergency feeding 

organizations for infrastructure development. 

Appropriations of $50 million a year (through fiscal year 2012) 

are authorized. (Section 4405) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendments to strike the definition of food security; strike the 

study and report relating to hunger; specify that not more than 50 

percent of the funds made available under this section be used for 

the federal share of collaborative grants; strike requirements relating to the contents of collaborative grants and priority for eligible 


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entities that meet certain criteria; and to make other technical 

changes. (Section 4405) 

(40) State performance on enrolling children receiving program benefits for free school meals 

The Senate amendment requires the Secretary to submit annual reports that assess the effectiveness and practices of each 

State in enrolling school-aged children in households receiving food 

stamp benefits for free school meals using ‘‘direct certification’’ (a 

current-law procedure allowing children in families receiving program benefits to be deemed automatically eligible for free school 

meals). (Section 4406) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to add the House Committee on Education and Labor 

to the list of recipients of the reports produced by the Secretary in 

accordance with this section. The Managers recognize the time and 

data constraints for developing the report scheduled to be provided 

on or before December 31, 2008, and expect that this report will 

include as much data as possible given such constraints. (Section 

4301) 

(41) Authorization of appropriations 

The House bill amends section 18(a)(1) of the FSA by reauthorizing appropriations to carry out that Act through 2012. (Section 

4024) 

The Senate amendment amends section 18(a)(1) of the Food 

and Nutrition Act by permanently reauthorizing appropriations to 

carry out the Act. (Section 4801) 

The Conference substitute adopts the Senate provision with an 

amendment to make technical changes and to extend authority for 

appropriations to carry out the Supplemental Nutrition Assistance 

Program (SNAP) through fiscal year 2012. The language for this 

provision is incorporated into a single section reauthorizing SNAP 

and other domestic nutrition assistance programs. (Section 4406) 

(42) Consolidated block grants for Puerto Rico and American 

Samoa 

The House bill amends section 19(a)(2)(A) of the FSA by extending to 2012 the Secretary’s authority to provide funds to Puerto Rico and American Samoa to administer their nutrition assistance programs. (Section 4025) 

The Senate amendment amends section 19(a)(2)(A)(ii) of the 

Food and Nutrition Act by permanently extending the Secretary’s 

authority to provide funds to Puerto Rico and American Samoa to 

administer their nutrition assistance programs. (Section 4801) 

The Conference substitute adopts the Senate provision with an 

amendment to make technical changes and to link the authority for 

consolidated block grants for Puerto Rico and American Samoa to 

the availability of appropriations provided through section 18(a) of 

the Supplemental Nutrition Assistance Program (SNAP). The language for this provision is incorporated into a single section reauthorizing SNAP and other domestic nutrition assistance programs. 

(Section 4406) 


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(43) Study on comparable access to nutrition assistance program 

benefits for Puerto Rico 

The House bill amends section 19 of the FSA by authorizing 

the Secretary to conduct a study on the feasibility of including 

Commonwealth of Puerto Rico in the SSNAP program, in lieu of 

providing Puerto Rico with a block grant. 

The study is to include, among other findings: (a) an assessment of the administrative, financial, and other changes that would 

be required for Puerto Rico to establish a comparable SSNAP program; (b) a discussion of the appropriate program rules under other 

sections of the FSA, such as benefit levels, income eligibility standards, and deduction levels for Puerto Rico to establish a comparable SSNAP program; (c) an estimate of the impact on Federal 

and Commonwealth benefit and administrative costs; and (d) an estimate on the impact of the SSNAP program on hunger and food 

insecurity among low-income Puerto Ricans. (Section 4026) 

The Senate amendment is the same as the House bill (with 

technical differences), but provides mandatory funding of $1 million 

to conduct the study. (Section 4206) 

The Conference substitute adopts the Senate provision. (Section 4142) 

(44) Reauthorization of community food project competitive grants 

The House bill continues the Secretary’s authority to make 

grants. Section 25 of the FSA is amended by authorizing an appropriation of $30,000,000 a year through fiscal year 2012 for community food projects. The eligibility requirements remain unchanged. 

Section 25 of the FSA is amended by expanding the list of preferences for selecting community food projects to include projects 

that are designed to serve special needs in the areas of: (1) emergency food service infrastructure; (2) retail access to underserved 

markets; (3) integration of urban and metro-area food production in 

food projects; and (4) technical assistance for youth, socially disadvantaged individuals, and limited resource groups. 

The Federal share of the cost of establishing or carrying out a 

community food project is not to exceed 75 percent of the cost of 

the project during the time of the grant. 

The maximum term of a grant is increased to 5 years. 

No changes are made to the Secretary’s authority. 

The Secretary is required to allocate, for each of the fiscal 

years 2008 through 2012, out of the funds made available to carry 

out community food projects, $500,000 for the project to address 

common community problems. 

The Senate amendment amends section 25 of the Food and Nutrition Act to provide $10 million a year in mandatory funding for 

community food projects, through fiscal year 2012. 

The Conference substitute adopts the Senate provision with 

amendments to authorize the establishment of and provide a grant 

to the Healthy Food Urban Enterprise Development Center; to provide authority for the Center to provide subgrants to eligible entities for the purpose of carrying out feasibility studies, as well as 

to establish and facilitate enterprises that process, distribute, aggregate, store, and market healthy affordable foods; to provide 

mandatory funding of $1,000,000 a year for fiscal years 2009 


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through 2011 for the Center, and to incorporate these changes into 

section 4402. The Senate provision providing mandatory funding of 

$5 million a year for the Community Food Projects competitive 

grants appears in section 4406. (Section 4402; Section 4406) 

(45) Emergency Food Assistance Program 

The House bill amends section 27 of the FSA by increasing the 

Emergency Food Assistance Program (TEFAP) commodity purchase 

requirement. In fiscal year 2008, the Secretary is authorized to 

purchase a total of $250,000,000 in commodities; for fiscal years 

2009 through 2012, the dollar amount is to be indexed annually for 

food-price inflation. (Section 4028) 

The Senate amendment is substantially similar to the House 

bill with technical differences and without the requirement to index 

the base amount of $250 million per year. (Section 4110) 

The Conference substitute adopts the Senate provision with 

amendments to increase mandatory funding to $190,000,000 in fiscal year 2008, $250,000,000 in fiscal year 2009 and subsequently 

indexed for food-price inflation during fiscal years 2010 through 

2012. (Section 4201) 

(46) Authorization of appropriations 

The House bill amends section 204(a) of the Emergency Assistance Food Act of 1983 by increasing the authorization of appropriations to $100,000,000 a year, through fiscal year 2012. (Section 

4201) 

The Senate amendment amends section 204(a) of the Emergency Food Assistance Act by permanently increasing the authorization of appropriations to $100 million a year. It also requires 

that State TEFAP agencies submit operation and administrative 

plans every 3 years (as opposed to every 4 years under current law) 

and makes clear that funds may be applied to the cost of administering wild game donations. (Section 4802, 4601) 

The Conference substitute adopts the Senate provisions with 

amendments to specify that amendments to State operation and 

administrative plans may be submitted as necessary; and to combine sections 4802 and 4601 into a single section. (Section 4201) 

(47) Distribution of commodities special nutrition projects 

The House bill provides that no changes are made to the mandate encouraging reprocessing agreements, with respect to surplus 

commodities. 

Section 1114(a)(2)(A) of the Agriculture and Food Act (AFA) is 

amended by extending, through fiscal year 2012, the requirement 

for the Secretary to encourage reprocessing agreements. (Section 

4202) 

The Senate amendment is the same as House bill with technical differences. (Section 4802) 

The Conference substitute adopts the Senate provision with an 

amendment for technical changes. The language for this provision 

is incorporated into a single section reauthorizing the Supplemental Nutrition Assistance Program and other domestic nutrition 

assistance programs. (Section 4406) 


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(48) Commodity Distribution Program 

The House bill amends section 4(a) of the Agriculture and Consumer Protection Act of 1973 (ACPA) by extending the Secretary’s 

authority through fiscal year 2012. 

Section 5 of the ACPA is amended by extending through fiscal 

year 2012 the ACPA requirement concerning inflation-indexed 

caseload slot grants. 

Section 5(d)(2) of the ACPA is amended by extending the requirement that the Commodity Credit Corporation (CCC) furnish 

cheese and nonfat dry milk for the Community Supplemental Food 

Program (CSFP) through fiscal year 2012. 

Section 5(g) of the ACPA is amended by mandating that local 

agencies are to use funds made available under the CSFP to provide assistance to low-income elderly individuals, women, infants, 

and children in need for food assistance in accordance with any 

regulations the Secretary may prescribe. Conforming amendments 

are made stipulating that CSFP benefits are available to low-income elderly individuals. 

Section 5 of the ACPA is further amended by requiring the 

Secretary to establish maximum income eligibility standards for 

the CSFP that are the same for all applicants. The standards are 

not to exceed the maximum income limits established for the Special Supplemental Nutrition Program for Women, Infants, and 

Children (WIC)—i.e., 185 percent of the federal poverty income 

guidelines. (Section 4203) 

The Senate amendment amends section 4(a) of the ACPA by 

permanently extending the Secretary’s authority to purchase and 

distribute agricultural commodities for food assistance programs 

(including the Commodity Supplemental Food Program). 

The Senate amendment permanently extends the ACPA requirement in section 5 for inflation-indexed caseload slot grants, 

and permits State to serve low-income elderly persons with income 

up to 185% of the federal poverty income guidelines, if the Secretary determines that annual appropriations have enabled every 

State seeking to participate in the CSFP to participate. 

Section 4602 bars the Secretary from requiring any State or 

local CSFP program to prioritize assistance to a particular group 

of individuals that are low-income elderly persons or women, infants, and children. (Section 4802, 4602) 

The Conference substitute adopts the Senate provisions with 

amendments to make technical changes to incorporate the reauthorization of the Commodity Supplemental Food Program into 

Section 4406; incorporate language relating to the prohibition on 

requiring State or local agencies to prioritize assistance to certain 

groups of individuals into section 4221. (Section 4406; Section 

4221) 

The Managers recognize the importance of the Commodity 

Supplemental Food Program (CSFP) as a critical nutrition program 

that serves primarily the vulnerable population of low-income elderly Americans. CSFP provides nutritious food, often in the form 

of food boxes for home delivery, that are designed to meet the dietary needs of seniors, women, and children in 32 states, two Indian 

tribal organizations, and the District of Columbia. In fiscal year 

2007, 93 percent of the recipients were elderly individuals with an 


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annual income at or below $13,273. CSFP serves a unique niche by 

providing nutritious commodities to homebound seniors who are at 

severe risk for hunger. 

The Managers fully support the continued operation of this 

program and recognize the need for a substantial expansion of the 

CSFP. The Managers note that there are five states that have currently been approved by USDA for entry into CSFP (Arkansas, 

Delaware, Oklahoma, New Jersey and Utah) subject to the availability of appropriations. Provided that sufficient funds are appropriated by Congress, the Managers encourage the Secretary to approve all remaining states for expansion and to expand caseload in 

all participating states. 

(49) Periodic surveys of foods purchased by school food authorities 

The Senate amendment amends section 6 of the Richard B. 

Russell National School Lunch Act to require periodic nationally 

representative surveys of food purchased by schools participating in 

the school lunch program. It also provides funding of $3 million for 

each survey. (Section 4901) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an amendment to provide one-time funding of $3,000,000 to carry out 

the section. (Section 4307) 

(50) Healthy Food Education and Program replicability 

The Senate amendment amends section 18(i) to provide that 

sponsored projects may promote healthy food education and that 

the Secretary must give priority to projects that can be replicated 

in schools. It also authorizes a new pilot project (at $10 million) in 

not more than 5 States under which grants are made to ‘‘high-poverty’’ schools for initiatives with hands-on gardening. No cost-sharing is required. (Section 4903) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to strike the authorization of appropriations to carry 

out the provision. (Section 4303) 

(51) Purchase of fresh fruits and vegetables for distribution to 

schools and service institutions 

The House bill amends section 10603 of the Farm Security and 

Rural Investment Act of 2002 (FSRIA) by increasing the dollar 

amount of fresh fruits, vegetables and other specialty foods the Secretary must procure for schools and service institutions participating in programs under the National School Lunch Act to at least 

$50,000,000 a year for each of the fiscal years 2008 and 2009 and 

$75,000,000 a year for each of the fiscal years 2010 through 2012. 

As under current law, these amounts may be spent through the Department of Defense (DoD) Fresh Program. (Section 4301) 

The Senate amendment provides that, in lieu of purchases required under Sec. 10603, the Secretary purchase fruits, vegetables, 

and nuts for use in domestic food assistance programs using Section 32 funds. 

Purchase amounts are set at: $390 million for fiscal year 2008, 

$393 million for fiscal year 2009, $399 million for fiscal year 2010, 


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$403 million for fiscal year 2011, and $406 million for fiscal year 

2012 and each year thereafter. 

Items purchased may be in frozen, canned, dried, or fresh 

form. 

The Senate amendment also allows the Secretary to offer 

value-added products containing fruits, vegetables or nuts after 

taking into consideration whether demand exists for the valueadded product and the interest of entities that receive fruits, vegetables and nuts under this program. (Section 4907) 

The Conference substitute adopts the House language with an 

amendment to retain the current $50 million a year requirement 

to acquire fresh fruits and vegetables for distribution in accordance 

with section 6(a) of the Richard B. Russell National School Lunch 

Act. The Managers expect the purchases of fresh fruits and vegetables previously made through the Department of Defense Fresh 

Program will continue under an equivalent procurement mechanism. (Section 4404) 

(52) Buy America requirements 

The House bill includes Congressional findings that: (1) Federal law requires that commodities and products purchased with 

Federal funds be, to the extent practicable, of domestic origin; (2) 

Federal Buy American statutory requirements seek to ensure that 

purchases made with Federal funds benefit domestic producers; 

and (3) the School Lunch Act requires the use of domestic food 

products for all meals served under the program, including food 

products purchased with local funds. (Section 4302) 

The Senate amendment is the same as the House bill, with 

technical differences. (Section 4906). 

The Conference substitute adopts the House provision. (Section 

4306) 

(53) Expansion of Fresh Fruit and Vegetable Program 

The House bill amends section 18(f) of the Richard B. Russell 

National School Lunch Act (NSLA) by expanding the fresh fruit 

and vegetable program in elementary and secondary schools. Mandatory funding is increased from $9,000,000 to $70,000,000 a year, 

and the program is to be available nationwide in: (A) 35 elementary and secondary schools in each State; and (B) additional elementary and secondary schools in each State in proportion to the 

student population of the State. 

The Senate amendment replaces the current fresh fruit and 

vegetable program, beginning with the 2008–2009 school year. The 

new program would provide mandatory funding ($225 million in 

the first year, indexed for inflation in later years) and authorize additional appropriations for a program to make free fresh fruits and 

vegetables available in participating elementary schools nationwide. 

Participating elementary schools would be selected by States 

with priority generally given to schools with the highest proportion 

of children eligible for free or reduced-price school meals, those that 

partner with entities that provide non-federal resources, and those 

that evidence efforts to integrate the program with other efforts to 


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promote sound health and nutrition, reduce overweight and obesity, or promote physical activity. 

Funding would be allocated among States under a formula distributing roughly half of the funds equally among States and apportioning the remainder based on State population. At least 100 

schools chosen to participate must be operated on Indian reservations. Per-student grants would be determined by the State but 

could not be less than $50, or more than $75, annually. An evaluation is required and provided funding of $3 million 

to remain available until expended. 

The Senate amendment changes the final report’s due date to 

December 31, 2012. 

The Secretary is authorized, in selecting schools to participate 

in the program, to encourage plans for implementation that include 

locally grown foods. 

The Secretary is required to establish requirements to be followed by States in administering the Fresh Fruit and Vegetable 

Program—the initial set of requirements must be established not 

later than 1 year after the enactment. 

The Secretary is allowed to reserve up to 1% of program funding for administrative expenses related to the program. States may 

use up to 5% of program funding for administrative expenses. (Section 4904) 

The Conference substitute adopts the Senate provision with 

several amendments. The substitute deletes Senate language allowing a consortia of schools to apply for funding. The substitute includes a new requirement that state agencies administering the 

program initiate special outreach to schools with significant numbers of children eligible for free or reduced price meals informing 

them of their eligibility for the program. The substitute includes a 

new provision to ensure that states currently receiving funding 

under the program do not see a reduction in their funding as the 

program is phased in over time. The substitute includes an amendment which allows states to reserve funding for program administration, in accordance with regulations promulgated by the Secretary. And the substitute includes several provisions intended to 

aid the Secretary as the program transitions from the existing requirements of section 18(f) to the new requirements established by 

this section. Mandatory funding is provided through section 32 of 

the Act of August 24, 1935 in the amounts of $40,000,000 on October 1, 2008; $65,000,000 on July 1, 2009; $101,000,000 on July 1, 

2010; $150,000,000 on July 1, 2011; $150,000,000 indexed for inflation according to the CPI–U on July 1, 2012. (Section 4304) 

It is the intent of the Managers to specifically target available 

program funding to schools with the highest proportion of children 

who are eligible for free and reduced price meals, in accordance 

with (d)(1)(B). Accordingly, the Managers expect that, provided the 

rest of a school’s application is acceptable, that a school with a 

higher proportion of children eligible for free and reduced-price 

meals will be selected to participate rather than a school with a 

lower proportion of children eligible for free and reduced-price 

meals. 

As the name of the program makes clear, it is the intent of the 

program to provide children with free fresh fruits and vegetables. 


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It is not the intent of the Managers to allow this program to provide other products, such as nuts, either on their own or comingled 

with other foods, such as in a trail mix. The Managers support the 

inclusion of all fruits and vegetables in the federal nutrition programs where supported by science and will continue to work with 

the Department on promoting access to all fruits and vegetables. 

(54) Purchases of locally produced foods 

The House bill amends section 9(j) of the NSLA by authorizing 

the Secretary to: 

(1) encourage institutions that receive funds under the 

NSLA and the Child Nutrition Act (CNA) to purchase, to the 

maximum extent practicable and appropriate, locally-produced 

foods; 

(2) advise institutions about the policy related to purchasing locally-produced foods and post information related to 

this policy on the website maintained by the Secretary; and 

(3) allow institutions receiving funds under the NSLA and 

the CNA, including the DoD Fruit and Vegetable Program, to 

use geographic preference in their procurement of locally- produced foods. (Section 4304) 

The Senate amendment is the same as the House bill, except 

that Senate amendment pertains to locally produced fruits and 

vegetables. (Section 4902) 

The Conference substitute adopts the House provision with an 

amendment to specify that the Department of Agriculture is required to allow institutions to use a geographic preference for the 

procurement of unprocessed, locally grown and raised agricultural 

products. (Section 4302) 

The Managers do not intend that the Food and Nutrition Service interpret the term ‘‘unprocessed’’ literally, but rather intend 

that it be logically implemented. In specifying the term ‘‘unprocessed,’’ the Managers’’ use of the term intends to preclude the use 

of geographic preference for agricultural products that have significant value added components. The Managers do not intend to preclude de minimis handling and preparation such as may be necessary to present an agricultural product to a school food authority 

in a useable form, such as washing vegetables, bagging greens, 

butchering livestock and poultry, pasteurizing milk, and putting 

eggs in a carton. 

(55) Seniors Farmers’ Market Nutrition Program 

The House bill amends section 4402 of FSRIA by: (1) extending 

mandatory funding of $15,000,000 for the Senior Farmers’ Market 

Nutrition Program through fiscal year 2012; and (2) authorizing 

additional appropriations of $20,000,000 for fiscal year 2008, 

$30,000,000 for fiscal year 2009, $45,000,000 for fiscal year 2010, 

$60,000,000 for fiscal year 2011, and $75,000,000 for fiscal year 

2012. 

Honey is added to the list of items to be covered by program 

vouchers. 

The value of benefits provided to eligible Senior Farmers’ Market Nutrition Program recipients is prohibited from being considered income or resources for any purposes under any Federal, State 


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or local law. State and local governments are also prohibited from 

collecting taxes on food purchased with vouchers distributed under 

the program. (Section 4401) 

The Senate amendment amends section 4402 by permanently 

extending mandatory funding for the senior farmers’ market nutrition program (at $15 million a year). It also mandates additional 

funding of $10 million a year. 

Provisions regarding the treatment of senior farmers’ market 

nutrition program benefits are the same as in the House bill. (Section (4701, 4702) 

The Conference substitute adopts the House provision with an 

amendment to strike the authorization of additional appropriations 

to carry out the program, and to make other technical changes. The 

Senate provision requiring additional mandatory funds is adopted 

and appears in section 4405 with an amendment to increase current mandatory funding to $20,600,000 a year. (Section 4231) 

(56) Congressional Hunger Center 

The House bill amends section 4404 of FSRIA with provisions 

similar to those contained in current law. Provisions in this section 

differ from those in current law by authorizing annual appropriations of $3,000,000 a year, through fiscal year 2012, and by specifically naming the Congressional Hunger Center as the administering entity for Emerson and Leland fellowships. (Section 4402) 

The Senate amendment is the same as the House bill, with 

technical differences and requires: 1) issuance of a grant from 

USDA to the Congressional Hunger Center to administer the program (as opposed to a contract in the House bill); and (2) an appropriations authorization set at ‘‘such sums as are necessary.’’ (Section 4404) 

The Conference substitute adopts the Senate provision with an 

amendment to strike language pertaining to congressional findings, 

and make other technical changes. (Section 4401) 

(57) Joint Nutrition Monitoring 

The House bill amends Subtitle D of Title IV of FSRIA by authorizing the Secretary of Agriculture, along with the Secretary of 

Health and Human Services, to continue to provide jointly for national nutrition monitoring and related research activities. 

Among other duties, the two Secretaries are required to: (a) 

collect continuous dietary, health, physical activity, and diet and 

health knowledge data on a nationally representative sample; (b) 

periodically collect data on special at-risk populations as identified 

by the Secretaries; (c) distribute information on health, nutrition, 

the environment, and physical activity to the public in a timely 

fashion; (d) analyze new data that becomes available; (e) continuously update food composition tables; and (f) research and develop 

data collection methods and standards. (Section 4403) 

The Senate amendment is the same as the House bill, with 

technical differences. Freestanding provision. (Section 7501) 

The Conference substitute adopts the House provision with a 

technical amendment to structure the language as a freestanding 

provision. (Section 4403) 


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(58) Team Nutrition Network 

The Senate amendment provides mandatory funding for Team 

Nutrition Network activities—$3 million a year through fiscal year 

2012. (Section 4905) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. 

(59) Agricultural policy and public health 

The Senate amendment requires the Government Accountability Office (GAO) to assess whether the agricultural policies of 

the U.S. have an impact on health, nutrition, overweight and obesity, and diet-related chronic disease. (Section 4908) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. 

(60) Sense of the Congress 

The House bill expresses the sense of Congress that food items 

provided pursuant to the Federal School Meal Program should be 

selected so as to reduce the incidence of juvenile diabetes and to 

maximize nutritional value. (Section 4404) 

The Senate amendment has no comparable provision. 

The Conference substitute deletes the House provision. 

(61) Grain Pilot Program 

The Senate amendment amends the Richard B. Russell National 

School Lunch Act to establish a pilot project to provide grain products in selected elementary and secondary schools. Funding of $4 

million is provided—to be supplied from funds available for the 

senior farmers’ market nutrition program and community food 

projects. (Section 4912) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendments to purchase whole grain products for distribution in 

the school lunch and breakfast programs; provide an evaluation of 

the pilot program; and to require that funding to carry out this program be utilized from funds made available under Section 32 of the 

Act of August 24, 1935. (Section 4305) 

(62) Report on Federal hunger programs 

The Senate amendment requires the Government Accountability 

Office (GAO) to submit a report that surveys all federal programs 

that seek to alleviate hunger or food insecurity or improve nutritional intake. (Section 4913) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. 

(63) Food Employment Empowerment and Development Program 

The Senate amendment authorizes a ‘‘food employment empowerment and development’’ program under which grants would 

be made to encourage the effective use of community resources to 

combat hunger and the causes of hunger through food recovery and 

job training initiatives. (Section 4914) 

The House bill has no comparable provision. 


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The Conference substitute deletes the Senate provision. The 

Managers note that the activities authorized under the Senate provision are eligible for funding under the Community Food Projects 

(CFP) competitive grants program, and encourage organizations 

seeking federal assistance to carry out such activities to submit an 

application for funding through CFP. 

The Managers recognize the Community Food Projects (CFP) 

program is designed to provide one-time grant funding for projects 

that meet the food needs of low-income people, increase the self-reliance of communities in providing for their own food needs, and 

plan for long-term solutions to address such needs. The Managers 

acknowledge that the Food Employment Empowerment and Development (FEED) Program meets the requisite eligibility standards 

for funding under the CFP program. 

The goal of the FEED Program is to encourage the effective 

use of community resources to combat hunger and the root causes 

of hunger by creating opportunity through food recovery and job 

training. In general, eligible participants of the FEED Program, 

such as school based programs, will focus their efforts in the following areas: 

(1) Recovery of donated food from area restaurants, caterers, hotels, cafeterias, farms, or other food service businesses 

and distribution of meals or recovered food to nonprofit organizations. 

(2) Training of unemployed and underemployed adults for 

careers in the food service industry. 

(3) Carrying out of a welfare-to-work job training. 

The Managers expect USDA to give full consideration to CFP 

grant applications that meet the goals of the FEED program. 

(64) Infrastructure and transportation grants to support rural food 

bank delivery of perishable foods 

The Senate amendment authorizes competitive grants—totaling $10 million a year through fiscal year 2012—to expand the capacity and infrastructure of food banks to improve their ability to 

handle ‘‘time-sensitive’’ (perishable) food products, to improve identification of potential providers of donated food, and to support the 

procurement of locally-produced food from small and family farms 

and ranches. (Section 4915) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendments to structure the provision as an amendment to the 

Emergency Food Assistance Act of 1983; provide a requirement 

that the Secretary use not less than 50 percent of grant funds for 

rural areas; specify authorized levels of appropriations; and to 

make other technical changes. (Section 4202) 

(65) Reauthorization and application 

The House bill extends the various expiring authorities 

through fiscal year 2012 in sections 4016, 4019, 4020, 4021, 4024, 

4025, 4027, 4028, 4201, 4202, and 4203 of this Act, except for the 

authorization of appropriations for the nutrition information and 

awareness program established by Section 4403 of FSRIA. (Section 


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4016, 4019, 4020, 4021, 4024, 4025, 4027, 4028, 4201, 4202 and 

4203) 

The Senate amendment extends most expiring authorities indefinitely. Community food projects, authority in section 1114(a)(2) 

of the AFA, and the nutrition information and awareness program 

are extended through FY2012. 

The Senate amendment also stipulates that, except as otherwise provided, the amendments made in the Nutrition title take effect April 1, 2008. It also provides that States may implement 

amendments made in Sections 4101 through 4110 beginning on a 

date determined by the State during the period between April 1 

and October 1, 2008. States are given the option to implement 

amendments made by sections 4103 and 4104 for a certification period that begins not earlier than an implementation date between 

April 1 and October 1, 2008 (as determined by the State). 

This section provides that the amendments made in sections 

4101–4104, 4107–4109, 4110(a)(2), 4208, 4701(a)(3), 4801(g), and 

4903 terminate September 30, 2012. (Section 4801, 4802, 4803, 

4910, 4911) 

The Conference substitute adopts the Senate provision with 

amendments for technical changes, to extend various expiring authorities through fiscal year 2012, and to link various expiring authorities to the availability of appropriations provided through section 18(a) of the Supplemental Nutrition Assistance Program 

(SNAP). The language for this provision is incorporated into a single section reauthorizing SNAP and other domestic nutrition assistance programs. (Section 4406) 

(66) Study on purchases of food with program benefits 

The Senate amendment requires GAO to conduct a study of 

the effects of a rule requiring that food stamp benefits only be used 

to purchase food included in the most recent thrifty food plan market basket. (Section 4202) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. 

TITLE V—CREDIT 

(1) Farming experience 

The Senate amendment amends section 302(a)(2) of the Consolidated Farm and Rural Development Act (Con Act) by clarifying 

that the Secretary may take into consideration all farming experience of a loan applicant when considering eligibility for farm ownership loans. (Section 5001) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 5001) 

(2) Refinancing of guaranteed farm ownership loans for beginning 

farmers or ranchers 

The Senate amendment amends Section 303 of the Con Act by 

allowing beginning farmers or ranchers to refinance a delinquent 

guaranteed farm ownership loan with a direct farm ownership 

loan. (Section 5002) 


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The House bill as no comparable provision. 

The Conference substitute deletes the Senate provision. 

(3) Conservation loan guarantee program 

The House bill amends section 304 of the Con Act by creating 

a conservation loan guarantee program. The Secretary is authorized to provide loan guarantees and interest subsidies, or both, to 

farmers, ranchers, and other entities that are controlled by farmers 

and ranchers and primarily and directly engaged in agricultural 

production to carry out qualified conservation projects. 

The Secretary is required to give priority to: qualified beginning farmers or ranchers; socially disadvantaged farmers or ranchers; owners or tenants who use the loans to convert to sustainable 

or organic agricultural production systems; and producers who use 

the loans to build conservation structures or establish conservation 

practices to comply with section 1212 of the Food Security Act of 

1985. 

The term ‘‘qualified conservation loan’’ is defined as a loan in 

which: the proceeds are used to cover the costs of the borrower in 

carrying out a qualified conservation project; the principal amount 

of the loan is not more than $1 million; the loan repayment period 

is 10 years; and the total amount of all processing fees does not exceed an amount to be prescribed by the Secretary. 

The term ‘‘qualified conservation project’’ is defined as conservation measures that address provisions of the borrower’s conservation plan. 

The term ‘‘conservation plan’’ is defined as a plan, approved by 

the Secretary, that for a farming or ranching operation, identifies 

the conservation activities that will be addressed with the conservation loan, including the installation of conservation structures; 

the establishment of forest cover for sustained yield timber management, erosion control, or shelter belt purposes; the installation 

of water conservation measures; the installation of waste management systems; and the establishment of improvement or permanent pasture; compliance with section 1212 of the Food Security 

Act of 1985; and any other emerging or existing conservation practices, techniques, or technologies approved by the Secretary. 

The amount of the interest subsidies the Secretary may provide is limited to 500 basis points, if the principal amount of the 

loan is less than $100,000; 400 basis points, if the principal amount 

of the loan is not less than $100,000 and is less than $500,000; and 

300 basis points in all other cases. 

The Secretary is prohibited from approving any application for 

the program unless the Secretary determines that the loan sought 

by the applicant, as described in the application, would be a qualified conservation loan, and the project for which the loan is sought 

is likely to result in a net benefit to the environment. 

Necessary appropriations are authorized for each of the fiscal 

years 2008 through 2012. (Section 5001) 

The Senate amendment amends section 304 of the Con Act. 

The transition to organic and sustainable farming practices is to be 

an eligible loan purpose. The implementation of one or more practices under the Environmental Quality Incentives Program is also 

to be an eligible loan purpose. 


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Beginning farmers or ranchers and socially disadvantaged 

farmers or ranchers are to be given priority in this program. The loan restriction of $50,000 is eliminated. (Section 5003) 

The Managers agreed to include the House provision in the 

Conference substitute, with an amendment. The amendment establishes a conservation loan and loan guarantee program where eligible borrowers may get a loan or loan guarantee to carry out qualified conservation projects. The Secretary shall guarantee 75 percent of the principle loan amount guaranteed under this program. 

It is the intent of the Managers that the loan program established 

in the section should complement financial assistance offered in the 

conservation title of this Act. In addition to the priorities established under the program, the Secretary shall give strong consideration to loan applicants who are awaiting funding under conservation programs authorized and established under title XII of the 

Food Security Act of 1985. (Section 5002) 

Qualified conservation projects eligible to receive funding 

under this program must have a conservation plan that identifies 

the conservation activities that will be addressed by a loan made 

under this program. It is the Managers’ view that conservation 

structures that address soil, water and related resources include 

sod waterways, permanently vegetated stream boarders and filter 

strips, wind breaks, shelterbelts, living snow fences, and other vegetative practices. 

It is also the Managers’ intent that the Farm Service Agency 

operating loan limitations established in section 312 of the Con Act 

are to apply to a loan or loan guaranteed under this program. 

(4) Limitations on amount of ownership loans 

The House bill amends section 305(a)(2) of the Con Act by set- ting the farm ownership loan limit at $300,000. 

The Secretary is required to establish a plan, in coordination 

with the activities under section 359, 360, 361, and 362 of the Con 

Act, to encourage borrowers to graduate to private commercial or 

other sources of credit. (Section 5002) 

The Senate amendment is the same as the House bill but has 

no comparable provisions requiring the Secretary to establish graduation criteria. (Section 5004) 

The Conference substitute adopts the Senate provision. (Section 5003) 

(5) Down payment loan program 

The House bill amends section 310E of the Con Act by: including socially disadvantaged farmers or ranchers in the down payment loan program; setting the Farm Services Administration 

(FSA) portion of the loan at 45 percent; fixing the interest rate for 

the program at 4 percent below the regular direct farm ownership 

interest rate or 1 percent, whichever is greater; setting the duration of the loan at 20 years; requiring a borrower down payment 

of 5 percent; and setting the maximum price for the farm or ranch 

at $500,000. 

The Secretary is authorized to establish annual performance 

goals to promote the use of the down payment loan program and 

other joint financing participation loans as the preferred choice for 


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direct real estate loans made by lenders to qualified beginning 

farmers or ranchers or socially disadvantaged farmers or ranchers. 

(Section 5003) 

The Senate amendment amends section 310E of the Con Act 

by: allowing socially disadvantaged farmers or ranchers to be eligible for the down payment loan program; setting the FSA portion 

of the loan at 45 percent; and adjusting the interest rate for the 

down payment loan to the greater of 4 percent below the interest 

rate for the regular farm ownership loan or 2 percent. 

The duration of the loan, the borrower payment, and the maximum price are the same as the House bill. 

The Secretary is required to establish annual performance 

goals to promote the use of the down payment loan program and 

joint financing arrangements. (Section 5004) 

The Conference substitute adopts the House provision with an 

amendment to adjust the interest rate to 4 percent below the regular direct farm ownership interest rate or 1.5 percent, whichever 

is greater. (Section 5004) 

(6) Beginning farmer and rancher contract land sales program 

The House bill amends section 310F of the Con Act by: expanding the beginning farmer and rancher contract land sales program 

to include socially disadvantaged farmers or ranchers; making the 

program permanent and expanding it nationwide; requiring program participants to provide a down payment of 5 percent of the 

purchase price of the farm or ranch; setting the maximum purchase price for the farm or ranch that is the subject of the contract 

land sale at $500,000; and setting the loan guarantee period, for 

a loan provided under this program, at 10 years. 

The land seller is given the option of choosing either a prompt 

payment guarantee or a standard guarantee. A prompt payment 

guarantee consists of either three amortized annual installments or 

an amount equal to three annual installments (including an 

amount equal to the total cost of any tax and insurance incurred 

during the period covered by the annual installments. A standard 

guarantee plan covers an amount equal to 90 percent of the outstanding principle of the loan. (Section 5004) 

The Senate amendment is the same as the House bill except 

socially disadvantaged farmers or ranchers are not added as eligible participants. In addition, the Senate amendment does have a 

standard guarantee plan. (Section 5006) 

The Conference substitute adopts the House provision with 

amendment. The amendment clarifies that in order for a private 

seller to use the standard guarantee plan they must obtain a servicing agent who will be responsible for servicing activities associated with the contract land sale. Further, the amendment allows 

the Secretary to phase-in use of the standard guaranteed option. 

(Section 5005) 

(7) Loans to purchase highly fractioned lands 

The House bill amends section 1 of Public Law 91–229 (25 

U.S.C. 488) by giving the Secretary of Agriculture the discretionary 

authority to make and insure loans, as provided in section 309 of 

the Con Act, to eligible purchasers of highly fractioned lands, purVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00799 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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suant to section 204(c) of the Indian Land Consolidation Act. (Section 5005) 

The Senate amendment is the same as the House except it 

amends section 205(c) of the Indian Land Consolidation Act. (Section 5401) 

The Conference substitute adopts the Senate provision. (Section 5501) 

(8) Farming experience; direct operating loan term limitations 

The Senate amendment amends section 311(a) of the Con Act 

by clarifying that the Secretary may take into consideration all 

farming experience of a loan applicant when considering eligibility 

for farm operating loans. The period that a participant is eligible 

for direct operating loan assistance is extended by 1 year. (Section 

5105) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to delete the provision that extends the period of time 

a borrower is eligible for direct farm operating loan assistance. 

(Section 5101) 

(9) Limitations on amount of operating loans 

The House bill amends section 313(a)(1) of the Con Act by limiting the amount of an operating loan other than one guaranteed 

by the Secretary to $300,000. (Section 5012) 

The Senate amendment includes the same provision as the 

House bill. (Section 5102) 

The Conference substitute adopts the House provision. (Section 

5102) 

(10) Suspension of limitation on period for which borrowers are eligible for guaranteed assistance 

The House bill amends section 5102 of the Farm Security and 

Rural Investment Act of 2002 (FSRIA) by suspending, until January 1, 2008, a limitation placed on the number of years that borrowers are eligible to receive guaranteed assistance on operating 

loans. (Section 5012) 

The Senate amendment repeals section 319 of the Con Act. 

This section provides a limitation on the number of years a borrower is eligible to receive guaranteed assistance on operating 

loans. (Section 5103) 

The Conference substitute adopts the Senate provision with 

amendment. The amendment extends the waiver on guaranteed operating loan term limits through December 31, 2010. (Section 5103) 

(11) Beginning farmer and rancher individual development accounts 

The Senate amendment amends the Con Act by adding an 

after section that establishes the New Farmer Individual Development Account Pilot Program (IDA). Its purpose is to match the savings of beginning farmers or ranchers to help them establish a pattern of savings and build assets which will help their long term 

farm viability. 


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The terms demonstration program, eligible participant, individual development account, qualified entity are defined. Subsection (a) creates definitions that will be used throughout this section. 

The Secretary is authorized to establish a pilot program to be 

administered by the FSA in at least 15 states. Each qualified entity 

that receives a grant under the pilot program must provide a 25 

percent non-Federal match of the grant awarded. An eligible participant will enter into a contract with a qualified entity that requires: a monthly deposit into a personal savings by the eligible 

participant; an agreement on the eligible expenditure for which the 

savings will be used when the contract is completed; and an 

agreed-upon match of not more than 3 to 1 for every dollar saved 

by the eligible participant provided by the eligible entity. An eligible participant cannot receive more than $9,000 in matching funds 

for each fiscal year of the contract. 

The Senate amendment establishes an application process in 

which eligible entities receive a grant to administer the IDA program. When considering applications for the program, the Secretary is to give preference to qualified entities that have a track 

record of serving eligible participants and expertise in dealing with 

financial management aspects of farming. The maximum grant a 

qualified entity may receive is $300,000 to carry out the IDA program. 

Qualified entities that receive a grant must submit, to the Secretary, an annual report that includes the following: an evaluation 

of the demonstration project’s progress; the amounts in the reserve 

fund; the amounts deposited in each IDA; the amounts withdrawn 

from the IDA and the purpose for which the money was withdrawn; and information about the demonstration program and participants. 

The Secretary is authorized to promulgate regulations that ensure the termination of pilot program and control of the reserve 

fund in case of early termination of a demonstration program. 

An appropriation of $10,000,000 is authorized for each fiscal 

year 2008 through 2012. The Secretary is prohibited from using 

more than 10 percent of the funds made available to administer the 

program and provide technical assistance to qualified entities. (Section 5201) 

The House bill has no comparable provisions. 

The Conference substitute adopts the Senate provision with 

amendment. 

The amendment increases the non-Federal match of the grant 

amount from 25 percent to 50 percent. Federal grant money used 

for administrative costs is limited to 10 percent. The amendment 

caps the savings match a qualified entity may provide under the 

program at not more than 200 percent of the participant’s savings. 

Furthermore, the amendment reduces the maximum federal grant 

amount to $250,000. (Section 5301) 

The Managers are aware that farmers over the age of 65 outnumber those below the age of 35 by more than 2 to 1. Access to 

credit and land are two of the largest problems facing beginning 

farmers or ranchers today. The increased cost of farmland, equipment, and other farm inputs have created a significant barrier to 


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farm entry. To ensure the future viability of U.S. farming, the 

Managers are aware of the need to develop public policies that address the unique challenges beginning farmers and ranchers face. 

The New Farmer Individual Development Accounts Pilot Program 

(IDA) is designed to help those with modest means save and build 

assets and enter the financial mainstream. This pilot program 

would assist beginning farmers or ranchers by using matched savings accounts, the proceeds of which may be used toward capital 

expenditures for a farm or ranch operation, including expenses associated with the purchase of farmland, buildings, equipment, livestock, infrastructure, or the acquisition of training. The Managers 

intend that the IDA established by a qualified entity for an eligible 

participant will be separate from the personal savings of the eligible participant. The IDA account and funding shall be controlled by 

the qualified entity. Upon completion of an IDA contract by an eligible participant, the qualified entity shall supply funds from the 

IDA account directly toward the eligible purchase on behalf of the 

eligible participant. 

It is the Managers’ intent that eligible participants must also 

complete financial training established by the qualified entity establishing the IDA for the participant. Such training may involve 

education and technical assistance related to budgeting, business 

planning, recordkeeping, banking, farm credit management, cash 

flow management, market development, equity investment, land 

access and land tenure options, and other similar financial training 

needs. It is the intent of the Managers that eligible entities may 

create their own financial management training programs or utilize 

curricula and training events of other organizations, businesses, 

and institutions. The Managers encourage FSA to coordinate with 

eligible entities who may want to make use of the borrower financial and farm management training programs established under 

Section 359 of the Con Act as part of their financial management 

training offering. The Managers believe when considering applications to carry out eligible demonstrations the term ‘new farming 

opportunities’ used in the application criteria means either starting 

a farm or converting to other production. 

(12) Inventory sales preferences 

The House bill amends section 335(c) of the Con Act by restoring the first priority given to socially disadvantaged farmers or 

ranchers whenever the Secretary sells or leases property. The Secretary is required to ensure that socially disadvantaged farmers or 

ranchers are included in the process whenever property is sold or 

leased. (Section 5021) 

The Senate amendment amends section 335(c) of the Con Act 

by making socially disadvantaged farmers or ranchers eligible for 

inventory property in the first 135 days the Secretary is able to sell 

the inventory property. If one or more eligible socially disadvantaged or beginning farmers offer to purchase the same property in 

the first 135 days, the buyer is to be chosen randomly. (Section 

5202) 

The Conference substitute adopts the Senate provision. (Section 5302) 


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(13) Loan authorization levels 

In section 346(b)(1) of the Con Act the Senate Amendment increases the loan authorization for FSA loan programs to 

$4,226,000,000. 

Section 346(b)(2)(A) increases the loan authorization for direct 

loans to $1,200,000,000. The authorization for the direct farm ownership loan program is increased to $350,000,000, and the authorization for the direct operating loan program is increased to 

$850,000,000. (Section 5204) 

The House bill has no comparable provisions. 

The Conference substitute adopts the Senate provision. (Section 5303) 

(14) Loan fund set-asides 

The House bill amends section 346(b)(2)(A)(i)(I) of the Con Act 

by increasing the amount of direct farm ownership loans that the 

Secretary is to reserve for beginning farmers or ranchers to 75 percent. Of the funds reserved for beginning farmers or ranchers in 

the direct farm ownership program, 66 percent of those funds are 

reserved for the down payment loan program and joint financing 

arrangements. 

Section 346(b)(2)(A)(ii)(III) of the Con Act is amended by increasing the amount of direct operating loans the Secretary is to 

make available to beginning farmers or ranchers to 50 percent. 

Section 346(b)(2)(B)(i) of the Con Act is amended by increasing 

the amount of guaranteed farm ownership loans that the Secretary 

is to reserve for beginning farmers or ranchers to 40 percent. (Section 5022) 

The Senate amendment is the same as the House provision. 

(Section 5204) 

The Conference substitute adopts the Senate provision. (Section 5302) 

(15) Transition to private commercial or other sources of credit 

The House bill amends section 344 of the Con Act by requiring 

the Secretary, when making or insuring a real estate or operating 

loan, to establish regulations that have as their goal transitioning 

borrowers to other sources of credit, including private commercial 

credit, in the shortest practicable period of time. (Section 5023) 

The Senate amendment is the same as House provision. 

The Conference substitute adopts the House provision. (Section 

5304) 

(16) Interest rate reduction program 

The Senate amendment amends section 351(a) of the Con Act 

by clarifying that interest assistance is to be available for new 

guaranteed operating loans or restructured guaranteed operating 

loans. (Section 5205) 

The House bill has no comparable provisions. 

The Conference substitute deletes the Senate provision. 

The Managers are aware that the Secretary has amended regulations under the guaranteed loan program to limit the availability of interest rate reduction authorized under section 351 of 

the Con Act to new guaranteed operating loans. The Managers beVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00803 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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lieve that non-statutory limitations in the program’s regulations 

will deter the immediate availability of funds that may be appropriated in the future for interest rate reductions for other categories of guaranteed loans. It is the Managers’ expectation that 

the regulations and policies for the guaranteed loan program 

should clarify that interest rate reduction may be available for all 

new and restructured guaranteed loans. 

(17) Extension of the right of first refusal to reacquire homestead 

property to immediate family member of borrower-owner 

The House bill amends section 352(c)(4)(B) of the Con Act by 

extending, in the case of a socially disadvantaged farmer or rancher, the right of first refusal to reacquire a homestead property to 

members of the immediate family of the borrower. 

It allows, in the case of a socially disadvantaged farmer or 

rancher, for an independent appraisal of the property by an appraiser selected by the immediate family member of the borrower. 

(Section 5024) 

The Senate amendment has no comparable provisions. 

The Conference substitute adopts the House provision. (Section 

5305) 

(18) Deferral of shared appreciation recapture amortization 

The Senate amendment amends section 353(e)(7)(D) of the Con 

Act by clarifying that deferral is an available servicing tool and 

limits any deferral to 1 year. (Section 5206) 

The House bill has no comparable provisions. 

The Conference substitute deletes the Senate provision. 

The Managers are aware that under subsection (e)(7)(D) of section 353 of the Con Act, the Secretary has permitted borrowers to 

seek only re-amortization of amortized Shared Appreciation recapture payments despite the reference in that section to all ‘‘loan 

service tools under section 343(b)(3) [7 USC 1991(b)(3)].’’ It is the 

Managers’ expectation that the Secretary will amend program regulations and policies to clarify that the full range of loan service 

tools set out in subsection (b)(3) of section 343 of the Con Act is 

available for modification of amortized Shared Appreciation recapture payments. 

(19) Rural development and farm loan program activities 

The House bill amends Subtitle D of the Con Act by prohibiting the Secretary from completing a study or entering into a contract with any private party to carry out, without a specific authorization in an Act of Congress, a competitive source activity of the 

Secretary, including USDA support personnel, relating to rural development or farm loan programs. (Section 5025) 

The Senate amendment amends the Con Act by adding a new 

section, 365, that prohibits the Secretary from completing or entering into a contract with a private party to carry out competitive 

sourcing activities relating to rural development, housing, and farm 

loan programs at the United States Department of Agriculture. 

(Section 5207) 

The Conference substitute adopts the House provision. (Section 

5306) 


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The managers intend this provision to cover USDA’s Rural Development mission area, including rural cooperative, business, 

housing, and energy programs. 

(20) Technical correction 

The Senate amendment amends section 3.3(b) of the Farm 

Credit Act (FCA) of 1971 by making a technical correction. It 

strikes ‘‘per’’ in the first sentence and inserts ‘‘par’’. (Section 5302) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 5402) 

(21) Banks for cooperatives voting stock 

The House bill amends section 3.3(c) of the FCA by authorizing 

the board of a bank for cooperatives to determine the terms and 

conditions for the issuance and transfer of bank voting stock to 

bank for cooperatives customers and other Farm Credit System associations. 

A conforming amendment is made to section 4.3A(c)(1)(D) of 

the FCA to add to the list of borrowers eligible to hold voting stock 

under the bylaws of the banks for cooperatives persons and entities 

eligible to borrow from banks for cooperatives. (Section 5031) 

The Senate amendment has no comparable provisions. 

The Conference substitute adopts the House provision. (Section 

5403) 

(22) Confirmation of the Farm Credit Administration Chair 

The Senate amendment amends section 5.8(a) of the FCA by 

requiring the advice and consent of the Senate for the confirmation 

of chairman of the Farm Credit Administration. (Section 5303) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. 

(23) Rural utility loans 

The House bill amends section 8.0(9) of the FCA to allow rural 

utility loans (loans, or interest in a loan, for electric and telephone 

facilities) to be considered as ‘‘qualified loans’’. (Section 5032) 

The Senate amendment amends section 8.0(9) of the FCA by 

adding a new subparagraph to allow rural utility loans (loans, or 

interest in a loan, for electric and telephone facilities) to be considered as ‘‘qualified loans’’ for Federal Agricultural Mortgage Corporation financing. 

Section 8.6(a)(1) of the FCA is amended by making conforming 

and technical changes to the standards established under section 

8.8(a) of the FCA related to agricultural real estate loans and rural 

utility loans. 

Section 8.8(a) of the FCA is amended by authorizing the creation of appropriate underwriting, security, and repayment standards for agricultural mortgage loans and rural utility loans. 

Minimum criteria standards are set for agricultural real-estate 

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ation of real estate tax purposes). These standards do not apply to 

rural utility loans. 

Loan amounts for agricultural production are established. The 

limitation does not apply to rural utilities loans. (Section 5306) 

The Conference substitute adopts the Senate provision. (Section 5406) 

(24) Farm Credit System Insurance Corporation 

The House bill amends section 1.12(b) of the FCA to change 

the method that each Farm Credit System (FCS) bank must use to 

assess associations and other financing institutions to cover the 

costs of making Farm Credit System Insurance Corporation 

(FCSIC) premium payments under Part E of Title V of the FCA. 

FCS banks are required to compute the assessments on lenders in 

an ‘‘equitable manner.’’

Section 5.55(a) of the FCA is amended by mandating that the 

premiums due from System institutions will no longer to be collected annually when the aggregate amount in the Farm Credit Insurance Fund does not exceed the secure base amount. The premium due from any insured System institution is to be based on 

the average outstanding insured debt. 

Section 5.55(b) of the FCA is amended by allowing the FCSIC 

to collect premiums more frequently than annually. 

Section 5.55(c) of the FCA is amended by authorizing FCS 

banks to deduct a percentage of investments guaranteed by the 

Federal government and a percentage of investments guaranteed 

by State governments when calculating the secure base amount. 

Section 5.55(d) of the FCA is amended by authorizing the 

FSCIC to use the principal outstanding on all loans made by an insured FCS bank or the amount outstanding on all investments 

made by an insured system bank for purposes of premium calculations and secure base amount calculations. 

Section 5.55(e) of the FCA is amended by requiring the FCSIC 

to use year-end numbers in calculating excess funds, with respect 

to the secure base amount. The formula concerning payments from 

the Farm Credit Insurance Fund Allocated Insurance Reserve Accounts is simplified. 

Section 5.56(a) of the FCA is amended by authorizing FCS 

banks to file certified statements quarterly. 

Section 5.58(10) of the FCA is amended by clarifying that 

FCSIC has the authority to adopt rules and regulations concerning 

section 1.12(b) of Title I of the FCA, the ‘‘Authority to Pass Along 

Cost of Insurance Premiums.’’ (Section 5033) 

The Senate amendment amends section 1.12 (b) of the FCA to 

allow FCS banks to have flexibility in deciding how to pass along 

insurance premiums to their affiliates. This section specifies that 

premiums are to be computed in an equitable manner. (Section 

5301) 

The Senate amendment also amends section 5.55(a) of the FCA 

by allowing the total insured debt obligations on which premiums 

are assessed to be subtracted by 90 percent for investments guaranteed by the Federal government and 80 percent for investments 

guaranteed by State governments. 


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Section 5.55(b) of the FCA is amended by allowing the FCSIC 

to collect premiums more frequently than annually. 

Section 5.55(c) of the FCA is amended by adjusting the outstanding insured obligations of all insured System banks by excluding an amount equal to the sum of 90 percent of federal government guaranteed loans and investments and 80 percent of state 

government-guaranteed loans and investments when calculating 

the ‘‘secure base amount’’. 

Section 5.55(d) of the FCA is amended to determine the principal outstanding on all loans made by an insured System bank, or 

the amount outstanding on all investments made by an insured 

System bank, for the purpose of premium calculations and ‘‘secure 

base amount’’ collections. 

Subsection 5.55(e) of the FCA is amended by allowing the 

Farm Credit System Insurance Fund to use year-end numbers 

rather than the average daily balance when calculating excess 

funds and simplifying the current formula concerning payments 

from the Allocated Insurance Reserve Accounts. (Section 5304) 

Section 5.56(a) of the FCA is amended by allowing System 

banks to collect insurance premiums quarterly rather than annually. (Section 5305) 

Section 5.58(10) of the FCA is amended to clarify that FCSIC 

has the authority to adopt rules and regulations concerning section 

1.12(b) the FCA. (Section 5301) 

The Conference substitute adopts the Senate provision with 

technical amendments. (Sections 5401, 5404, and 5405) 

(25) Risk-based capital levels 

The House bill amends section 8.32(a)(1) of the FCA by allowing FSCIC to calculate risk-based capital levels for rural electric 

and telephone loans. (Section 5034) 

Section 8.32(a)(1) of the FCA is amended by creating a new 

subparagraph (B) that directs the FCA to establish a risk-based 

capital standard for rural utility loans. (Section 5306) 

The Conference substitute adopts the Senate provision. (Section 5406) 

(26) Farm Credit System equalization 

The Senate amendment amends the FCA by establishing a 

new section, 7.7, which equalizes lending authorities among FCS 

associations in Alabama, Mississippi, and Louisiana. 

The Federal Land Banks or Credit Associations are given the 

ability to make short- and intermediate-term loans, and Production 

Credit Associations are given the ability to make long-term loans. 

The new authorities can only be exercised if the board of directors 

of the association and a majority of voting stockholders approve. 

The FCA is authorized to issue charter amendments to reflect 

the new lending authority. (Section 5307) 

The House bill has no comparable provision. 

The Conference substitution adopts the Senate provision. (Section 5407) 


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(27) Emergency loans for equine farmers and ranchers 

The Senate amendment amends section 321(a) of the Con Act to 

allow equine farmers and ranchers to be eligible for FSA emergency loans. (Section 5404) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 5201) 

The managers are aware that family farmers and ranchers 

who breed and raise horses are eligible for the FSA’s emergency 

loan program. In order to be eligible for a loan under this section, 

the farmer or rancher must meet all of the relevant requirements 

of the Con Act, including the credit elsewhere test. The farmer or 

rancher must also be primarily engaged in the operation and must 

not have an operation larger than a family farm. Horse owners who 

use horses for racing, showing, recreation, or pleasure are not eligible for the emergency loan program. Further, the regulation that 

implements a specifically authorized equine disaster assistance 

program is not applicable to the change made by this provision. 

(28) Operating loan assistance for commercial fisherman 

The Senate amendment amends section 343(a)(1) of the Con 

Act by amending the definition of farmer and farming to include 

commercial fishing for the purposes of operating loans. 

Section 343 of the Con Act is amended by adding a new subsection, (c) that defines farm to include a commercial fishing enterprise; the owner or operator of which is unable to obtain credit 

from a bank or other lender, as determined by the Secretary. (Section 6020) 

The House bill has no comparable provision. 

The conference substitute deletes the Senate provision. 

TITLE VI—RURAL DEVELOPMENT 

(1) Definition of rural 

The House bill directs the Secretary to prepare and submit a 

report to the House and Senate Agriculture Committees that: (a) 

assesses the varying definitions of rural used by the U.S. Department of Agriculture (USDA); (b) describes what effect those varying 

definitions have on USDA programs; and (c) makes recommendations on ways to better target the funds provided through rural development programs. (Section 6001) 

The Senate amendment amends section 343(a)(13) of the Consolidated Farm and Rural Development Act (Con Act) to provide a 

standard definition for ‘‘rural’’ and ‘‘rural area to exclude: (1) cities 

of 50,000 or more; (2) any urbanized area contiguous and adjacent 

to a city of 50,000 or more, except for narrow strips of urbanized 

areas; and (3) any collection of contiguous census blocks with a 

housing density of 200 housing units per square mile that is adjacent to a city of 50,000 or adjacent to an urbanized area, except for 

narrow strips of such territory. An exception to this definition is 

provided for Honolulu and Puerto Rico where cities and counties 

are coterminous. An applicant may appeal the determination of the 

Secretary with regard to the housing density factor. 


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The Senate amendment retains the rural area eligibility in 

current law for the water and waste disposal loans and grants program, as a city, town, or unincorporated area that has a population 

of no more than 10,000 inhabitants. For purposes of determining 

eligibility for Community Facility loans, the Senate amendment applies the standard definition’s housing density requirement, thereby making the definition of rural for the purposes of eligibility for 

such loans any area that meets the standard definition’s criteria 

and is less than 20,000 in population. 

The Undersecretary for Rural Development may designate a 

place to be of rural character and include in that designation any 

cluster of census blocks that would otherwise be considered not in 

a rural area only because the cluster is adjacent to not more that 

2 census blocks that are otherwise considered not in a rural area. 

The Secretary is required to submit a report, once every 2 years, 

to the House and Senate Agriculture committees on the various 

definitions of ‘‘rural’’ and ‘‘rural area’’ that are used with respect 

to USDA programs, the effects the definitions have on those programs, and recommendations on how to better target funds provided through rural development programs. 

The Senate amendment makes changes to other definitions. ‘‘Sustainable agriculture’’ is defined as a system of plant and animal production that will satisfy human food and fiber needs, enhance environmental quality and the natural resources, make efficient use of nonrenewable resources and integrate biological cycles 

and controls, sustain the viability of the farming operation, and enhance the quality of life for farmers and society. ‘‘Technical assistance’’ is defined as managerial, financial, operational, and scientific 

analysis and consultation. The definition of ‘‘farmer’’ and ‘‘farming’’ is amended to include commercial fishermen, and for the purpose 

of the Farm Service Agency operating loan program the definition 

of ‘‘farm’’ is amended to include a commercial fishing enterprise in 

which the owner or operator is unable to obtain commercial credit 

from a bank or other lender. (Section 6020) 

The Conference substitute adopts the Senate amendment with 

several modifications. The housing density criterion in the Senate 

amendment is struck from the standard definition of ‘‘rural’’ and 

‘‘rural area’’ and from Community Facilities Program eligibility. 

However, USDA is directed to conduct a rulemaking to develop additional restrictions on areas that consist of any collection of contiguous census blocks with a housing density of 200 housing units per 

square mile that is adjacent to a city of 50,000 or adjacent to an 

urbanized area. The exception for the standard definition of ‘‘rural 

area’’ for Honolulu and Puerto Rico is retained, as is the eligibility 

of isolated census blocks that would otherwise be considered nonrural simply because they are connected by not more that 2 census 

blocks to an urbanized area. 

The eligibility for water and waste disposal loans and grants 

program and the community facility program are unchanged from 

current law. 

To address urbanized area mapping complications, the Undersecretary for Rural Development is provided with the authority to 

determine a place to be of rural character if: (1) it is located in an 

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cated next to a city of more than 150,000 people; or (2) is within 

one-quarter mile of a rural/non-rural boundary. This authority may 

not be delegated and must be done in consultation with State rural 

development directors and Governors. The consideration of a petition for such a determination must be made public and is subject 

to appeal. A report must be submitted to the Congress annually on 

the use of this authority. 

The Conference substitute adopts the Senate provision requiring 

a report, once every 2 years, on the definitions of ‘‘rural’’ and ‘‘rural 

area’’ that are used with respect to USDA programs, the effects the 

definitions on those programs, and recommendations on how to better target funds provided through rural development programs. 

The Conference substitute strikes the definitions of technical 

assistance, sustainable agriculture, and the modifications made to 

‘‘farmer’’ and ‘‘farming’’. (Section 6018) 

The Managers have authorized the Secretary of Agriculture to 

make areas of the Commonwealth of Puerto Rico and the County 

of Honolulu, Hawaii eligible for Rural Development programs because the unique governmental structure of those entities prevents 

Census Bureau maps from adequately capturing the demographics 

of these island areas. The Managers do not expect the Secretary to 

provide access to rural development programs to areas that are 

urban or do not meet other requirements of the applicable programs, but do expect the Secretary to recognize areas that meet the 

intent and spirit of the law. 

(2) Water, waste disposal and wastewater facility grants 

The House bill extends the authorization for appropriations in 

section 306(a)(2)(A) of the Con Act through 2012. (Section 6002) 

The Senate amendment is the same as the House bill. (Section 

6001) 

The Conference substitute adopts the House provision. (Section 

6001) 

(3) Rural business opportunity grants 

The House bill extends the authorization of appropriations for 

306(a)(11)(a) of the Con Act through 2012. (Section 6003) 

The Senate amendment is the same as the House bill. (Section 

6002) 

The Conference substitute adopts the Senate provision. (Section 6003) 

(4) Rural water and wastewater circuit rider program 

The House bill amends section 306(a)(22)(A) of the Con Act by 

increasing the authorization of appropriations for the rural water 

and wastewater circuit rider program to $25,000,000 for each of the 

fiscal years 2008 through 2012. (Section 6004) 

The Senate amendment increases the authorization to 

$20,000,000. (Section 6004) 

The Conference substitute adopts the House provision. (Section 

6006) 


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(5) Tribal college and university essential community facilities 

The House bill amends section 306(a)(25)(B) of the Con Act by 

prohibiting the Secretary from requiring non-Federal financial support in an amount that is greater than 5 percent of the total cost 

of developing essential community facilities at tribal colleges and 

universities. The authorization is extended to 2012. (Section 6005) 

The Senate amendment provides that the maximum Federal 

grant tribal colleges and universities may receive for the cost of developing essential community facilities in rural areas is 95 percent. 

The authorization is extended through 2012. (Section 6007) 

The Conference substitute adopts the House provision. (Section 

6007) 

(6) Child day care facility grants, loans, and loan guarantees 

The Senate amendment amends section 306(a)(19) of the Con 

Act (the community facilities program) by providing $40,000,000 in 

mandatory funding, to remain available until expended, starting in 

2008. The Secretary is authorized to make grants, loans and loan 

guarantees to pay the Federal share of the cost of developing and 

constructing day care facilities for children in rural areas. The 

mandatory funding provided under this section is to be in addition 

to any other funds and authorities relating to development and 

construction of rural day care facilities. (Section 6003) 

The House contains no comparable provision. 

The Conference substitute provides that the program will not 

receive mandatory funding, but the current set-aside for this purpose in the community facility program will be extended from April 

1 to June 1. (Section 6004) 

(7) Community facility loans and grants for freely associated States 

and outlying areas 

The Senate amendment reserves 0.5 percent of community facility loans and grants for freely associated States and outlying 

areas. If, after 180 days within a fiscal year, an insufficient number 

of applications have been received to account for 0.5 percent then 

the unused funds are to be reallocated to make loans and grants 

to otherwise eligible entities located in the States. (Section 6008) 

The House contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

The Managers note the higher infrastructure costs faced by those 

in the freely associated States and outlying areas of the United 

States due to the very considerable distances involved in transporting building materials and equipment necessary for infrastructure projects to these areas. In addition, severe storms that are 

common to these areas cause repeated damage to infrastructure. 

USDA resources from the community facilities program and from 

the Rural Utilities Service programs can be of tremendous help in 

alleviating these serious problems. The Managers expect the Secretary to fully take into account the higher costs that are involved 

in infrastructure projects in this region and to provide assistance 

to allow improvements to infrastructure that will be resilient to 

storms and less likely to be damaged by them even though those 

costs of construction are higher. 


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(8) Priority for community facility loan and grant projects with high 

non-Federal share 

The Senate amendment provides that priority will be given to 

community facility projects with non-Federal funding that is substantially greater than the minimum requirement. (Section 6009) 

The House contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(9) Emergency and Imminent Community Water Assistance Grant 

Program 

The House bill is the same as section 306A of the Con Act, which 

authorizes the Secretary to provide grants to assist residents in 

rural areas and small communities comply with the Water Pollution Control Act or the Safe Drinking Water Act. The authorization 

of appropriations remains the same and is extended through 2012. 

(Section 6006) 

The Senate amendment provides the same as the House bill. 

(Section 6011) 

The Conference substitute adopts the House provision. (Section 

6008) 

(10) Water systems for rural and native villages in Alaska 

The House bill amends section 306D(d)(1)(a) of the Con Act by 

extending the authorization of appropriations through 2012. (Section 6007) 

The Senate amendment provides that the Denali Commission 

may be eligible for grants to improve solid waste disposal sites that 

are contaminating or threatening to contaminate rural drinking 

water in the State of Alaska. The program is extended through 

2013. (Section 6012) 

The Conference substitute includes the House provision, with 

an amendment to provide a $1,500,000 authorization for each of 

the fiscal years 2008 through 2012 under the Solid Waste Disposal 

Act for the Denali Commission to provide assistance to municipalities in Alaska. (Section 6009) 

(11) Grants to finance water well systems in rural areas 

The House bill provides for an extension of the authorization 

of the program through 2012 and provides that the level of matching funds is not to be taken into account when determining priority 

in awarding grants. The payment by a grant recipient of audit fees, 

business insurance, salary, wages, employee benefits, printing 

costs, and legal fees associated with the purpose of the grant program is to be considered as the providing of matching funds by the 

grant recipient. (Section 6008) 

The Senate amendment extends the program through 2012. 

(Section 6013) 

The Conference substitute adopts the House provision with a 

modification to strike the change with respect to consideration of 

the matching fund levels, and to increase the limitation on the 

amount that can be expended on each well from $8,000 to $11,000. 

(Section 6010) 


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(12) Grants to develop wells in isolated areas 

The Senate amendment amends section 306F of the Con Act by authorizing $10,000,000 for a new program for each of the fiscal 

years 2008 through 2012. The new program allows the Secretary 

to make grants to nonprofit organizations to develop and construct 

household, shared, and community wells in isolated areas when a 

traditional water system is not practical due to distance, geography 

and limited number of households present. Priority is given to applicants that have experience in developing similar types of wells 

in rural areas. As a condition of receipt of a grant, the water from 

the well is to be tested annually for quality and the results made 

available to well users and the appropriate State agency. The grant 

amount is limited to an amount not to exceed the lesser of $50,000 

and the amount that is 75 percent of the costs of a single well and 

associated system. Grants are prohibited in areas where a majority 

of users’ household incomes exceed the nonmetropolitan median 

household income. (Section 6013) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(13) Rural cooperative development grants 

The House bill amends section 310B(e)(5) of the Con Act by authorizing the Secretary to give preference to grant applications 

that— (A) demonstrate a proven track record in administering activities to promote and assist in the development of cooperatively and mutually owned businesses; 

(B) demonstrate previous expertise in providing technical 

assistance in rural areas to promote and assist in the development of cooperatively and mutually owned businesses; 

(C) demonstrate the ability to assist in the retention of 

businesses, facilitate the establishment of cooperative and new 

cooperative approaches, and generate employment opportunities that will improve the economic conditions in rural areas; 

(D) commit to providing technical assistance and other 

services to underserved and economically distressed areas in 

rural areas of the U.S.; 

(E) demonstrate a commitment to— (i) networking with and sharing the results of its efforts with other cooperative development centers and other 

organizations involved in rural economic development efforts; and 

(ii) developing multi-organization and multi-State approaches to address the cooperative and economic development needs of rural areas; and 

(F) commit to provide a 25-percent matching contribution 

with private funds and in-kind contributions, except that the 

Secretary is prohibited from requiring non-Federal financial 

support in an amount that is greater than 5 percent in the 

case of a 1994 institution. 

The Secretary is authorized to award 1-year grants to centers 

that have not received prior funding and evaluate programs that 

receive grant funding. The Secretary is given the discretion to 

award grants for a period of more than 1 year, but not more than 


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3 years, to programs that the Secretary determines are meeting the 

criteria of the program. The Secretary is also given the discretion 

to extend for only 1 additional 12-month period the period in which 

a grantee may use a grant made under this section. The Secretary 

is authorized to enter into a cooperative research agreement with 

one or more qualified academic institutions for the purpose of conducting research on the national economic effects of all types of cooperatives. 

The Secretary is authorized to reserve 20 percent of appropriated funds for grants for cooperative development centers, individual cooperatives, or groups of cooperatives serving socially disadvantaged communities when the appropriated funds for a fiscal 

year exceed $7,500,000. If the Secretary determines the number of 

applications received for this purpose is insufficient, the Secretary 

is authorized to use the funds for the purposes outlined in this section. 

The current law authorization is retained and extended 

through 2012. (Section 6009) 

The Senate amendment is the same as the House bill except 

that it requires the Secretary to award multi-year grants to programs that the Secretary determines meet the parameters of the 

program and provides a definition for the term socially disadvantaged. (Section 6015) 

The Conference substitute adopts the Senate provision with 

minor changes. (Section 6013) 

(14) Criteria to be applied in providing loans and loan guarantees 

under the business and industry loan program 

The House bill amends section 310B(g) of the Con Act by authorizing the Secretary, in providing loans and loan guarantees 

under the Business and Industry Loan Program, to consider applications more favorably—when compared to other applications— when the project described in the application supports community 

development and farm and ranch income by marketing, distributing, storing, aggregating, or processing locally or regionally produced agricultural product. 

A ‘‘locally or regionally produced product’’ is defined to mean 

an agricultural product: (1) which is produced and distributed in 

the locality or region where the finished product is marketed; (2) 

which has been shipped a total of distance of 400 or fewer miles, 

as determined by the Secretary; and (3) about which the distributor 

has conveyed to the end-use consumers information regarding the 

origin of the product or production practices, or other valuable information. (Section 6010) 

The Senate amendment authorizes the Secretary to make 

loans and loan guarantees to individuals, cooperatives, businesses, 

and other entities to establish and facilitate enterprises that process, distribute, aggregate, store, and market locally-produced agricultural food products. 

The term ‘‘locally-produced agricultural food product’’ is to 

mean an agricultural product that is raised, produced, and distributed within the locality or region and that is transported less than 

300 miles from the origin of the agricultural product or the State 

in which the agricultural product is produced. 


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The term ‘‘underserved community’’ is to mean an urban, 

rural, or Indian tribal community that has, as determined by the 

Secretary: (i) limited access to affordable, healthy foods, including 

fresh fruits and vegetables, in grocery retail stores or farmer-toconsumer direct markets or a high incidence of diet-related disease 

as compared to the national average, including obesity; and (ii) a 

high rate of food insecurity or a high poverty rate. 

The priorities for awarding loans and loan guarantees under 

this program are for projects that support community development 

and farm and ranch income by marketing, distributing, storing, aggregating, or processing a locally produced agricultural product; or 

for projects that have components benefiting underserved communities, as defined in this section. 

The recipients of loans and loan guarantees may use up to $250,000 in loan or loan guarantee funds per retail or institutional 

facility to modify and update facilities to accommodate locally-produced agricultural food products and to provide outreach to consumers about the sale of locally-produced agricultural food products. 

The Secretary is required to submit an annual report to the 

House and Senate Agriculture Committees that describes the 

projects carried out using loans and loan guarantees provided 

under this program. The report is to include the characteristics of 

the communities served and benefits of the projects. (Section 6017) 

The Conference substitute adopts the Senate provision with 

modifications. The distance for which a product can travel and still 

be considered for the program is extended to 400 miles. ‘‘Underserved community’’ is defined as an urban, rural, or Indian tribal 

community that has, as determined by the Secretary: (i) limited access to affordable, healthy foods, including fresh fruits and vegetables, in grocery retail stores or farmer-to-consumer direct markets; 

and (ii) a high rate of food insecurity or a high poverty rate. Priority for the program is given to entities proposing to provide product to underserved communities. 

The Conference substitute does not include the Senate provision allowing recipients to redistribute loan or loan guarantee proceeds to retail or institutional facilities. However, the Managers expect recipients of business and industry loans and loan guarantees 

under this section to include applicants who propose to work with 

retail establishments in underserved communities to supply items 

to promote and ensure the salability of the locally-produced agricultural food product. (Section 6015) 

The Managers expect the Administrator of the Rural Business 

Cooperative Service to work in coordination with the Administrator 

of the Agricultural Marketing Service on implementation of this 

program. 

The Managers are aware of the increased demand for locally 

and regionally produced foods. Although demand exists for locally 

and regionally produced foods, producers in many parts of the 

country have difficulties finding markets and processing facilities 

as well as and establishing distribution channels. In many instances, retail outlets are not interested in buying from smaller volume producers because they cannot provide sufficient and consistent supply of food products. The Managers expect this section 


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to help bridge the gap between the production of locally and regionally produced agricultural food products and the processing and 

distribution of those products. A distributor could work with several farmers in an area and build the necessary relationships with 

small, medium or large retail outlets, schools, hospitals or other institutions to provide a marketing channel for locally and regionally 

produced foods. 

(15) Cooperative equity security guarantee 

The Senate amendment amends section 310B of the Con Act 

to allow Business and Industry guarantees for loans made for the 

purchase of preferred stock or similar equity issued by a cooperative organization or a fund that invests primarily in cooperative organizations. (Section 6014) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

technical changes. (Section 6012) 

(16) Appropriate technology transfer for rural areas 

The House bill provides for the establishment of a national 

technology transfer program for rural areas to assist agricultural 

producers that are seeking information to help them: (1) reduce 

their input costs; (2) conserve their energy costs; (3) diversify their 

operations through new energy crops and energy generation facilities; and (4) expand markets for their agricultural commodities 

through the use of sustainable farming practices. The Secretary is 

authorized to carry out the program by making a grant or entering 

into a cooperative agreement with a national non-profit agricultural assistance organization. A grant or cooperative agreement entered into is to provide 100 percent of the cost of providing information. The program is authorized at $5,000,000. (Section 6011) 

The Senate amendment is substantially similar to the House 

bill. (Section 6018) 

The Conference substitute adopts the Senate provision with 

minor changes to elaborate on the purpose of the program. (Section 

6016) 

(17) Grants to improve technical infrastructure and improve quality 

of rural health care facilities 

The House bill authorizes a grant program for rural health facilities to assist such facilities in: purchasing health information 

technology to improve quality health care and patient safety or, improving health care quality and patient safety, including the development of: a) quality improvement support structures to assist 

rural health systems and professionals; and (b) innovative approaches to financing and delivery of health services to achieve 

rural health quality goals. (Section 6012) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. 

(18) Rural hospital loans and loan guarantees 

The Senate amendment provides $50,000,000 in mandatory 

funding in fiscal year 2008, to remain available until expended, for 

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pitals with not more than 100 acute beds in rural areas. Not less 

than $25,000,000 is to be allocated to hospitals with fewer than 50 

beds. (Section 6006) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(19) Rural Entrepreneur and Microloan Assistance Program 

The House bill provides for the establishment of a rural entrepreneurship and microenterprise grant and loan program, authorized for $20,000,000 per year for each of the fiscal years 2008 

through 2012. Grants may be made to qualified organizations to: 

(i) provide training, operations support, or rural capacity-building 

services to qualified organizations to assist them in developing 

microenterprise training, technical assistance, market development 

assistance, and other related services; (ii) assist in researching and 

developing best practices in delivering training, technical assistance, and microcredit to rural entrepreneurs; and (iii) carry out 

other projects that the Secretary deems to be consistent with the 

purposes of the program. As a condition of receiving a grant, the 

qualified organization is required to match not less than 25 percent 

of the total amount of the grant. In addition to cash from non-Federal sources, the matching share may include indirect costs or inkind contributions funded under non-Federal programs. 

A rural microloan program is established to: (i) make loans to 

qualified organizations for the purpose of making short-term, fixed 

interest rate microloans to startup, newly established, and growing 

rural microbusiness concerns; and (ii) in conjunction with the 

loans, provide grants for the purpose of providing intensive marketing, management, and technical assistance to small businesses. 

The term of the loan is to be 20 years and the loan is to bear an 

annual interest rate of at least 1 percent. The Secretary has the 

discretion to defer payments, both principal and interest, for 2 

years beginning on the date the loan is made. The amount of a 

grant given in connection with the loan program is not to be more 

than 25 percent of the total outstanding balance of the loan the organization received and, as a condition of receiving a grant, the 

qualified organization is required to match not less than 15 percent 

of the total amount of the grant. 

No more than 10 percent of the assistance received by a qualified organization is to be used to pay administrative expenses. An 

organization that receives either a rural entrepreneurship and 

microenterprise grant or a rural microloan has to provide the Secretary any information that the Secretary requires to ensure that 

the grant or loan is being used for its intended purposes. (Section 

6013) 

The Senate amendment amends Subtitle D of the Con Act by 

authorizing the Secretary to establish a Rural Microenterprise Program to provide low- or moderate- income individuals with the 

skills necessary to establish a new rural microenterprise and to 

continue technical and financial assistance to rural microenterprises. The Senate and House sections are substantially similar; 

however, the Senate section requires the Secretary to ensure that 

grant recipients include microenterprise development organizations 


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of varying sizes and that serve racially and ethnically diverse populations. 

Mandatory funding of $40,000,000, to remain available until 

expended, is provided starting in fiscal year 2008. Not less than 

$25,000,000 of the funds provided are to be used to carry out 

grants for the Rural Microenterprise Program. Not less than 

$15,000,000 of the funds provided are to be used to carry out the 

Rural Microloan Program; of that amount, not more than 

$7,000,000 is to be used to support direct loans. In addition to mandatory funding, an authorization of appropriations is provided for 

each of fiscal years 2009 through 2012 to carry out this program. 

(Section 6022) 

The Conference substitute adopts the House provision with 

modifications. The Conference substitute strikes as an eligible use 

of program funding research and development of best practices in 

delivering training, technical assistance and microcredit to rural 

microenterprises. Additionally, the Conference substitute provides 

$15,000,000 in mandatory funding, to remain available until expended, in the following years: fiscal year 2009 ($4,000,000); fiscal 

year 2010 ($4,000,000); fiscal year 2011 ($4,000,000); and fiscal 

year 2012 ($3,000,000). (Section 6022) 

The Managers intend that the Microentrepreneur Assistance 

Program will be used to assist microenterprises located in rural 

areas. However, a microenterprise development organization receiving assistance under the program need not be located in a rural 

area to be eligible to participate. A microenterprise development organization is eligible so long as the organization provides assistance to microentrepreneurs located in rural areas, facilitates access 

to capital for a microenterprise in a rural area, or has a demonstrated record of delivering services to microentrepreneurs located in a rural area. 

In addition, in making grants available to microenterprise development organizations to support microenterprise development, 

the Managers intend that the Secretary shall not require an organization to have received a loan in order to receive a grant under 

subsection (b)(4)(a). 

(20) Criteria to be applied in considering applications for rural development projects. 

The House bill amends subtitle D of the Con Act by authorizing the Secretary to review the income demographics, population 

density, and seasonal population increases, and other factors as determined by the Secretary, for eligible communities that submit applications for rural development programs authorized or modified 

by title VI of the 2007 Farm Bill, or section 306, 306A, 306C, 306D, 

306E, 310(c), 310(e), 310B(b), 310B(c), 310B(e), or 370B, or subtitles F, G, H, or I, of the Con Act. 

The Secretary is authorized to issue regulations to establish 

the limitation that a rural area cannot exceed in order to remain 

eligible for rural development funds. (Section 6014) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. 


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(21) National sheep industry improvement center 

The House bill provides for the continuation of the National 

Sheep Industry revolving fund to promote strategic development 

activities and collaborative efforts to strengthen and enhance the 

production and marketing of sheep or goat products in the United 

States; by optimizing the use of available human capital and resources within the sheep and goat industries, and adopting flexible 

and innovative approaches to solving the long-term needs of the 

U.S. sheep or goat industry. 

The House bill eliminates the requirement that the National 

Sheep Industry Improvement Center be required to privatize its revolving fund and authorizes appropriations of $10,000,000 for each 

of the fiscal years 2008 through 2012. (Section 6015) 

The Senate amendment renames the program as the National 

Sheep and Goat Industry Improvement Center. The Senate amendment also eliminates the requirement that the National Sheep Industry Improvement Center be required to privatize its revolving 

fund. The Senate amendment provides for new mandatory funding 

of $1,000,000 for fiscal year 2008, to be available until expended, 

and authorizes $10,000,000 for each of the fiscal years 2008 

through 2012 for infrastructure development, business planning, 

production, resource development and market and environmental 

research. (Section 11009) 

The Conference substitute adopts the Senate provision with 

modifications. It retains the existing name of the Center and provides $1,000,000 in mandatory funds for the Center. (Section 11009 

of the Livestock Title) 

(22) National rural development partnership 

The House bill extends authorization through 2012. (Section 

6016) 

The Senate amendment extends the authorization to 2012 and 

amends subsection (h) of section 378 of the Con Act by establishing 

the termination date for this authority as September 30, 2012. 

(Section 6024) 

The Conference substitute adopts the House provision. (Section 

6019) 

(23) Historic barn preservation 

The House bill amends section 379A(c) of the Con Act by extending the authorization for this program through 2012 and providing that the Secretary, in making grants, is to give the highest 

priority to funding projects that identify, document, and conduct research on historic barns and that develop and evaluate appropriate 

techniques or best practices for protecting historic barns. (Section 

6017) 

The Senate amendment establishes that a grant may be made 

to an eligible applicant for ‘‘eligible projects’’ that rehabilitate or repair historic barns; preserve historic barns; and identify, document, 

survey, and conduct research on historic barns or farm structures 

and that evaluate techniques or best practices for protecting these 

structures. (Section 6025) 

The Conference substitute adopts the House provision with 

technical changes. (Section 6020) 


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(24) NOAA weather transmitters 

The House bill is the same as section 379B of the Con Act. The 

authorization remains the same and is extended through 2012. 

(Section 6018) 

The Senate amendment is identical to the House bill. (Section 

6026) 

The Conference substitute adopts the House provision. (Section 

6021) 

(25) Delta Regional Authority 

The House bill provides for the extension of the Delta Regional 

Authority (DRA) to 2012. (Section 6019) 

The Senate amendment provides for the extension of the (DRA) 

and also authorizes the Secretary to award grants to the Delta 

Health Alliance (DHA) for the development of health care services, 

health educational programs, health care job training, and for public health facilities in the Delta region. The DHA must solicit input 

from local governments, public health care providers and other entities in the Mississippi Delta region. (Section 6029) 

The Conference substitute adopts the House provision with 

modifications to add counties to the eligible region for the DRA. 

(Section 6025) In addition, the Conference substitute establishes a 

separate section called Health Care Services, which authorizes 

$3,000,000 annually for each of fiscal years 2008 through 2012 for 

healthcare services in the Delta Region to be provided by a consortium of regional institutions. (Section 6024) 

The Managers note that, for the purposes of the Delta Health 

Care Services provision, the term ‘‘Delta region’’ refers to the Mississippi River Delta region. The Managers recognize the serious 

unmet health needs in this region and authorize this program with 

the goal of promoting collaboration among entities that are working 

in the region to provide access to quality health care. 

(26) Northern Great Plains Regional Authority 

The House bill provides for an extension of the Northern Great 

Plains Regional Authority (NGPRA), which provides funding for 

programs and projects designed to serve the needs of distressed 

counties and isolated areas of distress in the States of Iowa, Minnesota, Nebraska, North Dakota and South Dakota. The House bill 

broadens the Authority’s support for resource conservation districts. 

The House bill makes several modifications to the authority by: 

(1) changing the formula for the federal share of the NGPRA’s administrative expenses—the formula is: for fiscal year 2007, 100 

percent; for fiscal year 2008, 75 percent; and for fiscal year 2009, 

50 percent; (2) eliminating the order of priority, with respect to 

funding for economic and community development projects, and the 

prohibition on providing funds for projects located in nondistressed 

counties; and (3) reducing to 25 percent, the minimum amount of 

funds that the authority is to allocate to transportation, telecommunication, and public infrastructure projects. 

The House bill also adds ‘‘renewable energy projects’’ among 

the projects that are eligible to receive funds. (Section 6020) 


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The Senate amendment provides for an extension of the 

NGPRA and makes changes similar to the House, with respect to 

renewable energy investments and the proportion of funds made 

available to distressed counties. The Senate amendment allows the 

NGPRA to organize and operate without a Federal member if such 

a member has not been confirmed by the Senate 180 days after enactment. With respect to the tribal chairperson, the Senate amendment allows the leaders of the Indian tribes in the region to select 

a member if a tribal chairperson has not been confirmed by the 

Senate within 180 days of enactment. 

The Senate amendment provides that, among other duties, the 

NGPRA is to develop comprehensive and coordinated plans and 

programs for multistate cooperation to advance the economic and 

social well-being of the region and approve grants for the economic 

development of the Northern Great Plains region. Additionally, the 

assessment of needs and assets of the region should include available research, demonstrations, investigations, assessments, and 

evaluations from the regional boards established under the Rural 

Collaborative Investment Program (RCIP). 

The Senate amendment provides that the NGPRA should enhance the capacity of, and provide support for, multistate development and research organizations, local development organizations 

and districts, and resource conservation districts in the region. 

The Senate amendment amends section 383B(g)(1) of the Con 

Act by providing a 100 percent Federal cost-share for fiscal years 

2008 and 2009, a 75 percent Federal cost-share for fiscal year 2010, 

and a 50 percent Federal cost-share for fiscal year 2011 and beyond. 

The Senate amendment adds a new provision to provide assistance to States in developing plans to address multistate economic 

issues, including plans to: develop a regional transmission system 

for the movement of renewable energy; assist in the harmonization 

of transportation policies and regulations that impact the interstate 

movement of goods and individuals; encourage and support interstate collaboration on federally funded research of national interest; and establish regional working groups on agriculture development and transportation concerns. 

Multistate economic issues are to include: renewable energy 

development and transmission, transportation planning and economic development, information technology, movement of freight 

and persons in the region; conservation land management, and federally funded research. 

The Senate amendment would allow grants to be awarded to 

multistate, local or regional development district organizations for 

administrative expenses. Grants may not exceed 80 percent of the 

administrative expenses of the local development district and no 

grant may exceed 3 years in duration. The contribution of the 

grantee may be in cash or in-kind, fairly evaluated, and can include equipment, space and services. 

The Senate amendment removes the requirement for local development districts to serve as lead organizations and liaison between State, tribal, and local governments, nonprofit groups, the 

business community, and citizens. (Section 6030) 


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The Conference substitute adopts the Senate amendment, but 

modifies it to require that the NGPRA consult and coordinate, as 

appropriate, with tribal leaders in the region should a Federal or 

tribal chairperson not be appointed and confirmed. Generally, a 

local development district will operate as the lead organization 

serving a multicounty area in the region. However, the Federal cochairperson, or the Secretary, if no person has been confirmed, may 

designate an Indian tribe or an alternative organization to serve in 

that capacity. Organizations that are suitable to serve in such a capacity include rural conservation and development districts, Rural 

Economic Area Partnership (REAP) zone organizations, or regional 

organizations established under RCIP. (Section 6026) 

(27) Rural Collaborative Investment Program/Rural Strategic Investment Program 

The House bill provides for the extension of the rural strategic 

investment program (RSIP) in section 385E of the Con Act with an 

authorization of appropriations of $25,000,000 for fiscal years 2008 

through 2012. The preservation and promotion of ‘‘rural heritage,’’ as defined in this section, are added to the criteria for regional 

plans, for the purpose of making regional strategic planning 

grants—which are competitive grants awarded to Regional Boards 

for the purpose of developing, maintaining, and evaluating regional 

plans. 

In awarding innovation grants, the National Board is to give 

priority to Regional Boards that, among other criteria, demonstrate 

a plan to protect and promote rural heritage. (Section 6021) 

The Senate amendment amends section 385A of the Con Act 

by establishing a Regional Rural Collaborative Investment Program (RCIP) to provide rural regions with a flexible investment vehicle to develop and implement locally prioritized, comprehensive 

strategies for achieving regional competitiveness, innovation and 

prosperity. 

The Senate amendment requires the Secretary to appoint a 

National Rural Investment Board and establish a National Institute on Regional Rural Competitiveness and Entrepreneurship. The 

National Institute on Regional Rural Competitiveness and Entrepreneurship will work with the Secretary to create a National 

Rural Investment Plan and a Rural Philanthropic Initiative, certify 

Regional Rural Investment Boards, and make Regional Innovation 

Grants to Regional Boards to implement approved regional strategies. These Regional Boards are to be multijurisdictional, multisectoral, regional entities which are broadly representative of the 

long-term economic, community and cultural interests of a region, 

and are comprised of public, private and non-profit organizations 

and residents of the region. A region must include a population of 

at least 25,000 individuals or in regions with a population density 

of less than 2 persons per square mile, a population of at least 

10,000 individuals. The Regional Board designs a Regional Investment Strategy and competes for Regional Innovation Grants. 

Grants of not more than $150,000 are to be provided on a competitive basis to certified Regional Boards to develop, implement 

and maintain Regional Investment Strategies, developed through a 

collaborative and inclusive public process. Regional Investment 


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Strategies are to provide an assessment of the region’s competitive 

advantage, an analysis of the region’s economic and community development challenges, opportunities, and resources, a plan of action 

to implement the goals of the strategies identified, and performance measures by which to evaluate implementation. 

Regional Innovation Grants shall be provided on a competitive 

basis to certified Regional Boards, to implement projects and programs identified in funded Regional Investment Strategy Grants. 

The Secretary is to give priority to strategies that demonstrate significant leverage of capital, quality job creation, and asset-based 

development. A Regional Board may not receive more than 

$6,000,000 in Regional Innovation Grants during any 5-year period. 

Long-term loans may be provided to eligible community foundations to assist in the implementation of funded Regional Investment Strategies. The eligible community foundation must be located in the covered region, provide a 25 percent match, and use 

the funds to implement priorities within the Regional Investment 

Strategy. 

The Senate amendment provides $135,000,000 in mandatory 

funding to remain available until expended. Of the amounts made 

available, the Secretary is to use $15,000,000 for Regional Investment Strategy Grants, $110,000,000 for Regional Innovation 

Grants, $5,000,000 to administer the National Board, and 

$5,000,000 to administer the National Institute. (Section 6032) 

The Conference substitute adopts the Senate provision, with 

modifications to incorporate rural heritage as a goal of the program. An appropriation of $135,000,000 is authorized for fiscal 

years 2009 through 2012 to carry out this program. (Section 6028) 

(28) Northern Border Economic Development Commission 

The Senate amendment adds a new subtitle to the Con Act 

that establishes the Northern Border Economic Development Commission (NBEDC) made up of a Federal member appointed by the 

President with the advice and consent of the Senate. The membership of the Commission includes the Governors of each State in the 

region that elects to participate in the Commission. The State cochairperson is a Governor of a participating State in the region. 

The State cochairperson will serve for a term of not less than a 

year. Each State member may have a single alternate, who is appointed by the Governor of the State from among the Governor’s 

cabinet. Each Commission may appoint and fix the compensation 

of an executive director to carry out the duties of the Commission. 

Although the Commission has the authority to determine what 

constitutes a quorum of the Commission, the Federal cochairperson 

must be present to reach a quorum. Alternate members cannot be 

counted toward the quorum. Decisions, such as approval of State, 

regional, or subregional development plans or strategy statements, 

allocations to States, and modifications to the Commission’s code, 

may not be made without a quorum. 

The Senate amendment establishes the duties and administrative actions of the Commission. The amendment specifies that the 

Commission is required to submit an annual report to Congress. In 


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addition, Federal agencies are required to work with the Commission. 

Any State member, alternate, official, or employee of the Commission, their immediate family, organization, or organization for 

which the employee has an arrangement concerning prospective 

employment, are prohibited from participating personally or substantially in a matter in which the employee has a financial interest. A conflict of interest can be overcome by full disclosure to the 

Commission and a subsequent determination by the Commission 

that the matter will not substantially affect the integrity of the 

work of the Commission. 

The Senate amendment confers upon the Commission the authority to approve grants to improve economic development of the 

region. Grants may be provided from Federal appropriations, other 

Federal and State grant funds, or any other sources. The Federal 

cochairperson is permitted to use funds made available to the program to fund any portion of the basic Federal contribution to a 

project or activity under a Federal grant program in the region in 

an amount not to exceed 80 percent of the project cost. The Commission is also permitted to make grants to local development districts for administrative expenses as long as the grant does not exceed 80 percent of the administrative expense of the local development district receiving the grant. 

States participating in the Commission are required to submit 

a development plan for the area of the region represented by the 

State member. In developing the plan, the State must consult with 

the appropriate organizations. The Commission is to encourage 

public participation in developing such plans. Any State or regional 

development plan or any multistate subregional plan that is proposed must be reviewed by the Commission. An appropriation of $30,000,000 is authorized for each of fiscal 

years 2008 through 2012; not more than 5 percent of the appropriated amount is to be used for administrative expenses. The authority of the Commission is terminated on October 1, 2012. (Section 6034) 

The House contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

modifications to establish the Northern Border Regional Commission, the Southeast Crescent Regional Commission, and the Southwest Border Regional Commission in a new subtitle, ‘‘Regional Economic and Infrastructure Development,’’ in Title 40 of the U.S. 

Code. (Section 14217 of the Miscellaneous Title) 

The Conference substitute establishes commission membership, voting structure, and staffing; outlines conditions for financial 

assistance; authorizes grants to local development districts; establishes an Inspector General for the commissions; and includes other 

provisions designed to produce a standard administrative framework. 

Each Commission includes a Federal cochairperson, appointed 

by the President and confirmed by the Senate. The Federal Cochairperson will appoint an alternate Federal cochairperson. The 

membership of the Commission also includes the Governors of each 

State in the region that elects to participate in the Commission. 

The State cochairperson is a Governor of a participating State in 


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the region. The State cochairperson will serve for a term of not less 

than a year. Each State member may have a single alternate, who 

is appointed by the Governor of the State from among the Governor’s cabinet. Each Commission may appoint and fix the compensation of an executive director to carry out the duties of the 

Commission. 

Each State member is required to submit a development plan 

for the area of the region represented by the State member. In carrying out the development planning process, a State will consult 

with local development districts, local units of government, and 

universities and take into account the goals, objectives, and recommendations of these entities. Each Commission is to establish 

priorities in an economic and infrastructure development plan for 

its region, including 5-year regional outcome targets. The Commission will, to the extent practicable, encourage and assist public participation in the plans and programs of the Commission. 

The Commission is authorized to hold hearings, take testimony 

under oath, and request information from State and Federal agencies; adopt, amend, and repeal bylaws and rules governing the conduct of the Commission; request the head of any Federal department or of any State agency or local government to detail to the 

Commission personnel needed to carry out the duties of the Commission; provide Commission employees with retirement and other 

benefits; accept, use, and dispose of gifts; enter into contracts to 

carry out Commission duties; establish a central office and field offices for the Commission; and provide an appropriate level of representation in Washington, D.C. 

The Federal Government will pay 50 percent of the administrative expenses of the Commission and the States participating in the 

Commission will pay 50 percent of such expenses. Each Commission is required to hold an initial meeting no later than 180 days 

after the date of enactment of this Act. 

Any State member, alternate, official, or employee of the Commission, their immediate family, organization, or organization for 

which the employee has an arrangement concerning prospective 

employment, are prohibited from participating personally or substantially in a matter in which the employee has a financial interest. A conflict of interest can be overcome by full disclosure to the 

commission and a subsequent determination by the Commission 

that the matter will not substantially affect the integrity of the 

work of the Commission. 

Governments of Indian tribes in the region of the Southwest 

Border Regional Commission are allowed to participate in matters 

in the same manner and to the same extent as State agencies and 

instrumentalities in the region. 

Not less than 90 days after the last day of the each fiscal year, 

each Commission will submit to the President and Congress a report on the activities carried out by the Commission in the past fiscal year. The report will include a description of the criteria used 

by the Commission to designate counties, a list of the counties designated in each category, an evaluation of the progress of the Commission in meeting the goals identified in the Commission’s economic and infrastructure development plan, and any policy recommendations approved by the Commission. 


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Each Commission may make grants to State and local governments, Indian tribes, and public or nonprofit organizations for 

projects to develop infrastructure in the region, including transportation, public, and telecommunications infrastructure; assist the region in obtaining job skills training; provide assistance to severely 

economically distressed and underdeveloped areas that lack financial resources for improving basic health care and other public 

services; promote resource conservation; promote the development 

of renewable and alternative energy sources; and other measures 

to achieve the purposes of this subtitle. 

The Commission will allocate at least 40 percent of any grant 

amounts provided for transportation, public, or telecommunications 

infrastructure for the region. The Commission may use amounts 

appropriated to carry out this subtitle to fund a project or activity 

under a Federal grant program in the region in an amount that is 

above the fixed maximum portion of the cost of the project otherwise authorized by applicable law, but may not exceed 50 percent 

of the costs of the project, except for distressed counties or regional 

projects. The maximum contribution for a project or activity to be 

carried out in a distressed county may be increased to 80 percent. 

A Commission may increase the maximum grant for a project from 

50 percent to 60 percent under the normal criteria of section 15501 

and from 80 percent to 90 percent for a distressed county if the 

project or activity involves three or more counties or more than one 

State and the Commission determines that the project or activity 

will bring significant inter-state or multi-county benefits to a region. 

An application to a Commission for a grant or any other assistance for a project is to be made through, and evaluated for approval by, the State member of the Commission representing the 

applicant. Upon certification by a State member of a Commission 

of an application for a grant or other assistance for a specific 

project under this section, an affirmative vote of the Commission 

shall be required for approval of the application. 

Each Commission is required, in considering programs and 

projects to be provided assistance and in establishing a priority 

ranking of the requests for assistance, to consider: the relationship 

of the project or class of projects to overall regional development; 

the per capita income and poverty and unemployment and out migration rates in an area; the financial resources available to the applicants for assistance seeking to carry out the project; the importance of the project in relation to the other projects that may be 

in competition for the same funds; the prospects that the project 

will improve opportunities for employment, the average level of income, or the economic development of the area on a continuing 

basis; and the extent to which the project design provides for detailed outcome measurements by which grant expenditures and the 

results of the expenditures may be evaluated. 

The Commission may make grants to a local development district to assist in the payment of development planning and administrative expenses. In the case of a State agency certified as a local 

development district, a grant may not be awarded to the agency 

under this section for more than 3 fiscal years. The contributions 

of a local development district for administrative expenses may be 


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in cash or in-kind services including space, equipment, and services. 

A local development district is to operate as a lead organization serving multi-county areas in the region at the local level and 

serve as a liaison between the State and local governments, nonprofit organizations, the business community, and citizens that are 

involved in multi-jurisdictional planning; provide technical assistance; and provide leadership and civic development assistance. 

Supplements to Federal grant programs may be made because 

certain States and local communities, including local development 

districts, may be unable to take maximum advantage of Federal 

grant programs for which they are eligible because they lack the 

economic resources to provide the required State or local matching 

share. Supplemental funds may also provide necessary funding for 

a project to be carried out in the region when there are insufficient 

funds available under applicable Federal law. 

A Commission, with the approval of the Federal cochairperson, 

may use amounts made available to carry out this subtitle for any 

part of the basic Federal contribution to projects or activities under 

the Federal grant programs authorized by Federal laws and to increase the Federal contribution to projects and activities under the 

programs above the fixed maximum part of the cost of the projects 

or activities otherwise authorized by the applicable law. 

For a project for which any part of the basic Federal contribution to the project or activity under a Federal grant program is proposed to be made under this subtitle, the Federal contribution is 

not to be made until the responsible Federal official administering 

the Federal law authorizing the Federal contribution certifies that 

the program, project, or activity meets the applicable requirements 

of the Federal law and could be approved for Federal contribution 

under that law if amounts were available under the law for the 

program, project, or activity. Amounts provided pursuant to this 

subtitle are available without regard to any limitations on areas eligible for assistance or authorizations for appropriation in any 

other law. 

The Federal share of the cost of a project or activity receiving 

assistance under this subtitle shall not exceed 80 percent. 

A State is not required to engage in or accept a program under 

this subtitle without its consent. 

The Conference substitute establishes the designation of distressed, transitional, and attainment counties and isolated areas of 

distress in the region. Not later than 90 days after the date of enactment of this Act, and annually thereafter, each Commission is 

required to designate counties under 4 categories. The categories 

will include: (1) distressed counties, defined as counties that are 

the most severely and persistently economically distressed and underdeveloped and have high rates of poverty, unemployment, or out 

migration; (2) transitional counties, defined as counties that are 

economically distressed and underdeveloped or have recently suffered high rates of poverty, unemployment, or out migration; (3) attainment counties, which are counties that are not designated as 

distressed or transitional counties; and (4) isolated areas of distress, defined as areas, located in counties designated as attainVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00827 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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ment counties, that have high rates of poverty, unemployment, or 

out migration. 

A Commission is to allocate at least 50 percent of the appropriations made available to the Commission to carry out this subtitle for programs and projects designed to serve the needs of distressed counties and isolated areas of distress in the region. 

No funds may be provided to a county designated as an attainment county except for funding the administrative expenses of local 

development districts, a multi-county project that includes participation of the attainment county, and other projects if a Commission determines that the project could bring significant benefits to 

areas of the region outside the attainment county. 

For the isolated area of distress designation to be effective, the 

designation must be supported by the most recent Federal data 

available or if no recent Federal data are available, by the most recent data available. 

Counties are not eligible for assistance in more than 1 region. 

A political subdivision included in the region of more than 1 Commission will select the Commission with which it will participate 

by notifying, in writing, the Federal cochairperson and the appropriate State member of the Commission. The selection of a Commission by a political subdivision will apply in the fiscal year in 

which the selection is made and will apply in each subsequent fiscal year unless the political subdivision, at least 90 days before the 

first day of the fiscal year, notifies another Commission in writing 

that the political subdivision will participate in that Commission 

and also transmits a copy of such notification to the Commission 

in which the political subdivision is currently participating. In this 

section, the term ‘‘Commission’’ includes the Appalachian Regional 

Commission. 

An Inspector General for Commissions, appointed in accordance with the Inspector General Act of 1978, is established for each 

Commission. All of the Commissions are to be subject to a single 

Inspector General. Each Commission is to maintain accurate and 

complete records of all transactions and activities of the Commission and make them available to the Inspector General for audit 

and examination. The Inspector General will audit the activities, 

transactions, and records of each Commission annually. 

Representatives of each Commission, the Appalachian Regional 

Commission, and the Denali Commission will meet biannually to 

discuss issues confronting regions suffering from chronic and continuous distress as well as successful strategies for promoting regional development. The chair of each meeting will rotate among 

the Commissions, with the Appalachian Regional Commission to 

host the first meeting. 

The region of the Southeast Crescent Regional Commission is 

defined as consisting of all counties of the States of Virginia, North 

Carolina, South Carolina, Georgia, Alabama, Mississippi, and Florida not already served by the Appalachian Regional Commission or 

the Delta Regional Authority. 

The region of the Southwest Border Regional Commission is 

defined as consisting of the following political subdivisions: 


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(1) ARIZONA—The counties of Cochise, Gila, Graham, 

Greenlee, La Paz, Maricopa, Pima, Pinal, Santa Cruz, and 

Yuma in the State of Arizona. 

(2) CALIFORNIA—The counties of Imperial, Los Angeles, 

Orange, Riverside, San Bernardino, San Diego, and Ventura in 

the State of California. 

(3) NEW MEXICO—The counties of Catron, Chaves, Dona 

Ana, Eddy, Grant, Hidalgo, Lincoln, Luna, Otero, Sierra, and 

Socorro in the State of New Mexico. 

(4) TEXAS—The counties of Atascosa, Bandera, Bee, 

Bexar, Brewster, Brooks, Cameron, Coke, Concho, Crane, 

Crockett, Culberson, Dimmit, Duval, Ector, Edwards, El Paso, 

Frio, Gillespie, Glasscock, Hidalgo, Hudspeth, Irion, Jeff Davis, 

Jim Hogg, Jim Wells, Karnes, Kendall, Kenedy, Kerr, Kimble, 

Kinney, Kleberg, La Salle, Live Oak, Loving, Mason, Maverick, 

McMullen, Medina, Menard, Midland, Nueces, Pecos, Presidio, 

Reagan, Real, Reeves, San Patricio, Shleicher, Sutton, Starr, 

Sterling, Terrell, Tom Green Upton, Uvalde, Val Verde, Ward, 

Webb, Willacy, Wilson, Winkler, Zapata, and Zavala in the 

State of Texas. 

The region of the Northern Border Regional Commission is defined to include the following counties: 

(1) MAINE—The counties of Androscoggin, Aroostook, 

Franklin, Hancock, Kennebec, Knox, Oxford, Penobscot, 

Piscataquis, Somerset, Waldo, and Washington in the State of 

Maine. 

(2) NEW HAMPSHIRE—The counties of Carroll, Coos, 

Grafton, and Sullivan in the State of New Hampshire. 

(3) NEW YORK—The counties of Cayuga, Clinton, Essex, 

Franklin, Fulton, Hamilton, Herkimer, Jefferson, Lewis, Madison, Oneida, Oswego, Seneca, and St. Lawrence in the State of 

New York. 

(4) VERMONT—The counties of Caledonia, Essex, Franklin, Grand Isle, Lamoille, and Orleans in the State of Vermont. 

An authorization of $30,000,000 is provided for each of fiscal 

years 2008 through 2012 for each Commission to carry out this 

subtitle; not more than 10 percent of the funds made available to 

a Commission in a fiscal year may be used for administrative expenses. 

The Managers note that within the Southeastern region of the 

United States—defined for the purposes here to include the coastal 

and central portions of the seven Southeastern States from Virginia to Mississippi—approximately 40 percent of the counties have 

had 20 percent or more of their citizens living in poverty, on average, during the last 30 years. Additionally, this region has experienced natural disasters at a rate of 2 to 3 times greater than any 

other region of the U.S. The Southeastern United States is one of 

the last areas of the country without a Federal authority dedicated 

to ending poverty and strengthening communities. The Southeast 

Crescent Authority will be a valuable tool to assist State and local 

officials, county development organizations, and many others in 

providing resources and leveraging additional funds to assist communities with the greatest need. 


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With regards to the Southwest border, an Interagency Task 

Force on the Economic Development of the Southwest Border found 

that 20 percent of the residents in this region live below the poverty level. Unemployment rates often reach as high as 5 times the 

national unemployment rate and a lack of adequate access to capital has created economic disparities that have made it difficult for 

businesses to start up in the region. Border communities have long 

endured a depressed economy and low-paying jobs. The Southwest 

Border Regional Commission will help foster planning to encourage 

infrastructure development, technology development and deployment, education and workforce development, and community development through entrepreneurship. 

Finally, the Northern Border region, while abundant in natural resources and rich in potential, lags behind much of the nation 

in its economic growth. In this region, 12.5 percent of the population lives in poverty. Furthermore, the median household income 

in this region is more than $6,500 below the national average. Due 

to this region’s historic reliance on a few basic industries and agriculture, unemployment through layoffs in traditional manufacturing industries is persistent. In addition, the population growth 

in this region increased by only 0.6 percent between 1990 and 

2000, while the U.S. population rose by 13.2 percent during that 

same period. The Northern Border Regional Commission will assist 

in supporting traditional industries while fostering new industry in 

the region. 

(29) Multijurisdictional regional planning organizations 

The Senate amendment reauthorizes section 306(a) of the Con 

Act through fiscal year 2012. (Section 6005) 

The House bill contains no comparable provision. 

The conference substitute deletes the Senate provision. 

(30) Rural Economic area partnership zones 

The Senate amendment amends section 310B of the Con Act 

by requiring the Secretary to continue to carry out the existing 

rural economic area partnerships in New York, North Dakota, and 

Vermont in accordance with terms and conditions contained in the 

memorandums of agreement entered into by the Secretary through 

2012. (Section 6019) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

modifications to ensure that only those rural economic area partnership zones in effect on date of enactment are to be extended to 

2012. (Section 6017) 

(31) SEARCH grants 

The Senate amendment amends section 306(a) of the Con Act 

by authorizing the Secretary to make grants to eligible communities for feasibility study, design, and technical assistance under 

the water and waste disposal and wastewater facilities grant program. The grants are to fund up to 100 percent of the eligible 

project cost and are to be subjected to the least documentation requirements practicable. 


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An ‘‘eligible community,’’ for the purposes of this section, is defined as a community that has a population of 2,500 or fewer inhabitants and is financially distressed. Not more than 4 percent of 

funds available for water, waste disposal and essential community 

facilities are to be used to carry out this program. (Section 6010) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

modifications to ensure that the program is modeled after the existing pre-development planning grants. (Section 6002) 

The Managers expect that a community will meet the definition of ‘‘financially distressed’’ if the median household income of 

the probable area to be served by the proposed project is either 

below the poverty line or below 80 percent of the statewide nonmetropolitan median household income based on available historic 

statistical information going back to the last decennial census if no 

more recent data is available. It is the Managers’ intent that the 

latest data on income be used without the taking of an income survey that would escalate the cost. 

(32) Grants to broadcasting systems 

The Senate amendment reauthorizes current law through fiscal year 2012. (Section 6016) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 6014) 

(33) Geographically disadvantaged farmers and ranchers. 

The Senate amendment establishes a new program to provide 

geographically disadvantaged farmers and ranchers direct reimbursement payments to transport agricultural commodities, or inputs used to produce the commodities. 

To be eligible for direct reimbursement payments the farmer or 

rancher must provide the Secretary proof that transportation or agricultural commodity or inputs occurred over the distance of more 

than 30 miles. The total amount of direct reimbursement payments 

provided by the Secretary is not to exceed $15,000,000 for each fiscal year. Necessary sums are authorized to be appropriated to 

carry out this program. (Section 6021) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

technical changes. (Section 1620 of the Commodity Title) 

The Managers recognize the barriers to competition associated 

with the high transportation costs incurred by geographically disadvantaged farmers and ranchers. The Managers expect the Secretary to develop, in consultation with the eligible areas, an equitable allocation of the funds for such areas. The Managers also expect the Secretary to consult with eligible areas on administration 

of the program. 

(34) Artisanal cheese centers 

The Senate amendment amends Subtitle D of the Con Act by 

requiring the Secretary to establish artisanal cheese centers for 

education and technical assistance for the manufacturing and marketing of artisanal cheese by small and medium-sized producers 


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and businesses. Necessary sums are authorized to be appropriated 

for each of the fiscal years 2008 through 2012 . (Section 6023) 

The House bill contains no provision. 

The Conference substitute deletes the Senate provision. 

(35) Grants to train farmworkers in new technologies and to train 

farm workers in specialized skills necessary for higher value 

crops. 

The Senate amendment extends section 379(c) of the Con Act 

through fiscal year 2012. (Section 6027) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(36) Grants for expansion of employment opportunities for individuals with disabilities in rural areas 

The Senate amendment amends the Con Act by adding a new 

section, 379E, which authorizes a new grant program to nonprofit 

organizations to expand employment opportunities for individuals 

with disabilities in rural areas. 

To be eligible to receive a grant under this section the eligible 

entity must have: a significant focus on serving the needs of individuals with disabilities; demonstrated knowledge and expertise in 

employment of and advising on accessibility issues for individuals 

with disabilities; expertise in removing barriers to employment for 

individuals with disabilities; existing relationships with national 

organizations focused on the needs of rural areas; affiliates in a 

majority of the States; and a working relationship with USDA. 

Grants are to be used to expand or enhance employment opportunities, or self-employment and entrepreneurship opportunities, of 

people with disabilities. An appropriation of $2,000,000 for each of 

the fiscal years 2008 through 2012 is authorized. (Section 6028) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

minor modifications that strike the requirements that the entity 

have affiliates in a majority of States and a working relationship 

with USDA. (Section 6023) 

(37) Rural Business Investment Program 

The Senate amendment extends the Rural Business Investment Program authorization through 2012 with the following modifications: debentures may be prepaid at any time, distributions 

may be made to cover tax liability, USDA fees are limited to a $500 

application fee and USDA will not be required to operate the program with other Federal agencies. (Section 6031) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision, but removes the provision allowing distributions to be made to cover tax 

liability. The limitation on funding from certain financial institutions is maintained and raised 25 percent. (Section 6027) 

(38) Funding of pending rural development loan and grant applications 

The Senate amendment provides $135,000,000 in mandatory 

funding to fund applications that are pending for water systems, 


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waste disposal systems and emergency community water assistance 

grants. (Section 6033) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with a 

modification to provide $120,000,000 in mandatory funds for this 

purpose. (Section 6029) 

(39) Expansion of 911 areas 

The House bill extends through 2012 section 315(a) of the 

Rural Electrification Act (REA), which authorizes the Secretary to 

make telephone loans to State or local governments, Indian tribes, 

or other public entities for the expansion of rural 911 access and 

integrated emergency communication in rural areas. (Section 6022) 

The Senate amendment also amends section 315 of the REA by 

expanding eligibility to emergency communications providers, State 

or local governments, Indian tribes, or other public entities for facilities and equipment to expand or improve 911 access, interoperable emergency communications, homeland security communications, transportation safety communication and location technologies used outside urbanized areas. Funds made available for 

telephone or broadband loans are authorized to be used for the program for each of the fiscal years 2008 through 2012. Governmentimposed fees to emergency communications providers are allowed 

as security for a loan. (Section 6107) 

The Conference substitute adopts the Senate provision with 

modifications to allow emergency communications equipment providers to apply for loans on behalf of municipalities where they 

serve when those municipalities are unable to incur such debt. The 

Conference substitute also adds clarifying language to ensure that 

the program operates only in rural areas. (Section 6107) 

(40) Access to broadband telecommunications services in rural areas 

The House bill provides for several modifications of section 601 

of the REA, which authorizes the Secretary to provide loans and 

loan guarantees for the costs of construction, improvement, and acquisition of facilities and equipment for broadband service in eligible rural communities. 

The House bill changes the definition of an ‘‘eligible rural community’’ to include any area in the United States that is not: included within the boundaries of any city, town, borough, or village, 

whether incorporated or unincorporated, with a population of more 

than 20,000 inhabitants; and the urbanized area contiguous and 

adjacent to such a city or town. The term ‘‘incumbent service provider’’ is defined to mean an entity that is providing broadband 

service to at least 5 percent of the service area proposed in the application. 

The House bill requires priority to be given to applications proposing to serve communities in the following order: (1) no incumbent service provider; (2) 1 incumbent service provider; or (3) 2 incumbent service providers who, together, serve not more than 25 

percent of the households in the service area proposed in the application. 


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This section prohibits the Secretary from making a loan under 

2 conditions: (1) the loan is to any community where there are 

more than 3 incumbent service providers, unless; 

(a) the loan is to an incumbent service provider of the community; 

(b) the other providers in that community are notified of 

the application before approval by the Secretary, and have sufficient time to comment on the application; and 

(c) the application includes substantially increasing the 

quality of broadband service in the community and the provision of broadband service to unserved households inside and 

outside the community; or 

(2) the loan is for new construction (i.e. the construction or acquisition of broadband facilities and equipment by a new entrant 

into the community) in any community in which more than 75 percent of the households may obtain affordable broadband service, on 

request, from at least 1 incumbent service provider. 

The House bill authorizes the Secretary to take steps to reduce 

the costs and paperwork associated with applying for a loan or loan 

guarantee under this section by first- time applicants, particularly 

those who are smaller and start-up Internet providers. It also mandates that not more than 25 percent of loans are to be made available, in a single fiscal year, to entities that serve more than 2 percent of the telephone subscriber lines in the United States. 

The House bill provides that the period of a loan or loan guarantee cannot exceed 35 years, as the borrower may request, so long 

as the Secretary determines that the loan is adequately secured; 

the Secretary is to consider whether the recipient is, or would be, 

serving an area that is not receiving broadband services. 

This section also requires the Secretary to ensure that the 

type, amount, and method of security used to secure a loan or loan 

guarantee is commensurate to the risk involved with the loan or 

loan guarantee, particularly when the loan or loan guarantee is 

issued to a financially healthy, strong, and stable entity. The Secretary is also required, in determining the amount and method of 

security, to consider reducing the security in areas that do not have 

broadband service. 

The Secretary must annually report to Congress by December 

1 of each fiscal year on the rural broadband loan and loan guarantee program. The annual report is to include information pertaining to the loans made, communities served, speed of broadband 

service offered, and types of services offered by applicants and recipients, length of time taken to approve applications submitted, 

and outreach efforts undertaken by USDA. 

The House bill establishes a ‘‘National Center for Rural Telecommunications Assessment’’ to assess the effectiveness of the 

rural broadband loan and loan guarantee program, increase 

broadband penetration and purchase in rural areas; and develop 

assessments of broadband availability in rural areas. An appropriation of $1,000,000 is authorized for each of the fiscal years 2008 

through 2012 for the Center. 

The House bill mandates that the Secretary is required to set 

aside 10 percent of appropriated funds for eligible tribal communities. Unobligated amounts contained in the reserve for tribal 


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communities will be released by June 30 of each fiscal year. (Section 6023) 

The Senate amendment maintains current law, with respect to 

the purposes for which loans and loan guarantees may be made, 

but provides that they should be provided to ‘‘rural areas,’’ as defined in section 6105 of this Act. All references to eligible rural 

communities have been changed to rural areas. 

The Senate amendment defines the term ‘‘mobile broadband’’

to mean any ‘‘broadband service’’ that is provided over a licensed 

spectrum through the use of a mobile station or receiver communicating with a land station or other mobile stations communicating among themselves. 

Under the Senate amendment, highest priority is to be given 

to applicants that offer to provide broadband service to the greatest 

proportion of households currently without broadband service. A 

provider is considered to offer broadband service to a rural area if 

the provider makes the service available to households in the rural 

area at not more than average prices as compared to the prices at 

which similar services are made available in the nearest urban 

area, as determined by the Secretary. Eligible entities are required 

to: submit a proposal to the Secretary that meets the requirements 

for a project to offer to provide service to a rural area; offer to provide broadband service to at least 25 percent of households in a 

specified rural area that do not currently have such service offered 

to them; and agree to complete buildout of the broadband service 

within 3 years. 

The Senate amendment prohibits the Secretary from making 

or guaranteeing loans for projects in areas where 3 or more existing providers already offer to provide comparable service. 

The Secretary is given the discretion to require an entity to 

provide a cost-share in an amount not to exceed 10 percent of the 

amount of the loan or loan guarantee. The Secretary is also given 

the discretion to require an entity that proposes to have a subscriber projection of more than 20 percent of the broadband market 

in a rural area to submit a market survey. However, the Secretary 

is prohibited from requiring a market survey from an entity that 

projects to have less than 20 percent of the broadband market. 

State, local governments, and Indian tribes are eligible to receive loans or loan guarantees available under this section. 

No entity may acquire more than 20 percent of the resources 

of the program outlined under this section in a fiscal year. 

The Senate amendment requires the Secretary to include a notice of applications on the Secretary’s website for 90 days, post information relating to the broadband proposal on the website, establish a timeline on the website to track applications, and establish 

procedures for processing loan and loan guarantee applications (including requests for additional information). Not later than 45 days 

after the date on which the Secretary approves an application the 

documents necessary for closing the loan or loan guarantee are to 

be provided to the applicant. Not later than 10 business days after 

the date of receipt of a valid documentation requesting disbursement of the approved, closed loan, the disbursement of the loan 

funds is to occur. 


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The Senate amendment requires the Secretary to establish an 

optional pre-application process under which an applicant may 

apply to RUS for a binding determination of whether the area proposed to be served is eligible prior to preparing a full loan application. 

An application for a loan or a loan guarantee under this section, or a petition for reconsideration of a decision on such an application, is to be considered under eligibility and feasibility criteria 

that are no less favorable to the applicant than the criteria in effect 

on the original date of submission of the application. 

The Senate amendment establishes the annual rate of interest 

as the lower of: (i) the cost of borrowing to the Treasury Department for comparable obligations; or (ii) 4 percent. The loan or loan 

guarantee may not exceed 30 years. The type, amount, and method 

of security used to secure a loan or loan guarantee is commensurate to the risk involved with the loan or loan guarantee, particularly when the loan or loan guarantee is issued to a financially 

healthy, strong, and stable entity. 

Similar to the House bill, the Senate amendment provides for 

a National Center for Rural Telecommunications Assessment. The 

authorization of appropriations for the Center is the same as the 

House bill. The Center is required to submit an annual report that 

describes its activities, the results of the research it has carried, 

and any additional information that the Secretary may request. 

The Senate amendment allows the Secretary to provide the 

proceeds of any loan made or guaranteed under the REA for the 

purpose of refinancing another telecommunications-related loan 

made under REA. 

An appropriation of $25,000,000 is authorized for each of the 

fiscal years 2008 through 2012. (Section 6110) 

The Conference substitute adopts the Senate amendment with 

modifications. The definition of incumbent service provider is retained from the House bill. 

The Conference substitute maintains the definition of rural 

area from the Senate amendment. The Conference substitute prohibits the Secretary from making a loan in any area where there 

are more than 3 incumbent service providers unless the loan meets 

all of the following requirements: (1) the loan is to an incumbent 

service provider that is upgrading service in that provider’s existing territory; (2) the loan proposes to serve an area where not less 

than 25 percent of the households are offered service by not more 

than 1 provider; and (3) the applicant is not eligible for funding 

under another provision of the REA. 

The Conference substitute also prohibits the Secretary from 

making a loan in any area where not less than 25 percent of the 

households are offered broadband service by not more than 1 provider unless a prior loan has been made in the same area under 

this section. 

The Conference substitute provides that the highest priority is 

to be given to applicants that offer to provide broadband service to 

the greatest proportion of households currently without broadband 

service. Eligible entities are required to submit a proposal to the 

Secretary that meets the requirements for a project to offer to proVerDate Aug 31 2005 01:19 May 19, 2008 Jkt 042321 PO 00000 Frm 00836 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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vide service to a rural area and agree to complete buildout of the 

broadband service within 3 years. 

The Conference substitute prohibits any eligible entity that 

provides telecommunications or broadband service to at least 20 

percent of the households in the United States from receiving an 

amount of funds under this section for a fiscal year in excess of 15 

percent of the funds authorized and appropriated for the broadband 

loan program. 

The Conference substitute allows the Secretary to require an 

entity to provide a cost-share in an amount not to exceed 10 percent of the amount of the loan or loan guarantee. The Secretary is 

also allowed to require an entity that proposes to have a subscriber 

projection of more than 20 percent of the broadband service market 

in a rural area to submit a market survey. However, the Secretary 

is prohibited from requiring a market survey from an entity that 

projects to have less than 20 percent of the broadband market. 

The Conference substitute requires public notice of each application submitted, including the identity of the applicant, the proposed area to be served, and the estimated number of households 

in the application without terrestrial-based broadband. The Conference substitute authorizes the Secretary to take steps to reduce 

the costs and paperwork associated with applying for a loan or loan 

guarantee under this section by first-time applicants, particularly 

those who are smaller and start-up Internet providers. 

The Conference substitute allows the Secretary to establish a 

pre-application process under which a prospective applicant may 

seek a determination of area eligibility. 

The Conference substitute provides that an application, or a 

petition for reconsideration of a decision on such an application, 

that was pending on the date 45 days before enactment of this Act 

and that remains pending on the date of enactment of this Act is 

to be considered under eligibility and feasibility criteria in effect on 

the original date of submission of the application. 

The current law rate of interest for direct loans—which is the 

rate equivalent to the cost of borrowing to the Department of 

Treasury for obligations of comparable maturity or 4 percent—is 

retained. The Secretary is to consider existing recurring revenues 

at the time of application in determining an adequate level of credit support. 

The Conference substitute requires the Secretary to ensure 

that the type, amount, and method of security used to secure a loan 

or loan guarantee is commensurate to the risk involved with the 

loan or loan guarantee, particularly when the loan or loan guarantee is issued to a financially healthy, strong, and stable entity. 

The Secretary is also required, in determining the amount and 

method of security, to consider reducing the security in areas that 

do not have broadband service. 

The Conference substitute requires that the Secretary report to 

Congress by December 1 of each fiscal year on the rural broadband 

loan and loan guarantee program. The annual report is to include 

information pertaining to the loans made, communities served and 

proposed to be served, speed of broadband service offered, types of 

services offered by the applicants and recipients, length of time to 


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approve applications submitted, and outreach efforts undertaken 

by USDA. 

The Conference substitute authorizes the program at 

$25,000,000 to be appropriated for each of fiscal years 2008 

through 2012. (Section 6110) 

The Conference substitute provides for a National Center for 

Rural Telecommunications Assessment and criteria for the Center. 

The Center is to assess the effectiveness of programs carried out 

under this section, work with existing rural development centers to 

identify appropriate policy initiatives, and provide an annual report 

that describes the activities of the Center, the results of research 

carried out by the Center, and any additional information that the 

Secretary may request. An appropriation of $1,000,000 is authorized for each of the fiscal years 2008 through 2012. (Section 6111) 

The Managers expect the Secretary to consider the unique way 

of life in rural America and to be mindful that mobile broadband 

technologies are applicable to farmers, ranchers, and small rural 

business owners. Fixed broadband service will continue to be important in rural homes and offices, but mobile technologies also 

may have a role to play in expanding broadband access to rural 

residents. The Managers expect the Secretary to weigh all appropriate technologies, including the unique characteristics of mobile 

broadband service and technologies, during consideration of applications. 

With respect to applications not described in Section 601(c)(2) 

of the REA, as amended by this section, the Managers expect the 

Secretary to incorporate the new criteria as soon as practicable, 

taking into consideration the need to act upon pending applications 

within a reasonable time. 

The Managers expect the Secretary to provide the necessary 

resources to expedite the processing of applications under this section. The Managers also expect that the notice of applications will 

be posted on the Agency’s website in a manner that will be easy 

for interested members of the public to find the information described and would be posted in a manner consistent to the way 

similar notices are currently posted on the Agency’s website. It is 

intended that such notices shall not contain any proprietary information as defined by section 552(b)(4) of title 5 of the United 

States Code. Finally, the Managers also intend that in addition to 

the notice, the Agency will also post on its website with respect to 

each loan and loan guarantee application the status of the Agency’s 

consideration of the application and an estimate of when the Agency’s consideration will be concluded, which shall be regularly updated. 

(41) Study of Federal assistance for broadband infrastructure 

The Senate amendment instructs the Comptroller General of 

the U.S. to conduct a study and review of the Rural Utilities Service (RUS) administration of Federal broadband programs with recommendations for changes. (Section 6113) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 


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(42) Comprehensive rural broadband strategy 

The House bill requires the Secretary to submit to the President and the Congress a report describing a comprehensive rural 

broadband strategy that includes: (1) recommendations to: 

(A) promote interagency coordination of Federal agencies 

and improve and streamline policies, programs, and services; 

(B) coordinate among Federal agencies regarding existing 

broadband or rural initiatives that could be of value to rural 

broadband development; 

(C) address both short- and long-term solutions and needs 

for a rapid buildout of rural broadband solutions and applications for Federal, State, regional, and local government policy 

makers; 

(D) identify how specific Federal agency programs and resources can best respond and overcome obstacles that currently 

impede rural broadband deployment; and 

(E) promote successful model deployments and appropriate 

technologies being used in rural areas so that State, regional, 

and local governments can benefit from the success of other 

State, regional, and local governments; and 

(2) a description of goals and timeframes to achieve the strategic plans and visions identified in the report. (Section 6031) 

The Senate amendment requires the Secretary of Agriculture 

and the Chairman of the Federal Communications Commission 

(FCC) to submit a report to the Committees on Energy and Commerce and Agriculture of the House and the Committees on Commerce, Science, and Transportation and Agriculture, Nutrition and 

Forestry of the Senate describing a comprehensive rural broadband 

strategy with recommendations for improvement. 

The Senate amendment includes recommendations to: (A) promote interagency coordination of Federal agencies and improve and 

streamline policies, programs, and services; (B) coordinate among 

Federal agencies regarding existing broadband or rural initiatives 

that could be of value to rural broadband development; (C) address 

both short- and long-term solutions and needs for a rapid buildout 

of rural broadband solutions and applications for Federal, State, regional, and local government policy makers; (D) identify how specific Federal agency programs and resources can best respond and 

overcome obstacles that currently impede rural broadband deployment. 

This Senate amendment stipulates that the Chairman of the 

FCC, in coordination with the Secretary of Agriculture, is to update 

and evaluate the report required under this section on an annual 

basis. 

The Senate amendment modifies section 306(a)(20)(E) of the 

Con Act by striking the reference to dial-up Internet access. (Section 6111) 

The Conference substitute adopts the Senate provision to require a report on Federal broadband strategy with technical 

changes and a modification to require the update of the report required under this section in the third year following enactment. 

(Section 6112) 


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The Conference substitute adopts the Senate provision striking 

an obsolete reference to dial-up Internet and places the provision 

in a separate section. (Section 6005). 

(43) Community connect grant program 

The House bill amends the REA by authorizing the Secretary 

to provide financial assistance to eligible applicants for the provision of broadband transmission service that fosters economic 

growth and delivers enhanced services. The Secretary is authorized 

to prioritize grants that will enhance community access to telemedicine and distance learning. Grant applicants are required to 

provide a matching contribution of at least 15 percent of the grant 

amount requested. An appropriation of $25,000,000 is authorized for fiscal years 

2008 through 2012. (Section 6024) 

The Senate amendment contains no comparable provision. 

The Conference substitute strikes the House provision. 

(44) Connect the Nation 

The Senate amendment provides that the subtitle of this section is to be cited as the ‘‘Connect the Nation Act.’’ (Section 6201) 

The Senate amendment also creates a competitive, matching 

grant program (80 federal/20 state) called the ‘‘Connect the Nation 

Act of 2007’’ to be housed at the Department of Commerce for eligible statewide public-private partnerships to benchmark current access and use, build detailed GIS maps of service, and create demand through grassroots teams. Eligible entities would be limited 

to 4 years of participation. Grant applications would be reviewed 

through a peer review process. Collaboration is required between 

State agencies, service providers, and relevant labor organizations, 

and community organizations to be considered eligible. An appropriation of $40,000,000 for each of the fiscal years 2008 through 

2012 is authorized. (Section 6202) 

The House contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(45) Distance learning and telemedicine 

The House bill amends the Food, Agriculture, Conservation, 

and Trade Act (FACT Act) by authorizing the Secretary to provide 

grants to noncommercial education television broadcast stations 

that serve rural areas for the purposes of developing digital facilities, equipment, and infrastructure to enhance digital services to 

rural areas. (Section 6028) 

The House bill amends section 2335A of the FACT Act by extending the authorization of appropriations to fiscal year 2012. 

(Section 6029) 

The Senate amendment permits as allowable purposes for receiving financial assistance library connectivity and public television station digital conversion. The Secretary is required to establish, by notice, the amount of financial assistance available to applicants in the form of grants, costs of money loans, combinations 

of grants and loans, or other financial assistance. Libraries or library support organizations, public television stations and parent 

organizations of public television stations, and schools, libraries, 


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and other facilities operated by the Bureau of Indian Affairs or Indian Health Service are added as eligible for assistance. In 

prioritizing financial assistance the Secretary may also consider 

the cost and availability of high-speed network access. 

The Senate amendment allows the following as eligible purposes under this section: the development, acquisition, and digital 

distribution of instructional programming to rural users; the development and acquisition of computer hardware and software, audio 

and visual equipment, computer network components, telecommunications transmission facilities, date terminal equipment, 

or interactive video equipment, teleconferencing equipment, or 

other facilities that would further telemedicine services, library 

connectivity, or distance learning services; the provision of technical assistance and instruction for the development or use of the 

programming, equipment, or facilities; the acquisition of high-speed 

network transmission equipment or services that would not otherwise be available or affordable to the applicant; costs relating to 

the coordination and collaboration among and between libraries on 

connectivity and universal service initiatives, or the development of 

multi-library connectivity plans that benefit rural users; and competitive grants, for public television stations or a consortium of 

public television stations, to provide education, outreach, and assistance, in cooperation with community groups, to rural communities and vulnerable populations with respect to the digital television transition, and particularly the acquisition, delivery, and installation of the analog-to-digital converter boxes. 

The Senate amendment reauthorizes appropriations through 

2012. (Section 6302) 

The Conference substitute adopts the Senate provision with 

modifications to provide that only libraries are added as eligible entities, clarifying current law. No additional uses are added. However, the Managers direct that public television entities are eligible 

to receive assistance under this section for high-speed telecommunication services in rural areas to provide educational programming for schools and communities in rural areas. (Section 

6201) 

(46) Agricultural innovation center demonstration grants 

The House bill provides for an extension of section 6402 of the 

Farm Security and Rural Investment Act of 2002 (FSRIA) by authorizing an appropriation of $6,000,000 for each of the fiscal years 

2008 through 2012. (Section 6025) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision. (Section 

6203) 

(47) Rural firefighters and emergency services assistance program 

The House bill amends section 6405 of the FSRIA by authorizing the Secretary to award grants to eligible entities to enable 

such entities to provide for improved emergency medical services 

(EMS) in rural areas. Grants may be used to pay the cost of training firefighters and emergency medical personnel in firefighting, 

and emergency medical practices in rural areas. 


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Eligible entities must be: a State EMS office or association; a 

State office of rural health; a local government entity; an Indian 

tribe; or any other entity determined appropriate by the Secretary. 

To receive a grant under this section, the eligible entity must prepare and submit an application to the Secretary that includes: a 

description of the activities to be carried out under the grant and 

an assurance that the applicant will comply with the grant program’s matching fund requirement. 

Under the House bill, eligible entities are to use grant funds 

only in rural areas to: (1) hire, recruit or train EMS personnel; (2) 

recruit or retrain emergency EMS personnel; (3) fund training to 

meet State or Federal certification requirements; (4) provide training for firefighters and emergency medical personnel for improvements to the training facility, equipment, and personnel; (5) develop new ways to educate emergency health care providers 

through the use of technology-enhanced educational methods; (6) 

acquire EMS vehicles and equipment; (7) acquire personal protective equipment for EMS personnel as required by the Occupational 

Safety and Health Administration (OSHA); (8) educate the public 

concerning CPR, first aid, injury prevention, safety awareness, illness prevention, and other emergency preparedness topics. Preference is to be given to applications that reflect a collaborative effort by 2 or more eligible entities and are submitted by eligible entities who intend to use grant funds to: hire, recruit, or train EMS 

personnel; recruit or retrain volunteer EMS personnel; fund training to meet State or Federal certification requirements; or develop 

new ways to educate emergency health care providers through the 

use of technology-enhanced educational methods. Appropriations of 

not more than $30,000,000 are authorized for each of the fiscal 

years 2008 through 2012; no more than 10 percent of appropriated 

funds in a fiscal year may be used for administrative expenses. 

(Section 6026) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with 

minor changes. The funds made available under this section are 

not to go to entities operating on a for-profit basis. Additionally, 

the amount allowed for administrative expenses is decreased to 5 

percent. (Section 6204) 

(48) Value-added agricultural product market development grants 

The House bill extends the program through fiscal year 2012 

and provides $30,000,000 in mandatory funding for each fiscal 

year. Of the mandatory funds, 10 percent is to be set aside for 

projects benefiting beginning farmers and ranchers or socially disadvantaged farmers or ranchers and 10 percent is to be set aside 

for applications that propose to develop mid-tier value chains, 

which are defined in this section as local and regional supply networks that link independent producers with businesses and cooperatives that market value-added agricultural products. Should 

viable applications for these 2 purposes not meet the full 10 percent set-aside, amounts unobligated by June 30 may be reallocated. 

The House bill requires the Secretary, in awarding grants under 

this section, to consider applications more favorably, when compared to other applications, to the extent that the project proposed 


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in the application contributes to increasing opportunities for operators of small and medium-sized farms and ranchers structured as 

‘‘family farms’’—as defined in the regulations prescribed under section 302 of the Con Act. (Section 6027) 

The Senate amendment provides for an extension of the program through 2012 and updates the definitions of ‘‘assisting organization,’’ ‘‘technical assistance,’’ and ‘‘value-added agricultural product.’’ Under the Senate amendment, a grant recipient can receive 

no more than $300,000 in the case of grants including working capital or $100,000 in the case of all other grants. The amount of 

grant funds provided to an assisting organization for research, 

training, technical assistance, and outreach for a fiscal year may 

not exceed 10 percent of the total funds that are used to make 

grants. 

The Senate amendment requires that grants made under this 

section be limited to a 3-year term. The Secretary is authorized to 

offer a simplified application form and process for project proposals 

that request less than $50,000. The Secretary is also authorized, to 

the maximum extent practicable, to provide grants to projects that 

provide training and outreach activities in areas that have received 

relatively fewer grants. The Senate amendment adds a priority for 

projects that contribute to increasing opportunities for beginning 

farmers or ranchers, socially disadvantaged farmers or ranchers, 

and operators of small and medium-sized farms and ranchers that 

are not larger than family farms and support new ventures that do 

not have well-established markets or product development staffs 

and budgets, including the development of local food systems and 

the development of infrastructure to support local food systems. 

(Section 6401) 

The Conference substitute adopts the Senate provision with 

modifications. The Secretary is required to reserve 10 percent of 

funds for projects that benefit beginning farmers or ranchers or socially disadvantaged farmers or ranchers and 10 percent of funds 

for projects proposing to develop mid-tier value-chains. Priority in 

awarding grants should go for projects that contribute to increasing 

opportunities for beginning farmers and ranchers, socially disadvantaged farmers or ranchers, and operators of small and medium-sized farms and ranches that are structured as family farms. 

Mandatory funding of $15,000,000, to remain available until expended, is to be provided in fiscal year 2009. The authorization of 

appropriations for the program is extended through 2012. (Section 

6202) 

The Managers are aware of the increasing producer interest in 

mid-tier value chains that are strategic alliances between small 

and mid-sized farms and ranches and other supply chain partners 

that deal in significant volumes of high-quality, differentiated food 

products and distribute rewards equitably across the supply chain. 

The Managers expect that awards under this new mid-tier value 

chain component of the program will support strategic alliances in 

which the producer, producer group, farmer cooperative, or majority-controlled producer based venture participate in developing the 

overall framework and specific rules for the alliance. 


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(49) Guarantees for bonds and notes 

The House bill extends guarantees for bonds and notes issued 

for electrification or telephone purposes through 2012. (Section 

6030) 

The Senate amendment extends eligibility for guarantees for 

telephone installation purposes; expands the funds available for 

guarantees to $1,000,000,000; requires the annual fee paid for the 

guarantee of a bond or note to be equal to 30 basis points of the 

amount of the unpaid principal; and requires a lender to pay fees 

required on a semi-annual basis on a schedule structured by the 

Secretary. 

The Senate amendment also extends the Secretary’s authority 

to guarantee payments to September 30, 2012. (Section 6106) 

The Conference substitute adopts the Senate provision, with a 

modification to allow the provision expanding the funds available 

for guarantees to apply immediately upon enactment. (Section 

6106) 

(50) Study of rural transportation issues 

The House bill authorizes the Secretary of Agriculture, in coordination with the Secretary of Transportation, to conduct a 

study, and submit a report to Congress on the results of the study 

within 9 months of the date of enactment of this Act, on railroad 

issues, with respect to the movement of agricultural products, domestically produced renewable fuels and domestically produced resources for the production of electricity in rural America. 

The study includes an examination of the importance of freight 

railroads to: the delivery of equipment, seed, fertilizer, and other 

products important to the development of agricultural commodities 

and products; the movement of agricultural commodities and products to market; the delivery of ethanol and other renewable fuels; 

the delivery of domestically produced resources for use in the generation of electricity in rural America; the location of grain elevators, ethanol plants, and other facilities; the development of 

manufacturing facilities; the vitality and economic development of 

rural communities; the sufficiency in rural America of railroad capacity, the sufficiency of rail competition, the reliability of rail service, and the reasonableness of rail prices; and the accessibility to 

rail customers in rural America of Federal processes for the resolution of rail customer grievances with the railroad. (Section 6032) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment expanding the study to include other modes of transportation, including truck and barge. (Section 6206) 

(51) Energy efficiency programs 

The Senate amendment amends sections 2(a) and 4 in the REA 

by authorizing the Secretary to extend loans to energy efficiency 

programs. (Section 6101) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 6101) 

The Managers note that assistance is authorized under this 

section for renewable energy, including geo-thermal ground loops, 


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under sections 2 and 4 of the REA as amended. The Managers expect that applications for such assistance will be properly considered and when meritorious, that they should be funded. 

(52) Loans and grants for electric generation and transmission 

The Senate amendment amends section 4 of the REA by requiring the Secretary to make loans and grants for the purpose of 

financing the construction and operation of generating plants, electric transmission and distribution lines or systems for the furnishing and improving of electric services to persons in rural areas 

if appropriated funds are made available. (Section 6102) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

If funds are appropriated for Section 4 of the REA, the Managers expect the Secretary to make funds available for baseload 

generation. 

(53) Fees for electrification baseload generation loan guarantees 

The Senate amendment amends the REA by adding a new section, 5, which allows the Secretary to charge an upfront fee to cover 

the cost of loan guarantees. The fee is to be at least equal to the 

costs of the loan guarantee. The Secretary is given the authority 

to establish a separate fee for each loan. (Section 6103) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision, but 

adopts an amendment to require a study on the electric power generation needs in rural areas. (Section 6113) 

(54) Deferment of payments to allow loans for improved energy efficiency and demand reduction 

The Senate amendment amends section 12 of the REA by requiring the Secretary to allow borrowers to defer payment of principal and interest on any direct loan to enable the borrower to 

make loans to residential, commercial, and industrial consumers to 

install energy efficient measures or devices that reduce the demand 

on electric systems for 60 months. (Section 6104) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

modifications to allow energy efficiency and use audits as an eligible purpose under the program. (Section 6103) 

The Conference substitute also makes technical changes to 

allow for direct lending from the U.S. Department of Treasury for 

RUS financing. Under the authority conferred to it under section 

4 of the REA, RUS has the ability to guarantee loans made by the 

Federal Financing Bank (FFB), an agency of the U. S. Department 

of the Treasury (Treasury), to rural electric providers. Through approval of both the Office of Management and Budget and the appropriations process, direct loans from the Treasury have been 

used in addition to the FFB loan guarantees for several years. Language is included in a new section authorizing the loan rate program through Treasury with a requirement that cost of money 

loans be made with 1/8 of 1 percent added to the interest rate. This 

will effectively take the place of the FFB program. The loans 

should continue to be scored at a negative subsidy. (Section 6102) 


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The Managers expect that this language will enable the loans 

to be processed more efficiently and still protect the taxpayer investment in a strong, modern infrastructure in rural America. 

(55) Rural electrification assistance 

The Senate bill amends the definition of ‘‘rural area’’ to mean 

an area that excludes: (1) cities of 50,000 or more; (2) any urbanized area contiguous and adjacent to a city of 50,000 or more, except for narrow strips of urbanized areas; and (3) any collection of 

contiguous census blocks with a housing density of 200 housing 

units per square mile that is adjacent to a city of 50,000 or adjacent to an urbanized area, except for narrow strips of such territory. The definition is also amended to include any area within the 

service area of a borrower for which a borrower has an outstanding 

loan made under titles I through V of the REA. (Section 6105) 

With respect to loans and loan guarantees made under the 

rural broadband program, the term rural area also excludes a city, 

town, or unincorporated area that has a population of greater than 

20,000 inhabitants. 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment with 

modifications. Rural area is defined to mean an area that excludes 

a city or town of 20,000 or more, or is an area within the service 

area of a borrower for which a borrower has an outstanding loan 

made under titles I through V of the REA. (Section 6104) 

(56) Electric loans for renewable energy 

The Senate amendment amends Title III of the REA by adding 

a new section, 317, which allows the Secretary to make loans to 

rural electric cooperatives for purposes of electric generation and 

transmission of renewable energy. Renewable energy source is defined as a qualified energy resource under section 45(c)(1) of the Internal Revenue Code of 1986. (Section 6108) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

modifications. The provision to allow transmission under this section is deleted with the understanding that the agency currently 

possesses authorization to make loans for such transmission. Additionally, the definition of renewable energy source is redefined to 

mean ‘‘an energy conversion system fueled from a solar, wind, hydropower, biomass, or geothermal source of energy.’’ (Section 6108) 

The Managers expect the Secretary to make electric loans 

under this title for electric generation from renewable energy resources to rural and nonrural residents. 

(57) Bonding requirements 

The Senate amendment amends Title III of the REA by adding 

agency procedures for loans or grants under this Act. The amendment: (1) requires that loan applicants are contacted at least once 

each month by RUS regarding the status of any pending loan applications; (2) requires the Secretary to ensure that applicants for any 

RUS grants have the opportunity to present a case for financial 

need and that these special economic circumstances are considered 

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retary to adjust population limitations related to digital mobile 

wireless service; and (4) requires the Secretary to review bonding 

requirements for all programs administered by RUS. (Section 6109) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision to require the Secretary to review bonding requirements for all programs administered by RUS, but strikes the other provisions in the 

Senate amendment. (Section 6109) 

The Managers are aware of significant annual increases in the 

cost of labor and materials in major electric generation and transmission projects resulting in parallel increases in cost for Surety 

and Performance Bonds. The cost of Surety and Performance Bonds 

precludes some contractors from bidding on projects successfully. 

The Managers therefore request the Secretary give consideration to 

other measures that will ensure more contractors can bid on 

projects and simultaneously protect the government’s investment in 

these projects. Suggestions have been made that lines of credit or 

parent company guarantees are examples of methods that could 

provide such protection for both the borrowers and the government. 

(58) Substantially underserved trust areas 

The Senate amendment provides that Native American trust 

lands, where more than 20 percent of the population does not have 

electric, telecommunications, broadband or water service, are to be 

considered substantially underserved trust areas. The Secretary 

may make programs administered by RUS available to such areas 

at lower loan rates and may waive non-duplication requirements. 

(Section 6112) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

modifications to ensure only that only the restrictions and requirements specified under this section are waived with this authority. 

The authority of the Secretary to waive non-duplication restrictions, matching fund requirements, or credit support requirements 

from any loan or grant program administered by RUS to facilitate 

the construction, acquisition, or improvement of infrastructure is 

not to affect any loan or grant program administered by the U.S. 

Environmental Protection Agency. In addition, the language in this 

section is not intended to amend, alter, or affect any statutory provisions contained in the Safe Drinking Water Act or any regulations promulgated under that Act, including any orders or guidance 

issued pursuant to that authority. (Section 6105) 

(59) Rural electronic commerce extension 

The Senate amendment reauthorizes section 1670(e) of the 

FACT Act through 2012. (Section 6301) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(60) Insurance of loans for housing and related facilities for domestic farm labor 

The Senate amendment amends section 514 (f)(3) of the Housing Act of 1949, by extending the definition of ‘‘domestic farm 

labor’’ to include any person who receives a substantial portion of 


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their income from the processing of agricultural or aquaculture 

commodities. (Section 6402) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 6205) 

(61) Housing Assistance Council 

The Senate amendment provides for the ‘‘Housing Assistance 

Council Authorization Act of 2007.’’ (Section 6501) 

This section authorizes the Secretary of Housing and Urban 

Development (HUD) to provide financial assistance to the Housing 

Assistance Council (HAC) for the purpose of supporting community-based housing development organizations’ community development and affordable housing projects and programs in rural areas. 

(Section 6502) 

The Senate amendment requires the Comptroller General to 

audit any institution receiving funds from HAC and a GAO report 

on the use of any funds appropriated to HAC over the past 10 

years. (Section 6503) 

The Senate amendment prohibits funds from subtitle D of this 

Act from being used to provide housing assistance to persons not 

lawfully present in the United States. (Section 6504) 

The Senate amendment prohibits funds from being used to 

lobby or retain a lobbyist. (Section 6505) 

The House bill contains no comparable provisions. 

The Conference substitute adopts the Senate amendment, with 

modifications to allow the GAO to use private, independent audits 

for the review of HAC. (Sections 6301, 6302, 6303, 6304, and 6305) 

(62) Interest rates for water and waste disposal 

The Senate amendment amends section 307(a)(3) of the Con 

Act to ensure that interest rates for intermediate and poverty rate 

loans are tied to the current market rate. The poverty rate is set 

at 60 percent of the market rate and the intermediate rate is set 

at 80 percent of the market rate. (Section 12602) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment, with 

modifications to exclude from the interest rate change, those loans 

that have been approved prior to the enactment of this Act. (Section 6011) 

TITLE VII—RESEARCH 

(1) Definitions 

The House bill defines terms necessary to implement this Act: 

capacity program, competitive program, capacity program critical 

base funding, competitive program critical base funding, ASCARR 

Institution, Secretary, Directors, Under Secretary, and Hispanicserving agricultural college and university. (Section 7101) 

The Senate amendment amends the Department of Agriculture 

Reorganization Act of 1994 to define the terms: advisory board, 

competitive program, director, infrastructure program, and institute (Section 7401). The Senate amendment amends Section 1404 

of the National Agricultural Research, Extension and Teaching PolVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00848 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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icy Act of 1977 (NARETPA) to define the terms Hispanic-serving 

agricultural colleges and universities, and Hispanic-serving institution, and to expand ‘college’ and ‘university’ to include research 

foundations maintained by a college or university. (Section 7001) 

The Conference substitute adopts the House provision with an 

amendment to include the terms defined in the House bill and the 

Senate amendment. 

The Conference substitute defines the following terms necessary to implement this Act: capacity and infrastructure program, 

capacity and infrastructure program critical base funding, competitive program, competitive program critical base funding, Hispanicserving agricultural colleges and universities, NLGCA Institution 

(non-land-grant colleges of agriculture), 1862 Institution, 1890 Institution, and 1994 Institution. (Section 7501) 

The Conference substitute amends section 1404 of the 

NARETPA to define Hispanic-serving agricultural colleges and universities, Hispanic-serving institution, and NLGCA Institutions 

(non-land-grant colleges of agriculture), and to expand the definition of ‘college’ and ‘university’ to include research foundations 

maintained by a college or university. (Section 7101) 

The Conference substitute amends section 251 of the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6971) to 

define the terms ‘capacity and infrastructure program’ and ‘competitive program’. (Section 7511) 

(2) Budget submission and funding 

The House bill requires the President to submit with the annual budget request a single line item reflecting the total funding 

requested for competitive programs for the fiscal year and the previous five fiscal years. The capacity program critical base funding 

request should be apportioned among programs based on priorities 

established by the Under Secretary of Research, Education, and Economics, and the Directors of the National Agricultural Research 

Program Office (NARPO). Additional funds requested should enhance 1890 institutions, 1994 institutions, small 1862 institutions, 

ASCARR institutions, and Hispanic-serving agricultural colleges 

and universities. The competitive program critical base funding request should be apportioned among programs based on priorities 

established by the Under Secretary and Directors of NARPO. Additional funds requested should support the study of emerging problems and their solutions. Necessary funds are authorized to be appropriated. Competitive programs under this section include only 

those requested by the President for funding. (Section 7102) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to include the total amount requested by the President 

for the research, extension, and education activities of the Research, Education, and Economics (REE) mission area of the Department in a single budget line item. The Conference substitute 

recommends that out of funds above the capacity and infrastructure critical base funding level, budgetary emphasis should be 

placed on certain institutions; and out of funds above the competitive program critical base funding level, budgetary emphasis 

should be placed on emerging problems. (Section 7506) 


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The Managers recognize the numerous benefits of competitive 

research programs and have supported the expansion of funding for 

these programs. The Managers encourage the Department to make 

every effort to increase support for competitive programs while 

maintaining the needs of capacity and infrastructure programs 

when making budgetary decisions. 

The Managers expect the Secretary to review, in conjunction 

with the consultative panel on the Extension Indian Reservation 

Program (also known as the Federally Recognized Tribes Extension 

Programs), the demand for and status of extension services on Indian reservations and reflect that need in their budget submission. 

(3) Additional purposes of agricultural research and extension 

The House bill amends section 1403 of the NARETPA to add 

the following to the purposes of agricultural research and extension: integrating and organizing agricultural research, extension, 

education, and related programs to respond to 21st century challenges; continuing to meet the needs of society from a local, tribal, 

State, national, and international perspective; minimizing duplication and maximize coordination of the program at all levels; positioning the research, extension, education, and related programs to 

expand the portfolio to increase its contribution to society. (Section 

7103) 

The Senate amendment has no comparable provision. 

The Conference substitute deletes the House provision. 

(4) National Agricultural Research Program Office 

The House bill establishes six research Program Offices, collectively known as the ‘‘National Agricultural Research Program Office’’ (NARPO) within the office of the Under Secretary of Agriculture for Research, Education, and Economics. The NARPO will 

coordinate the programs and activities of the research agencies 

within the mission area to the maximum extent practicable. The 

NARPO will include the following offices: 

(1) Renewable energy, resources, and environment; 

(2) Food safety, nutrition, and health; 

(3) Plant health and production and plant products; 

(4) Animal health and production and animal products; 

(5) Agriculture systems and technology; and 

(6) Agriculture economics and rural communities. 

Each research program office will have a director appointed by 

the Under Secretary. The requirements to qualify for one of the director positions include performance of outstanding research, extension, or education in agriculture or forestry, a doctoral-level degree, and other standards as required for appointment to a senior 

level of the competitive service. 

The Directors will formulate programs, assess workforce needs, 

cooperate with the National Agricultural Research, Extension, Education, and Economics Advisory Board (NAREEE Advisory Board) 

in planning for personnel needs, develop strategic planning and 

priorities for Department-wide research, extension, education, and 

related activities, and communicate with program beneficiaries. 

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nate programs within relevant departmental agencies to focus on 

understanding program problems and opportunities, and addressing those problems along with national, regional, and local priorities. 

The Under Secretary will coordinate with the Directors And receive the advice of the NAREEE Advisory Board to ensure that 

programs are integrated and coordinated. 

The Under Secretary will fund each Program Office with Appropriated funds made available to the agencies within the mission 

area. The total number of staff for all Program Offices will not exceed 30 full time positions and will have to be filled by current positions. 

The Under Secretary will integrate leadership functions from 

existing program offices to ensure that program offices are the primary program leaders. 

The Under Secretary will develop and implement specialty 

crop research activities, facilitate information delivery, and ensure 

coordination among research initiatives related to specialty crops. 

(Section 7104) 

The Senate amendment requires coordination between the Agricultural Research Service (ARS) and the National Institute of 

Food and Agriculture (NIFA)—formerly the Cooperative State Research, Education, and Extension Service (CSREES). The Under 

Secretary for Research, Education, and Economics will coordinate 

the programs under the authority of the Administrator of ARS and 

the Director of NIFA. The staff of the Administrator and the Director, including national program leaders, are required to meet on a 

regular basis to: increase coordination and integration of research 

programs at ARS and the research, extension, and education programs of NIFA; coordinate responses to emerging issues; minimize 

unnecessary duplication of work and resources at the staff level of 

each agency; use the extension and education program to deliver 

knowledge to stakeholders; address critical needs facing agriculture; and focus the research, extension, and education funding 

strategy of the Department. An annual report to Congress is required on efforts to increase coordination between ARS and NIFA. 

The Undersecretary for Research, Education, and Economics is 

charged with undertaking a roadmap to identify major opportunities and gaps in agricultural research, extension, and education 

and to use this roadmap to set the research agenda and recommend funding levels for programs in this mission area of the Department. 

Such sums necessary for activities undertaken to develop the 

roadmap are authorized. (Sections 7402) 

The Conference substitute adopts the House provision with an 

amendment to change the name of the name of the office to the Research, Extension, and Education Office (REEO) and to integrate 

it into the office of the Under Secretary for Research, Education, 

and Economics. The Conference substitute also captures the roadmap from the Senate amendment. 

The Conference substitute requires the Under Secretary for 

Research, Education, and Economics to have specialized training or 

significant experience in agricultural research, education, and economics. The Under Secretary is designated as the chief scientist of 


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the Department and is tasked with the coordination of the research, education, and extension activities of the Department. 

The Conference substitute organizes the REEO into six Divisions: 

(1) Renewable energy, natural resources, and environment; 

(2) Food safety, nutrition, and health; 

(3) Plant health and production and plant products; 

(4) Animal health and production and animal products; 

(5) Agriculture systems and technology; and 

(6) Agriculture economics and rural communities. 

Each Division will be led by a Division Chief. The Division 

Chiefs are to be selected by the Under Secretary to promote leadership and professional development, to enable personnel to interact 

with other agencies of the Department, and to allow for the rotation of Department personnel into the position of Division Chief. 

Each Division Chief is required to have conducted exemplary research, extension, or education in the field of agriculture or forestry 

and is required to have earned an advanced degree at an institution of higher education. Each Division Chief is limited to a fouryear term of service. The duties of each Division Chief include addressing the agricultural research, extension, and education needs 

and priorities within the Department and communicating with 

stakeholders, as well as the development of the roadmap as described in section 7504 of this Act. (Section 7511 and Section 7504) 

The Managers expect the REEO to be staffed and funded from 

appropriations made available to the agencies within the REE mission area. There is concern that the REEO will evolve into a new 

layer of bureaucracy. To address this, the Managers have included 

language to limit the number of staff positions for the REEO to 30 

full-time current positions. 

The Managers expect the REEO Divisions to coordinate the research, extension, and education activities across the Department. 

The Managers expect the Division Chiefs of each office to: coordinate the functions of intramural and extramural research, extension, and education programs to ensure the maximum integration 

of activities; and to formulate programs, assess workforce needs, 

and cooperate with the agencies of the REE mission area and the 

NAREEE Advisory Board in developing strategic planning and priorities for the Department. 

The Managers expect that once REEO is operational, the Division Chiefs will be able to track, report, and identify research gaps, 

unnecessary duplication among programs, and assess the needs for 

immediate, emerging, and future needs for research, extension, and 

education programs. 

(5) Establishment of competitive grant programs under the National 

Institute for Food and Agriculture 

The House bill establishes the NIFA within CSREES to administer all competitive programs as defined in section 7101 of this 

Act. (Section 7105) 

The Senate amendment transfers all authorities under 

CSREES to NIFA, and all programs currently under CSREES will 

continue under NIFA. NIFA will be headed by a Director, who is 

required to report to and consult with the Secretary on the reVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00852 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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search, extension, and education activities of NIFA. The Director 

will work with the Under Secretary for Research, Education, and 

Economics to ensure proper coordination and integration of all research programs that are within the responsibility of the Department. 

The Senate amendment establishes four offices at NIFA to increase competitive grant opportunities and re-establish the importance of the land-grand college and university system. First, the 

Office of the Agricultural Research, Extension, and Education Network administers all infrastructure programs (also known as capacity programs) such as those funded by formula funds at state agricultural experiment stations and the extension service. Second, the 

Office of Competitive Programs for Fundamental Research administers competitive programs that fund fundamental (basic) food and 

agricultural research, such as the National Research Initiative’s 

basic research projects. Third, the Office of Competitive Programs 

for Applied Research administers competitive programs for applied 

food and agricultural research. Fourth, the Office of Competitive 

Programs for Education and Other Purposes administers competitive programs for education and other fellowships. The Director of 

NIFA has the discretion to divide programs that intersect more 

than one competitive program office. 

The Senate amendment authorizes appropriations for NIFA, 

above the authorizations of individual programs, to be allocated according to recommendations in the roadmap to be developed by the 

Under Secretary of Research, Education and Economics under section 7402 of this Act. 

The Senate amendment includes a series of conforming amendments to modify each place in current law to reflect the change 

from ‘‘Cooperative State Research, Education, and Extension Service’’ to ‘‘National Institute of Food and Agriculture’’. (Section 7401) 

The Conference substitute adopts the Senate provision to modify the appointment, supervision, compensation, and authorities of 

the Director of NIFA and to modify the organization of offices 

under NIFA. It also modifies the programs under the definition of 

‘‘capacity and infrastructure program’’ and ‘‘competitive program’’. 

The Conference substitute provides that NIFA will be established by October 1, 2009. The Director of NIFA is required to be 

a distinguished scientist and will be appointed by the President. 

The Director is required to report to the Secretary or the designee 

of the Secretary and will serve a six-year term, subject to reappointment for an additional six-year term. 

The Conference substitute also provides the Director with discretion to organize NIFA into offices and functions to administer 

fundamental and applied research and extension and education 

programs. The NIFA Director is required to ensure an appropriate 

balance between fundamental and applied research programs, and 

is required to promote the use and growth of competitively awarded 

grants. 

The Conference substitute provides an authorization of appropriations for NIFA without fiscal year limitation, in addition to 

funds appropriated to each program administered by the Institute. 

The appropriated funding is required to be allocated according to 


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recommendations in the roadmap described in section 7504 of this 

Act. 

The Managers are concerned about the visibility of competitive 

research grants, the increasing demands placed on the land-grant 

system, and the weakening financial support of both competitive 

grants and formula funds. By restructuring CSREES, the Managers intend for NIFA to raise the profile of agricultural research, 

extension, and education. The Managers believe that NIFA will be 

commensurate in stature with other grant-making agencies across 

the Federal government, such as the National Institutes of Health 

and the National Science Foundation. The Managers intend for 

NIFA to be an independent, scientific, policy-setting agency for the 

food and agricultural sciences, which will reinvigorate our nation’s 

investment in agricultural research, extension, and education. 

The Managers are concerned about the balance between fundamental and applied research at the Department. The Managers 

note that the Conference substitute gives the Director of NIFA discretion to establish offices, to set appropriate policy, and to address 

problems that agricultural research, extension, and education can 

help solve. In particular, the Managers intend that the Director 

place emphasis on fundamental research because this type of research is the engine and cornerstone for all other types of research. 

Although fundamental research across the sciences is funded by 

the National Science Foundation, the Managers expect NIFA to 

play a larger role in funding this type of research. However, the 

Managers recognize that without applied research, the fruits of 

fundamental research would never be used to solve the pressing 

needs of the public. Therefore, the Managers intend for the Director to carefully analyze the needs of the agricultural research, extension, and education system and address them accordingly by allocating appropriate staff and resources within NIFA. (Section 

7511) 

(6) Merging of IFAFS and NRI 

The House bill combines the Initiative for Future Agriculture 

and Food Systems (IFAFS) with the National Research Initiative 

(NRI) by repealing section 401 of the Agricultural Research, Extension, and Education Reform Act of 1998, except for section 401(b)(3) 

of that Act which will remain in effect, and incorporating the priorities under section 401 into subsection (b) of the Competitive, Special, and Facilities Research Grant Act. 

This section states that competitive grants authorized under 

the new program are to be available to State agricultural experiment stations, all colleges, universities, university research foundations, research institutions and organizations, Federal agencies, national laboratories, private organizations, corporations, and individuals. 

The term of any grant received under this program will not exceed 10 years. All grant awards are to be made on the basis of peer 

and merit review. Funds may not be used for construction. 

Within the combined program, there will be two separate programs for basic and applied research, to be referred to as NRI and 

IFAFS respectively. Out of the funds made available to the comVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00854 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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bined program, 60 percent will fund NRI and 40 percent will fund 

IFAFS. 

Within the NRI allocation, funding will be allocated as follows: 

30 percent for multidisciplinary teams; 20 percent for missionlinked systems research; not less than 10 percent for education and 

research opportunities. The offer or availability of matching funds 

shall not be taken into account when making a grant. The match 

requirement may be waived in certain cases. 

Matching funds will be required for IFAFS grants if the grant 

is for applied, commodity-specific research and not national in 

scope. 

In addition to NRI grants, the Secretary may conduct a program in agricultural, food, and environmental sciences in a variety 

of specified categories. Funding made available under current law 

for IFAFS will be transferred to this new combined program. The 

House bill authorizes $500,000,000 to be appropriated and to remain available until expended for obligations incurred in that fiscal 

year. 

This section repeals the authority for construction of non-Federal agricultural research facilities with appropriated Federal 

funds. (Section 7106) 

The Senate amendment amends Section 401 of the Agricultural Research, Extension, and Education Reform Act of 1998 to 

add sustainable and renewable agriculture-based energy production, ecosystem services, and beginning farmers and ranchers to 

the purposes of IFAFS. This section strikes a provision allocating $200,000,000 per year in mandatory funds for IFAFS and provides $45,000,000 in 

mandatory funds for IFAFS to be obligated 30 days after the enactment of the farm bill. This section requires 32 percent of appropriated funds for the NRI to go towards IFAFS grants if funds are 

not appropriated or obligated for IFAFS. (Section 7201) 

The Senate amendment amends the Competitive, Special, and 

Facilities Research Grant Act to add research on agricultural 

genomics and biotechnology, classical animal and plant breeding, 

beginning farmers and ranchers, and the judicious use of antibiotics to the research priorities of the NRI. 

This section modifies the availability of grant funds for classical plant and animal breeding to ten years and establishes National Research Support Project–7 for research on drugs for use in 

minor animal species. (Section 7307) 

The Conference substitute adopts the House provision with an 

amendment to replace subsection (b) of the Competitive, Special, 

and Facilities Research Grant Act to create a new program, titled 

the ‘‘Agriculture and Food Research Initiative’’ (AFRI), to award 

competitive grants for fundamental and applied research, extension, and education to address food and agricultural sciences. The 

program combines the priority areas of the NRI with the purposes 

and priority areas of IFAFS. There are six priority areas in AFRI: 

(1) Plant health and production and plant products; 

(2) Animal health and production and animal products; 

(3) Food safety, nutrition, and health; 

(4) Renewable energy, natural resources, and environment; 

(5) Agriculture systems and technology; and 


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(6) Agriculture economics and rural communities. 

The term of competitive grants awarded under AFRI may not 

exceed 10 years. 

Under AFRI, the Secretary will seek proposals to conduct research, extension, or education activities in a specific priority area, 

determine the relevance and merit of proposals, and award grants 

on the basis of merit, quality, and relevance as determined by experts in the specific subject area. 

AFRI funds are to be allocated in the following manner: 60 

percent will be made available for fundamental research and 40 

percent will be made available for applied research. Of the allocation for fundamental research, not less than 30 percent will be 

made available for multidisciplinary research and not more than 

two percent will be made available for equipment grants. 

Grants awarded through AFRI may also be used to assist in 

the development of capabilities in the agricultural, food, and environmental sciences to certain institutions, investigators, and faculty members where such development is necessary. 

Eligible entities that may receive grants through AFRI include 

State agricultural experiment stations, colleges and universities, 

university research foundations, other research institutions and organizations, Federal agencies, national laboratories, private organizations or corporations, individuals, or groups thereof. 

AFRI funds are prohibited from being used for the construction, acquisition, remodeling, or alteration of a facility or building. 

For equipment grants funded through AFRI, the cost of the 

equipment required may not exceed 50 percent of the Federal 

funds. The Secretary may waive this matching requirement under 

specified conditions. For grants awarded to conduct applied research that is commodity-specific and not of national scope, the 

grant is required to be matched with equal matching funds from 

a non-Federal source. 

The authorization level for AFRI is set at $700,000,000 from 

fiscal year 2008 through fiscal year 2012, of which not less than 30 

percent is required to be made available for integrated research. 

(Section 7406) 

The Managers expect that in providing an annual authorization of appropriations of $700,000,000 that AFRI will receive substantial funding to carry out its purposes in the annual appropriations process. NRI and IFAFS have been consistently underfunded 

despite the growing list of identified needs in agricultural research, 

extension, and education. 

The Managers created AFRI to enhance the work funded by 

NRI and IFAFS. As such, AFRI should receive the combined level 

of authorized and mandatory funding that NRI and IFAFS, respectively, were to receive in previous fiscal years. The Managers expect that AFRI be funded at increasing levels each fiscal year to 

meet identified priority agriculture research, extension and education demands. 

The Managers are aware of the importance of supporting public sector conventional plant and animal breeding, as evidenced by 

the specific mention of this priority under the ‘‘plant health and 

production and plant products’’ and ‘‘animal health and production 

and animal products’’ priorities in AFRI. The Managers intend that 


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the term ‘‘conventional breeding,’’ also known as ‘‘classical breeding,’’ refers to breeding techniques which rely on creating an organism with desirable traits through controlled mating and selection. 

Because conventional breeding is critical to the development of 

seeds and breeds that are well adapted to local conditions and 

changing environmental constraints, these efforts are important to 

the food and agriculture sector. The Managers are aware that 

participatory breeding programs, where producers are involved in 

the process of developing new plant varieties and animal breeds, 

yield varieties and breeds that are better adapted to local environments. The Managers encourage an emphasis on funding of conventional plant and animal breeding as part of the new AFRI. 

The Managers are aware of the need for integrated research, 

extension, and education activities to stimulate entrepreneurship 

across rural America to support business development, improve 

skills of current and emerging entrepreneurs, expand access to capital, and build entrepreneurial networks. Under the priority area 

of ‘‘agriculture economics and rural communities,’’ AFRI includes ‘‘rural entrepreneurship’’ to increase competitive funding for integrated entrepreneurship activities. The Managers intend for this 

priority area to include both agricultural and rural development 

ventures, including strengthening non-farm self-employment for 

farm and rural populations. 

The Managers intend that most program areas within AFRI 

would have grant terms of short duration. However, the Managers 

are aware that there are areas of research where longer-term 

grants are needed, such as conventional plant and animal breeding, 

environmental research, and nutrition research. The Managers expect the Secretary to use 10-year grant terms only when it is critical for long-term systems research. 

The Managers encourage the Director of NIFA to continue to 

support National Research Support Project-7 and to work cooperatively with the Center for Veterinary Medicine of the Food and 

Drug Administration to facilitate the development and approval of 

drugs for minor species and minor uses for major species. (Section 

7406) 

In order to improve the Department’s capacity to develop programs designed to address critical and emerging issues, leverage 

Federal resources, and promote public and private sector participation, Congress created an Integrated Research, Education, and Extension Competitive Grants Program in 1998. The Managers continue to support this important competitive grants program and 

have extended the authorization for these activities in section 7306 

of this Act. To further expand on these activities, the Managers 

have included a provision in this section which directs that not less 

than 30 percent of the funds made available to AFRI be used for 

integrated research, extension, and education competitive grants. It 

is the intent of the Managers that with these additional funds, the 

Department will be able to expand the number and scope of programs supported under this authority. 

(7) Capacity Building Grants for ASCARR Institutions 

The House bill establishes a competitive grant program for 

ASCARR Institutions to maintain and expand education, outreach, 


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and research capacity relating to agriculture, renewable resources, 

and other similar fields. Necessary sums are authorized to be appropriated. (Section 7107) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to add a new section, 1473F, to NARETPA, and to replace the term ‘‘ASCARR’’ with the term ‘‘NLGCA,’’ an abbreviation 

for ‘‘non-land-grant colleges of agriculture.’’ (Section 7138) 

(8) Establishment of research laboratories for animal disease 

The House bill authorizes the Secretary to establish animal 

disease research laboratories, and to the extent that an animal disease constitutes a threat to the livestock industry, authorizes the 

Secretary to conduct research, diagnostics, and other activities. 

This section prohibits a person, State, or Federal agency from importing, transporting, or storing at a research facility a live virus 

that the Secretary determines to be a threat to livestock, such as 

Foot and Mouth Disease. The Secretary may, however, import, 

transport, or store such a live virus and may also allow for a person, State, or Federal agency to do the same if it is in the public 

interest. Necessary sums are authorized to be appropriated. (Section 7108) 

The Senate amendment requires the Secretary to issue a permit to the Department of Homeland Security for work on live Foot 

and Mouth Disease virus at the National Bio- and Agro-Defense 

Laboratory. This section allows the Secretary to invalidate the permit if research is not conducted in accordance with its regulations. 

This section clarifies that the suspension, revocation, or impairment of the permit is only to be made by the Secretary of Agriculture and is a nondelegable function. (Section 11016) 

The Conference substitute adopts the Senate provision with an 

amendment to replace the term ‘‘National Bio- and Agro-Defense 

Laboratory’’ with ‘‘any facility that is a successor to the Plum Island Animal Disease Center and charged with researching highconsequence biological threats involving zoonotic and foreign animal diseases.’’ (Section 7524) 

(9) Grazinglands Research Laboratory 

The House bill requires that Federal land and facilities currently administered by the Department as the Grazinglands Research Laboratory shall not be declared excess or surplus property. 

(Section 7109) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to sunset the provision at the end of fiscal year 2012. 

(Section 7502) 

(10) Research training 

The House bill requires plant genetic researchers that receive 

certain federal funds to complete an approved training program. 

(Section 7110) 

The Senate has no comparable provision. 

The Conference substitute deletes the House provision. 


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(11) Fort Reno Science Park Research Facility 

The House bill allows the Secretary to lease land at the 

Grazinglands Research Laboratory to the University of Oklahoma. 

(Section 7111) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision. (Section 

7503) 

(12) Assessing the nutritional composition of beef products 

The House bill allows the Secretary to award a grant, contract, 

or other agreement to a land-grant university to update the Nutrient Composition Handbook for Beef. Necessary sums are authorized to be appropriated. (Section 7112) 

The Senate amendment has no comparable provision. 

The Conference substitute deletes the House provision. 

(13) Sense of Congress regarding funding for human nutrition research 

The House bill states that it is the sense of Congress that 

human nutrition research has the potential for improving the 

health of Americans. (Section 7113) 

The Senate amendment has no comparable provision. 

The Conference substitute deletes the House provision. 

(14) Advisory Board 

The House bill amends Section 1408(g)(1) of NARETPA by increasing the maximum annual appropriations for the NAREEE Advisory Board to $500,000. (Section 7201) 

The Senate amendment amends Section 1408 of NARETPA by 

increasing the maximum annual appropriations for the NAREEE 

Advisory Board to $500,000 and to change the membership of the 

board from 31 to 24 members. The Senate amendment mandates 

that members representing the following organizations are no 

longer to be members of the board: a national animal commodity 

organization; a national crop commodity organization; a national 

aquaculture association; a non-land grant college or university with 

a historic commitment to research in the food and agricultural 

sciences; the portion of the scientific community not closely associated with agriculture; an agency within the Department that lacks 

research capabilities; a research agency of the Federal Government 

other than the Department; and national organizations directly involved in agricultural research, extension, and education. One 

member actively engaged in aquaculture is added to compensate 

for the loss of a representative from a national aquaculture association. (Section 7002 and Section 7401) 

The Conference substitute adopts the Senate provision with an 

amendment to include a member representing NLGCA institutions; 

a member actively engaged in the production of a food animal commodity recommended by a coalition of national livestock organizations; a member actively engaged in the production of a plant commodity recommended by a coalition of national crop organizations; 

and a member actively engaged in aquaculture recommended by a 

coalition of national aquaculture organizations. (Section 7102) 


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(15) Advisory Board termination 

The House bill (section 7202) and the Senate amendment (section 7002) extend section 1408(h) of NARETPA through 2012. 

The Conference substitute adopts the Senate provision. (Section 7102) 

(16) Renewable Energy Committee 

The House bill adds a new section, 1408B, to NARETPA that 

requires the executive committee of the NAREEE Advisory Board 

to establish and appoint initial members to a permanent renewable 

energy subcommittee responsible for studying the research, extension, and economics programs affecting the renewable energy industry. The renewable energy committee will submit annual reports to the Board with the committee’s findings and recommendations. 

This section states that the Renewable Energy Subcommittee 

shall coordinate with the Biomass Research and Development Act 

Technical Advisory Committee. 

This section states also that when preparing the annual budget 

recommendations for the Department, the Secretary shall take into 

account the recommendations made by the committee and adopted 

by the NAREEE Advisory Board. (Section 7203) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to make technical changes in the Renewable Energy 

Committee. (Section 7104) 

(17) Specialty Crop Committee Report 

The House bill amends section 1408A(c) of NARETPA by expanding the list of recommendations the Specialty Crops Subcommittee must make annually to the NAREEE Advisory Board to 

include economic analyses of the specialty crops sector and data 

that provides applied information useful to specialty crop growers. 

(Section 7204) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to make technical changes. (Section 7103) 

(18) Inclusion of UDC grants and fellowships for food and agricultural sciences education 

The House bill amends section 1417 of NARETPA by adding 

the University of the District of Columbia (UDC) as an eligible university to compete for food and agricultural sciences education 

grants and fellowships. (Section 7205) 

The Senate amendment is the same as the House provision 

with technical differences. (Section 7004) 

The Conference substitute adopts the Senate provision. (Section 7106) 

(19) Grants and fellowships for food and agricultural Sciences Education 

The House bill amends section 1417(j) of NARETPA by adding 

agriculture programs for grades K–12 to the purposes of these 

grants. The current authorization of appropriations of $60,000,000 


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for each fiscal year is extended through 2012. This section requires 

a report on the distribution of funds to teaching programs. (Section 

7206) 

The Senate amendment is the same as House provision with 

technical differences. (Section 7007) 

The Conference substitute adopts the House provision with an 

amendment to require a biennial report. (Section 7109) 

(20) Grants for research on production and marketing of alcohols 

and industrial hydrocarbons from agricultural commodities 

and forest products 

The House bill (section 7207) and the Senate amendment (section 7008) extend section 1419(d) of NARETPA through 2012. 

The Conference substitute adopts the Senate provision with an 

amendment to repeal this section from current law. (Section 7110) 

(21) Policy Research Centers 

The House bill amends section 1419A of NARETPA by including the Food Agricultural Policy Research Institute (FAPRI) and 

the Agricultural and Food Policy Center (AFPC) as eligible to receive grants under the policy research center authorization and extending the authorization of appropriations through 2012. (Section 

7208) 

The Senate amendment amends section 1419A of NARETPA 

by including FAPRI, the AFPC, the Rural Policy Research Institute, and the Community Vitality Center as eligible to receive 

grants under the policy research center authorization and extending the authorization of appropriations through 2012. (Section 

7009) 

The Conference substitute adopts the Senate provision with an 

amendment to remove the Community Vitality Center, add the 

Drought Mitigation Center, and clarify that the specialty crops sector should be covered by the centers. (Section 7111) 

The Managers recognize specialty crops are a vital component 

of agriculture in the Midwestern region of the United States and 

encourage the development of a collaborative research program at 

a land-grant university to support specialty crop research focused 

on genetic resource development, sustainable production practices, 

and improved marketing systems. The Managers recognize the resources and expertise available among the Midwestern land-grant 

universities, such as Purdue University, and encourage the Secretary to support continued expansion of the specialty crop research, extension, and education capabilities of these institutions. 

(22) Human Nutrition Intervention and Health Promotion Research 

Program 

The House bill (section 7209) and the Senate amendment (Section 7010) extend section 1424(d) of NARETPA through 2012. 

The Conference substitute adopts the House provision. (Section 

7114) 


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(23) Pilot Research Program to combine medical and agricultural 

research 

The House bill (section 7210) and the Senate amendment (section 7011) extend section 1424A(d) of NARETPA through 2012. 

The Conference substitute adopts the Senate provision. (Section 7115) 

The Managers recognize the potential for the development of 

pharmaceuticals for human use through the use of bovine blood 

products. The usefulness of bovine blood products has resulted from 

a number of technical advances. These advances ensure the proper 

and necessary level of control of the animal-based raw materials so 

that they can now meet or exceed the requirements to develop safe 

and efficacious pharmaceuticals for human use. The Managers encourage the Secretary to fund pilot projects through this authorization to accelerate the development of pharmaceuticals for human 

use from bovine blood products. 

(24) Nutrition Education Program 

The House bill authorizes appropriations of $90,000,000 for 

each fiscal year through 2012 to carry out the food and nutrition 

education program. (Section 7211) 

The Senate amendment has no comparable provision. (Section 

7012) 

The Conference substitute deletes the House provision. 

(25) Continuing animal health and disease research programs 

The House bill (section 7212) and the Senate amendment (section 7014) extend section 1433(a) of NARETPA through 2012. 

The Conference substitute adopts the House provision. (Section 

7117) 

(26) Cooperation among eligible institutions 

The House bill requires the Secretary to encourage cooperation 

among institutions eligible for funding under continuing animal 

health and disease research programs in setting research priorities. 

(Section 7213) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision. (Section 

7118) 

(27) Appropriations for research on national or regional problems 

The House bill (section 7214) and the Senate amendment (section 7015) extend section 1434(a) of NARETPA through 2012. 

The Conference substitute adopts the Senate provision. (Section 7119) 

(28) Authorization level of extension at 1890 land-grant colleges 

The House bill (section 7215) and the Senate amendment (section 7017) modify section 1444(a)(2) of NARETPA by increasing 

from 15 to 20 percent the Smith-Lever (extension) formula funding 

allocated to 1890 institutions. 

The Conference substitute adopts the House provision. (Section 

7121) 


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(29) Authorization level for agricultural research at 1890 land-grant 

colleges 

The House bill (section 7216) and the Senate amendment (section 7018) modify section 1445(a)(2) of NARETPA by increasing 

from 25 to 30 percent the Hatch Act (research) formula funding 

that is allocated to 1890 institutions. 

The Conference substitute adopts the Senate provision. (Section 7122) 

(30) Grants to upgrade agriculture food sciences facilities at the District of Columbia Land-Grant University 

The House bill (section 7217) and the Senate amendment (section 7020) amend NARETPA by adding an authorization of 

$750,000 in annual appropriations for grants to be made to UDC 

to acquire, alter, or repair facilities or relevant equipment necessary for conducting agricultural research. 

The Conference substitute adopts the Senate provision. (Section 7124) 

(31) Grants to upgrade agricultural and food sciences facilities at 

1890 land-grant colleges, including Tuskegee University 

The House bill (section 7218) and the Senate amendment (section 7019) extend section 1447(b) of NARETPA through 2012. 

The Conference substitute adopts the House provision. (Section 

7123) 

(32) National research and training virtual centers 

The House bill (section 7219) and the Senate amendment (section 7021) extend section 1448 of NARETPA through 2012. 

The Conference substitute adopts the Senate provision. (Section 7126) 

(33) Matching funds requirement for research and extension activities of 1890 institutions 

The House bill (section 7220) and the Senate amendment (section 7022) extend section 1455 of NARETPA through 2012. 

The Conference substitute adopts the House provision with an 

amendment to update current law and clarify the current requirement of providing equal matching funds from non-Federal sources. 

(Section 7127) 

(34) Hispanic-serving institutions 

The House bill extends section 1455(c) of NARETPA through 

2012. (Section 7221) 

The Senate amendment amends section 1455 of NARETPA by 

removing the ability to receive a grant without a competitive application process. The modification also allows single institutions to 

receive grants. The annual appropriation is increased from 

$20,000,000 to $40,000,000 and the authorization of appropriations 

is extended through 2012. (Section 7023) 

The Conference substitute adopts the Senate provision with an 

amendment to make technical changes. (Section 7128) 


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(35) Hispanic-serving agricultural colleges and universities 

The House bill adds a new section, 1456, to NARETPA which 

establishes an endowment fund, an institutional capacity building 

grant program, and a competitive grant program to benefit Hispanic-serving agricultural colleges and universities (HSACUs). 

This section defines Hispanic-serving agricultural colleges and 

institutions as institutions that qualify as Hispanic-serving institutions under the Higher Education Act and offer an associate, bachelor, or other accredited degree in agricultural fields of study. 

This section authorizes necessary funds to be appropriated for 

the endowment fund, extension, and institutional capacity building, 

and competitive grants through 2012. A formula for the distribution of appropriations is authorized for the endowment and maintenance of Hispanic-serving agricultural colleges and universities in 

the same manner prescribed under the Second Morrill Act. (Section 

7222) 

The Senate amendment is similar to the House provision with 

technical differences. (Section 7024) 

The Conference substitute adopts the Senate provision with an 

amendment to make technical changes. (Section 7129) 

(36) International agricultural research, extension, and education 

The House bill (section 7223) and the Senate amendment (section 7025) modify section 1458(a) of NARETPA by allowing the Secretary to give priority under this program to institutions with existing memoranda of understanding or agreements with U.S. institutions or State or Federal agencies. This section includes HSACUs 

as organizations the Secretary may enter into agreements with to 

help develop a sustainable global agricultural system. This section 

adds HSACUs to the list of universities eligible for support to do 

collaborative research with other countries on U.S. agricultural 

competitiveness. This section also adds HSACUs to the list of colleges and universities where Federal scientists are involved with 

research conducted internationally. This section establishes a program to provide fellowships to U.S. or foreign students to study at 

foreign agricultural colleges. 

The Conference substitute adopts the Senate provision with an 

amendment to add anti-hunger and nutrition efforts and increased 

quantity, quality, and availability of food to the purposes of agreements between eligible institutions or organizations and the Department. (Section 7130) 

(37) Competitive grants for international agricultural science and 

education programs 

The House bill (section 7224) and the Senate amendment (section 7026) extend section 1459A(c) of the NARETPA through 2012. 

The Conference substitute adopts the House provision. (Section 

7131) 

(38) Limitation on indirect costs for agricultural research, education, and extension programs 

The House bill amends section 1462(a) of NARETPA to allow 

a recipient of any grant administered under the REE mission area, 


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excluding those administered under the Small Business Act, to use 

up to 19 percent of Federal funds for indirect costs. (Section 7225) 

The Senate amendment amends section 1462(a) of NARETPA 

by raising from 19 to 30 percent the allowance of indirect costs a 

recipient institution can use from a competitive grant awarded by 

the Department. (Section 7027) 

The Conference substitute adopts the House provision with an 

amendment to increase the indirect cost limitation to 22 percent. 

(Section 7132) 

(39) Research equipment grants 

The House bill (section 7226) and the Senate amendment (section 7028) extend section 1462A(e) of NARETPA through 2012. 

The Conference substitute adopts the Senate provision. (Section 7133) 

(40) University research 

The House bill (section 7227) and the Senate amendment (section 7029) extend section 1463 of NARETPA through 2012. (Section 

7227) 

The Conference substitute adopts the House provision. (Section 

7134) 

(41) Extension service 

The House bill (section 7228) and the Senate amendment (section 7030) extend section 1464 of NARETPA through 2012. 

The Conference substitute adopts the Senate provision. (Section 7135) 

(42) Supplemental and alternative crops 

The House bill (section 7229) and the Senate amendment (section 7032) extend section 1473D(a) of NARETPA through 2012. 

The Conference substitute adopts the House provision. (Section 

7136) 

(43) Aquaculture assistance programs 

The House bill extends section 1477 of NARETPA through 

2012. (Section 7230) 

The Senate amendment extends section 1477 of NARETPA 

through 2012 and amends section 1475(f) of the Act to prioritize 

the study and management of Viral Hemorrhagic Septicemia 

(VHS). (Section 7033) 

The Conference substitute adopts the House provision and 

adds VHS research as a high-priority item in section 7203 of this 

Act. 

The Managers are aware of the devastating impacts that VHS 

is having on freshwater fish populations in the United States. The 

Managers encourage the Department’s Animal and Plant Health 

Inspection Service to coordinate its VHS management activities 

with State natural resource management agencies and tribes to research, develop, and implement a comprehensive set of priorities 

for managing VHS, including providing funds for research into the 

spread of the disease, surveillance, monitoring, risk evaluation, enforcement, screening, and management. (Section 7140) 


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(44) Rangeland research 

The House bill extends section 1483(a) of NARETPA through 

2012. (Section 7231) 

The Senate amendment extends section 1483(a) of NARETPA 

through 2012 and amends section 1480(a) of the Act by authorizing 

pilot programs to address natural resources management issues 

and facilitate the collection of information and analysis to provide 

information for improved management of public and private rangeland. (Section 7034) 

The Conference substitute adopts the House provision. (Section 

7141) 

(45) Special authorization for biosecurity planning and response 

The House bill (section 7232) and the Senate amendment (section 7035) extend section 1484(a) of NARETPA through 2012. 

The Conference substitute adopts the Senate provision. (Section 7142) 

(46) Resident instruction and distance education grants program for 

insular area institutions of higher education 

The House bill (section 7233) and the Senate amendment (section 7036) extend sections 1490(f) and 1491 of NARETPA through 

2012. 

The Conference substitute adopts the House provision. (Section 

7143) 

(47) Hispanic-serving institutions 

The House bill (section 7234) and the Senate amendment (section 7001) modify section 1404 of NARETPA to give the term ‘‘Hispanic-Serving Institution’’ the same definition as section 502(a) of 

the Higher Education Act of 1965. 

The Conference substitute adopts the House provision with an 

amendment to move it into the definitions section of this Act. (Section 7101) 

(48) Specialty Crop Policy Research Institute 

The House bill amends section 1419A of NARETPA by establishing a Specialty Crop Policy Research Institute within FAPRI. 

The objectives are to produce and disseminate analyses of the specialty crop sector and an annual review on the state of the specialty 

crop industry. Necessary sums are authorized to be appropriated. 

(Section 7235) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to incorporate the purposes of this section into subsection (a)(1) of section 1419A of NARETPA. (Section 7111) 

(49) Emphasis of Human Nutrition Initiative 

The House bill amends section 1424(b) of NARETPA (7 U.S.C. 

3174(b)) to add a new emphasis to the Human Nutrition Intervention and Health Promotion Research Program to examine the efficacy of agricultural programs in promoting the health of disadvantaged populations. (Section 7236) 

The Senate amendment has no comparable provision. 


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The Conference substitute adopts the House provision. (Section 

7113) 

(50) Grants to upgrade agriculture and food sciences facilities at insular area land-grant institutions 

The House bill amends NARETPA by authorizing assistance to 

insular land-grant institutions to acquire, alter, or repair facilities 

or equipment for agricultural research. An appropriation of 

$8,000,000 is authorized for each fiscal year through 2012. (Section 

7237) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision. (Section 

7125) 

(51) Veterinary medicine loan repayment 

The Senate amendment amends section 1415A of NARETPA 

by setting a deadline for rulemaking to implement the National 

Veterinary Medical Services Act (NVMSA). This section amends 

NVMSA to prioritize large and mixed animal practitioner shortages 

in rural communities and prohibits funds to be used for the existing Federal employee loan repayment program under 5 U.S.C. 

5379. (Section 7003) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to clarify the priorities within NVMSA and to disapprove of the transfer of funds from CSREES to the Food Safety 

and Inspection Service (FSIS). The funds are required to be transferred back CSREES from FSIS. (Section 7105) 

The Managers continue to be frustrated by the lack of progress 

by the Department in implementing NVMSA. When developing this 

legislation, the House Committee on Agriculture worked closely 

with the various agencies of the Department to ensure that the legislation was drafted in a manner in which it could be implemented 

and administered. During Committee consideration, amendments 

were included at the Department’s request to ensure quick and efficient implementation. In a legislative report submitted by the Secretary of Agriculture, with the consent of the Office of Management 

and Budget, the Department reiterated its support and recommended that the legislation be enacted. More than $2,000,000 

has been appropriated for this program, yet the Department has 

not taken steps to develop regulations to implement it. Instead, the 

Managers note that CSREES, to which authority to administer 

NVMSA had been delegated, chose to transfer funds appropriated 

for this important program to another agency of the Department to 

assist in loan repayment for Federal employees. While this funding 

transfer was technically within the authority of the NVMSA legislation, it was not in line with the intent of Congress in developing 

this legislation. The Managers disapprove of this funding transfer 

and expect the full amount of funds that were transferred to be returned. Likewise, amendments have been included in NVMSA to 

prevent further funding transfers. 

In a hearing held before the House Subcommittee on Livestock, 

Dairy, and Poultry on February 7, 2008, representatives of the Department were asked repeatedly if the Administration intended to 


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propose legislation to amend NVMSA to speed its implementation. 

To date, no proposed legislation has been submitted, leading the 

Managers to conclude that the Department has sufficient funding 

and capability to implement and administer this law. The Managers have therefore included a deadline for the Department to 

propose regulations for NVMSA and expect the Department to 

meet this deadline without further delay. 

(52) Expansion of Food and Agricultural Sciences Award 

The Senate amendment amends section 1417(i) of NARETPA 

by expanding the current National Agricultural Teaching Award to 

include research and extension. (Section 7006) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 7108) 

(53) Purposes and findings relating to animal health and disease 

research 

The Senate amendment amends Section 1429 of NARETPA to 

add a purpose supporting research on the judicious use of antibiotics. (Section 7013) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. 

(54) Animal Health and Disease Research Program 

The Senate amendment amends section 1434(b) of NARETPA 

by clarifying that 1890 institutions are eligible for animal health 

and disease research grants under this section. (Section 7015) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 7120) 

The Managers are concerned about arthropod-borne diseases 

that increasingly affect the U.S. livestock industry and wildlife. 

Consequently, the Managers expect the Agricultural Research 

Service to update the March 2005 feasibility study on the modernization of the arthropod-borne animal disease research laboratory. 

(55) Farm management training and public farm benchmarking 

database 

The Senate amendment adds a new section, 1468, to 

NARETPA that establishes a National Farm Management Center 

to improve farm management knowledge and the skills of agriculture producers through an education program. It also authorizes 

the creation of a database that will allow for the comparison of 

farm management data among producers. This section authorizes 

annual appropriations for the center and database through 2012. 

(Section 7037) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to modify the Food, Agriculture, Conservation, and 

Trade Act of 1990 (FACT Act) and to allow the Secretary to make 

competitive research and extension grants for the purposes of the 

program. (Section 7208) 


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The Managers recognize that the Center for Farm Financial 

Management at the University of Minnesota has a proven record 

of providing farm financial planning, marketing, and credit analysis and encourage the Department to continue to support its 

benchmarking efforts. 

(56) Tropical and subtropical agricultural research 

The Senate amendment adds a new section, 1473E, to 

NARETPA that establishes a competitive program for research on 

tropical and subtropical agriculture. Annual appropriations for the 

program are authorized through 2012. (Section 7038) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision and 

adds tropical and subtropical research as a high priority item in 

Section 7203 of this Act. 

(57) Regional centers of excellence 

The Senate amendment adds a new section, 1473F, to 

NARETPA that establishes regional centers of excellence, including 

a Poultry Sustainability Center of Excellence, funded by Federal, 

state, and industry funds to research a specific commodity. Annual 

appropriations are authorized for the centers through 2012. (Section 7039) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision and 

gives priority to regional centers of excellence that leverage funds 

from Federal, State, and private sector sources to research a specific agricultural commodity or concern under Section 7203 of this 

Act. 

(58) National Drought Mitigation Center 

The Senate amendment adds a new section, 1473G, to 

NARETPA that authorizes the Secretary to enter into an agreement with the National Drought Mitigation Center. Annual appropriations are authorized for the Center through 2012. (Section 

7040) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision and 

adds the National Drought Mitigation Center as one of the research institutions and organizations that is eligible to receive 

funding through the policy research center authorization in section 

7111 of this Act. 

(59) Agricultural development in the American-Pacific region 

The Senate amendment adds a new section, 1473H, to 

NARETPA that establishes consortia of institutions in the American-Pacific region to carry out integrated research, extension, and 

instruction programs in support of food and agricultural sciences. 

Annual appropriations are authorized for the consortia through 

2012. (Section 7041) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision and 

adds agricultural development in the American-Pacific region as a 

high priority item in Section 7203 of this Act. 


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(60) Farm and ranch stress assistance network 

The Senate amendment adds a new section, 1473K, to 

NARETPA that establishes a farm and ranch stress assistance network to provide behavioral programs to participants in the U.S. agricultural sector. Annual appropriations are authorized for the network through 2012. (Section 7044) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to clarify the activities covered under this authorization and to make technical changes. (Section 7522) 

(61) Rural entrepreneurship and enterprise facilitation 

The Senate amendment adds a new section, 1473L, to 

NARETPA to establish a program for the promotion of rural entrepreneurship, rural business development, and collaboration among 

rural entrepreneurs, local business communities, nonprofit organizations, and K–12 and higher education institutions. The program 

also provides rural entrepreneurs with technical assistance and access to capital, and it determines the best methods of entrepreneurial training. Annual appropriations for the program are authorized. (Section 7045) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision. 

(62) Seed distribution 

The Senate amendment adds a new section, 1473M, to 

NARETPA that establishes a program to distribute vegetable seeds 

to underserved communities free-of-charge. Annual appropriations 

are authorized for the program through 2012. (Section 7046) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to award grants on a competitive basis and to make 

technical changes. (Section 7523) 

(63) Farm and ranch safety 

The Senate amendment adds a new section, 1473N, to 

NARETPA that establishes a grant program to determine how to 

decrease the incidence of injury and death on farms and ranches. 

Annual appropriations for the program are authorized through 

2012. (Section 7047) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision and 

adds farm and ranch safety as a high priority item in section 7203 

of this Act. 

(64) Women and minorities in STEM fields 

The Senate amendment adds a new section, 1473O, to 

NARETPA that establishes a grant program to increase participation by women and underrepresented minorities from rural areas 

in science, technology, engineering, and mathematics fields (STEM 

fields). Annual appropriations for the program are authorized 

through 2012. (Section 7048) 

The House bill has no comparable provision. 


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The Conference substitute deletes the Senate provision and 

adds women and minorities in STEM fields as a high priority item 

in section 7203 of this Act. 

(65) Natural Products Research Program 

The Senate amendment adds a new section, 1473P, to 

NARETPA that establishes a research program for the discovery, 

development, and commercialization of pharmaceuticals and 

agrichemicals from natural products, including those from plant, 

marine, and microbial sources. Annual appropriations are authorized for the program. (Section 7049) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to make technical changes. (Section 7525) 

(66) International Anti-Hunger and Nutrition Program 

The Senate amendment adds a new section, 1473Q, to 

NARETPA that authorizes the Secretary to support nonprofit organizations that focus on promoting research concerning anti-hunger 

and improved nutrition efforts internationally and increased quantity, quality, and availability of food. (Section 7050) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision and 

adds the purposes of the Senate amendment to section 7130 of this 

Act. 

(67) Consortium for agricultural and rural transportation research 

and education 

The Senate amendment adds a new section, 1473R, to 

NARETPA that establishes a research program focusing on critical 

rural and agricultural transportation and logistics issues facing agricultural producers and other rural businesses. Annual appropriations of $19,000,000 are authorized for each fiscal year through 

2012. (Section 7051) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to give priority to institutions that apply as a group 

and to make technical changes. (Section 7529) 

(68) Regional centers of excellence in food systems veterinary medicine 

The Senate amendment adds a new section, 1473S, to 

NARETPA that establishes a grant program for veterinary schools 

to support centers of emphasis in food systems veterinary medicine. 

Annual appropriations for the centers are authorized through 2012. 

(Section 7052) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate provision, adds 

food systems veterinary medicine as a high priority item in Section 

7203 of this Act, and captures the purposes of the Senate amendment in the regional centers of excellence provision under section 

7203 of this Act. 


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(69) National Genetics Resources Program 

The House bill extends section 1635(b) of the FACT Act 

through 2012. (Section 7301) 

The Senate amendment extends section 1635(b) of the FACT 

Act through 2012 and adds research on plant and animal breeding 

to the purposes and functions of this program as listed in section 

1632 of the FACT Act. (Section 7101) 

The Conference substitute adopts the House provision. (Section 

7201) 

(70) National Agricultural Weather Information System 

The House bill extends section 1641(c) of the FACT Act 

through 2012. (Section 7302) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision. (Section 

7202) 

The Managers recognize the importance of creating a southern 

mesonetwork of weather stations to support applied research in 

solar and wind energy production. The Managers are aware of the 

capabilities and experience of the Center for Earth and Environmental Studies at Texas A&M International University in this area 

and believe this institution could prove to be a valuable resource 

in the Rio Grande Valley. 

(71) Partnerships 

The House bill amends section 1672(d) of the FACT Act by requiring that grant proposals received must be scientifically meritorious and involve cooperation of multiple entities in order to receive priority consideration under the High Priority Research and 

Extension Initiative. (Section 7303) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision. (Section 

7203) 

(72) Aflatoxin research and extension 

The House bill amends section 1672(e)(3) of the FACT Act by 

changing the existing grant description contained in current law to 

improve and commercialize aflatoxin control in corn and other 

crops. (Section 7304) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision. (Section 

7203) 

(73) High Priority Research and Extension Areas 

The House bill amends section 1672 of the FACT Act by adding 

the following to the High Priority Research and Extension Area 

Initiatives: farmed and wild cervid disease and genetic research; 

air emissions from livestock operations; swine genome project; cattle fever tick program; colony collapse disorder program; synthetic 

gypsum from power plants research; cranberry research program; 

sorghum research initiative; and a bean health research program. 

(Section 7305) 

The Senate amendment amends section 1672 of the FACT Act 

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sion Area Initiatives: Colony Collapse Disorder and Pollinator Research Program; Marine Shrimp Farming Program; Cranberry Research Program; Turfgrass Research Initiative; Pesticide Safety Research Initiative; Swine Genome Project; High Plains Aquifer Region; Cellulosic Feedstock Transportation and Delivery Initiative; 

Deer Initiative; Pasture-Based Beef Systems; Sustainable Agricultural Production for the Environment; Biomass-Derived Energy Resources; Brucellosis Control and Eradication; and Bighorn and Domestic Sheep Disease Mechanisms. (Section 7102) 

The Conference substitute adopts the Senate provision with an 

amendment to add the following to the list of high-priority research 

and extension initiatives: Air Emissions from Livestock Operations; 

Swine Genome Project; Cattle Fever Tick Program; Synthetic Gypsum; Cranberry Research Program; Sorghum Research Initiative; 

Marine Shrimp Farming Program; Turfgrass Research Initiative; 

Agricultural Worker Safety Research Initiative; High Plains Aquifer Region; Deer Initiative; Pasture-Based Beef Systems Research 

Initiative; Agricultural Practices Relating to Climate Change; Brucellosis Control and Eradication; Bighorn and Domestic Sheep Disease Mechanisms; Agricultural Development in the American-Pacific Region; Tropical and Subtropical Agricultural Research; Viral 

Hemorrhagic Septicemia; Farm and Ranch Safety; Women and Minorities in STEM Fields; Alfalfa and Forage Research Program; 

Food Systems Veterinary Medicine; Biochar Research. 

The Conference substitute also strikes the following from section 1672 of the FACT Act: Brown citrus aphid and citrus tristeza 

virus research and extension; Mesquite research and extension; 

Red meat safety research and extension; Grain sorghum ergot research and extension; Low-bush blueberry research and extension; 

Wild pampas grass control, management, and eradication research 

and extension; Sheep scrapie research and extension; Forestry research and extension; Wind erosion research and extension; Crop 

loss research and extension; Harvesting productivity for fruits and 

vegetables; Agricultural marketing; Beef cattle genetics; Dairy 

pipeline cleaner; Development of publicly held plants and animal 

varieties; and Specialty crop research. (Section 7204) 

The Managers encourage the Secretary to support collaborative 

research focusing on the development of viable strategies for the 

prevention, diagnosis and treatment of infectious, parasitic, and 

toxic diseases of farmed deer and the mapping of the deer genome. 

This initiative may be carried out by a consortium that can include 

land-grant universities and veterinary schools with appropriate facilities and experience in husbandry and care of captive cervidae. 

The consortium may carry out research dedicated to developing 

vaccines for epizootic hemorrhagic disease and blue tongue disease 

in farmed deer and may work to map the deer genome with emphasis on the identification of genes that confer resistance or susceptibility to disease relevant to the production of farmed deer. 

The Managers recognize the unique needs of the Appalachian 

region for the Pasture-Based Beef Systems Initiative. 

The Managers intend that the term ‘‘Caribbean and Pacific basins’’ refers to the States of Hawaii and Florida, the Commonwealth of Puerto Rico, the United States Virgin Islands, American 

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lands, the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic of Palau. 

The Managers intend that the term ‘‘American-Pacific region’’

refers to the States of Hawaii and Alaska, American Samoa, Guam, 

the Commonwealth of the Northern Mariana Islands, the Federated States of Micronesia, the Republic of the Marshall Islands, 

and the Republic of Palau. 

(74) High priority research and extension initiative 

The House bill extends Section 1672(h) of the FACT Act 

through 2012. (Section 7306) 

The Senate amendment extends section 1672(h) of the FACT 

Act through 2012 and authorizes an annual appropriation of 

$20,000,000 for the Colony Collapse Disorder and Pollinator Research Program. (Section 7102) 

The Conference substitute adopts the House provision. (Section 

7204) 

(75) Nutrient management research and extension initiative 

The House bill amends section 1672A of the FACT Act by giving a priority to grant proposals that address unique regional concerns as eligible for priority treatment. The House bill also adds 

dairy cattle waste as a type of waste to be studied to develop new 

methods of managing air and water quality. The authorization of 

appropriations is extended through 2012. (Section 7307) 

The Senate amendment: establishes a consortium of land grant 

colleges in the northeast region to perform research on dairy nutrient management and energy production (Section 9023); establishes 

a Southwest regional dairy, environment, and private land program 

for the research, development, and implementation of solutions for 

issues faced by the dairy industry (Section 11092); and extends section 1672A of the FACT Act through 2012. (Section 7103) 

The Conference substitute adopts the House provision with an 

amendment to include the production of renewable energy from 

animal waste as an eligible activity to receive grants under this 

section. (Section 7205) 

The Managers recognize that different regions of the country 

have varying needs for both energy development and nutrient management, and that cooperative efforts by institutions and States 

will leverage available resources to address problems and identify 

solutions. The Managers therefore encourage the development of 

regional consortia in which partners would work together to accomplish the goals of developing viable nutrient management systems, 

energy products from manure, and to asses these systems for cost, 

performance, and function among dairy, poultry, and swine operations. 

(76) Agricultural Telecommunications Program 

The House bill (section 7308) and the Senate amendment (section 7105) extend section 1673(h) of the FACT Act through 2012. 

The Conference substitute adopts the House provision with an 

amendment to repeal section 1673 of the FACT Act. (Section 7209) 


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(77) Assistive Technology Program for Farmers with Disabilities 

The House bill (section 7309) and the Senate amendment (section 7106) extend section 1680(c)(1) of the FACT Act through 2012. 

The Conference substitute adopts the Senate provision. (Section 7210) 

(78) Organic research 

The House bill amends section 1672B of the FACT Act by expanding the Organic Agriculture Research and Extension Initiative 

to examine optimal conservation and environmental outcomes for 

organically produced agricultural products and to develop new and 

improved seed varieties that are particularly suited for organic agriculture. This section authorizes $25,000,000 in mandatory funding for each of fiscal years 2008 through 2012. Appropriations of 

$25,000,000 are authorized for each of fiscal years 2009 through 

2012. The Director of NARPO is to coordinate this program to 

avoid duplication. (Section 7310) 

The Senate amendment amends Section 1672B of the FACT 

Act by authorizing mandatory funds of $16,000,000 per year for fiscal years 2008 through 2012 for the Organic Agriculture Research 

and Extension Initiative. (Section 7104) 

The Conference substitute adopts the House provision with an amendment to provide the initiative with a total of $78,000,000 in 

mandatory funds for fiscal year 2009 through fiscal year 2012. 

(Section 7206) 

Organic farming has the potential to capture atmospheric carbon and store it in the soil in the form of soil organic matter. The 

Managers encourage continued support of the research at the 

Rodale Institute regarding this research as it relates to certified organic standards. 

(79) National Rural Information Center Clearinghouse 

The House bill (section 7311) and the Senate amendment (section 7107) extend section 2381(e) of the FACT Act through 2012. 

The Conference substitute adopts the House provision. (Section 

7212) 

(80) New Era Rural Technology Program 

The House bill establishes a grant program for community colleges to develop an agriculture-based renewable energy and timber 

industry workforce. Annual appropriations are authorized for the 

program through 2012. (Section 7312) 

The Senate amendment adds a new section, 1473J, to 

NARETPA to establish a grant program for community colleges to 

develop an agriculture-based renewable energy and timber industry 

workforce and provides the definition of rural community college. 

Annual appropriations are authorized for the program through 

2012. (Section 7043) 

The Conference substitute adopts the House provision with an 

amendment to make technical changes and to add a new section, 

1473E, to NARETPA. (Section 7137) 

The Managers recognize the importance of developing a workforce to support the fields of bioenergy, agriculture-based renewable energy resources, and pulp and paper manufacturing. The 


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Managers recognize that Alabama Southern Community College, 

Northeast Iowa Community College, Eastern Iowa Community College District, Hawkeye Community College, Neosho County Community College, Kennebec Valley Community College, Itasca Community College, York Technical College, Midstate Technical College, Jones County Junior College, Minnesota West Technical and 

Community College, Orangeburg-Calhoun Technical College, 

Horry-Georgetown Technical College, and Central Carolina Technical College are among the rural community colleges that have a 

proven record and the ability to develop and implement programs 

to supply certified technicians. The Managers encourage the Secretary to work with these community colleges to establish the New 

Era Rural Technology Program. 

(81) Partnerships for high-value agricultural product quality research 

The House bill (section 7401) and the Senate amendment (section 7202) extend section 402(g) of the Agricultural Research, Extension, and Education Reform Act of 1998 (AREERA) through 

2012. 

The Conference substitute adopts the Senate provision with an 

amendment to repeal section 402 of AREERA. (Section 7302) 

(82) Precision agriculture 

The House bill (section 7402) and the Senate amendment (section 7203) extend section 403(i)(1) of AREERA through 2012. 

The Conference substitute adopts the House provision with an 

amendment to repeal section 403 of AREERA. (Section 7303) 

(83) Biobased products 

The House bill (section 7403) and the Senate amendment (section 7204) extend section 404(e)(2) of AREERA through 2012. 

The Conference substitute adopts the House provision. (Section 

7304) 

(84) Thomas Jefferson Initiative for Crop Diversification 

The House bill (section 7404) and the Senate amendment (section 7205) extend section 405(h) of AREERA through 2012. 

The Conference substitute adopts the Senate provision with an 

amendment to repeal section 405 of AREERA. (Section 7305) 

(85) Integrated Research, Education, and Extension Competitive 

Grants Program 

The House bill (section 7405) and the Senate amendment (section 7206) extend section 406(f) of AREERA through 2012. 

The Conference substitute adopts the Senate provision. (Section 7306) 

(86) Fusarium graminearum grants 

The House bill amends section 408 of AREERA to provide a 

technical correction and extends the authorization of appropriations through 2012. (Section 7406) 

The Senate amendment extends section 408(e) of AREERA 

through 2012. (Section 7207) 


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The Conference substitute adopts the House provision. (Section 

7307) 

(87) Bovine Johne’s Disease Control Program 

The House bill (section 7407) and the Senate amendment (section 7208) extend section 409(b) of AREERA through 2012. 

The Conference substitute adopts the Senate provision. (Section 7308) 

(88) Grants for youth organizations 

The House bill amends section 410 of AREERA to provide additional flexibility in content delivery and management of grant 

funds to recipient organizations under this section. The authorization of appropriations is extended through 2012. (Section 7408) 

The Senate amendment extends section 410(c) of AREERA 

through 2012. (Section 7209) 

The Conference substitute adopts the House provision. (Section 

7309) 

(89) Agricultural research and development for developing countries 

The House bill (section 7409) and the Senate amendment (section 7210) extend section 411(c) of AREERA through 2012. (Section 

7409) 

The Conference substitute adopts the House provision. (Section 

7310) 

(90) Agricultural bioenergy and biobased products research initiative 

The House bill adds a new section, 412, to AREERA that establishes a bioenergy and biobased products research initiative to 

enhance the production, sustainability, and conversion of biomass 

to renewable fuels and related products. The research initiative 

will be supported by a bioenergy and biobased product laboratory 

network that will focus research on improving biomass production 

and sustainability and improving biomass conversion in biorefineries. The Director of NARPO, established under section 7410 of 

the House bill, will coordinate projects and activities under the Biomass Research and Development Act of 2000 to coordinate and 

maximize the strengths of the Department and the Department of 

Energy. The Secretary is authorized to carry out research and 

award grants on a competitive basis. Appropriations are authorized 

at $50,000,000 for each of fiscal years 2008 through 2012. The Director of NARPO is to coordinate this program to avoid duplication 

of projects carried out under the Biomass Research and Development Act. (Section 7410) 

The Senate amendment has no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to incorporate the purposes of sections 9010 and 9020 

of the House bill, and sections 9010, 9011, 9022, and 9025 of the 

Senate amendment. 

The Conference substitute, titled the ‘‘Agricultural Bioenergy 

Feedstock and Energy Efficiency Research and Extension Initiative,’’ establishes a program to award competitive grants for 

projects with a focus on supporting on-farm biomass crop research 


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and the dissemination of results to enhance the production of biomass energy crops and the integration of such production with the 

production of bioenergy. The Conference substitute directs the Secretary to establish a best-practices database on the production of 

various biomass crops and on the harvesting, transport, and storage of biomass crops. 

The Conference substitute authorizes competitive grants for 

on-farm energy efficiency research and extension projects aimed at 

improving the energy efficiency of agricultural operations. (Section 

7207) 

The Managers encourage the Secretary to consider the approach of the New Century Farm at Iowa State University as a 

model for integrated research in the areas of biomass crop research 

and the production of bioenergy and to use its established capabilities. 

The Managers encourage the Secretary to consider the Future 

Farmsteads program at the University of Georgia as a model for 

on-farm energy efficiency research and to use its established capabilities. 

Additionally, the Managers encourage the Secretary to use the 

capabilities of the Colorado Renewable Energy Collaboratory in 

carrying out this section. 

The Managers recognize the significant work Arkansas State 

University is conducting in the area of plant cell wall structure and 

function and encourages the Secretary to continue to recognize the 

value of plant-produced, biotechnology-derived, enzymatic-developed products. 

The Managers are aware of the work being done at the Pennsylvania State University on all aspects of biofuels development 

from plant transformation to production, harvest, and storage to 

fuel formulation and engine testing. 

(91) Specialty crop research initiative 

The House bill adds a new section, 413, to AREERA that establishes the Specialty Crop Research Initiative to develop and disseminate science-based tools to address the needs of specific crops 

and their regions, including work in plant breeding and genetics, 

safety, quality, and yield; efforts to identify and address threats 

posed by invasive species; marketing; pollination; and efforts to improve production. The Secretary is authorized to award competitive 

grants through this program. Appropriations are authorized at 

$100,000,000 for each of fiscal years 2008 through 2012. Additionally, $215,000,000 in mandatory funds is to be provided in fiscal 

year 2008 to remain available until expended. The Director of 

NARPO shall coordinate this program to avoid duplication. (Section 

7411) 

The Senate amendment adds a new section, 412, to AREERA 

that establishes a Specialty Crop Research Initiative. This section 

is similar to the House provision and has additional language to include in the purposes of the program the optimization of organic 

specialty crop production and research on methods to prevent, control, and respond to pathogen contamination of specialty crops, including fresh-cut produce. Mandatory funding is provided at 


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$16,000,000 per year for fiscal years 2008 through 2012 for the initiative. (Section 7211) 

The Conference substitute adopts the House provision with an 

amendment that adds a new section, 412, to AREERA. It expands 

the initiative to a research and extension initiative; incorporates 

the prevention, detection, monitoring, control, and response to food 

safety hazards in the production and processing of specialty crops, 

including fresh products; allocates 10 percent of the funds obligated 

through this initiative to each of the research and extension activities described in this section; and provides $230,000,000 in mandatory funds for fiscal years 2008 through 2012. (Section 7311) 

The Managers intend that most activities funded by the initiative would have grant terms of short duration. However, the Managers are aware that there are areas of research where longer term 

grants are needed, such as research related to tree fruits. The 

Managers expect the Secretary to use 10-year grant terms only 

when it is critical for long-term systems research. 

The Managers recognize the critical importance of research directed at food safety hazards in the production and processing of 

specialty crops including fresh fruits and vegetables. The Managers 

encourage the Secretary to select projects for funding in this area 

that focus on applied research and technology transfer. 

(92) Office of Pest Management Policy 

The House bill extends section 614(f) of AREERA through 

2012. (Section 7412) 

The Senate amendment amends section 614 of AREERA by 

placing the Office of Pest Management Policy within the Office of 

the Chief Economist and extending the authorization of appropriations through 2012. (Section 7212) 

The Conference substitute adopts the House provision. (Section 

7313) 

(93) Food Animal Residue Avoidance Database Program 

The Senate amendment amends section 604 of AREERA by authorizing annual appropriations of $2,500,000 for the Food Animal 

Residue Avoidance Database program. (Section 7213) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment that clarifies that the authorized funds are in addition 

to other funds available as specified in section 604(c) of AREERA. 

(Section 7312) 

(94) Critical Agricultural Materials Act 

The House bill (section 7501) and the Senate amendment (section 7301) extend section 16(a) of the Critical Agricultural Materials Act through 2012. 

The Conference substitute adopts the Senate provision. (Section 7401) 

(95) Equity in Educational Land-Grant Status Act of 1994 

The House bill extends sections 533(b), 535, and 536(c) of the 

Equity in Educational Land-Grant Status Act of 1994 (EELGSA) 

through 2012. (Section 7502) 


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The Senate amendment extends sections 533(b), 535, and 

536(c) of EELGSA through 2012 and amends section 532 of the 

EELGSA to add Ilisagvik College in Alaska to the list of land-grant 

tribal colleges. (Section 7302) 

The Conference substitute adopts the Senate provision with an 

amendment to redistribute endowment funds that would be paid to 

a 1994 Institution among other 1994 Institutions if that 1994 Institution declines to accept funds or fails to meet existing accreditation requirements. (Section 7402) 

(96) Agricultural Experiment Station Research Facilities Act 

The House bill (section 7503) and the Senate amendment (section 7305) extend section 6(a) of the Research Facilities Act 

through 2012. 

The Conference substitute adopts the House provision. (Section 

7405) 

(97) National Agricultural Research, Extension and Teaching Policy 

Act Amendments of 1985 

The House bill (section 7306) and the Senate amendment (section 7306) extend section 1431 of the NARETPA Amendments of 

1985 through 2012. 

The Conference substitute adopts the Senate provision. (Section 7416) 

(98) Competitive, Special and Facilities Research Grant Act (National Research Initiative) 

The House bill amends section 2 of the Competitive, Special, 

and Facilities Research Grant Act (CSFRGA) to extend the authorization of appropriations through 2012 and to repeal the authority 

to limit allowable overhead costs. (Section 7505) 

The Senate amendment has no comparable provision. 

The Conference substitute deletes the House provision but reauthorizes section 2 of the CSFRGA in section 7406 of this Act. 

(99) Agricultural Risk Protection Act of 2000 (carbon cycle research) 

The House bill extends the section 221of the Agricultural Risk 

Protection Act of 2000 (ARPA) through 2012. (Section 7506) 

The Senate amendment extends the section 221 of ARPA 

through 2012 and transfers authority for this program from that 

Act to the Farm and Energy Security Act of 2007. (Section 7315) 

The Conference substitute adopts the House provision. (Section 

7407) 

(100) Renewable Resources Extension Act of 1978 

The House bill (section 7507) and the Senate amendment (section 8201) extend section 6 of the Renewable Resources Extension 

Act of 1978 (RREA) and section 8 of RREA through 2012. (Section 

7507) 

The Conference substitute adopts the House provision. (Section 

7413) 

The Managers are aware of the U.S. Forest Service’s (USFS) 

work on the Fire Research and Management Exchange System, an 

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change of science-based data, analysis tools, training materials, 

and other information related to interagency wildland fire management. The Managers recognize that the system can make a major 

contribution to science-based understanding and response to 

wildland fires, which continue to threaten many areas of our nation. The Managers expect the USFS to continue to work with its 

partners to develop a plan for nationwide implementation by 2011. 

(101) National Aquaculture Act of 1980 

The House bill (section 7508) and the Senate amendment (section 7311) extend section 10 of the National Aquaculture Act of 

1980 (16 U.S.C. 2809) through 2012. (Section 7508) 

The Conference substitute adopts the Senate provision. (Section 7414) 

(102) Construction of a Chinese garden at the National Arboretum 

The House bill amends the Act of March 4, 1927, (20 U.S.C. 

191 et seq.) by authorizing the construction of a Chinese garden at 

the National Arboretum. (Section 7509) 

The Senate amendment amends the Act of March 4, 1927, (20 

U.S.C. 191 et seq.) by authorizing the construction of a Chinese 

garden at the National Arboretum, prohibiting federal funds from 

being used for the construction of the Chinese Garden, and requiring an annual report to Congress on the budget and expenditures 

of the National Arboretum. (Section 7312) 

The Conference substitute adopts the House provision. (Section 

7415) 

(103) Public education regarding use of biotechnology in producing 

food for human consumption 

The House bill extends section 10802 of the Farm Security and 

Rural Investment Act of 2002 (FSRIA) through 2012. (Section 

7510) 

The Senate amendment has no comparable provision. 

The Conference substitute deletes the House provision and repeals section 10802 of FSRIA. (Section 7411) 

(104) Fresh cut produce safety grants 

The House bill authorizes the Secretary to award competitive 

research and extension grants to improve and enhance the safety 

of fresh cut produce. Universities, colleges, and other entities that 

have relationships with producers of fresh cut produce are eligible. 

Grant recipients must provide an equal of amount of matching 

funds or in-kind support from non-federal sources. The Director of 

NARPO is to coordinate this program to avoid duplication. Mandatory funding of $25,000,000 is provided for each of fiscal years 2008 

through 2012. Additionally, an appropriation for necessary funds is 

authorized from fiscal year 2008 through fiscal year 2012. (Section 

7511) 

The Senate amendment has no comparable provision. 

The Conference substitute deletes the House provision and incorporates the purposes and priorities of this program and funding 

into section 7311 of this Act. 


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(105) UDC/EFNEP eligibility 

The House bill (section 7512) and the Senate amendment (section 7313) amend Section 208 of the District of Columbia Public 

Postsecondary Education Reorganization Act (Public Law 93–471; 

88 Stat. 1428) to make the UDC eligible for the Expanded Food 

and Nutrition Education Program. 

The Conference substitute adopts the Senate provision. (Section 7417) 

(106) Hatch Act of 1887 

The House bill amends Section 3(d)(4) of the Hatch Act of 1887 

by requiring a 50 percent match of funds from the District of Columbia in order for UDC to receive formula funds for agricultural 

research. The Secretary is allowed to waive the matching requirement if necessary. (Section 7513) 

The Senate amendment amends Section 3(d)(4) of the Hatch 

Act of 1887 by requiring a 50 percent match of funds from the District of Columbia in order for UDC to receive formula funds for agricultural research. The Secretary is allowed to waive the matching 

requirement if necessary. This section also amends Section 6 of the 

Hatch Act of 1887 by eliminating Penalty Mail Authorities for 

State agricultural experiment stations and the extension service 

and making conforming amendments to NARETPA and to 39 

U.S.C. 3202(a). (Section 7304) 

The Conference substitute adopts the Senate provision. (Section 7404) 

(107) Smith-Lever Act 

The Senate amendment amends Section 3 of the Act of May 8, 

1914 (7 U.S.C. 343) to allow 1890 institutions to participate in the 

Children, Youth, and Families Education and Research Network 

Program. This section also amends section 5 of the Act of May 8, 

1914 (7 U.S.C. 345) to eliminate the Governor’s Report requirement 

for the extension service. (Section 7304) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to change programs authorized under section 3(d) of 

the Smith-Lever Act (7 U.S.C. 343(d)) into programs that award 

competitive grants and to add a conforming amendment to section 

1444(a)(2) of NARETPA. (Section 7403) 

(108) Education grants to Alaska Native Serving Institutions and 

Native Hawaiian Serving Institutions 

The Senate amendment amends section 759 of the Agriculture, 

Rural Development, Food and Drug Administration, and Related 

Agencies Appropriations Act, 2000 by permitting consortia of Alaska Native and Native Hawaiian Serving Institutions to designate 

fiscal agents and allocate funds for their members. (Section 7308) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to add this provision as a new section, 1419B, to 

NARETPA. (Section 7112) 


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(109) McIntire-Stennis Cooperative Forestry Act 

The Senate amendment amends Section 2 of the McIntireStennis Cooperative Forestry Act (16 U.S.C. 582a–1) by authorizing 

the participation of 1890 institutions to participate in the McIntireStennis cooperative forestry program. (Section 7310) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 7412) 

(110) Exchange or sale authority 

The Senate amendment adds Section 307 to Title III of the 

Federal Crop Insurance and Department of Agriculture Reorganization Act of 1994 by authorizing USDA to exchange, sell, or otherwise dispose of any qualified items of personal property and to 

retain and apply the sale or other proceeds to acquire any qualified 

items of personal property or to offset costs related to the maintenance, care, or feeding of any qualified items of personal property. 

(Section 7314) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 7408) 

(111) Enhanced Use Lease Authority Pilot Program 

The Senate amendment adds a new section, 308, to Title III of 

the Federal Crop Insurance and the Department of Agriculture Reorganization Act of 1994 by establishing a pilot program that allows non-Federal entities to use and invest in capital improvements at the Beltsville Agricultural Research Center and the National Agricultural Library by leasing non-excess property of the 

Center or the Library. (Section 7316) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to limit the terms of leases established under this authority to 30 years, sunset this authority five years after the date 

of enactment of this Act, and make technical changes. (Section 

7409) 

(112) Research and education grants for the study of antibiotic-resistant bacteria in livestock 

The Senate amendment establishes a competitive grant program for research and education on antibiotic-resistant bacteria in 

livestock. (Section 7317) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to modify the purposes of this research program. (Section 7521) 

The Managers are aware that resistance to antibiotics is a serious and growing public health concern in the United States and 

around the world. The Managers intend that section 7521 of this 

Act provide the necessary research and information for livestock 

producers as well as the general public to minimize the use of such 

drugs while still ensuring healthy animals and people. The Managers encourage the Secretary to fund research that can minimize 

the development and spread of antibiotic-resistant bacteria and to 


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make this a priority research area within relevant competitive research programs, including national programs related to animal 

production and water quality. 

(113) Merit review of extension and educational grants 

The House bill amends subsection (a)(2)(A) of section 103 of 

AREERA by inserting NIFA as the administering body for which 

merit review procedures must be established. (Section 7601) 

The Senate amendment has no comparable provision. 

The Conference substitute deletes the House provision. 

(114) Review of plan of work requirements 

The House bill (section 7602) and the Senate amendment (section 7503) require a review of the Plan of Work requirements under 

NARETPA, the Hatch Act, and the Smith-Lever Act. They also require a report to Congress identifying measures to streamline the 

plan of work requirements 

The Conference substitute adopts the House provision with an 

amendment to remove the reporting requirement. (Section 7505) 

(115) Multistate and integration funding 

The House bill amends section 3 of the Hatch Act of 1887 and 

section 3 of the Smith-Lever Act by requiring that, of the federal 

formula funds States receive under these Acts, 25 percent must be 

spent on the integration of cooperative research and extension activities. (Section 7603) 

The Senate amendment has no comparable provision. 

The Conference substitute deletes the House provision. 

(116) Expanded Food and Nutrition Education Program 

The House bill amends section 1425 of NARETPA by changing 

the allocation of funds in excess of the amount appropriated in fiscal year 1981. Funds in the amount of $100,000 are to be distributed to each land-grant college and university. The authorization 

of appropriations is increased to $90,000,000 through 2014. (Section 7604) 

The Senate amendment is the same as House provision with 

technical differences. (Section 7012) 

The Conference substitute adopts the Senate provision with an 

amendment to make technical changes. (Section 7116) 

(117) Grants to 1890 Schools to expand extension capacity 

The House bill (section 7605) and the Senate amendment (section 7005) amend section 1417(b)(4) of NARETPA to add extension 

as one of the purposes for which grants may be made through this 

program. 

The Conference substitute adopts the House provision. (Section 

7107) 

(118) Borlaug International Agricultural Science and Technology 

Fellowship Program 

The House bill establishes a fellowship program that provides 

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essary sums are authorized to be appropriated without fiscal year 

limitation. (Section 7606) 

The Senate amendment adds a new section, 1473I, to 

NARETPA that authorizes annual appropriations for the Borlaug 

International Agricultural Science and Technology Fellowship Program. The fellowship program brings scientists from developing 

countries to U.S. land-grant institutions to learn about improving 

agricultural productivity. (Section 7042) 

The Conference substitute adopts the Senate provision. (Section 7139) 

(119) Cost recovery 

The House bill amends Section 1473A of NARETPA by raising 

the indirect cost cap for cost reimbursable agreements between the 

Secretary and State cooperative institutions or colleges and universities from 10 percent to 19 percent. (Section 7607) 

The Senate amendment amends Section 1473A of NARETPA 

by raising the indirect cost cap for cost reimbursable agreements 

between the Secretary and State cooperative institutions or colleges 

and universities from 10 percent to 30 percent. (Section 7031) 

The Conference substitute deletes both the House and Senate 

provisions. 

(120) Organic food and agricultural systems funding 

The House bill expresses a sense of Congress that a portion of 

the annual funding provided for ARS should support research specific to organic food and agricultural systems. (Section 7608) 

The Senate amendment expresses a sense of the Senate that 

recognizes the need to increase funding at USDA for research specific to organic agriculture to keep pace with the expansion of the 

organic sector of U.S. agriculture. (Section 7505) 

The Conference substitute deletes the House and Senate provisions. 

(121) Demonstration project authority for temporary positions 

The Senate amendment authorizes the demonstration project 

authority for temporary positions indefinitely. (Section 7502) 

The House bill has no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 7528) 

(122) Modifications to information technology service 

The Senate amendment prohibits the Secretary from implementing any modification that reduces the availability or provision 

of information technology service, or administrative management 

control of that service, including data or center service agency, 

functions, and personnel at the National Finance Center and the 

National Information Technology Center service locations until a 

notification is received by Congress from the Department. This section requires the Secretary to report to Congress and the Government Accountability Office on specified administrative modifications made to the National Finance Center and National Technology Center service locations. (Section 7506) 

The House bill has no comparable provision. 


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The Conference substitute deletes the Senate provision. 

(123) Studies and reports by the Department of Agriculture, the Department of Health and Human Services, and the National 

Academy of Sciences on food products from cloned animals 

The Senate amendment requires studies on the safety and the 

impact on trade of allowing food products from cloned animals and 

their offspring into the food supply. The Secretary of Health and 

Human Services (HHS) is prohibited from issuing the final draft 

risk assessment on food from cloned animals and their offspring. 

The Secretary of HHS is also prohibited from lifting the voluntary 

moratorium on allowing food from cloned animals and their offspring from entering the food supply until after the studies are 

completed. (Section 7507) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate amendment. 

(124) Animal bioscience facility in Bozeman, Montana 

The Senate amendment authorizes appropriations of 

$16,000,000 for the construction of an animal bioscience facility in 

Bozeman, Montana. (Section 7508) 

The House bill has no comparable provision. 

The Conference substitute deletes the Senate amendment. 

TITLE VIII—FORESTRY 

(1) National priorities for private forest conservation 

The House bill amends section 2 of the Cooperative Forestry 

Assistance Act of 1978 (CFAA) by requiring the Secretary to focus 

on a set of three national private forest conservation priorities 

when allocating appropriated CFAA funds: (1) conserving and managing working forest landscapes; (2) protecting forests from threats, 

including wildfire, hurricane, tornado, windstorm, snow or ice 

storm, flooding, drought, invasive species, or insect or disease outbreak, and restoring appropriate forest types in response to such 

threat [included because paragraphs (1) & (3) contain full list of 

items]; and (3) enhancing public benefits from private forests, including air and water quality, forest products, forestry-related jobs, 

production of renewable energy, wildlife and wildlife habitat, and 

recreation. The House bill requires the Secretary to submit a report 

to Congress describing how funding has been used under the 

CFAA, and through other programs administered by the Secretary, 

to address the three national priorities. (Section 8001) 

The Senate amendment amends section 2 of the CFAA by adding a new subsection which requires the Secretary to focus on a set 

of three national private forest conservation priorities when allocating appropriated CFAA funds. The national priorities are: (1) 

conserving and managing working forest landscapes for multiple 

values and uses; (2) protecting forests from threats to forest and 

forest health including unnaturally large wildfires, hurricanes, tornadoes, windstorms, snow and ice storms, flooding, drought, 

invasive species, insect or disease outbreak, development, and restoring appropriate forest structures and ecological processes in response to such threats; and (3) enhancing public benefits from priVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00886 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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vate forests including air and water quality, forest products, forestrelated jobs, production of renewable energy, wildlife, enhancing 

biodiversity, the establishment of wildlife corridors and habitat, 

and recreation. The Senate amendment amends section 2 of the 

CFAA by adding a new subsection that requires the Secretary to 

submit a report to Congress describing how CFAA funds were used 

to address the three national priorities and the outcomes achieved 

in meeting the national priorities. (Section 8001) 

The Conference substitute adopts the House provision with 

minor changes. (Section 8001) 

(2) Long-term, state-wide assessments and strategies for forest resources 

The House bill amends section 2 of the CFAA by adding a new 

section that requires, for a State to be eligible to receive CFAA 

funds, that the State forester—or equivalent State official—develop 

and submit a State-wide assessment of forest resource conditions 

and a State-wide forest resource strategy. The State-wide assessment of forest conditions is to encompass a number of factors, including: the conditions and trends of forest resources in the State; 

the threats to forestlands and resources in the State, consistent 

with the three national priorities; any priority areas or regions in 

a State that are of priority; and any areas that are of priority to 

more than just that State. The State-wide forest resource strategy 

is to encompass a number of factors, including: strategies for addressing threats to forest resources in the State outlined in the 

State-wide assessment of forest conditions; and a description of the 

resources available to the State forester—or equivalent State official—from all sources to implement the State-wide forest resource 

strategy. The State forester—or equivalent State official—is required to submit the State-wide forest resource strategy on an annual basis. The State-wide assessment of forest resource conditions 

is to be updated as the Secretary or State forester—or equivalent 

State official—determines to be necessary. The State forester—or 

equivalent State official—is required in developing the State wide 

assessment and annual strategy, to coordinate with the State Forest Stewardship Committee established for the State, the State 

wildlife agency, and the State Technical Committee. The Secretary 

is prohibited from using more than $10 million in a fiscal year to 

implement this section. (Section 8002) 

The Senate amendment amends the CFAA by inserting after 

section 19 a new section entitled ‘‘Comprehensive Statewide Forest 

Planning’’ under which requires Secretary to provide financial and 

technical assistance to States for use in the development and implementation of statewide forest resource assessments and plans. 

For a State to be eligible for CFAA funding, the State forester or 

equivalent State official must develop a statewide forest resource 

assessment and plan. At a minimum, the statewide forest resource 

assessment and plan should identify each critical forest resource in 

the State consistent with national priorities; incorporate any current forest management plan in the State; address the needs of the 

region without regard to State borders; provide a comprehensive 

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egy for forest management. The statewide forest resource and plan 

should include a multiyear integrated forest management strategy. 

The State Forester—or equivalent State official—is required to coordinate with the State Forest Stewardship Coordination Committee, State wildlife agencies, the State Technical Committee and 

other applicable Federal land management agencies in developing 

statewide assessments and plans. Subsection (b)(3) requires the 

Secretary to review the statewide assessments and plans established under this section. Subsection (d) authorizes $10,000,000 to 

be appropriated to carryout this section. (Section 8004) 

The Managers adopt the House provision in the Conference 

substitute with amendment. The amendment allows Secretary to 

require the long term State-wide assessment and strategy to be updated and resubmitted as the Secretary or State Forester or equivalent State official determines necessary. The Managers expect 

that the assessments and strategies will guide the annual allocation of federal resources available under the authorities of the 

CFAA, to focus such resources on national priorities. In developing 

and updating the State-wide assessments and strategies, applicable 

Federal land management agencies are added to the list of organizations with which the State forester or equivalent State official 

are expected to coordinate. Existing forest management plans of 

the State are to be incorporated when developing State-wide assessments and strategies. The Conference amendment authorizes 

up to $10,000,000 to provide States financial and technical assistance needed for the development of the assessments and strategies 

under this section. The Conference amendment requires the State 

forester—or equivalent State official—to submit an annual report 

to the Secretary demonstrating how federal resources under the 

CFAA were used to implement the state-wide strategy. (Section 

8002) 

The Managers intend that Multi-State areas that are a regional priority should reflect areas identified at both the national 

and state level through assessment and mapping efforts. The Managers recognize that there is a national assessment and mapping 

effort underway and encourage consideration be given to multistate areas identified in this effort. 

(3) Community forest and open space program 

The Senate amendment amends the CFAA by adding a new 

section, 7A, entitled ‘‘Community Forest and Open Space Conservation Program.’’ The program provides Federal matching grants to 

help county or local governments, Indian tribes, or non-profit organizations acquire private forests that are threatened by conversion 

to non-forest uses and are economically, environmentally and culturally important to communities. The terms ‘‘eligible entity,’’ ‘‘Indian tribe,’’ ‘‘local governmental entity,’’ ‘‘non-profit organization,’’

‘‘program’’ and ‘‘Secretary’’ are defined. The Federal cost share of 

a grant provided under the program is to equal not more than 50- 

percent of the cost to acquire one or more parcels of land. Eligible 

entities are permitted to provide a non-Federal match in cash, donation, or in kind equal to the outstanding amount. An application 

process is established whereby an eligible entity is required to submit to the State forester or equivalent official (or in the case of an 


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eligible entity that is an Indian tribe an equivalent official of the 

Indian tribe) an application that includes a description of land to 

be acquired and a forest plan that includes a description of community benefits achieved from acquisition. Eligible entities must provide public access for recreational use consistent with the purposes 

of the program and are prohibited from converting the property to 

other uses. Eligible entities that sell or convert land acquired 

under this program to non-forest use must reimburse the Federal 

government in an amount equal to the greater of the sale price or 

current appraisal value of the land. Eligible entities that either sell 

or convert the land are prohibited from being eligible for additional 

grants under the program. The Secretary is authorized to allocate 

10-percent of funds made available for the program to State foresters—or equivalent officials (or in the case of an eligible entity 

that is an Indian tribe an equivalent official of the Indian tribe)—

for program administration and technical assistance. An appropriation of such sums as necessary is authorized to carryout the program. (Section 8002) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 8003) The Managers strongly encourage eligible entities acquiring forestland with resources under this program to manage 

the forestland as ‘‘working forests,’’ generating economic benefits 

and providing jobs and economic stability to communities. The 

Managers encourage the Secretary to provide a level of oversight 

over these acquired forests, to see that these goals are met and 

maintained. The authorities in this program allow non-profit organizations to use funds to acquire properties under this program. 

The Managers intend such authorities to be used only when a nonprofit organization’s acquisition of forestland results in a clear benefit to the community, and where there is not a significant loss in 

the property-tax base for the community. Where a local government 

entity can perform the same functions as the non-profit, the Managers encourage the Secretary to work with the local government 

entity. Additionally, revenues generated by the non-profit in the 

management of forestland acquired under the program should be 

used for the direct benefit of the local community. 

(4) Assistance to the Federated States of Micronesia, the Republic of 

the Marshall Islands, and the Republic of Palau 

The House bill amends section 13(d)(1) of the CFAA to specify 

that the Federated States of Micronesia, the Republic of the Marshall Islands, the Republic of Palau are to be included in the terms 

‘‘United States’’ or ‘‘States’’ for purposes of the CFAA. (Section 

8003) 

The Senate amendment is the same as the House bill. (Section 

8005) 

The Conference substitute adopts the House provision. (Section 

8004) 

(5) Changes to Forest Resource Coordinating Committee 

The House bill amends section 19(a) of the CFAA by revising 

the Forest Resource Coordinating Committee (FRCC). 


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The House bill states the FRCC is to be composed of the following: the Chief of the Forest Service, the Chief of the Natural Resources Conservation Service, the Director of the Farm Service 

Agency; and the Administrator of the Cooperative State Research, 

Education, and Extension Service. 

The House bill states the FRCC is to be composed of the following persons: at least three State foresters or equivalent State officials from geographically diverse regions of the United States; a 

representative of a State Fish and Game Commission, a private 

nonindustrial forest landowner, a forest industry representative, a 

conservation organization representative, a land grant university 

or college representative, a representative of a State Technical 

Committees, and such other persons as the Secretary determines 

appropriate. 

The House bill states the FRCC is to perform a number of duties, including: (1) providing direction to the United States Department of Agriculture (USDA) and enabling coordination with State 

agencies and the private sector to address the three national priorities; (2) clarifying individual agency responsibilities for each agency represented on the FRCC regarding the three national priorities; 

(3) providing advice on the allocation of funds, including competitive funds; and (4) assisting in developing a report on efforts to address the three national priorities. 

The House bill requires the FRCC to meet twice a year to discuss the national priorities and issues regarding nonindustrial private forest land. (Section 8004) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with 

minor changes. (Section 8005) 

(6) Changes to State Forest Stewardship Coordinating Committees 

The House bill amends section 19(b)(1)(B)(ii) of the CFAA by 

specifying that a representative from a State Technical Committee 

is to be on the State Forest Stewardship Coordinating Committee 

(SFSCC). It also amends section 19(b)(2)(C) of the CFAA by mandating that the SFSCC is to make recommendations for the Statewide assessments and strategies. The House bill strikes section 

19(b)(3) and 19(b)(4) of the CFAA. (Section 8005) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision. (Section 

8006) 

(7) Forest legacy applications 

The House bill maintains current law. 

The Senate amendment amends section 19(b)(2)(D) of the 

CFAA by stating that applications submitted by Indian tribes do 

not have to pass through the State Coordinating Committee. (Section 8003) 

The Conference substitute deletes the Senate provision. 

(8) Competition in programs under Cooperative Forestry Assistance 

Act of 1978 

The House bill authorizes the Secretary to competitively allocate a portion of CFAA funds to State foresters or equivalent State 


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officials. The Secretary is required to consult with the FRCC when 

determining the allocation of funds. The Secretary is also required 

to give priority for funding to States in which the strategies listed 

in the State-wide assessments best promote the three national priorities. (Section 8006) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision. (Section 

8007) 

(9) Cooperative forest innovation partnership projects 

The House bill states the Secretary is authorized to competitively allocate not more than 5 percent of CFAA funds to support 

innovative national, regional, or local education, outreach, or technology projects that the Secretary determines would increase the 

ability of USDA to address the national priorities outlined in section 8001. State or local governments, Indian tribes, land-grant colleges or universities, or private entities, are authorized to compete 

for the funds. The House bill states the Secretary is prohibited 

from covering more than 50 percent of the total cost of a project. 

The Secretary is required, in calculating the total cost of a project 

and the contributions made with regard to the project, to include 

in-kind contributions. (Section 8007) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision. (Section 

8008) 

(10) Healthy forest reserve program 

The House bill amends section 508(2) of the Healthy Forests 

Restoration Act by extending the Healthy Forests Reserve Program 

to 2012, and providing $10 million in mandatory funding for each 

of the fiscal years 2008 through 2012. (Section 8101) 

The Senate amendment moves the Healthy Forest Reserve 

Program into the Food and Security Act of 1985. An authorization 

of such sums as necessary are authorized for fiscal years 2008 

through 2012 to carry out the program. The 99-year easement option is eliminated and replaced with a permanent easement option. 

Indian tribes are encouraged to participate in the program by being 

allowed to enroll in 30-year contracts. The Senate amendment 

strikes section 502(e) of the Healthy Forest Restoration Act, which 

limits the amount of acreage that can be enrolled in the program 

to 2 million acres. (Section 2331) 

The Managers agree to adopt the House provision in the Conference substitute, with amendment. The current 99 year easement 

option is replaced with a permanent easement option. Indian tribes 

are allowed to enter into 10-year cost-share agreements or 30 year 

contracts that are equivalent to the value of a 30 year easement. 

Of the funds expended in a fiscal year, not more that 40 percent 

of the funding can be used for cost-share agreements while not 

more than 60 percent can be used for easements. A repooling date 

of April 1 is put in place to address potential high demand for a 

particular enrollment method. The Managers provide $9.75 million 

each of fiscal years 2009 through 2012, in mandatory funding for 

the Program. The Managers adopted the changes in the Senate 

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pate in the Program. The Managers intend that tribal land enrolled 

in the program should be land held in private ownership by a tribe 

or an individual tribal member. Tribal lands held in trust or reserved by the U.S. government or restricted fee lands should be not 

enrolled in the program, regardless of ownership. (Section 8205) 

(11) Emergency forest restoration program 

The House bill amends title VI of the Agricultural Credit Act 

(ACA) by authorizing the Secretary to provide financial and technical assistance to owners of nonindustrial private forest lands who 

have suffered a loss due to a number of events, including wildfires, 

hurricanes, drought, and windstorms, to assist with the development and implementation of plans that: (1) provide for the restoration and the rehabilitation of the nonindustrial private forest land; 

restores the land and its related natural resources; (2) uses best 

management practices on the forest land; and (3) incorporates good 

stewardship and conservation practices on the land. 

The House bill provides for a cost share of up to 75 percent, 

and limits the amount that an owner of nonindustrial forest lands 

may receive to $50,000 per year. Nonindustrial private landowners 

are eligible under the House bill if the Secretary determines that 

their lands are under an eminent threat of loss or damage by insect 

or disease and immediate action would help them avoid loss or 

damage. 

The House bill defines nonindustrial private forest land to 

mean rural lands, as determined by the Secretary that: (1) have existing tree cover or had tree cover within the preceding 10 years; 

and (2) are owned by any nonindustrial private individual, group, 

association, corporation, Indian tribe, or other private legal entity 

so long as the individual, group, association, corporation, tribe or 

entity has definitive decision-making authority over the lands. 

The House bill requires the Secretary of Agriculture to issue 

regulations to carry out the section within one year of enactment. 

(Section 8102) 

The Senate amendment establishes a new emergency landscape restoration program to rehabilitate cropland, grasslands, and 

private nonindustrial forest lands adversely affected by natural catastrophic events such as fire, drought, flood, excessive wind, ice, or 

other natural events. Entities eligible for assistance are community-based associations and city, county or regional governments, 

including watershed councils and conservation districts. Individuals 

eligible for assistance include producers, ranchers, operators, private nonindustrial forest landowners, and landlords on working agricultural land. 

The Senate amendment: provides a source of financial assistance for restoring and protecting natural resources and preventing 

further impairment of land and water, allows the Secretary to purchase floodplain easements, prioritizes applications that protect 

human health and safety, and provides technical assistance and 

cost-share payments up to 75 percent of the cost of remedial activities to rehabilitate watersheds. 

The Senate amendment defines ‘‘remedial activities’’ to include 

debris removal, stream bank stabilization, establishment of cover, 

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viding livestock water in drought situations, restoring nonindustrial private forestland. Discretionary funding is authorized. 

The Senate amendment provides for the temporary administration of current emergency programs until final regulations are formulated. (Section 2398) 

The Conference substitute adopts the House provision with 

amendment. The amendment clarifies that Secretary is authorized 

to make payments to owners of nonindustrial private forest land to 

carry out specific emergency measures on their land following natural disasters. To receive assistance owners will be required to 

demonstrate that their land had tree cover prior to the natural disaster. The amendment includes a separate authorization of appropriations, at such sums as necessary. 

The Managers include a definition of natural disasters, with an 

allowance for Secretarial discretion in determining if other resource-impacting events other than those specifically mentioned, 

constitute a natural disaster. The Managers intend the discretion 

to be used to help forest owners recover from events such as catastrophic insect or disease infestations, if the Secretary determines 

that such events are far outside normal ranges and did not result 

from a lack of forest management. Infestations can include outbreaks of non native forest pests including Emerald Ash Borer, 

Hemlock Woolly Adelgid, and Sudden Oak Death. (Section 8203) 

The Managers recognize that the Forest Service has significant 

experience in responding to natural disasters including assessment 

of resource damage and responding to a wide range of incidents 

and emergencies. The Managers encourage the Secretary of Agriculture to utilize this expertise in implementing this section, where 

appropriate. 

(12) Office of International Forestry 

The House bill maintains current law, and extends the authorization of appropriation to 2012. (Section 8103) 

The Senate amendment is the same as the House bill. (Section 

8203) 

The Conference substitute adopts the House provision. (Section 

8202) 

(13) Rural revitalization technologies 

The House bill maintains current law, and extends the authorization through 2012. (Section 8014) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision. (Section 

8201) 

(14) Renewable Resources Extension Act 

The House bill extends authorization through fiscal year 2012 

and makes provisions of the Renewable Resources Extension Act 

effective through September 30, 2012. (Section 7507) 

The Senate amendment is the same as the House bill. (Section 

8201) 

The Conference substitute adopts the House provision. (Section 

7413) 


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(15) Definitions 

The Senate amendment provides definitions for ‘‘Indian’’, ‘‘Indian Tribe’’ and ‘‘National Forestry System’’ that will be used 

under Subtitle B of this bill—Tribal-Forest Service Cooperative Relations. (Section 8101) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(16) Indian Tribes participation in the Forest Legacy Program 

The Senate amendment amends section 7(a) of the CF AA by 

including Indian tribes as direct participants in the Forest Legacy 

Program. Section 7(l) of the CFAA is amended to allow Indian 

tribes to receive grants from the Secretary to carry out the Forest 

Legacy Program. The Secretary is prohibited from providing grant 

for any project on land held in trust by the United States. Additionally, land acquired using grant funds cannot be converted to 

land held in trust by the United States on behalf of any Indian 

tribe. (Section 8111) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(17) Indian Tribes assistance 

The Senate amendment authorizes the Secretary to provide financial, technical, educational and related assistance to Indian 

tribes for consultation and coordination with the U.S. Forest Service on issues relating to: (1) access to Forest Service land by members of a tribe for traditional, religious and cultural purposes; (2) 

coordinated or cooperative management of resources shared by the 

tribe and the Forest Service; (3) the provision of expertise or knowledge; (4) projects and activities for conservation education and 

awareness with respect to forestland and grassland that is eligible 

Indian land; and (5) technical assistance for forest resources planning, management, and conservation on eligible Indian land. Indian tribes are only allowed to participate in one approved activity 

that receives assistance under this section or the Forest Stewardship Program under section 5 of the CFAA. The Secretary is required to promulgate regulations relating to assistance under this 

section within 180 days of enactment, including rules for determining the distribution of assistance. The Secretary is also required to coordinate with the Secretary of the Interior to ensure 

that activities authorized under this section do not conflict with Indian tribal programs at the Department of the Interior and achieve 

the goals established by affected Indian tribes. (Section 8112) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(18) Purposes of cultural and heritage cooperative authorities 

The Senate amendment: permits the reburial of human remains and cultural items, including items repatriated under the 

Native American Graves Protection and Repatriation Act, on National Forest System land; prevents the unauthorized disclosure of 

information regarding burial sites; authorizes the Secretary to 

allow Indians and Indian tribes to access National Forest System 

land for traditional and cultural purposes; and authorizes the SecVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00894 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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retary to protect the confidentiality of certain information that is 

culturally sensitive to Indian tribes. (Section 8121) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 8101) 

(19) Definitions 

The Senate amendment provides definitions for ‘‘adjacent site,’’ ‘‘cultural items,’’ ‘‘human remains,’’ ‘‘lineal descendant,’’ ‘‘reburial 

site,’’ and ‘‘traditional and cultural purpose.’’ (Section 8122) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 8102) 

(20) Authorization for reburial of human remains and cultural 

items on National Forest System land 

The Senate amendment provides that the Secretary may allow 

the use of National Forest System land for reburial of human remains or cultural items in possession of the Indian tribe or lineal 

descendant that have been disinterred from National Forest System land or adjacent site. The Senate amendment allows the Secretary to recover or rebury human remains and cultural items on 

National Forest System land at Federal expense when done with 

the consent of the affected Indian tribe or lineal descendent. It also 

allows the Secretary to authorize such uses on reburial sites, or the 

area immediately surrounding the reburial sites, as the Secretary 

determines necessary for management of the National Forest System land. The Secretary is required to avoid adverse impacts to 

cultural items and human remains to the maximum extent practicable. (Section 8123) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

minor changes. (Section 8103) 

(21) Temporary closure of National Forest System land for traditional and cultural purposes 

The Senate amendment requires the Secretary to ensure, to 

the maximum extent practicable, that Indian tribes have access to 

National Forest System land for traditional and cultural purposes. 

It provides that the Secretary may temporarily close from public 

access specifically identified National Forest System land to protect 

the privacy of tribal activities for traditional and cultural purposes 

on the smallest practicable area for a minimal period of time. (Section 8124) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 8104) 

(22) Forest products for traditional and cultural purposes 

The Senate amendment allows the Secretary to provide Indian 

tribes with forest products from National Forest System land if the 

forest products are for traditional and cultural purposes and are 

not used for commercial purposes. (Section 8125) 

The House bill contains no comparable provision. 


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The Conference substitute adopts the Senate provision. (Section 8105) 

(23) Disclosure 

The Senate prohibits the Secretary from disclosing information 

under the Freedom of Information Act relating to: human or cultural items reburied on National Forest System land or a site used 

for traditional and cultural purposes by an Indian tribe; and resources, cultural items, uses or activities that have a traditional 

and cultural purpose and are provided to the Secretary by an Indian tribe under an express expectation of confidentiality in the 

context of forest and rangeland research activities carried out by 

the Forest Service. The Secretary is not required to disclose information concerning the identity, use or specific location of a site or 

resource used for traditional and cultural purposes by an Indian 

tribe; or certain cultural items. The Secretary may disclose information about the location of human remains or cultural items if 

the Secretary consults with an affected Indian tribe or lineal descendant before disclosure and determines that the disclosure is 

necessary to protect human remains or cultural items from harm, 

theft, or destruction and mitigates any adverse impacts that may 

result from disclosure. The Secretary may disclose information regarding human remains or cultural items if the Secretary determines that disclosing the information to the public would not create an unreasonable risk of harm, theft or destruction of the resource, site or object; and would be consistent with other applicable 

laws. (Section 8126) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment with 

minor changes. (Section 8106) 

(24) Severability and savings provisions 

The Senate amendment provides that if any provision in Subtitle B of the amendment is deemed invalid it will not affect the 

remainder of the subtitle. It also provides a savings clause that 

covers trust responsibility, agreements between the Forest Service 

and Indian tribes, rights of an Indian tribe, and rights relating to 

National Forest System land or other public land. (Section 8127) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment. (Section 8107) 

(25) Hispanic-Serving Institution Agricultural Land National Resources Leadership Program 

The House bill authorizes the Secretary to establish an undergraduate scholarship program to assist Hispanic-serving institutions in the retention, recruitment, and training of Hispanics and 

other under-represented groups in forestry and related fields. An 

appropriation of such sums as necessary is authorized for fiscal 

years 2008 through 2012 to carry out the program. (Section 8201) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision. (Section 

8402) 


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(26) Green Mountain boundary adjustment 

The Senate amendment authorizes modification of the boundary of the Green Mountain National Forest in Vermont to include 

13 designated expansion units depicted on forest maps Green 

Mountain Expansion Area Map I and Green Mountain Expansion 

Area Map II, which is on file with the Chief of the Forest Service. 

(Section 8203) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 8301) 

(27) Illegal logging 

The Senate amendment amends section 2(f) of the Lacey Act 

Amendments of 1981 to change the definition of ‘‘plant.’’ Section 

2(j) of the Lacey Act is amended to define the terms taken and taking. Section 3(a)(2)(B) of the Lacey Act is amended to make it illegal for any plant: to be taken, possessed, transported or sold in violation of any State or foreign law that protects plants or regulates 

the theft of plants; to be taken from a park or forest reserve, or 

other officially protected area; and to be taken from an officially 

designated area or without, or contrary to, required authorization. 

The Senate amendment also makes it illegal to take, possess, 

transport or sell plants without the payment of royalties, taxes, or 

stumpage fees or in violation of any limitation under any State or 

any foreign law. Section 3(a)(3) of the Lacey Act is amended to 

make it illegal, within the special maritime and territorial jurisdiction of the United States, for any plant to be taken, possessed, 

transported or sold in violation of any state or foreign law that regulates the theft of plants. The taking of plants from a park or forest reserve, or other officially protected area and the taking of 

plants from an officially designated area or without, or contrary to, 

required authorization are also made illegal. Additionally, the 

amendment makes it illegal to take, possess, transport or sell 

plants without the payment of royalties, taxes, or stumpage fees or 

in violation of any limitation under any State or any foreign law, 

governing the export or transshipment of plants. 

A new subsection (f) is created in the Lacey Act to require a 

plant declaration to be filed upon importation of a plant. The plant 

declaration must include the scientific name of any plant, a description of the value, quantity (including the unit of measure) of 

the plant, and the name of the country from where the plant was 

taken. If a plant species or country of origin cannot be determined, 

the plant declaration is to include a list of possible plant species 

that could be found in the product or a list of possible countries 

from which the plant originated. An exclusion is provided for plants 

used exclusively as packing material unless the packing materials 

are the items being brought in. The Secretary is required to review 

the plant declaration. The Secretary is also required to review the 

exclusion for wood and paper packing and to limit the scope of the 

exclusion if the Secretary determines that such a limitation in 

scope is warranted. The Secretary is required to issue a report with 

analyses and recommendations on the affects of these new requirements. 


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Section 4 of the Lacey Act is amended by making conforming 

technical changes to the penalties and sanctions section of the Act. 

The forfeiture provisions in Section 5 of the Lacey Act are amended 

by adding a new subsection (d) which reaffirms, as has been the 

case since 2002, that civil forfeitures under this section are to be 

governed by chapter 46 of title 18, United States Code. (Section 

8204) 

The House bill contains no comparable provision. 

The Managers agree to include the Senate provision in the 

Conference substitute, with an amendment to modify the definition 

of plant, exclude recycled material from the plant declaration, clarify the application of section 3 paragraph (B)(iii) of the Lacey Act 

to regulations or laws pertaining to the export or transshipment of 

plants, and to require the Secretaries of Agriculture and the Interior to develop regulations to further define the term ‘‘plant.’’ The Managers understand illegal logging undermines responsible forest enterprises by distorting timber markets with unfair 

competition and price undercutting. Illegal logging also threatens 

the conservation of forest resources, wildlife, and biodiversity, by 

facilitating forest conversion to non-forest uses and depleting or 

completely eliminating certain forest ecosystems or the habitat of 

certain forest dependent wildlife. Finally, illegal logging results in 

a loss of revenue when taxes or royalties are not paid that could 

otherwise be invested in sustainable forest management or economic development. 

There are several relevant multilateral and international 

agreements intended to address illegal logging and the illegal timber trade, ranging from voluntary to legally binding multilateral 

agreements that enable signatory governments to seize illegal products. Yet, despite these many efforts, the problems of illegal logging 

continue to persist, driven by the demand for products that are developed from illegally harvested wood and the lack of adequate regulatory mechanisms in both exporting and consumer countries. 

According to the Department of Justice there is no legal mechanism that currently exists in U.S. law to preclude the importation 

of wood and wood products known to be illegally harvested in other 

countries. Currently under the Lacey Act, it is unlawful for any 

person to: (1) import, export, sell, acquire, or purchase any fish, 

wildlife or plants taken, possessed, transported, or sold in violation 

of U.S. law or regulation or in violation of any Indian tribal law; 

or (2) to import, export, sell, receive, acquire, or purchase in interstate or foreign commerce any fish or wildlife, taken, possessed, 

transported, or sold in violation of State or foreign law or any plant 

taken, possessed, transported or sold in violation of any State law. 

There are misdemeanor felony criminal and civil penalties for violations of the Act, and strict liability is established for forfeiture of 

illegal fish, wildlife or plants. 

Current law applies to all fish and wildlife and their parts, but 

is much narrower in its application of plants. The Lacey Act currently only applies to species of plants that are native to the 

United States and that are specifically protected either under State 

law or the Convention on International Trade in Endangered Species of Wild Fauna and Flora. It currently does not apply to plants 

that are protected under foreign laws. 


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Because the Lacey Act does not extend to plants that are 

taken, transported, or sold in violation of foreign laws, the U.S. 

government is not able to use the criminal and civil penalties of the 

Act to preclude the importation of wood and wood products or other 

plants and plant products harvested in violation of the laws of foreign governments designed to protect such plants, or to seize such 

illegally harvested plants and products when they enter the United 

States. According to Justice Department enforcement officials, 

changes to the Lacey Act that would extend its coverage to plants 

taken in violation of foreign laws would allow law enforcement officers to initiate actions similar to those they now use for fish and 

wildlife taken in violation of foreign laws. 

Section 8204 of the Senate amendment amends the prohibited 

acts section of the Lacey Act by making it unlawful to import any 

plant or plant product taken in violation of foreign laws related to 

the harvest, taking and protection of plants or to fees or taxes applicable to the plants. 

The Conference substitute amends the Senate amendment to 

clarify the definition of the term ‘‘plant.’’ This definition clarifies 

that ‘‘wild’’ members of the plant kingdom includes trees, whether 

they are naturally or artificially regenerated. The inclusion of 

trees, whether in natural or planted forest stands, is consistent 

with the longstanding interpretation of the Lacey Act to cover wild 

species whether the specimens are taken from the wild or captive 

bred. 

The exclusions to the term ‘‘plant’’ in section 2 subsection (f)(2) 

of the Lacey Act are meant to maintain the exclusions in current 

law with respect to cultivars and food crops. 

The exclusion to the definition of ‘‘plant’’ in the new subsection 

(f)(2)(C) of section 2 of the Lacey Act applies to plants (as that term 

is defined in new subsection (f)(1)) that are to remain planted or 

to be planted or replanted, and should include related or preparatory uses such as grafting or plant breeding. Thus, consistent 

with subsection (f)(1) of the Act, any member of the plant kingdom, 

including roots, seeds, germplasm, cuttings, parts, or products 

thereof, and including trees from either natural or planted forest 

stands, that is to remain planted or to be planted or replanted is 

covered under the exclusion.’’

The Conference substitute adds a new Section 7(c) to the Lacey 

Act which authorizes the Secretaries of Agriculture and the Interior to promulgate regulations to define the terms used in section 

2(f)(2)(A). The Managers added this new section to clarify the scope 

of what constitutes common cultivars and common food crops. The 

Managers are aware that some plant species produced in agricultural settings as cultivars or for food, food supplements, or medicines, also continue to be taken from the wild in volumes that 

threaten the conservation of these species. For example, the Court 

in United States v. McCullough, 891 F. Supp. 422 (N.D. Ohio 1995) 

read the current Lacey Act exclusion from the definition of plant 

for ‘‘common food crops and cultivars’’ as applying to American ginseng, a species that is artificially produced but also threatened in 

the wild by unsustainable exploitation. Therefore, the Managers 

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duly burdened, while wild plant species threatened with extinction 

(which may also be artificially produced) are adequately protected 

from illegal and unsustainable exploitation. 

The Managers are aware that the exclusion to the definition of 

‘‘plant’’ in section 2, subsection (f)(2)(A), could capture some commonly cultivated trees, grown on very short rotation, in a farm or 

nursery and not in a forest stand, that are harvested (as compared 

with those that are replanted) but do not typically face problems 

with illegal logging. Such trees could include conifers grown and 

harvested for Christmas trees or trees not typically grown in forest 

stands grown and harvested for floral arrangements. It is the intention of the managers to allow the Secretaries of Agriculture and 

the Interior, through the promulgations of regulations as provided 

in section 7(c), to clarify the application of this Act and minimize 

the burden on growers of Christmas trees and other flowering 

trees, for which the Secretaries have determined there is little risk 

of illegal harvesting. 

It is the Manager’s intention that in developing any regulations pursuant to this Act, the Secretaries of Agriculture and the 

Interior minimize the cost and regulatory burden placed on importers and consumers of plants and plant products covered by this 

Act. The Managers note in particular that the statutory language 

creating the requirement for a plant declaration does not include, 

or reference any authority to impose user fees to administer this 

provision. The Managers intend that the administration of the 

plant declaration requirement be carried out using appropriated 

funds and urge caution on the part of the Administration in seeking to interpret other laws to enable the taxation of importers of 

plants and plant products for this purpose. Additionally, the Managers urge the Secretaries of Agriculture and the Interior to develop a system to allow electronic filing of plant declarations required under this Act. 

It is the Manager’s intention that with regards to ‘‘plants’’, in 

this Act, term ‘‘Secretary’’, as clarified in paragraph (a) subparagraph (2), means primarily the Secretary of Agriculture. The addition of the term ‘‘also’’ is meant to ensure that the Secretary of Agriculture consults with the Secretary of the Interior and the Secretary of Commerce in the implementation of this Act. This modification should not be interpreted to remove the Secretary of Agriculture as the lead authority with respect to plants. (Section 8204) 

(28) Green Mountain land exchange/sale 

The Senate amendment authorizes the Secretary to sell or exchange a few specific parcels in the Green Mountain National Forest designated on the map entitles ‘‘Proposed Bromley Land Sale 

or Exchange’’ dated April 7, 2004. Funds from the sale of this land 

are to be used to relocate small portions of the Appalachian Trail 

or purchase additional land within the boundary of the Green 

Mountain National Forest. (Section 8205) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 8303) 


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(29) Timber contracts 

The Senate amendment authorizes the Secretary to cancel or 

re-determine rates of qualifying timber contracts if the rate at 

which a qualifying contract would be advertised on the date of enactment of this language is at least 50 percent less than the original purchased rate of the contract. The Secretary is also authorized 

to substitute the Producer Price Index for other authorized producer price indexes for a qualifying contract. The Secretary is authorized to extend re-determined contracts by one year. The provision is to have the effect of surrendering any claim by the United 

States against any timber purchaser that arose under a qualifying 

timber contract before the date of enactment of the provision. (Section 8301) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to allow the Secretary to adjust the terms of certain 

hardwood lumber contracts, if the Secretary does not substitute the 

Producer Price Index. The Secretary is also allowed to apply market-related contract term additions, consistent with regulations, to 

contracts awarded before January 1, 2007. (Section 8401) 

The Managers appreciate the efforts of the Forest Service to 

provide certain contractual relief to timber sale purchasers within 

their legal abilities under the timber sale contract and through existing regulations during these times of difficult markets. In that 

context, the provisions within this section provide additional help 

to timber sale purchasers. The Forest Service is encouraged to implement this section as quickly as possible. Because the provision 

in paragraph (c) is limited in scope, i.e. contracts awarded prior to 

January 1, 2007, the Managers encourage the Forest Service to revise the existing regulations within 90 days of enactment of this 

Act to reflect provisions of this section for future market problems. 

The Forest Service should modify existing contracts upon the request of the purchaser to include these revised regulations so that 

purchasers will not have similar problems with Market Related 

Contract Term Adjustments in the future. 

(30) Land conveyances, New Mexico and Virginia 

The Senate amendment authorizes the conveyance, without 

consideration, of certain lands in New Mexico, to the Chihuahuan 

Desert Nature Park. (Section 11075) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to authorize the conveyance, without consideration, of 

certain lands in the George Washington National Forest. (Section 

8302) 

TITLE IX—ENERGY 

(1) Table of contents 

The House bill provides a table of contents. (Section 9001) 

The Senate amendment provides a substitute amendment to 

title IX of FSRIA of 2002. The amendment makes the new section 

9001 the definitions section and includes definitions for: Administrator, Advisory Committee, advanced biofuel, biobased product, 


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biofuel, biomass conversion facility, biorefinery, board, Indian 

Tribe, Institute of Higher Education, intermediate ingredient or 

feedstock, renewable biomass, renewable energy, rural area and 

Secretary. (Section 9001) 

The Conference substitute adopts the Senate approach of 

amending title IX of the FSRIA of 2002 and accepts the Senate 

definitions with amendments. (Section 9001, new section 9001 of 

FSRIA) 

The Managers intend that the term ‘‘advanced biofuel’’ includes home heating fuels and aviation and jet fuels made from cellulosic biomass. 

(2) Federal procurement of biobased products 

The House bill clarifies that products with at least 5 percent 

of intermediate ingredients and feedstocks, that are biobased, 

should be considered for a procurement preference. (Section 

9002(a)) 

The Senate amendment changes the name of this section to 

Biobased Markets Program and clarifies that products to be considered for procurement preference should be composed of at least 5 

percent of biobased intermediate ingredients and feedstocks, or a 

lesser percentage that the Secretary determines to be appropriate. 

(Section 9001) 

The Conference substitute deletes both of these provisions. 

(3) Designation and information provided 

The Senate amendment provides for designation of items for 

which there is only one product or manufacturer in the category 

and automatic designation of items composed of at least 50 percent 

biobased intermediate ingredients or feedstocks. It also specifies 

that information provided for a biobased intermediate ingredient or 

feedstock shall be considered to be provided for an item composed 

of that ingredient or feedstock. This subsection also specifies that 

the Secretary may not require more information from manufacturers or vendors of biobased products than is required from other 

vendors or manufacturers. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendments. (Section 9001, new Section 9002 of FSRIA) 

The Managers recognize that USDA and its contractors have 

developed considerable capabilities in the designation of biobased 

products and have established an extensive network of biobased industry contacts. The Managers encourage USDA to continue to utilize those capabilities and resources in carrying out the biobased 

products procurement and labeling programs. 

(4) State procurement models 

The Senate amendment directs the Secretary to offer models 

for States for procurement of biobased products within 180 days of 

enactment. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. The 

Managers encourage the Secretary to make models for the procurement of biobased products available to States upon request. 


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(5) Procurement guideline considerations 

The House bill clarifies that the Secretary should consider life 

cycle costs only to the extent that information on life cycle costs is 

appropriate and available. (Section 9002(b)) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. 

(6) Labeling requirement and revised deadline 

The House bill requires the Secretary to issue new regulations 

for the program within 90 days of enactment with criteria for finished products and intermediate ingredients and feedstocks. It also 

requires the Secretary to consult with other Federal agencies and 

non-governmental groups with an interest in biobased products, including small and large producers of biobased materials and products, industry, trade organizations, academia, consumer organizations, and environmental organizations. (Section 9002(c)) 

The Senate amendment is the same as the House bill, except 

consultation is with the Administrator and representatives from 

small and large businesses, academia, other Federal agencies and 

such other persons as the Secretary considers appropriate. (Section 

9001) 

The Conference substitute adopts the Senate provision. (Section 9001, new Section 9002 of FSRIA) 

(7) Biobased Markets Program—Establishment 

The Senate amendment establishes a voluntary program under 

which the Secretary is directed to recognize agencies, contractors 

and persons that use significant amounts of biobased products. 

(Section 9002(b)(4)) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 9001, new Section 9002 of FSRIA) 

(8) Biobased Markets Program—Applicability 

The Senate amendment requires that Capitol Complex procurement shall comply with the biobased product mandate within 

90 days of enactment. The Senate amendment also requires the 

secretary to sponsor or support a biobased products showcase annually. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute does not require that the Capitol 

Complex procurement comply with the biobased product mandate, 

but encourages the Capitol procurement agencies to consider products designated under this program when making their procurement decisions. (Section 9001, new Section 9002 of FSRIA) 

The Managers also encourage the Secretary to continue outreach activities to the applicable agencies that may include an annual showcase of biobased products to meet the requirements of 

this section. 

(9) Biobased Markets Program—Testing centers 

The Senate amendment permits the Secretary to establish one 

or more national testing centers for biobased products, giving prefVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00903 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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erence to entities with established biobased testing capabilities. 

(Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute directs the Secretary to create a national registry of biobased product testing centers. (Section 9001 

new Section 9002 of FSRIA) 

The Managers intend that the registry should include entities 

with expertise in performance testing, verifying conformance with 

long-term performance standards, establishing biobased contents, 

evaluating uniformity of product quality, and other biobased product characteristics that producers may require. The Managers believe that the University of Northern Iowa is an example of an appropriate entity for listing in the national registry because of its 

biobased product testing activities. 

(10) Biobased Markets Program—Education and awareness 

The Senate amendment establishes a new Education and 

Awareness campaign for bioenergy (other than biodiesel) and 

biobased products, which is to be carried out through competitive 

grants to eligible entities. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(11) Authorization of appropriations; Federal procurement 

The House bill caps the currently unlimited authorization at $1,000,000 annually for 2008–13 to implement the section (other 

than the labeling provisions). (Section 9002(d)) 

The Senate amendment provides for mandatory funding of $3,000,000 annually for 2008 through 2012 to carry out mandatory 

testing and implement the bioenergy education and awareness 

campaign. Any additional sums, as necessary, are authorized. (Section 9001) 

The Conference substitute provides for mandatory funding $1,000,000 in fiscal year 2008 and $2,000,000 annually for 2009 

through 2012 to carry out mandatory testing and labeling. The 

Conference substitute authorizes an additional $2,000,000 per year 

for fiscal year 2009 through fiscal year 2012. (Section 9001, new 

Section 9002 of FSRIA) 

(12) Authorization of appropriations—Labeling 

The House bill authorizes $1,000,000 annually for 2008–2013 

for labeling. (Section 9001) 

The Senate bill contains no comparable provision. 

The Conference substitute deletes the House provision. 

(13) Report requirements—Report by agencies to administrator for 

Federal procurement policy 

The House bill requires procurement agencies to assist the Administrator for Federal Procurement by submitting annual reports 

and requires the Secretary of Agriculture to submit a report to 

Congress on implementation 6 months after enactment and annually thereafter. (Section 9002 (e)) 

The Senate amendment provides that the Office of Federal 

Procurement Policy submit a report to Congress every 2 years deVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00904 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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scribing implementation progress, including information provided 

by the Agencies with specific data related to the biobased procurement requirement. It requires the Secretary to report to Congress 

on program implementation within 180 days and each year thereafter. (Section 9001) 

The Conference substitute adopts the Senate provision with 

amendments. The substitute requires a report on program implementation progress and program details once every 2 years, and 

deletes the requirement to report to Congress after the first 180 

days. (Section 9001, new Section 9002 of FSRIA) 

(14) Grants and loan guarantees for biorefineries and biofuel production plants 

The House bill provides for loan guarantees to help pay for development and construction of biorefineries and biofuel production 

plants and retrofitting of other facilities to demonstrate the commercial viability of converting biomass to fuels or chemicals. (Section 9003(3)) 

The Senate amendment renamed this section as the Biorefinery and Repowering Assistance Program. It establishes grants 

for pilot or demonstration scale biorefineries, for repowering 

projects, and for repowering feasibility studies. It establishes loan 

guarantees for commercial scale biorefineries and repowering 

projects. Biorefineries are limited to advanced biofuels production. 

Repowering projects replace fossil fuel energy systems with renewable energy systems for biorefineries (including corn ethanol 

plants), power plants, or manufacturing facilities. (Section 9001) 

The Conference substitutes a provision entitled ‘‘Biorefinery 

Assistance,’’ which provides for grants and loan guarantees for construction and retrofitting of biorefineries for the production of advanced biofuels. The substitute provides for grants for constructing 

demonstration-scale biorefineries, and loan guarantees for the development and construction of commercial-scale biorefineries that 

use technologies that are either pre-commercial or commercially 

available. (Section 9001, new section 9003 of FSRIA) 

The Managers believe that it is in the nation’s interest to accelerate the commercialization of the production of advanced 

biofuels. The Managers also are aware that several commercial biorefinery projects are at the advanced planning stages and are ready 

for construction as soon as loan guarantees can become available 

through this program. 

Therefore, the Managers expect the Secretary to implement 

this program as soon as possible in fiscal year 2009. The Managers 

have provided specific funding for this program for fiscal year 2009 

to emphasize the need to implement this program as soon as possible. To enable expedited implementation of this program, the 

Managers expect that the Secretary consider issuing a Notice of 

Funds Availability (NOFA) to initiate the program as was done in 

the case of the section 9006 grants program after passage of the 

Farm Security and Rural Investment Act of 2002. The Managers 

expect that the NOFA will comply with, and be consistent with the 

spirit of, the provisions contained in section 9003 of this Act. At the 

same time of the release of the NOFA, the Managers expect the 

Secretary will issue an Advanced Notice of Proposed Rulemaking 


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(ANPR) to offer the public an opportunity to provide comments regarding the development of an Interim Rule for this program. Specifically, the Managers expect the ANPR will solicit comments with 

respect to critical issues regarding the implementation of section 

9003, such as whether the program loan guarantee will cover construction of the facility or be limited to post construction financing. 

It is expected that comments received will be included in the record 

of subsequent rulemaking regarding this program and will be considered by the Secretary during the development of such regulations. To further facilitate the rapid implementation of this program, the Managers expect that the Secretary consider using the 

processes and aspects developed for existing USDA loan guarantee 

programs including the Business and Industry Program and the 

Rural Energy for America Program (including its predecessor the 

section 9006 program), in the initial development of this program, 

especially if the Secretary intends to initiate implementation 

through the use of a NOFA. 

To ensure that proposals that are not yet in their final development stage can be considered, the Managers expect the Secretary 

to reserve funds for the second half of each fiscal year and reserve 

a portion of funds to be made available over the life of the Farm 

Bill. 

The Managers also expect the Secretary to take steps to evaluate the credit worthiness and the technical merit of proposals to 

make decisions regarding the responsible use of funds. 

It is the intent of the Managers that the Secretary use the approach for defining pre-commercial and commercially available 

technologies that were adopted in the regulations for Section 9006 

of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

8106) prior to the date of enactment of this Act. 

It is the intent of the Managers that, to the maximum extent 

practicable, preference be given to applicants seeking assistance for 

development and construction of biorefineries planning to convert 

cellulosic biomass feedstocks into advanced biofuels. It is also the 

intent of the Managers that for the purpose of ranking applications 

under the Biorefinery Program, the level of financial participation 

by the applicant from non-federal sources could include direct financial support, technical support, and contributions of in-kind resources, including such kinds of support from state governments. 

The Managers expect that demonstration or pilot-scale facilities will demonstrate the potential of a technology for commercial 

application at a biorefinery, including operational characteristics 

such as throughput rates and process yields. 

It is the intent of the Managers that the Secretary use the approach for defining pre-commercial and commercially available 

technologies that were adopted in the regulations for Section 9006 

of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 

8106) prior to the date of enactment of this Act. 

The Managers understand that over the life of this Act, it is 

likely that mandatory funding provided for loan guarantees will be 

awarded to commercial projects that are first-of-a-kind. This may 

include the commercial application of a technology that is: expanded to new regions, modified to utilize different feedstocks, or 


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substantially improved such that it represents a significant technological risk. 

It is the intent of the Managers that existing facilities including wood products facilities and sugar mills seeking to retrofit the 

facility with technologies to produce advanced biofuels be eligible 

for assistance under this section. 

The Conference substitute establishes a new section to support 

the repowering of existing biorefineries by making payments for 

the installation of new systems that use renewable biomass or for 

the new production of energy from renewable biomass. (Section 

9001, new section 9004 of FSRIA) 

It is the intent of the Managers that this repowering program 

should focus on biorefineries whose primary product is liquid transportation biofuels. The Managers encourage the Secretary to consider providing payments over time to help to ensure that 

repowering projects are operated as intended and produce the reduction in fossil fuels projected. The Managers also intend that 

new energy production need not come from a new energy system 

in order to be eligible for new production payments. The Managers 

also intend that no support should be given for installation or operation of repowering facilities that use feed grains that receive Title 

I payments, such as corn, as their energy source. 

(15) Grants—Limitations 

The Senate amendment provides for grants for pilot or demonstration scale biorefineries limited to 50 percent of project costs, 

grants for repowering projects limited to 20 percent of project costs 

and grants for repowering feasibility studies limited to the lesser 

of 50 percent of study costs and $150,000. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute authorizes grants for pilot or demonstration scale biorefineries for up to 30 percent of project costs. 

(Section 9001, new section 9003 of FSRIA) 

(16) Loan Guarantees—Limitations 

The House bill requires that loan guarantees not exceed 90 

percent of the principal and interest due on the loan. It provides 

that the total amount of principal and interest guaranteed may not 

exceed $1,000,000,000 for relatively small plants (up to 

$100,000,000) and may not exceed $1,000,000,000 for larger plants 

($100,000,000–$250,000,000). The Secretary determines the maximum loan term. (Section 9003(3)) 

The Senate amendment authorizes the Secretary to guarantee 

up to 100 percent of the principal and interest on such loans. The 

principal amount of a loan guaranteed for commercial biorefineries 

is limited to $250,000,000. The principal amount of a loan guaranteed for repowering projects is limited to $70,000,000. A loan guaranteed for a commercial biorefinery or repowering a biomass conversion facility shall not exceed 80 percent of project costs. (Section 

9001) 

The Conference substitute limits guarantees to 90 percent of 

the principal and interest on loans. The maximum principal 

amount of a loan guaranteed may not exceed $250,000,000 or 80 

percent of project costs. The substitute requires that the amount of 


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the loan guaranteed by the Department be reduced by the amount 

of other direct Federal funding going toward the project. (Section 

9001, new section 9003 of FSRIA) 

(17) Loan guarantees (and grants)—Priority 

The House bill provides selection criteria for loans which follow 

those for the existing grants program in section 9003 of FSRIA. 

Two new selection criteria are added to address the level of local 

ownership and the impact on other users of feedstocks. (Section 

9003(4)) 

The Senate amendment’s selection criteria for grants follow 

those for the existing grant program in Section 9003 of FSRIA. One 

new selection criterion is added: whether the distribution of funds 

would have minimal impact on existing manufacturing and other 

facilities that use similar feedstocks. Selection criteria for grants 

for repowering projects include the change in energy efficiency, the 

reduction in fossil fuel use, and the volume of biomass feedstock 

within a proximity to make local sourcing economically practicable. 

Preference for grants and loan guarantees is to be given to projects 

that receive financial support from the State in which they are located and priority is given to projects with significant local ownership. (Section 9001) 

The Conference substitute requires a feasibility study conducted by a third party be submitted as part of any application. 

Ranking criteria for grants include: the potential market for the 

biofuel and by-products; the level of financial participation by the 

applicant including other non-Federal and private sources; whether 

the applicant is proposing to use a feedstock not previously used 

in advanced biofuel production; whether the applicant is proposing 

to work with producer associations or cooperatives; whether the 

process will have a positive impact on resource conservation, public 

health and the environment; the potential for rural economic development; whether the area where the proposed facility will be located has other similar facilities; whether the project can be replicated; and the scalability of the proposed technology to commercial production. 

Ranking criteria for the loan guarantees include the same criteria as for the grants, with several changes and additions, including: whether the applicant has an established market for the 

biofuels and by-products; whether the applicant can establish that, 

if adopted, the biofuels production technology proposed in the application will not have any significant negative impacts on existing 

manufacturing and other facilities that use similar feedstocks; and 

the level of local ownership proposed in the application. The 

scalability of the project is not included in the loan guarantee criteria. (Section 9001, new section 9003 of FSRIA) 

In considering the level of financial participation by the applicant from non-federal sources, it is the intent of the Managers that 

such support could include direct financial support, technical support, and contributions of in-kind resources, including such kinds 

of support from state governments. 


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(18) Loan guarantees (and grants) condition of assistance 

The House bill requires prevailing wages for workers on 

projects financed under the section. (Section 9003(5)) 

The Senate bill contains no comparable provision. 

The Conference substitute adopts the House provision. (Section 

9001, new section 9003 of FSRIA) 

(19) Requirement for commitment 

The Senate amendment states conditions for assistance in the 

form of a loan guarantee include a binding commitment to cover at 

least 20 percent of project costs from non-Federal funds, demonstration of technology readiness, and demonstration that investment opportunities have been offered to local investors. (Section 

9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(20) Loan guarantees (and grants) funding 

The House bill extends the grant program in section 9003 of 

FSRIA through fiscal year 2012 and specifies mandatory funding 

levels for loan guarantees that total $800,000,000 over the period 

fiscal year 2008 through fiscal year 2012. (Section 9003(6)(7)) 

The Senate amendment provides mandatory funding of 

$300,000,000 for fiscal year 2008 to remain available until expended. (Section 9001) 

The Conference substitute provides mandatory funding of 

$75,000,000 for fiscal year 2009 to remain available until expended 

and $245 for fiscal year 2010 to remain available until expended 

for loan guarantees. It also authorizes $150,000,000 annually for 

fiscal year 2009 through fiscal year 2012. (Section 9001, new section 9003 of FSRIA) 

(21) Energy audit and renewable energy development program 

The House bill extends the energy audit and renewable energy 

development program through 2012. (Section 9004) 

The Senate amendment folds the energy audit program into 

the new REAP program. (Section 9001) 

The Conference substitute adopts the Senate provision with 

amendments as presented below. (Section 9001, new Section 9007 

of FSRIA) 

(22) Rural Energy for America Program—Name 

The House bill renames program under section 9006 the 

‘‘Rural Energy for America Program.’’ (Section 9005(2)(3)) 

The Senate amendment is the same as the House bill, except 

that section 9006 is renumbered to become section 9007. (Section 

9001) 

The Conference substitute adopts the House provision. (Section 

9001, new Section 9007 of FSRIA) 


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(23) Rural Energy for America Program—Eligible participant— Grants, loans and loan guarantees 

The House bill expands program eligibility, which currently extends to farmers, ranchers, and rural small businesses, to also include ‘‘other agricultural producers’’. (Section 9005(2)(3)) 

The Senate amendment provides for grants or loan guarantees 

for renewable energy systems and energy efficiency improvements 

for agricultural producers and rural small businesses. The Senate 

amendment excludes direct loans. (Section 9001) 

The Conference substitute adopts the Senate provision. (Section 9001, new Section 9007 of FSRIA) 

(24) Rural Energy for America Program—Eligible participants—Energy audit and renewable energy development assistance 

The Senate amendment adds State agencies and public power 

entities to eligible participants in the Energy Audit and Renewable 

Energy Assistance Program. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendments to make units of State, tribal, or local governments eligible. (Section 9001, new section 9007 of FSRIA) 

The Managers expect the definition for the term public power 

entity used in this section to be the same as the definition of state 

utility as defined in section 217(a)(4) of the Federal Power Act (16 

U.S.C. 824q(a)). The Committee intends that in carrying out subsection 9007(b), the Secretary may conduct a merit review process 

through the solicitation of input regarding applications from qualified experts either individually or collectively. 

(25) Rural Energy for America Program—Eligible participants—Energy from animal manure 

The Senate amendment specifies the following as eligible participants: agricultural producers; rural small businesses; rural cooperatives; and other similar entities. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. It is 

the intent of the Managers that the Rural Energy for America Program continue to provide significant support for projects that convert animal manure to energy, including both on-farm and community projects. 

(26) Rural Energy for America Program—Eligible activities— Grants, loans and loan guarantees 

The House bill expands to include sale of electricity generated 

by new renewable energy systems. (Section 9005(2)) 

The Senate amendment adds production-based incentives for 

renewable energy to eligible activities, eliminates direct loans and 

renewable energy systems. (Section 9001) 

The Conference substitute deletes both provisions. 

(27) Rural Energy for America Program—Eligible activities—Energy from animal manure 

The Senate amendment provides for grants and loan guarantees for facilities to convert animal manure to energy, including asVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00910 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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sociated feedstock gathering systems and gas pipelines, as well as 

first-year operating costs. For new technologies, the first 2 years of 

operation are eligible. This section also directs extension of the Energy Star program to address equipment and facilities for the agricultural sector. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

The Managers encourage the Secretary to compile and submit 

a list of equipment commonly used by agricultural producers to the 

Environmental Protection Agency and the Department of Energy 

for consideration in the existing Energy Star program. 

(28) Rural Energy for America Program—Criteria and preference—

Grants, loans and loan guarantees 

The award considerations in the Senate amendment for energy 

efficiency improvements and renewable energy systems (section 

9007(c)(2)) include: the type of renewable energy system; estimated 

quantity of renewable energy to be produced; expected environmental benefits; quantity of energy savings expected; expected energy savings payback time; and expected system’s energy efficiency. 

Preferences for grants and loan guarantees under section 9007 are 

to be given to projects that receive financial support from the state 

in which they are located. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate award considerations, but deletes the Senate provision that gives preference to 

projects receiving state funds. (Section 9001, new Section 9007 of 

FSRIA) 

The Managers encourage the Secretary to continue funding 

animal manure digester projects. The Managers believe these 

projects have and will continue to be an important tool to produce 

renewable energy in rural areas, create value for agricultural producers, and address environmental concerns surrounding manure 

management. It is the Managers’ intent that funding under this 

section may be used for the construction of infrastructure for collection and transportation of feedstocks and biogas for manure digesters, including community digesters. The Managers also intend that 

bioenergy production and utilization projects that also produce useful byproducts, such as fertilizer or biochar to be used as a soil conditioner, are eligible for support under the Rural Energy for America program. 

The Managers encourage the Secretary to use the references to 

energy efficiency and renewable energy sources in this section include geothermal heat pump systems using ground loops and that 

small hydroelectric systems (as determined by the Secretary) be 

considered renewable energy systems for the purpose of receiving 

financial assistance under this program. 

(29) Rural Energy for America Program—Criteria and preferences—

Energy from animal manure 

The Senate amendment states selection considerations for energy from animal manure projects include quality of energy produced, net energy conversion efficiency, environmental issues, net 


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impact on greenhouse gas emissions, diversity factors, and proposed costs. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(30) Rural Energy for America Program—Cost sharing 

The House bill increases the limit on the maximum amount of 

the combined loan and grant from 50 percent to 75 percent of the 

funded activity. It limits the maximum amount of loan guaranteed 

to 75 percent of the funded activity and not more than $25,000,000. 

(Section 9005(4)) 

The Senate amendment states that for energy from animal manure projects: grants are limited to 50 percent of project costs for 

smaller systems costing less than $500,000; for larger projects, 

grants are limited to the greater of $250,000 or 25 percent of 

project costs, with a cap of $2,000,000; loan guarantees are limited 

to loans not exceeding $25,000,000 and 80 percent of developer’s 

project costs. (Section 9001) 

The Conference substitute adopts the House provision. (Section 

9001, new section 9007 of FSRIA) 

(31) Rural Energy for America Program—Feasibility studies 

The House bill allows the Secretary to use up to 10 percent of 

funds available under the section to provide assistance to eligible 

participants to conduct feasibility studies for eligible projects, but 

provides that if such assistance is provided, the participant is ineligible for assistance under other law for such assistance. (Section 

9005(6)) 

The Senate amendment is the same as the House provision. 

(Section 9001) 

The Conference substitute adopts the House provision. (Section 

9001, new section 9007 of FSRIA) 

(32) Rural Energy for America Program—Reserve 

The House bill reserves 15 percent of funds for projects costing 

$50,000 or less. (Section 9005(6)) 

The Senate amendment directs the Secretary to develop a 

streamlined process for projects seeking less than $20,000, and it 

directs that not less than 20 percent of the funds for this section 

be made available for such projects. (Section 9001) 

The Conference substitutes sets aside not less than 20 percent 

of the funds for this section for grants of less than $20,000, with 

any remaining funds reverting to the general pool of funding on 

June 30 of each fiscal year. The substitute directs the Secretary to 

perform outreach at the State and local levels. This outreach 

should include local Rural Development, Farm Service Agency, 

Natural Resources Conservation Service and Extension offices. 

(Section 9001, new Section 9007 of FSRIA) 

(33) Rural Energy for America Program—Funding 

The House bill reauthorizes the program and provides mandatory funding of $50,000,000 in fiscal year 2008; $75,000,000 in fiscal year 2009; $100,000,000 in fiscal year 2010; $125,000,000 in fisVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00912 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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cal year 2011; and $150,000,000 in fiscal year 2012. (Section 

9005(7)) 

The Senate amendment provides mandatory funding of $230,000,000 in fiscal year 2008, to remain available until expended, for audits, loan guarantees and grants for energy efficiency 

improvements and renewable energy systems and loan guarantees 

and grants for animal manure facilities. It specifies that not less 

than 5 percent of the funding is to be used for Energy Audit and 

Renewable Energy Development Program and not less than 15 percent is to be used for animal manure facilities. It also authorizes 

additional funds as necessary to carry out this section from fiscal 

year 2008 through fiscal year 2012. (Section 9001) 

The Conference substitute provides mandatory funding of $50,000,000 in fiscal year 2009, $60,000,000 in fiscal year 2010, 

and $70,000,000 annually in fiscal year 2011 and fiscal year 2012. 

It also specifies that 4 percent is to be used for the Energy Audit 

and Renewable Energy Development Assistance portion of the program. The Conference substitute authorizes an additional 

$25,000,000 annually from fiscal year 2009 through fiscal year 

2012. (Section 9001, new section 9007 of FSRIA) 

(34) Biomass Research and Development Act of 2000 

The House bill modifies findings to include biodiesel. It increases the number of individuals affiliated with an environmental 

or conservation organization on the Advisory Committee from 1 to 

2. It adds an individual with expertise in agronomy, crop science, 

or soil science to the Advisory Committee. The provision includes 

language to improve dried distillers grain quality and clarifies the 

role of commercial applications in the objectives of the Biomass Research and Development Initiative. It requires the Secretary to 

submit a management plan to Congress every five years evaluating 

the success of the Initiative. It also provides mandatory funding of 

$35,000,000 for fiscal year 2008; $60,000,000 for fiscal year 2009; 

$75,000,000 for fiscal year 2010; $100,000,000 for fiscal year 2011; 

and $150,000,000 for fiscal year 2012. The House bill does not 

change the current law provision that authorizes an additional annual appropriation of $200,000,000 through fiscal year 2015. It 

amends technical study areas to clarify that research areas include 

sugar processing and refining plants and self-processing crops that 

express enzymes capable of degrading cellulosic biomass. (Section 

9006) 

The Senate amendment removes findings from the language. It 

changes ‘‘biobased fuel’’ to ‘‘biofuel’’ and ‘‘biomass’’ to ‘‘renewable 

biomass’’ for consistency across the Title. It also adds an individual 

with expertise in plant biology and biomass feedstock development. 

The provision adds language to emphasize research on harvest, collection, transport and storage of renewable biomass feedstocks. It 

removes specific funding allocations to the different technical areas 

and instead requires that at least 15 percent of funds go to each 

technical area. The Senate language requires the Secretary to submit a management plan to Congress every five years evaluating the 

success of the Initiative. It provides mandatory funding of 

$15,000,000 for fiscal year 2008; $25,000,000 for fiscal year 2009; 

and $35,000,000 for fiscal year 2010. The Senate amendment auVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00913 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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thorizes an additional annual appropriation of $85,000,000 through 

fiscal year 2012. (Section 9001) 

The Conference substitute moves the Initiative in statute to 

Title IX of the FSRIA of 2002. It removes findings from the language and changes ‘‘biobased fuel’’ to ‘‘biofuel’’ and ‘‘biomass’’ to ‘‘renewable biomass’’ for consistency across the Title. The substitute 

increases the number of individuals affiliated with an environmental or conservation organization on the Advisory Committee 

from 1 to 2, adds an individual with expertise in plant biology and 

biomass feedstock development and adds an individual with expertise in agronomy, crop science, or soil science to the Advisory Committee. The substitute reduces the number of technical areas from 

6 to 3 and streamlines considerations for grant selection. The new 

technical areas include feedstock development, biofuels and 

biobased products development, and biofuels development analysis. 

At least 15 percent of the available funding is required to be allocated to each of the three technical areas. The substitute also increases the minimum cost-share requirements for demonstration 

projects from 20 percent to 50 percent and for research projects 

from 0 percent to 20 percent, with a provision that allows the Secretary to waive the matching requirement for research if a waiver 

is determined to be necessary and appropriate. The substitute provides mandatory funding of $20,000,000 in fiscal year 2009, $28,000,000 in fiscal year 2010, $30,000,000 in fiscal year 2011, and $40,000,000 in fiscal year 2012. It authorizes 

$35,000,000 per year for fiscal year 2009 through fiscal year 2012. 

(Section 9001, new section 9008 of FSRIA) 

The substitute replaced language that was included in the Energy Independence and Security Act of 2007 (P.L. 110–140) (EISA) 

that amended Section 307(d) of the Biomass Research and Development Act of 2000 (7 U.S.C. 8606(d)). In order to ensure the sustainable production of biofuels, the Managers want to clarify that an 

intention of Sec. 9008(e)(3)(C)(ii) is to improve and develop analytical tools to facilitate the analysis of life-cycle energy and greenhouse gas emissions, including emissions related to resource management, associated with all potential biofuel feedstocks and production processes. 

The Managers encourage the Board to consider funding projects 

that address the critical need for integrated research and technology development in the area of biofuels. Funded projects should 

consider an integrated approach along the full biofuels and 

biobased products value chain and should serve as a platform for 

both technology transfer and workforce development. The Managers recognize that the New Century Farm project at Iowa State 

University specifically includes integrated research and development activities ranging from cropping practices and feedstock production, to biomass harvest and handling, and including biorefinery 

conversion processes. The Managers also are aware that Pennsylvania State University is working on all aspects of biofuels development from plant transformation to production, harvest, and storage; and from biomass pretreatment to fuel formulation and engine 

testing in collaboration with private industry and the government. 

The Managers are aware that Claflin University has been undertaking work in the area of biofuels and biobutanol and hope they 


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can continue that work. The Managers recognize that these are viable models which can provide invaluable feedback and systematic 

improvement to development of a national biofuels infrastructure. 

The Managers recognize the tremendous potential market that 

exists in this country for renewable aviation and jet fuel, and acknowledges that while much research and development has been 

directed toward the development of biofuels for ground transportation, the development of renewable aviation fuels has lagged far 

behind. For this reason, the Managers encourage the Secretary of 

Agriculture and the Secretary of Energy to give equal consideration 

to projects under this initiative that would perform innovative and 

beneficial research and commercial development of renewable aviation fuels. 

The Managers are aware of the use of algae to create biodiesel 

fuels, and believe this technology will contribute to relieving the 

U.S. of its dependence on fossil fuels. The Managers understand 

that algal-based oil yields are 2–3 times that of the highest yielding 

land plants and that algae can be cultured on land unfit for traditional commercial crops. The Managers encourage the Department 

to support existing algaculture laboratories that have the ability to 

develop algal-based feedstocks for the biodiesel industry. The Managers request the Department to report back within 90 days, or as 

soon as practicable on the status of this effort. 

The Managers hope that scientists and students at minority 

serving institutions, such as the nation’s historically black colleges 

and universities and Hispanic-serving institutions will utilize this 

program and other research and development programs in this title 

to continue the development of biofuels and biobased products in 

all regions of the country. 

The Managers also believe that this program plays a critical 

role in bridging the funding gap that many promising technologies 

face after university basic research is completed and before becoming attractive to venture capitalists and commercialized in the market. The Managers believe that support between basic research and 

commercialization is important for quickly bringing new technologies to market, and the Managers urge the Secretary to make 

sufficient funds available to address this issue. 

The Managers encourage consideration of collaborative research on corn and cellulosic genomics to support improved biofuels 

conversion processes. 

The Managers recognize the need for research and development to convert forest biomass to advanced biofuels and encourage 

USDA and DOE, in implementing the authorities in this section, 

work in partnership with the Forest Service to develop new techniques, technologies and methods toward this goal. The Managers 

do not intend the additional authority in section 9012 to preclude 

these activities under this section. 

(35) Adjustments to the bioenergy program—Eligibility 

The House bill clarifies that the term ‘‘bioenergy’’ also includes 

the production of heat and power at a biofuels plant, biomass gasification, hydrogen made from cellulosic commodities for fuel cells, 

and renewable diesel. The provision excludes corn starch from the 

list of eligible feedstock under the program. (Section 9007) 


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The Senate amendment clarifies that this program is intended 

to support increased production of advanced biofuels, which includes fuels derived from renewable biomass excluding those derived from corn starch. (Section 9001) 

The Conference substitute directs the Secretary to make payments to producers of advanced biofuels to support a stable and expanding production base. The payments are to be based on the 

quantity and duration of production, the net non-renewable energy 

content of the advanced biofuel, and other factors as determined by 

the Secretary. (Section 9001, new section 9005 of FSRIA) 

It is the intent of the Managers that the Secretary support existing advanced biofuel production, as well as encourage new production. 

The Managers recognize that, with respect to forest biomass, 

the feedstock for the production of advanced biofuels is often the 

same feedstock used by forest products facilities, include pulp and 

paper mills. The Managers encourage the Secretary to consider 

competing market outlets when establishing the payment rate for 

such feedstocks. 

(36) Adjustments to the bioenergy program—Renewable diesel 

The House bill defines renewable diesel. (Section 9007) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. 

(37) Adjustments to the bioenergy program—Payment rate and priority 

The House bill provides for a priority based on factors listed 

in section 9003(e)(2)(B) of FSRIA. (Section 9007(2)) 

The Senate amendment directs the Secretary to base payments 

on: level of production; price of feedstock; net nonrenewable energy 

content; and other appropriate factors. It restricts the payment to 

producers that do not receive the small producer tax credits and to 

production from facilities with capacity of less than 150,000,000 

gallons per year. (Section 9001) 

The Conference substitute directs the Secretary to base payments on the quantity and duration of production, the net non-renewable energy content of the advanced biofuel, and other appropriate factors as determined by the Secretary. (Section 9001, new 

Section 9005 of FSRIA) 

(38) Adjustments to the bioenergy program—Project viability 

The House bill requires Secretary to review project viability before renewing contracts. (Section 9007(2)) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. 

(39) Adjustments to the bioenergy program—Funding 

The House bill provides mandatory funds of $225,000,000 for 

fiscal year 2008; $250,000,000 for fiscal year 2009; $275,000,000 for 

fiscal year 2010; $300,000,000 for fiscal year 2011; and 

$350,000,000 for fiscal year 2012. (Section 9007(3)) 


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The Senate amendment provides mandatory funds of 

$245,000,000 for fiscal year 2008 to remain available until expended. (Section 9001) 

The Conference substitute provides mandatory funding of 

$55,000,000 in fiscal year 2009, $55,000,000 in fiscal year 2010, 

$85,000,000 in fiscal year 2011, and $105,000,000 in fiscal year 

2012. It authorizes $25,000,000 per year for fiscal year 2009 

through fiscal year 2012. It stipulates that no more than 5 percent 

of each year’s funding may be for production at facilities with a 

total refining capacity exceeding 150,000,000 gallons per year. (Section 9001) 

(40) Research, extension and educational programs on biobased energy technologies and products 

The House bill extends current authorization for appropriations at a level of $75,000,000 through 2012. It provides a research 

focus for insular and Pacific areas. (Section 9008) 

The Senate amendment provides for mandatory funding of 

$5,000,000 for fiscal year 2008; and $10,000,000 for fiscal year 

2009 and fiscal year 2010 and provides for authorization for appropriations at an annual level of $70,000,000 from fiscal year 2008 

through fiscal year 2012. It provides for a ‘‘subcenter’’ at the University of Hawaii with a research focus for insular and Pacific 

areas. (Section 9001) 

The Conference substitute adopts the Senate provision with 

amendments and moves the provision in statute to the Research 

Title of this Act. No mandatory funding is provided. The Conference substitute authorizes $75,000,000 per year for fiscal year 

2008 through fiscal year 2010. (Section 7526) 

(41) Regional biomass crop experiments 

The Senate amendment establishes a program of regional biomass crop experiments at 10 geographically dispersed and competitively selected land-grant universities. Crop experiments are to include all appropriate biomass species, including perennials, annuals, and woody biomass species. Selection criteria include crop experiment capabilities and experience, species and cropping practices proposed, crop experiment plan, and commitment of adequate 

acreage and resources. The provision calls for coordination among 

participants, with the Biomass Research and Development Board 

and with the Sun Grant Centers, and the establishment of a ‘‘best 

practices’’ database on all aspects of biomass crop production. It 

provides mandatory funding of $40,000,000 over the life of the bill, 

to be allocated as $1,000,000, $2,000,000, and $1,000,000 per institution for years fiscal year 2008, fiscal year 2009, and fiscal year 

2010, respectively. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

The Managers believe that the agricultural bioenergy feedstock 

and energy efficiency research and extension program included in 

section 7207 of the Research title will accomplish the purposes of 

this section. 


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(42) USDA Energy Council 

The House bill creates an Energy Council in the Office of the 

Secretary at USDA to coordinate energy policy at the Department 

and consult with other agencies. (The existing Office of Energy Policy and New Uses will support the activities of the Council.) (Section 9009) 

The Senate amendment directs the Secretary to assign coordination of projects and information, liaison work with other agencies 

and public outreach on USDA’s energy programs to one entity 

within the Department. (Section 9001) 

The Conference substitute deletes both provisions. 

It is the intent of the Managers that the Department should 

implement the actions outlined in the Senate bill using existing authorities. It is also the Managers’ intent that a single entity in the 

Department be responsible for coordinating energy policy activities 

in the Department and with other agencies. 

(43) Farm energy production pilot program 

The House bill establishes a pilot program to provide grants to 

farmers for the purpose of demonstrating the feasibility of making 

a farm energy neutral using existing technologies. It authorizes 

$5,000,000 for fiscal years 2008 through 2012. (Section 9010) 

The Senate amendment contains no comparable provisions. 

The Conference substitute deletes the House provision. 

The Managers believe that the purposes of this Section can be 

carried out through Section 7207 of the Research title. 

(44) Rural energy self-sufficiency initiative and rural energy systems 

renewal 

The House bill authorizes the Secretary to make cost-share 

grants to enable eligible rural communities develop renewable energy systems to increase their energy self-sufficiency. The provision 

authorizes appropriations of $5,000,000 in fiscal year 2008 and 

such sums as necessary in fiscal year 2009 through fiscal year 

2012. (Section 9011) 

The Senate amendment: (1) establishes a program of competitive cost-shared grants for rural communities to assess their energy 

systems, and to formulate and implement strategies for improvements; (2) specifies appropriate activities; (3) requires a 50 percent 

cost share; (4) directs the USDA in consultation with DOE to provide technical assistance; and (5) authorizes $5,000,000 per year for 

fiscal year 2008 through fiscal year 2012. (Section 9001) The Conference substitute authorizes $5,000,000 per year for 

fiscal year 2009 through fiscal year 2012 for a program of costshared grants to enable rural communities to assess their energy 

usage, formulate strategies for improvements and install and utilize integrated renewable energy systems. (Section 9001, new Section 9009 of FSRIA) 

It is the intent of the Managers that energy assessments will 

include total energy usage by all members and activities of the 

community, including an assessment of energy used in community 

facilities, energy for heating, cooling, lighting, and energy for all 

other building and facility uses; energy used in transportation by 

community members; current sources and types of energy used; enVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00918 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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ergy embedded in other materials and products; and the major impacts of the energy usage, including the impact on the quantity of 

oil imported, total costs, the environment, and greenhouse gas 

emissions. 

Energy system improvement strategies are intended to reduce 

conventional energy usage and greenhouse gas emissions by the 

community through adoption or use of measures such as building 

insulation, automatic controls on lighting and electronics, zone energy usage, and building energy conservation practices; transportation alternatives, vehicle options, transit options, transportation 

conservation, and walk- and bike-to-school programs; community 

configuration alternatives to provide pedestrian access to regular 

services; and community options for alternative energy systems, including alternative fuels, photovoltaic electricity, wind energy, geothermal heat pump systems, and combined heat and power. 

(45) Agricultural biofuels from biomass internship pilot program 

The House bill authorizes an internship program to encourage 

students to pursue employment in renewable energy related jobs. 

(Section 9012) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. 

(46) Feedstock flexibility program for bioenergy producers 

The House bill amends the energy title of FSRIA to require the 

Secretary to purchase sugar to produce bioenergy if necessary to 

avoid forfeitures of sugar to the Commodity Credit Corporation, 

and to ensure that the sugar loan program operates at no cost to 

the Federal government. (Section 9012) 

The Senate amendment is the same as the House bill. (Section 

1501(f)) 

The Conference substitute adopts the House provision with 

amendments. (Section 9001, new Section 9010 of FSRIA) 

Since the Feedstock Flexibility Program is a new program involving many interests, the Managers expect the program to be implemented following a public notice and comment period, providing 

an opportunity for all parties affected by the program to have input 

into its operations. 

(47) Biomass inventory report 

The House bill requires the Secretary to conduct an inventory 

of biomass resources on a county by county basis and report to 

Congress within 1 year of enactment. (Section 9014) 

The Senate amendment requires the Secretary to conduct an 

assessment of the growth potential for cellulosic material on a 

state-by-state basis, and to report to Congress within 18 months. 

(Section 9001) 

The Conference substitute deletes both provisions. 

The Managers believe that adequate biomass resource assessments are underway or planned. The Economic Research Service 

(ERS) in the Department is working on a biomass resource inventory and the Managers encourage the Secretary to continue this 

important work. 


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(48) Future farmsteads program 

The House bill establishes a program to advance farm energy 

use efficiencies and on farm production of renewable energies. (Section 9015) 

The Senate amendment is the same as the House bill. (Section 

9001) 

The Conference substitute deletes both provisions. 

The Managers believe that the agricultural bioenergy feedstock 

and energy efficiency research and extension program included in 

section 7207 of the Research title will accomplish the purposes of 

this section. 

(49) Sense of Congress on renewable energy 

The House bill provides a sense of Congress on renewable energy. (Section 9016) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. 

(50) Biodiesel fuel education program. 

The House bill doubles funding to $2,000,000 annually for fiscal year 2008 through fiscal year 2012. (Section 9017) 

The Senate amendment is the same as the House bill except 

it adds oil refiners, automotive companies and owners and operators of watercraft fleets to the list of entities targeted for education 

about biodiesel. (Section 9001) 

The Conference substitute adopts the House provision except that it funds the program at $1,000,000 annually for fiscal year 

2008 through fiscal year 2012. (Section 9001, new Section 9006) 

(51) Biomass energy reserve 

The House bill establishes a biomass energy reserve (BER) and 

provides financial and technical assistance to landowners and operators to produce energy crops and harvest, store, and transport cellulosic material. BER project areas must be within a 50-mile radius 

of an existing bioenergy facility. 

Under the House provision, BER eligible crop land must have 

been tilled in the current or immediately preceding crop year, and 

does not include Federal land, certain forest land, or land enrolled 

in specified conservation programs (unless biomass harvest occurs 

in accordance with a conservation plan outside of nesting and 

rearing season, and payments under the conservation program are 

reduced—subsection (h)). (Forest land is covered in subsection (e), 

which provides $5,000,000 for grants to help owners develop plans 

for sustainable management of biomass from forest land.) 

Groups of owners and operators, energy and agricultural companies, and Agricultural Innovation Centers (AICs) are all ‘‘Eligible 

Applicants’’ that may submit proposals for BER project areas. AICs 

have a dual role in the program, and may also serve as ‘‘Qualified 

Organizations’’, which assist other Eligible Applicants in developing proposals for approval by USDA. 

Under the House provision, the Secretary selects 10 qualified 

organizations across the country. Qualified organizations, which 

may also be colleges and universities, help eligible applicants structure projects that will advance the goal of sustainable production 


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of dedicated energy crops. Specifically, a qualified organization will 

help eligible applicants to identify suitable land and crop mixtures 

and get a commitment from a bioenergy facility. Program crops and 

invasive or noxious species are ineligible. Qualified organizations 

then rate the various project area applications according to a ranking system established by the Secretary, based on criteria set out 

in subsection (d)(5). The Secretary selects at least one project area 

in each of the 10 qualified organizations, which are regionally dispersed. 

Under the House provision, the Secretary enters into 5-year 

contracts with owners and operators (Eligible Participants) in the 

BER project area. Such contracts must comply with certain conservation requirements and provide for information sharing. The 

Secretary makes Establishment Payments to eligible participants 

to cover seeds, stock, and the cost of planting, and annual Rental 

Payments in an amount to be determined by the Secretary. 

Under the House provision, the Secretary may also provide Matching Payments of not more than $45 per ton for collecting, 

harvesting, storing, and transporting biomass. (Matching Payments 

are at a rate of $1 for every $1 per ton paid by the bioenergy facility for the biomass. The Secretary must reduce Rental Payments 

if making a Matching Payment to an eligible participant.) Forest 

land owners are eligible for this Matching Payment if acting under 

a forest stewardship plan. (Section 9018) 

The Senate amendment establishes a Biomass Crop Transition 

Assistance Program (BCTAP) to provide transitional assistance (including grants) for the establishment and production of eligible 

crops to be used in the production of advanced biofuels. The program includes assistance for the harvesting, transportation and 

storage of renewable biomass. Producers are not eligible to receive 

assistance for the establishment and production of crops eligible to 

receive benefits under Title I and that are invasive or noxious. Eligible land is defined as private agriculture or forest land planted 

or considered to be planted for at least 4 of the 6 years preceding 

enactment. 

The Senate amendment provides that contract requirements 

include adherence to conservation compliance and implementation 

of a conservation plan approved by the local soil conservation district. The conservation plans should advance the goals and objectives of fish and wildlife conservation plans and initiatives and 

comply with mandatory environmental requirements for a producer 

under Federal, State and local law. 

Eligible participants under the Senate amendment include individual agricultural producers, forest land owners or other individuals holding the right to collect or harvest the crop. Farmer-owned 

cooperatives, agricultural trade associations (or similar entitles on 

behalf of producer members) may serve as aggregators and enter 

into contracts as eligible participants. The Secretary is directed to 

provide planning grants of up to $50,000 (with a required 100 percent match) to assist in assessing the viability for, or assembling 

of, a regional supply. 

Under the Senate amendment, the Secretary will enter into 

contracts for perennial crops, covering the cost of establishing the 

crops during the first year and each subsequent year the Secretary 


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will make an incentive payment determined by the Secretary to encourage the participant to produce renewable biomass. All participants in this Section are required to keep records determined by 

the Secretary to allow for best practices to be studied and shared. 

Assistance under the Senate amendment is restricted to crops 

for use in the production of advanced biofuels, other biobased products, heat or power from a biomass conversion facility. Participants 

must have a letter of intent or proof of financial commitment from 

a biomass conversion facility and the production operation must be 

located in proximity of a biomass conversion facility to make delivery to the location economically practicable. Eligibility is also conditioned on the impact on wildlife, air, soil and water quality and 

availability and the local and regional economic impacts/benefits. 

The Senate amendment allows the Secretary to provide technical assistance and establishment cost-sharing for eligible participants planting annual biomass crops. The crop shall not be eligible 

for benefits under Title I and assistance is conditioned on adherence to conservation compliance requirements. 

The Senate amendment also creates a program that provides 

fixed-rate payments to eligible participants for the estimated cost 

of collection, harvest, storage and transport of renewable biomass. 

It also provides for forest biomass planning grants to help forest 

landowners sustainably harvest woody biomass for heat, energy or 

biobased products for use in a biomass conversion facility. The Senate amendment included $130,000,000 in mandatory 

funding for fiscal year 2008, to remain available until expended, for 

transition assistance for biomass crops. Of this amount, no more 

than $5,000,000 was to be used for biomass planning grants and 

no more than 5 percent expended for forest biomass planning 

grants. The payments for collection, harvest, storage and transportation were appropriated mandatory funding of $10,000,000 per 

year for each of fiscal year 2009, fiscal year 2010, and fiscal year 

2011, to remain available until expended. (Section 9001) 

The Conference substitute establishes a Biomass Crop Assistance Program (BCAP). Under this Section, the Secretary will select 

BCAP project areas from applications consisting of a group of producers willing to commit to biomass crop production or a biomass 

conversion facility. 

Biomass crop producers within these BCAP project areas will 

enter into contracts directly with the Secretary which will enable 

producers to receive financial assistance for crop establishment 

costs as well as annual payments to support biomass production. 

Contracts include resource conservation requirements. 

The Secretary is directed to reduce annual payments when the 

biomass crops are sold to the conversion facility, used for other allowed purposes or if the producer violates the BCAP contract. This 

section also authorizes cost-sharing support for biomass harvest, 

transport, storage, and delivery to biomass user facilities, both 

within BCAP project areas and elsewhere. The Conference substitute provides mandatory funding of such sums as necessary to 

carry out this section for each of fiscal year 2008 through fiscal 

year 2012. (Section 9001, new Section 9011 of FSRIA) 

The Managers expect the Secretary to determine if a producer 

is within an economically practicable distance from a facility based 


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on the expected cost of transporting a feedstock to the facility. The 

Managers understand that this distance may vary depending on 

several factors including the density of the feedstock and the producer’s plan for preprocessing the biomass including chopping, 

pelletizing or other techniques that make the biomass more easily 

transportable. 

The Managers intend that nonindustrial private forestland be 

included as ‘eligible land’ in a BCAP area and also be eligible for 

establishment and annual payments. Prior to entering into a contract with an owner of nonindustrial private forestland with existing tree cover, the Managers encourage the Secretary to consider 

the most suitable use of the land and encourage the maintenance 

of native forests and late successional forest stands and discourage 

conversion of native forests to non-forest use. The Managers understand that woody biomass feedstocks may require varying management practices including: establishment (natural or artificial regeneration), site preparation, and management of competing vegetation. The Managers recognize that in some cases, biomass from forests established or enhanced under this program may not be available for harvest within the timeframe of the contract, but may provide a long-term source of feedstock for a biomass conversion facility. 

It is the intent of the Managers that in determining the 

amount of an annual payment, the Secretary shall consider the 

costs of the activity being funded and the need for the involved biomass conversion facility to bear some costs of producing the feedstock. 

The Managers intend that the use of ‘‘soil, water and related 

resources’’ under this section includes wildlife-related concerns. 

The Managers also intend that the primary focus of the BCAP 

will be promoting the cultivation of perennial bioenergy crops and 

annual bioenergy crops that show exceptional promise for producing highly energy-efficient bioenergy or biofuels, that preserve 

natural resources, and that are not primarily grown for food or animal feed. In making BCAP project area selections, the Managers 

expect that the Secretary will consider the economic viability of the 

proposed biomass crop. The Managers do not intend that BCAP 

contract acreage provide all the feedstock necessary to supply a biomass conversion facility. 

It is the Managers’ intent that if the establishment or annual 

payment to a producer is reduced under this section, that the Secretary may vary the amount of payment reduction based on the 

reason for reducing the payment. It is also the intent of the Managers that establishment and annual payments are to be reduced 

by an appropriate amount in the case where a portion of an eligible 

crop is not sold or intended to be sold to the biomass conversion 

facility. 

The Managers direct the Secretary to provide a report to Congress on how information gathered under this Section was disseminated. The Managers urge the Secretary to utilize the Best Practices database created in Section 7207 of this Act and to utilize the 

expertise of institutions of higher education and Agriculture Innovation Centers to collect such information. 


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(52) Forest biomass for energy 

The House bill requires the Secretary of Agriculture, through 

the Forest Service, to conduct a competitive research and development program to encourage use of forest biomass for energy. The 

House bill provides $15,000,000 per year for fiscal year 2008–2012 

in mandatory funding. (Section 9019) Note that there are 2 sections 

numbered 9019 in the House bill. 

The Senate amendment is similar to the House bill but does 

not provide mandatory funding for the program. (Section 9001) 

The Conference substitute adopts the House provision with amendments. It authorizes $15,000,000 per year for fiscal year 

2009 through fiscal year 2012. (Section 9001, new Section 9012 of 

FSRIA) 

As part of this program, the Managers encourage the Secretary 

to work closely with the Pine Genome Initiative (PGI), which would 

promote healthy forests and the development of new biofuels technology. 

(53) Community wood energy program 

The House bill provides grants for community wood energy systems. (Section 9019) Note that there are 2 sections numbered 9019 

in the House bill. 

The Senate amendment is similar to the House provision. (Section 9001) 

The Conference substitute adopts the Senate provision with amendments. It authorizes $5,000,000 per year for fiscal year 2009 

through fiscal year 2012. (Section 9001, new Section 9013) 

(54) Supplementing corn as an ethanol feedstock 

The House bill requires the Secretary of Agriculture to estab- lish a program to make grants of not to exceed $1,000,000 each to 

no more than 20 universities for a 3-year program of demonstration 

of supplementing corn as an ethanol feedstock with sweet sorghum 

and switchgrass. (Section 9020) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. 

The Managers believe that the agricultural bioenergy feedstock 

and energy efficiency research and extension program included in 

section 7207 of the Research title will accomplish the purposes of 

this section. 

(55) New Century Farm Project 

The Senate amendment authorizes support for the development and operation of an integrated and sustainable biomass, feedstock, and biofuels production system to serve as a model for a new 

century farm. It authorizes $15,000,000 for fiscal year 2008 

through fiscal year 2012, to remain available until expended. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

The Managers believe that the agricultural bioenergy feedstock 

and energy efficiency research and extension program included in 

section 7207 of the Research title will accomplish the purposes of 

this section. 


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(56) Biochar research, development and demonstration 

The Senate amendment establishes a program of competitive 

grants for research and demonstration of the production and use of 

biochar in the agricultural sector. Activity areas include biochar 

production and use, agronomic effects, biochar characterization, soil 

carbon and greenhouse gas emission effects, integration with renewable energy systems, and economics. The provision authorizes 

$3,000,000 for each year of fiscal year 2008 through fiscal year 

2012. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. Research on biochar production and use is included as a high-priority 

research and extension area in section 7203 of the Research title. 

(57) Voluntary renewable biomass certification 

The Senate amendment establishes a voluntary certification 

program for renewable biomass that is grown using sustainable 

practices, in consultation with EPA. Standards are to be designed 

to reduce greenhouse gases and improve soil carbon, protect wildlife habitat, and protect air, soil, and water quality. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(58) Biofuels infrastructure study 

The Senate amendment directs USDA, in collaboration with 

the Secretaries of Energy and Transportation and the Administrator of the Environmental Protection Agency, to conduct a study 

of the infrastructure needs associated with a significant expansion 

in biofuel production and use. The amendment specifically includes 

dedicated ethanol pipeline feasibility studies and examination of 

water resource needs. The provision requires a report to Congress 

including recommendations. It also authorizes $1,000,000 in each 

of fiscal year 2008 and fiscal year 2009. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute directs USDA to jointly conduct a 

study with DOE, DOT and EPA on the infrastructure needs associated with significant expansion in biofuels production and use. 

(Section 9002) 

It is the intent of the Managers that this study should include 

an assessment of appropriate planning and development timelines 

associated with infrastructure development. The Managers suggest 

that the Biomass Research and Development Board established 

under the Biomass Research and Development Initiative may be an 

appropriate entity for coordination and oversight of this multiagency study. While this study is to use the information and results from the two related studies authorized in sections 243 and 

245 of the Energy Independence and Security Act of 2007 (P.L. 

110–140), it is the intent of the Managers that the Secretary 

should not wait on the execution or completion of those related 

studies before undertaking this study. 

(59) Nitrogen fertilizer study 

The Senate amendment directs USDA to assess the feasibility 

of producing nitrogen fertilizer from renewable energy, including 


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formulation of recommendations for an R&D program. It authorizes 

$1,000,000 for fiscal year 2008. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with amendments. It authorizes $1,000,000 in fiscal year 2009. (Section 

9003) 

(60) Study of life-cycle analysis of biofuels 

The Senate amendment directs USDA in consultation with the 

Secretary of Energy and the Administrator of the EPA to conduct 

a study of methods for evaluating the life-cycle greenhouse gas 

emissions of conventional fuels and biofuels, and to provide recommendations for a streamlined, simplified method for evaluating 

the lifecycle greenhouse gas emissions of fuels. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(61) E–85 fuel program 

The Senate amendment authorizes $20,000,000 for the period 

fiscal year 2008 through fiscal year 2012 for the USDA to award 

grants to ethanol production facilities where a majority of ownership is comprised of agricultural producers, to install blending and 

retail fueling infrastructure. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(62) Research and development of renewable energy 

The Senate amendment directs the Secretary to carry out a 

program of biomass and other renewable energy research in coordination with the Colorado Renewable Energy Collaboratory and authorizes funding to USDA and DOE for this purpose. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. The 

Managers believe that the agricultural bioenergy feedstock and energy efficiency research and extension program included in section 

7207 of the Research title will accomplish the purposes of this section. 

(63) Northeast Dairy Nutrient Management and Energy Development Program 

The Senate amendment provides for nutrient management and 

research extension. (Section 9001) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

The Managers believe that the nutrient management research 

and extension initiative included in section 7204 of the Research 

title will accomplish the purposes of this section. 

(64) Sense of the Senate concerning higher levels of ethanol blended 

gasoline 

The Senate amendment provides a Sense of the Senate encouraging the federal government to investigate and authorize the use 

of higher blends of ethanol in gasoline. (Section 9002) 

The House bill contains no comparable provision. 


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The Conference substitute deletes the Senate provision. 

(65) Conforming amendments 

The Senate amendment makes conforming amendments. (Section 9003) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(66) Sense of Senate concerning regional bioenergy consortia 

The Senate amendment directs the Secretary to continue to 

allow and support regional consortia of public institutions to support the bioeconomy. (Section 9004) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

The Managers encourage the Secretary to continue to allow 

and support efforts of regional consortiums of public institutions, 

including land grant universities and State departments of agriculture, to jointly support the bio-economy through research, extension and education activities. 

TITLE X—HORTICULTURE AND ORGANIC AGRICULTURE 

(1) Annual report on response to honey bee colony collapse disorder 

The House bill requires the Secretary to submit a report to 

Congress on the investigation of honey bee colony collapse and 

strategies to reduce colony loss. (Section 10001) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. Language incorporating the goals and objectives of this provision appears in section 7203 of the research title. 

(2) National Honey Board 

The Senate amendment amends section 7(c) of the Honey research, Promotion and Consumer Information Act (7 U.S.C. 

4606(c)) to ensure that the Honey Board continues and that the 

Secretary cannot conduct any referendum on the continuation or 

termination of the order without first conducting a concurrent referendum for approval of orders to establish a successor marketing 

board. (Section 1854) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to discontinue the current Honey Board after the Secretary has conducted a referendum for honey producers or honey 

packers, importers, and handlers. The Secretary is also required to 

act as a fiduciary in the conducting of referenda for new marketing 

boards to ensure that the rights and interests of producers, importers, packers, and handlers of honey are equitably protected in the 

transition to any 1 or more new successor marketing boards. (Section 10401) 

(3) Identification of Honey 

The Senate amendment amends section 203(h) of the Agricultural Marketing Act of 1946 (7 U.S.C. 1622(h)) to require the grading mark, statement, inspection mark of the Department of AgriVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00927 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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culture to be located in close proximity of the country of origin 

label on packaged honey. (Section 1855) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to specify that violations of the labeling requirements 

of this section, with respect to honey, may be deemed by the Secretary to be sufficient cause for debarment from the benefits of the 

Agricultural Marketing Act of 1946. (Section 10402) 

(4) Tree assistance program 

The House bill: (1) amends subtitle C of the Farm and Rural 

Investment Act of 2002, (2) makes nursery tree growers eligible 

under the Tree Assistance Program and future disaster assistance 

programs for which assistance is provided under that program, (3) 

changes the $75,000 limitation on assistance to $150,000 per year, 

and (4) maintains current discretionary authorization. (Section 

10101) 

The Senate amendment: (1) amends the Trade Act of 1974 by 

creating a Tree Assistance Program to compensate eligible growers 

for losses suffered due to natural disasters, (2) makes nursery tree 

growers eligible under the Tree Assistance Program, (3) changes 

the $75,000 limitation on assistance to $100,000 per year, (4) adds 

reimbursement for 50 percent of the cost of pruning, removal, and 

other costs to salvage existing trees or prepare the land to replant 

trees, and (5) provides necessary mandatory funding to carry out 

the program over the next five years. (Section 12101(e)) 

The Conference substitute adopts the Senate provision with 

amendments to modify the reimbursement of the cost of replanting 

trees lost due to a natural disaster; amend the Federal Crop Insurance Act with a provision identical to that which appears in the 

Trade Act of 1974; incorporate these changes into sections 12033 

and 15101 of this Act; and to make other technical changes. (Section 12033; Section 15101) 

The Managers wish to clarify that the insurance requirement for 

eligibility in the Tree Assistance Program applies only to insurance 

on crops and not on the underlying vines or trees. 

(5) Specialty crop block grants 

The House bill amends section 101 of the Specialty Crops Competitiveness Act by continuing the Specialty Crop Block Grant Program through 2012, and increasing the mandatory levels of funding 

to: 

$60,000,000 in FY’08 

$65,000,000 in FY’09 

$70,000,000 in FY’10 

$75,000,000 in FY’11 

$95,000,000 in FY’12. 

The House provision changes the definition of ‘‘specialty crop’’

under the Specialty Crops Competitiveness Act of 2004 to include 

‘‘horticulture,’’ and the definition of ‘‘State’’ to include Guam, American Samoa, the U.S. Virgin Islands and the Northern Mariana Islands. (Section 10102) 

The Senate amendment is the same as the House bill, except 

funding is discontinued after FY’11. The Senate definitions are the 


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same as in the House bill, but also includes ‘‘turfgrass sod’’ and ‘‘herbal crops’’ in the definition of ‘‘specialty crop’’. The Senate amendment modifies section 101(e) to require that 

States, to the maximum extent practicable and appropriate, develop plans that take into consideration the views of beginning and 

socially disadvantaged farmers and ranchers who produce specialty 

crops. It also changes the minimum grant amount from $100,000 

to one-half of one percent of the overall funding allocated to the 

program in a given fiscal year. (Section 1841) 

The Conference substitute adopts the House provision with 

amendments to specify that any funds made available for a fiscal 

year under the program that are not expended by certain date, to 

be determined by the Secretary, will be reallocated to other States; 

change the minimum grant amount to $100,000 or one-third of one 

percent of the overall funding allocated to the program in a given 

fiscal year (whichever is higher); provide mandatory levels of funding in the amounts of: $10 million for fiscal year 2008; 

$49 million for fiscal year 2009; and 

$55 million for each of fiscal years 2010 through 2012. (Section 10109) 

The Managers expect that the Secretary will encourage each 

state making applications for funding under the Specialty Crop 

Block Grant Program to provide a written plan detailing the affirmative steps it will take to perform outreach to specialty crop 

producers in the development of the State’s overall grant plan, including outreach to socially disadvantaged and beginning farmers 

of specialty crops. The Managers also note that herbal crops fall 

within the statutory definition of eligible specialty crops under the 

Specialty Crop Block Grant Program, and direct the Agricultural 

Marketing Service to include a comprehensive list of specific categories of eligible specialty crops in all relevant promotional materials distributed in connection to the program. The Managers expect the Secretary to continue to consider the cultivation of 

turfgrass sod as horticulture, and therefore included as part of the 

definition of specialty crop under the Specialty Crop Competitiveness Act of 2004, and as a specialty crop for any other purposes in 

this or any other Act. 

The Managers urge the Secretary to encourage state departments of agriculture to develop their grant plans through a competitive process in order to ensure maximum public input and benefit. The Managers expect the Secretary to ensure that States conduct extensive outreach to interested parties through a transparent 

process of receiving and considering public comment so that grant 

applications are developed with proven and justified public support, 

particularly when developing applications for multi-state projects. 

Further, the Managers expect the Secretary to carefully review requests that extend existing projects to ensure that support remains 

across the broad array of public-private partnerships unique to the 

structure of the specialty crop industry. 

The Managers note that since 2006 many states have used specialty crop block grant funding for marketing programs, some of 

which promote state grown products. The Managers expect the Secretary to carefully monitor the use of funds under grant awards to 


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ensure that funds are promoting specialty crops as defined under 

the Specialty Crop Competitiveness Act of 2004 and are not being 

used in generically cross-marketing other commodities which fall 

under state marketing programs but are outside the scope of the 

Act’s definition. 

The Managers recognize the ability of States to submit multistate projects under current program regulations. The Managers 

also recognize the growing need for solutions to problems that cross 

state boundaries and may therefore be addressed more effectively 

by multi-state projects. These problems include addressing good agricultural practices, research on crop productivity or quality, enhancing access to federal nutrition programs, pest and disease 

management, or commodity-specific projects addressing common 

issues in multi-state regions. The Managers therefore request that 

the Secretary encourage state departments of agriculture to submit 

grant plans that include multi-state and regional project proposals. 

The Managers also request that the Secretary give strong consideration to multi-state projects when reallocating unobligated block 

grant funding. 

(6) Additional section 32 funds for purchase of fruits, vegetables 

and nuts to support domestic nutrition assistance programs 

The House bill provides funding in addition to amounts available under section 32. Additional amounts of section 32 funds dedicated to fruit, vegetable, and nut purchases are: $190,000,000 in FY’08 

$193,000,000 in FY’09 

$199,000,000 in FY’10 

$203,000,000 in FY’11 

$206,000,000 in FY 2012 and each FY thereafter. 

The House provision expands the Secretary’s purchase discretion to include value-added fruit, vegetable, and nut products. (Section 10103) 

The Senate amendment is the same as the House bill, with 

technical differences. (Section 4907) 

The Conference substitute adopts the House provision with an 

amendment to require that, for each of fiscal years 2008 through 

2012, the Secretary shall use not less than $50,000,000 of the funds 

dedicated to fruit, vegetable, and nut purchases under section 32 

to purchase fresh fruits and vegetables for distribution to schools 

and service institutions in accordance with section 6(a) of the National School Lunch Act. This provision appears in section 4404 of 

this Act. (Section 4404) 

(7) Additional section 32 funds to provide grants for the purchase 

and operation of urban gardens growing organic fruits and 

vegetables for the local population 

The House bill provides grants to individuals or cooperatives 

composed of residents of urban neighborhoods where urban gardens 

or greenhouses are located to assist in purchasing and operating 

organic fruit and vegetable gardens and greenhouses. Provides that 

grants may not exceed $25,000 per year; $20,000,000 in discretionary funds are appropriated for fiscal year 2008 and each fiscal 

year thereafter. (Section 10103A) 


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The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. 

The Managers recognize the importance of urban gardens in 

providing opportunities for individuals and groups to produce food, 

beautify their neighborhoods, and educate themselves about food 

production systems. The Managers also recognize with the growing 

consumer awareness of organically produced food many communities may wish to operate organic gardens and greenhouses. The 

Managers further recognize the role of the Community Food 

Projects program in satisfying the need for these projects and 

strongly encourage the Secretary to increase the program’s outreach to urban areas in order to increase the submission of grant 

applications for urban gardens and greenhouses. 

(8) Independent evaluation of Department of Agriculture commodity 

purchase process 

The House bill requires an independent evaluation of the commodity purchasing processes and the importance of increasing purchases of specialty crops. (Section 10104) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to require the Secretary to arrange to have performed 

an independent evaluation of the purchasing processes used by the 

Department of Agriculture to implement the requirement that 

funds available under section 32 of the Act of August 24, 1935 be 

principally devoted to perishable agricultural commodities. (Section 

10101) 

(9) Quality requirement for clementines 

The House bill amends section 8e(a) of the Agricultural Adjustment Act by adding clementines to the list of commodities. (Section 

10105) 

The Senate amendment is the same as the House bill. (Section 

3207) 

The Conference substitute adopts the Senate provision. (Section 10102) 

(10) Implementation of food safety programs under marketing orders 

The House bill amends section 8c of the Agricultural Adjustment Act by authorizing the implementation of quality-related food 

safety programs under specialty crop marketing orders. (Section 

10106) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. 

The Managers are aware that the Secretary has issued marketing orders which include quality-related provisions intended to 

enhance the safety of the commodities to which they are applicable. 

Therefore, the managers recognize that statutory language is unnecessary. It is not the Manager’s intention to alter the Secretary’s 

authority to incorporate practices to improve the safety of commodities in marketing orders, but rather, to encourage the development 

of programs of quality-related good agricultural, manufacturing 


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and handling practices with full industry and public participation 

and in consultation with the Food and Drug Administration. 

(11) Inclusion of specialty crops in census of agriculture 

The House bill amends section 2(a) of the Census of Agriculture Act to include a census of specialty crops as part of the general census of agriculture. (Section 10107) 

The Senate amendment contains a freestanding provision 

which requires the Secretary to conduct a census of specialty crops 

not later than September 30, 2008 and each 5 years thereafter. It 

also allows the Secretary to include the census of specialty crops 

in the census on agriculture. (Section 1814) 

The Conference substitute adopts the House provision. (Section 

10103) 

(12) Maturity requirements for Hass avocados 

The House bill: (1) amends subtitle A of the Agricultural Marketing Act of 1946 by adding at the end of the title a new section, 

(2) requires the Secretary to issue regulations requiring all Hass 

avocados sold in the U.S. to meet a minimum maturity requirement, (3) allows for exceptions from this requirement for avocados 

intended for charities, relief agencies or processing, (4) uses existing inspectors that already inspect avocados under other orders, 

and allows the Secretary to collect fees to pay for inspection activities, (5) imposes civil penalties between $50 and $5,000 for each 

violation, (6) allows for the diversion of avocados that don’t meet 

the maturity requirements, and (7) authorizes appropriations for 

necessary sums. (Section 10108) 

The Senate amendment contains a freestanding provision 

which authorizes an organization of domestic avocado producers to 

submit to the Secretary a proposal for a grades and standards marketing order for Hass avocados. Once that proposal is received, the 

Secretary is required to initiate established procedures under the 

normal marketing order process for the purpose of determining 

whether there is sufficient industry support for the proposal submitted by the organization. If the Secretary deems it appropriate 

to establish a marketing order, the language also requires the Secretary to complete that order within 15 months. (Section 1856) 

The Conference substitute adopts the Senate provision. (Section 10108) 

(13) Mushroom promotion research and consumer information 

The House bill: (1) amends the Mushroom Promotion, Research 

and Consumer Information Act of 1990, (2) reflects the changed geographic distribution of mushroom growers and their productivity 

by combining the regions that are represented on the Board, and 

increasing the number of pounds required for representation in the 

region, and (3) allows the development of good agricultural practices and good handling practices under the mushroom research 

and promotion order. (Section 10109) 

The Senate amendment is the same as the House bill, except 

also allows the development of food safety programs under the promotion order. (Section 1853) 


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The Conference substitute adopts the House provision with an 

amendment to clarify that the mushroom council may develop and 

propose to the Secretary programs for good agricultural and good 

handling practices and related activities for mushrooms. (Section 

10104) 

(14) Fresh produce education initiative 

The House bill authorizes a program to educate persons involved in the fresh produce industry and the public about ways to 

reduce pathogens in fresh produce and sanitary handling practices. 

It authorizes necessary sums for each FY 2008 through 2012. (Section 10110) 

The Senate amendment is the same as the House, except authorizes $1,000,000 in discretionary funding to carry out the section. (Section 1813) 

The Conference substitute adopts the Senate provision with an 

amendment to specify that there are authorized to be appropriated 

to carry out this section $1,000,000 for each of fiscal years 2008 

through 2012, to remain available until expended. (Section 10105) 

(15) Pest and disease program 

The House bill establishes a new program to conduct early pest 

detection and surveillance activities in coordination with state departments of agriculture, to prioritize and create action plans to 

address pest and disease threats to specialty crops, and to create 

an audit-based certification approach to protect against the spread 

of plant pests. It provides mandatory funding in the amount of: 

(1) $10,000,000 in FY 2008; 

(2) $25,000,000 in FY 2009; 

(3) $40,000,000 in FY 2010; 

(4) $55,000,000 in FY 2011; and 

(5) $70,000,000 in FY 2012. (Section 10201) 

The Senate amendment is the same as the House, except for 

technical differences and provides mandatory funds in the amounts 

of: 

(1) $10,000,000 for FY 2008; 

(2) $25,000,000 for FY 2009; 

(3) $40,000,000 for FY 2010; 

(4) $50,000,000 for FY 2011; 

(5) $64,000,000 for FY 2012. (Section 12101(f)) 

The Conference substitute adopts the Senate provision with an 

amendment to: describe the application procedure for the program; 

prohibit the Department of Agriculture from considering the availability of nonfederal funds in determining whether to enter into a 

cooperative agreement with a State department of agriculture; direct the Secretary to consider various risk factors when considering 

an application for a cooperative agreement; express Congressional 

disapproval of a cost-sharing rule for animal and health emergency 

programs and; specify mandatory funding in the amounts of: 

(1) $12,000,000 for fiscal year 2009; 

(2) $45,000,000 for fiscal year 2010; 

(3) $50,000,000 for fiscal year 2011; and 

(4) $50,000,000 for fiscal year 2012. (Section 10201) 


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The Managers believe that the nursery plant pest risk management systems established under this section will provide the nursery industry with assistance and flexibility in developing programs 

that meet its needs to determine and manage plant pest and disease risks. 

The Managers note that the U.S. Department of Agriculture 

has taken specific steps to promote new methods of inspection and 

regulation based on new approaches to nursery pest risk management, sometimes referred to as the ‘‘systems approach.’’ These 

steps include a technical agreement under the auspices of the 

North American Plant Protection Organization (Regional Standards 

for Phytosanitary Measures Number 24), and the development of 

the U.S. Nursery Certification Program, a limited test-pilot program developed by Animal and Plant Health Inspection Service 

Plant Protection and Quarantine to promote U.S. nursery shipments to Canada. 

The Managers are aware of the U.S. Department of Agriculture’s efforts to promote the systems approach for the nursery 

industry. The development of effective systems of pest risk management and the industry adoption of such systems will be hastened 

and made more effective through an initiative based on collaboration among key agencies, Departmental personnel, industry organizations, and research institutions. To implement the nursery plant 

pest risk management systems under this section, U.S. Department 

of Agriculture policies and regulations must have a sound foundation in research and experience through pilot programs of nursery 

plant pest risk management systems. In addition, there must be 

collaboration among industry and state and federal regulators to 

improve programs of inspection, certification and regulation using 

such systems. 

The Managers recognize that systems of pest risk management 

developed by the nursery industry must satisfy prevailing regulatory requirements if they are to be useful and effective. The Managers encourage the U.S. Department of Agriculture to provide 

guidance and technical assistance to the nursery industry, and to 

promote and coordinate related programs of research in the implementation of nursery plant pest risk management systems under 

this section. 

(16) Multi-species fruit fly research and sterile fly production 

The House bill authorizes the construction of a warehouse and 

irradiation containment facility for fruit fly rearing and sterilization in Waimanalo, Hawaii. It also authorizes the appropriation of 

$15,000,000 for construction and $1,000,000 for 2008 and each subsequent fiscal year for facility maintenance. (Section 10202) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes the House provision. 

The Managers recognize that fruit flies are among the most destructive pests of fruits and vegetables in the world and pose a significant risk to U.S. agriculture. Further, the Managers recognize 

the importance of the Animal and Plant Health Inspection Service’s 

(APHIS) Fruit Fly Control Programs in controlling fruit flies. Given 

the need for a backup sterile fruit fly facility for Mediterranean, 

Melon, Oriental, and Solanaceaous fruit flies, the Managers strongVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00934 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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ly encourage the Secretary to fully consider Waimanalo, Hawaii, 

when determining where such a multi-species facility will be located. In examining Waimanalo, Hawaii, and other locations, 

APHIS should consider whether the locations will support the establishment of the species of fruit flies being produced, existing researcher expertise and experience, whether the area is already infested with the species of fruit flies being produced, and cost effectiveness. The Managers strongly encourage APHIS to request appropriated funding as authorized by 7 U.S.C. 428a to provide for 

the costs of building, maintaining, and operating a backup sterile 

multi-species fruit fly facility at the location deemed most suitable. 

(17) National organic certification cost-share program 

The House bill amends section 10606 of the Farm Security and 

Rural Investment Act to provide $22,000,000 for the national organic certification cost-share program, to be available until expended. It provides that the federal share may not exceed 75 percent of the cost of certification, and the maximum amount a producer may receive is raised from $500 to $750. (Section 10301) 

The Senate amendment amends section 10606 of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 6523) to reauthorize the National Organic Certification Cost-Share program, 

which provides funds for the Secretary to assist producers and handlers of agricultural products in obtaining certification under the 

Organic Foods Production Act of 1990. Payments to producers or 

handlers are limited to $750, and the federal share of the certification cost will be no more than 75 percent of the total certification 

cost incurred. The Senate provision adds language to require the 

Secretary to submit to Congress, reports that describes the expenditures for each state under the program during the previous fiscal 

year. It also provides $22,000,000 in mandatory funding. (Section 

1823) 

The Conference substitute adopts the Senate provision with an 

amendment to delete the federal share requirements as well as the 

federal and state recordkeeping requirements, and to require the 

Secretary to submit to the House and Senate Agriculture Committees a report containing certain program information. (Section 

10301) 

The Managers encourage the Secretary to keep accurate and 

current records of requests by and disbursements to States under 

the program, and require accurate and consistent recordkeeping 

from each State and entity that receives program payments. The 

Managers also recognize the importance of distributing cost-share 

funds to the States in a timely manner, and request that the Secretary distribute such funds at the soonest date practicable following the deadline for submission of funding requests under the 

program. The Managers are aware that there have been discussions between the Department of Agriculture and the States regarding administrative fees for the program and encourage the Department to review administrative fees to ensure optimal performance in serving the needs of organic producers and handlers. 


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(18) Organic production and market data 

The House bill: (1) amends section 7407 of the Farm Security 

and Rural Investment Act to add pricing of organic products as 

new data to be included in the ongoing collection of data on agriculture production and marketing, (2) provides that the data on 

organics under this section shall be collected to analyze crop loss 

risk of organic methods of production, (3) provides $3,000,000 in 

mandatory funds to be available until expended, and (4) includes 

a free-standing provision that requires the Secretary of Agriculture 

to submit to Congress a report regarding the progress made in implementing this amendment. (Section 10302) 

The Senate amendment amends section 2104 of the Organic 

Foods Production Act of 1990 (7 U.S.C. 6503) by granting the Secretary authority to segregate data as it relates to the organic industry by publishing organic production and marketing information 

and surveys. The language is intended to remedy the lack of price 

and yield information for organic producers. 

Senate expands upon House language by requiring detailed 

data collection for: organic production and market data initiatives 

and surveys; expand, collect, and publish organic census data analysis, fund comprehensive reporting of prices relating to organicallyproduced agricultural products; conduct analysis relating to organic 

production, handling, distribution, retail, and trend studies; study 

and perform periodic updates on the effects of organic standards on 

consumer behavior; conduct analysis for organic agriculture using 

the national crop table. 

The Senate provision provides $5,000,000 in mandatory funding. 

(Section 1821) 

The Conference substitute adopts the Senate provision with an 

amendment to clarify the data collection, analysis, and survey development requirements for the Secretary, as well as to further 

specify the contents of the report that the Secretary shall submit 

to the House and Senate Agriculture Committees. (Section 10302) 

The Managers have provided $5,000,000 in mandatory funding 

in an effort to jump-start organic data collection efforts at the Department of Agriculture, but recognize that remedying the unmet 

data collection needs of the organic sector will require further investment, and therefore, have provided an additional authorization 

of appropriations of $25,000,000 for the period of fiscal years 2008 

through 2012 to carry out the program. The Managers intend that 

$3.5 million of the funding provided for this section be allocated to 

the Agricultural Market Service to collect and distribute comprehensive reporting of prices relating to organically produced agricultural products. The Managers also note the critical importance 

of collecting data related to crop loss risk, and farm-gate prices, in 

order to determine appropriate products and premiums for crop insurance policies offered to organic producers. The Managers further 

intend that $1.5 million of the funding provided for this section be 

used by the Economic Research Service and National Agricultural 

Statistics Service to carry out the specified requirements of the initiative that are appropriate to each agency. 


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(19) Organic conversion, technical and educational assistance 

The House bill authorizes $50,000,000 over five years to provide technical assistance and cost-sharing grants to farmers trying 

to transition to organic farming. (Section 10303) 

The Senate amendment contains a comparable provision in the 

conservation title (EQIP). 

The Conference substitute deletes the House provision. Language addressing the goal of providing technical assistance to farmers trying to transition to organic farming appears in section 2501 

of the conservation title. 

(20) Exemption of certified organic products from assessments 

The Senate amendment amends section 501(e) of the Federal 

Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7401 

(e)) to allow farmers who have some or part of their farm certified 

organic to receive the exemption. Only producers that are USDA 

organically certified may receive the exemption for that portion of 

land they produce organically. (Section 1822) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(21) National organic program 

The Senate amendment amends section 2123 of the Organic 

Foods Production Act of 1990 (7 U.S.C. 6522) to provide increased 

authorized incremental funding levels for the National Organic 

Program to ensure proper compliance and oversight of the National 

Organic Program. It also authorizes $5,000,000 for fiscal year 2008; 

$6,500,000 for fiscal year 2009; $8,000,000 for fiscal year 2010; 

$9,500,000 for fiscal year 2011; and $11,000,000 for fiscal year 

2012. (Section 1824) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to provide such additional sums as are necessary to 

carry out the program. (Section 10303) 

The National Organic Program (NOP) is the first line of defense in assuring consumers that organic products certified under 

the program consistently meet the program’s standards. The Managers are aware of concerns raised by numerous organic agriculture 

interests concerning the level of resources devoted to the NOP. 

While the program’s funding level has increased over time, the 

Managers view the current level of funding as inadequate to permit 

the NOP to properly address the world-wide scope of accreditation 

oversight and certifier training. The Managers strongly encourage 

the Secretary to prepare NOP budget requests at least equal to the 

appropriations levels authorized in this Act. 

(22) Grant program to improve the movement of specialty crops 

The House bill: (1) authorizes the Secretary to make grants to 

State and local governments, grower cooperatives, and producer 

and shipper organizations to improve the cost-effective movement 

of specialty crops, (2) provides that the grant recipient must match 

the amount of funds received under this program, and (3) authorizes appropriations for necessary sums to carry out the section. 

(Section 10401) 


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The Senate amendment is the same as the House bill, except 

Senate language amends title II of the Specialty Crops Competitiveness Act of 2004 (Public Law 108–465; 118 Stat. 3884), and 

clarifies that non-profit trucking associations and their research entities are eligible to receive grants. (Section 1842) 

The Conference substitute adopts the House provision with an 

amendment to allow national, state, or regional organizations of 

producers, shippers or carriers to be eligible for grants under the 

program. (Section 10403) 

(23) Authorization of appropriations for market news activities regarding specialty crops 

The House bill authorizes necessary funds for each of fiscal 

years 2008 through 2012 to support market news activities regarding specialty crops. (Section 10402) 

The Senate amendment authorizes $9,000,000 for each of fiscal 

years 2008 through 2012, to remain available until expended for 

market news activities to provide timely price information on fruits 

and vegetables. (Section 1811) 

The Conference substitute adopts the Senate provision with an 

amendment to specify that in addition to any other funds made 

available through annual appropriations for market news services, 

there is authorized to be appropriated $9,000,000 for each of fiscal 

years 2008 through 2012, to remain available until expended. (Section 10107) 

(24) Farmer marketing assistance program 

The House bill: (1) amends section 6 of the Farmer-to-Consumer Direct Marketing Act of 1976 and provides findings, (2) renames the Farmers’ Market Promotion Program the ‘‘Farmer Marketing Assistance Program’’, (3) specifies categories of farmer-toconsumer direct marketing activities eligible for funding under the 

program, (4) provides mandatory funds in the amounts of 

$5,000,000 for fiscal years 2008 through 2010; and $10,000,000 for 

fiscal years 2011 through 2012, and (5) provides that 10 percent of 

these funds shall be used to support the use of electronic benefit 

transfers at farmer’s markets. (Section 10403) 

The Senate amendment: (1) amends section 6 of the Farmerto-Consumer Direct Marketing Act of 1976 (7 U.S.C. 3005) to reauthorize the Farmers Market Promotion Program, (2) adds language 

to include producer networks or associations, and (3) provides mandatory funds in the amounts of $5,000,000 for each of fiscal years 

2008 through 2011; and $10,000,000 for fiscal year 2012. (Section 

1812) 

The Conference substitute adopts the Senate provision with an 

amendment to specify that 10 percent of the funds available to 

carry out the Farmers’ Market Promotion Program be used to implement electronic benefit transfer systems at farmers’ markets; 

and to specify mandatory funding in the amounts of: 

$3,000,000 for fiscal year 2008; 

$5,000,000 for each of fiscal years 2009 and 2010; 

$10,000,000 for each of fiscal years 2011 and 2012. (Section 

10106) 


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The Managers recognize that farmer-to-consumer direct marketing activities offer significant economic opportunities for farmers 

and ranchers seeking to increase profit retention. The Farmers’ Market Promotion Program is intended to support the development 

and expansion of farmers’ markets, and all other forms of direct 

marketing, through the provision of grants to assist in organizing, 

marketing, training, business plan development, community outreach and education, and other associated activities designed to establish or improve direct marketing opportunities for farmers and 

ranchers and the consumers they serve. 

The Managers recognize that the growth of farmers’ markets 

and other direct marketing ventures has been limited in some communities and regions, and therefore encourage the Department to 

determine the underlying reasons for this uneven distribution, with 

the goal of addressing this disparity through the support of meritorious projects in these locations. 

The Managers are aware of the growing role that the more 

than 4,300 farmers markets and 1,200 community supported agriculture enterprises across the country play in providing access to 

fresh, healthy, and local foods, to all Americans, including those 

who participate in federal food assistance programs. As of 2006, the 

USDA estimated that only 6 percent of farmers’ markets nationwide have electronic benefit transfer (EBT) systems in place to accept food stamp benefits. To increase the use of food stamp benefits 

at farmers’ markets and community supported agriculture enterprises, the Managers have required a minimum of ten percent of 

the Farmers’ Market Promotion Program funds be devoted to 

projects designed to implement EBT systems. The Managers also 

encourage the Secretary to examine and implement more systemic 

administrative approaches to increase the nationwide access of 

EBT technology suitable for farmers’ markets and community supported agriculture enterprises, including possible ways to improve 

the administration of EBT service provider contracts to achieve this 

goal. 

(25) National clean plant network 

The House bill creates a funding source for clean planting 

stock and authorizes the Secretary to enter into cooperative agreements to produce, maintain and distribute healthy planting stock. 

It authorizes the appropriation of necessary funds through 2012 in 

addition to $20,000,000 in mandatory funds for the period of fiscal 

years 2008 through 2012. (Section 10404) 

The Senate amendment is the same as the House bill, with 

technical differences. (Section 1851) 

The Conference substitute adopts the Senate provision with an 

amendment to add NLGCA institutions to the list of entities the 

Secretary shall consult with in carrying out the program, and to 

specify mandatory funding in the amounts of $5,000,000 for each 

of fiscal years 2009 through 2012. (Section 10202) 

(26) Healthy food urban enterprise development program 

The House bill: (1) provides competitive grants to eligible entities to conduct studies on improving access of underserved communities to affordable, locally produced food, (2) provides that the 


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maximum grant amount shall not exceed $250,000, and (3) authorizes the appropriation of necessary funds for each of fiscal years 

2008 through 2012. (Section 10405) 

The Senate amendment requires the Secretary of Agriculture 

to establish, through a competitive grant process, the Healthy Enterprise Development Center, the mission of which is to increase 

access to healthy, affordable foods to underserved communities. 

The Healthy Food Enterprise Development Center will be required 

to collect, develop, and provide technical assistance to agricultural 

producers, food wholesalers and retailers, schools, and other entities regarding best practices for aggregating, storing, processing, 

and marketing local agricultural products and increasing the availability of such products in underserved communities. The Healthy 

Food Enterprise Development Center is also provided with the authority to subgrant funds to carry out feasibility studies to carry 

out the purposes of the Center. The provision provides $7,000,000 

in mandatory money. (Section 1843) 

The Conference substitute adopts the Senate provision with 

amendments to place language for the Healthy Urban Food Enterprise Development Center within the Community Food Projects 

statute; clarify that subgrants may be used to establish and facilitate enterprises that process, distribute, aggregate, store, and market healthy affordable foods; limit the amount allocated for administrative expenses; provide $1,000,000 in funding for each of fiscal 

years 2009 through 2011; and authorize $2,000,000 for fiscal year 

2012. (Section 4402) 

The Managers expect that sub-grants be provided for activities 

in underserved areas that assist appropriate institutions in modifying and upgrading facilities through the purchase of refrigeration 

units, coolers or other equipment appropriate to accommodate 

healthy and locally produced agricultural food products. 

(27) Definitions 

The Senate amendment sets out definitions to apply throughout subtitle F for the terms ‘‘specialty crop’’, ‘‘state’’, and ‘‘state department of agriculture.’’ (Section 1801) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to remove the definition of the term ‘‘State.’’ (Section 

10001) 

(28) Foreign market access study and strategy plan 

The Senate amendment requires the Comptroller General of 

the United States to carry out a study regarding the extent to 

which United States specialty crops have or have not benefited 

from the reduction of foreign trade barriers under the Uruguay 

Round. (Section 1831) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(29) Consultations on sanitary and phytosanitary restrictions for 

fruits and vegetables 

The Senate amendment requires the Secretary to consult with 

interested persons and conduct annual briefings on sanitary and 


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phytosanitary trade issues, included the development of a strategic 

risk management framework and as appropriate implementation of 

a peer review for risk analysis. (Section 1833) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(30) Market loss assistance for asparagus producers 

The Senate amendment establishes a program to pay those 

producers currently growing asparagus for revenue losses during 

the 2004–2007 crop years due to imports. The language provides 

$15,000,000 in mandatory funding ($7,500,000 for producers of 

fresh asparagus and $7,500,000 for producers of processed or frozen 

asparagus). (Section 1852) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 10404) 

TITLE XI—LIVESTOCK 

(1) Livestock mandatory price reporting 

The Senate amendment amends the Livestock Mandatory Reporting Act in subsection (a). It amends section 232(c)(3) to change 

the time of the afternoon swine report from 2:00 p.m. to 3:00 p.m. 

(Central Time). It also changes the time that USDA will publish 

the afternoon swine report from 3:00 p.m. to 4:00 p.m. (Central 

Time). Subsection (b) directs USDA to study the economic impacts 

of including wholesale pork product sales reporting on producers 

and consumers, including the effects of a confidentiality requirement on mandatory reporting. Upon completion of that study, 

USDA may establish mandatory packer reporting of wholesale pork 

product sales (such as pork cuts and retail-ready pork products), 

requiring each packer processing plant to report to USDA price and 

volume information at least twice each reporting day. Subsection 

(c) ensures that USDA continues to publish retail scanner data. 

(Section 10001) 

The House bill contains no comparable provision. 

The Conference substitute deletes subsection (a) of the Senate 

provision to amend the afternoon swine report. The conference substitute adopts subsection (b) of the Senate provision with an 

amendment to restrict the focus of the wholesale pork study to only 

pork cuts. Additionally, the Secretary of Agriculture will be provided 1 year to complete the study upon enactment of this Act. The 

substitute also clarifies that the Secretary is only authorized to collect the data necessary to complete the study during the period preceding the completion of the report. An authorization of such sums 

as necessary is provided to complete the study. 

The Conference substitute deletes subsection (c) of the Senate 

provision. The conference substitute also provides enhancements to 

improve readability and understanding of information published 

under the Livestock Mandatory Reporting Act through electronic 

reporting. 

The Managers expect the website improvements to be presented in a user friendly format that can be readily understood by 

producers, packers and other market participants. The website 


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should include charts and graphs that provide real time data, including comparable data from previous days so that producers and 

other industry participants can track market changes. (Section 

11001) 

(2) Grading and inspection 

The Senate amendment amends section 203 of the Agricultural 

Marketing Act of 1946 (7 U.S.C. 1622) to provide USDA authority 

to establish a voluntary grading program at USDA for catfish. The 

provision requires USDA to provide inspection activities under the 

Federal Meat Inspection Act for farm raised catfish, by adding catfish to the list of ‘‘amenable species.’’ The Secretary, while establishing the grading and inspection program for catfish, is required 

to ensure that nothing duplicates, impedes, or undermines any of 

the food safety or product grading activities conducted by the Department of Commerce or the Food and Drug Administration. (Section 10002) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to authorize a voluntary fee-based grading program at 

USDA for catfish. Additional species of farm-raised fish or farmraised shellfish may be added to the grading program through a petition process to the Secretary of Agriculture. The conference substitute also provides that catfish shall be an amenable species 

under the Federal Meat Inspection Act, and therefore will be subject to examination and inspection by USDA’s Food Safety and Inspection Service (FSIS) when processed for use as human food. In 

conducting such inspections, FSIS is authorized to take into account the conditions under which the catfish are raised and transported to a processing establishment. Additional species of fish and 

shellfish are not addressed in this amendment; however, the Managers note that the Secretary has underlying authority within the 

Federal Meat Inspection Act to amend the definition of amenable 

species as he considers necessary and appropriate. 

Additionally, the conference substitute requires the Secretary, 

in promulgating regulations for inspection activities, to consult 

with the Commissioner of the Food and Drug Administration. Final 

regulations for grading and inspection activities shall be promulgated not later than 18 months after the date of enactment of this 

section. The Conference substitute also requires the Secretary of 

Agriculture to submit an estimate of the costs of implementing the 

program. (Section 11016) 

It is the intent of Congress that catfish be subject to continuous inspection and that imported catfish inspection programs be 

found to be equivalent under USDA regulations before foreign catfish may be imported into the United States. 

The Managers intend that nothing in this section be interpreted to reduce funding or the level of inspection for meat, poultry 

and egg products. The Managers expect the Secretary to budget accordingly each year for catfish inspection. The Managers expect the 

Secretary, in approving any petition for voluntary, fee-based grading services for any additional farm-raised fish or farm-raised shellfish species, to make any resulting service available only on a facility by facility basis. 


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(3) Country of origin labeling 

The House bill amends the Agricultural Marketing Act of 1946 

to provide new country of origin labeling requirements for beef, 

lamb, pork and goat. It amends the list of covered commodities to 

include goat meat. The provision specifies labeling requirements for 

products that are of United States country of origin, multiple countries of origin, imported for immediate slaughter, and from a foreign country of origin. To be eligible for U.S. country of origin, the 

product must be derived from an animal that was exclusively born, 

raised, and slaughtered in the U.S. (with a narrow exception for 

animals from Alaska or Hawaii and transported through Canada), 

or present in the U.S. on or before January 1, 2008. The House provision authorizes the Secretary to conduct audits to verify compliance with this section. It prohibits the Secretary from requiring a 

person or entity to maintain a record of the country of origin of covered commodities, other than those maintained in the course of the 

normal conduct of business of such person or entity. The House bill 

amends section 283 to clarify that a retailer or person engaged in 

the business of supplying a covered commodity to a retailer notified 

of a violation will be provided 30 days to come into compliance with 

the law. It provides that if such person does not make a good faith 

effort to comply, and continues to willfully violate the law, the Secretary may fine the person in an amount up to $1,000 for each violation. (Section 11104) 

The Senate amendment is similar to the House language but 

has several modifications. It amends the list of covered commodities to include goat meat, macadamia nuts and chicken. In addition to House language, Senate adds language to U.S. country of 

origin labeling category to require that animals present in the 

United States on or before January 1, 2008, and once present in 

the United States, must have remained continuously in the United 

States. In addition to House language regarding multiple countries 

of origin, Senate adds disclaimer under subsection (B) to clarify 

that labeling for multiple countries of origin is a mandatory requirement. (Section 10003) 

The Conference substitute adopts the Senate provision with an 

amendment to add ginseng and pecans as covered commodities. 

Covered commodities, such as beef, lamb, pork, chicken, or goat 

present in the United States on or before July 15, 2008 will be labeled as product of the United States. The Managers reinstate current law regarding the labeling of processed wild fish to include locations such as aboard a vessel that is documented under chapter 

121 of title 46, United States Code, or registered in the United 

States. (Section 11002) 

(4) Definitions 

The Senate amendment: (1) amends the definitions of terms 

provided for the purposes of the Agricultural Fair Practices Act of 

1967, (2) expands the definition of ‘‘association of producers’’ to also 

include general livestock, poultry and farm groups, and (3) clarifies 

that a handler is not a producer, nor a person that provides custom 

feeding services. (Section 10101) 

The House bill contains no comparable provision. 


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The Conference substitute adopts the Senate provision with an 

amendment to define the term associations of producers to include 

organizations with a membership exclusively limited to agricultural 

producers and dedicated to promoting the common interest and 

general welfare of agricultural products. Additionally, the conference substitute deletes the Senate provision that excluded the 

term ‘‘producer’’ from the definition of ‘‘handler.’’ The conference 

substitute also removes the provision defining the Secretary of Agriculture under the Agricultural Fair Practices Act of 1967. (Section 

11003) 

It is the intent of the Managers that custom feeding services 

should be interpreted to mean a producer or business that feeds 

livestock for other producers, but does not own the livestock they 

are feeding and raising for those producers. 

(5) Prohibited practices 

The Senate amendment: (1) amends section 4 of the Agricultural Fair Practices Act to expand the list of prohibited practices, 

(2) amends the first category to add that it shall also be unlawful 

for any handler to knowingly engage or permit any employee or 

agent to coerce any producer in the exercise of his right to form an 

association of producers, and (3) adds that it shall be unlawful to 

‘‘fail to bargain in good faith with an association of producers.’’ (Section 10102) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(6) Enforcement 

The Senate amendment amends the enforcement provisions by 

striking section 5 and replacing it with a directive for the Secretary 

to conduct rulemaking to clarify what constitutes normal and fair 

dealing per section 10104. It also strikes section 6 of the current 

law to provide the Secretary of Agriculture the authority to bring 

a civil action in United States District Court by filing a complaint 

requesting preventative relief, including an application for a permanent or temporary injunction, restraining order or other order, 

against the handler. Under the Senate provision, handlers found to 

have violated the Act are liable for the amount of damages including the costs of litigation and reasonable attorneys’ fees. The Senate provision changes the statute of limitations from 2 years to 4 

years and provides for an additional penalty of not more than 

$1,000 per violation. (Section 10103) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(7) Rules and regulations 

The House bill amends the Agricultural Fair Practices Act by 

adding provisions for the promulgation of new rules and regulations. It directs USDA to promulgate rules and regulations, including rules or regulations necessary to clarify what constitutes fair 

and normal dealing for purposes of the selection of customers by 

handlers. Please note section 5 (7 U.S.C. 2304) was struck pursuant to section 10103. (Section 10104) 

The Senate amendment 


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The Conference substitute deletes the Senate provision. 

(8) Special counsel for agricultural competition 

The Senate amendment amends the Packers and Stockyards 

Act by adding a new subtitle that provides for the appointment of 

a special counsel at USDA to investigate and also prosecute violations of Packers and Stockyards Act and Agricultural Fair Practices Act. The Special Counsel will oversee the Office of Special 

Counsel and will have the responsibility for all duties and functions of the Packers and Stockyards programs at USDA. Employees 

within GIPSA’s Packers and Stockyards programs will report to the 

Special Counsel. Grain inspection activities currently carried out by 

GIPSA would continue to report to the Administrator for GIPSA as 

a separate agency or as determined by the Secretary upon implementing this section. The Administrator for GIPSA would no longer 

oversee activities of the Packers and Stockyards programs. The 

Senate provision provides that the Special Counsel will report to 

the Secretary of Agriculture. The Special Counsel shall be free from 

the direction and control of any person in the Department of Agriculture other than the Secretary. The Special Counsel shall be appointed by the President with the advice and consent of the Senate. 

The Senate provision provides that the Special Counsel shall report 

twice each year to Congress that details the number of complaints 

received and closed, number of investigations and civil and administrative actions initiated, carried out and completed, number and 

type of decisions agreed to and number of stipulation agreements, 

the number of investigations and civil and administrative actions 

that the Secretary objected to or prohibited from being carried out, 

and the stated purpose of the Secretary for each objection or prohibition. The Special Counsel, prior to commencing, defending, or intervening in any civil action under the Packers and Stockyards Act 

or the Agricultural Fair Practices Act, shall give written notification to the Attorney General. Should the Attorney General fail to 

commence, defend, or intervene in the proposed action, the Special 

Counsel may commence, defend or intervene and supervise the litigation in the name of the Special Counsel. Nothing prevents the 

Attorney General from intervening on behalf of the United States 

in any civil action under the Packers and Stockyards Act or the Agricultural Fair Practices Act. (Section 10201) 

The House bill contains no comparable provision. 

The Conference substitute provides that the Secretary shall 

submit an annual report by the Grain Inspection, Packers and 

Stockyards Administration at the Department of Agriculture to detail the number of investigations into possible violations of the 

Packers and Stockyards Act, 1921. The annual report will detail 

the length of time that investigations are pending with the Grain 

Inspection, Packers and Stockyards Administration, the General 

Counsel of the Department of Agriculture and the Department of 

Justice. The annual report requirement will expire with the expiration of this Act. (Section 11004) 

It is the intent of the Managers that the annual report provide 

ranges into the length of time investigations may be pending with 

the Grain Inspection, Packers and Stockyards Administration, the 

Office of General Counsel, or the Department of Justice. The ManVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00945 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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agers have provided flexibility for the Secretary to conduct the report using various summary statistics such as range, maximum, 

minimum, mean and average times. However, at a minimum, the 

Managers request charts to be provided in the annual report denoting the ranges in 6 month intervals. 

(9) Investigation of live poultry dealers 

The Senate amendment: (1) amends section 2 of the Packers 

and Stockyards Act to remove the poultry slaughter requirement 

from the existing definitions, (2) amends title II of the Packers and 

Stockyards Act to give the USDA administrative enforcement authority over live poultry dealers under the Act, (3) defines ‘‘poultry 

grower’’ as any person engaged in the business of raising or caring 

for live poultry under a poultry growing arrangement, regardless of 

whether the poultry is owned by the person or by another person, 

(4) amends section 408 of the Packers and Stockyards Act to provide authority for the Secretary to request a temporary injunction 

or restraining order if a person subject to the Act fails to pay a 

poultry grower what is due the poultry grower for poultry care, (5) 

increases the penalty for violations under the Act from $10,000 to 

$22,000, and (6) repeals sections regarding poultry enforcement 

under sections 411, 412, and 413. (Section 10202) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(10) Definition of capital investment 

The Senate amendment amends title I of the Packers and 

Stockyards Act to add the definition of a capital investment. Capital investment is defined as an investment in a structure, such as 

a building or manure storage structure; or machinery or equipment 

associated with producing livestock or poultry that has a useful life 

of more than 1 year. (Section 10203(a)) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(11) Definition of contractor 

The Senate amendment amends title I of the Packers and 

Stockyards Act to add the definition of a contractor. Contractor is 

defined as a person that obtains livestock or poultry from a contract producer in accordance with a production contract. (Section 

10203(a)) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(12) Definition of contract producer 

The Senate amendment amends title I of the Packers and 

Stockyards Act to add the definition of a contract producer. Contract producer is defined as a producer that produces livestock or 

poultry under a production contract. (Section 10203(a)) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 


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(13) Definition of investment requirement 

The Senate amendment amends title I of the Packers and 

Stockyards Act to add the definition of an investment requirement. 

Investment requirement is defined as an investment that requires 

a contract producer to make a capital investment that, but for the 

production contract, the producer would not have made; or a representation by a contractor that results in the contract producer 

making a capital investment. (Section 10203(a)) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(14) Definition of production contract 

The Senate amendment amends title I of the Packers and 

Stockyards Act to add the definition of a production contract. A 

production contract is defined as a written agreement that provides 

for the production of livestock or poultry by a contract producer or 

the provision of a management service relating to the production 

of livestock or poultry by a contract producer. (Section 10203(a)) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(15) Right to cancel production contracts 

The Senate amendment amends title II of the Packers and 

Stockyards Act to add a new section (section 208) governing production contracts. It allows contract producers to cancel a production contract within three business days after the contract execution date. The contract shall disclose the right of the producer to 

cancel a production contract and the method by which the contract 

producer may cancel the production contract, including the deadline for canceling the production contract. (Section 10203(b)) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to provide that poultry growers and swine production 

contract growers may cancel their contract up to three business 

days after the date on which the contract was signed. (Section 

11005) 

(16) Production contracts requiring large capital investments 

The Senate amendment amends title II of the Packers and 

Stockyards Act to add a new section (section 208) governing production contracts that require large capital investments. The provision allows contract producers who have made an investment of 

$100,000 or more for purposes of securing the production contract 

with a packer, live poultry dealer, or swine contractor, to be given 

at least 90 days to correct an alleged breach before a contractor can 

terminate a contract. The contractor may terminate or cancel a production contract without notice for voluntary abandonment by the 

contract producer, conviction of the contract producer for an offense 

or fraud or theft committed against the contractor, the natural end 

of the production contract, or the well-being of the livestock or 

poultry would be in jeopardy once under the care of the contract 

producer. If not later than 90 days, a producer remedies the cause 

of breach under the contract, the contractor may not terminate or 

cancel a production contract. (Section 10203(b)) 


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The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

In Section 11006 of the conference substitute, the Managers require the Secretary to promulgate rules regarding what constitutes 

a reasonable period of time for a live poultry dealer or swine production contract grower to remedy a breach of contract that could 

lead to termination of the poultry growing arrangement or swine 

production contract. 

(17) Additional capital investments 

The Senate amendment amends title II of the Packers and 

Stockyards Act to add a new section (section 208) to prohibit a contractor from requiring additional investments of the contract producer during the term of the contract unless the additional investments are offset by reasonable additional consideration, including 

compensation or a modification of the terms of the contract; and 

the contract producer agrees in writing that there is acceptable and 

satisfactory consideration for the additional capital investment; or 

without the additional capital investments the well-being of the 

livestock or poultry subject to the contract are in jeopardy. (Section 

10203(b)) 

The House bill contains no comparable provision. 

The Conference substitute provides that a poultry growing arrangement or swine production contract contain a conspicuous 

statement that additional large capital investments may be required of the poultry grower or swine production contract grower 

during the term of the poultry growing arrangement or swine production contract. The provision will apply to any poultry growing 

arrangement or swine production contract entered into, amended, 

altered, modified, renewed, or extended after the date of enactment 

of this section. (Section 11005) 

(18) Choice of law, jurisdiction and venue 

The Senate amendment: (1) amends title II of the Packers and 

Stockyards Act to add a new section (section 209) governing the 

settlement of disputes arising under production or marketing contracts governed by the Packers and Stockyards Act, (2) provides 

that any provision of a livestock or poultry contract shall be subject 

to the jurisdiction, venue of the state in which the production occurs, and (3) designates that the choice of law, jurisdiction and 

venue requirements shall apply to any production or marketing 

contract entered into, amended, altered, modified, renewed, or extended after the date of enactment. (Section 10203) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to require that the forum for resolving any dispute 

among the parties to a poultry growing arrangement or swine production or marketing contract shall be the Federal judicial district 

in which the principle part of the performance takes place under 

the arrangement or contract. A poultry growing arrangement or 

swine production or marketing contract may specify which State’s 

law is to apply to issues governed by State law in any dispute arising out of the arrangement or contract, except to the extent that 

doing so is prohibited by the law of the State in which the principal 


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part of the performance takes place under the arrangement or contract. (Section 11005) 

(19) Arbitration of livestock and poultry contracts 

The Senate amendment amends title II of the Packers and 

Stockyards Act to add a new section (section 210) governing the 

settlement of disputes arising under contracts governed by the 

Packers and Stockyards Act. The Senate provision provides that arbitration may be used to settle a controversy arising from a livestock or poultry contract only if, after the controversy arises, both 

parties consent in writing to use arbitration to settle the controversy. (Section 10203(b)) 

The House bill amended the Packers and Stockyards Act to instruct the Secretary to promulgate regulations to establish standards related to arbitration provisions in livestock and poultry contracts. The provision directs the Secretary to promulgate regulations addressing venue, costs, number and appointment of arbitrators, and other elements of arbitration, as necessary. The provision 

requires that any person appointed as arbitrator disclose any circumstances that could raise doubt as to impartiality. 

The Conference substitute provides a producer or grower the 

ability to decline arbitration prior to entering the contract. Any 

livestock or poultry contract that contains a provision requiring the 

use of arbitration shall conspicuously disclose the right of the contract producer or grower, prior to entering the contract, to decline 

the requirement to use arbitration to resolve any controversy that 

may arise under the livestock or poultry contract. Any contract producer or grower that declines arbitration prior to entering the contract has the right to still seek the use of arbitration after a controversy arises, if both parties consent in writing to use arbitration 

to settle the controversy. The conference substitute provides that it 

shall be an unlawful practice under the Packers and Stockyards 

Act for a packer, swine contractor, or live poultry dealer to violate 

this section including any action that has the intent or effect of 

limiting the ability of a producer or grower to freely make a choice 

to decline the use of arbitration. The Secretary is also required to 

promulgate regulations to establish criteria to be used in determining whether the arbitration process provided in a contract provides a meaningful opportunity for the grower or producer to participate fully in the arbitration process. (Section 11005) 

When used in this section, the Managers intend that the term 

‘‘contract’’ means at a minimum, poultry growing arrangements, 

livestock production, marketing and forward contracts. 

The Managers expect that this section be implemented in such 

a manner that producers and growers have a choice and the ability 

to decline arbitration prior to entering the contract. Additionally, it 

is the intent of the Managers that the Secretary of Agriculture develop regulations which provide producers and growers a reasonable period of time in which to decide whether or not to decline arbitration prior to entering the contract. 

(20) Right to discuss terms of contracts 

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rent law. It would allow contract growers to also discuss contract 

terms with business associates, neighbors, and other producers. 

(Section 10204) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(21) Attorneys’ fees 

The Senate amendment amends section 308 to allow producers 

to attempt to recover the costs of the litigation, including reasonable attorneys’ fees, (in addition to damages) in an action arising 

under the Packers and Stockyards Act. (Section 10205) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(22) Appointment of outside counsel 

The Senate amendment amends section 407 to provide the Secretary with the authority to obtain the services of attorneys who 

are not federal employees to aid in investigations and civil cases. 

(Section 10206) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(23) Prohibition on packers owning, feeding, or controlling livestock 

The Senate amendment amends section 202 of the Packers and 

Stockyards Act (7 U.S.C. 192) to add to the list of prohibited practices. It prohibits most major packers from owning, feeding, or controlling livestock directly, or through a subsidiary, or through an 

arrangement that gives the packer operational, managerial, or supervisory control over livestock or over the farming operation that 

produces the livestock, to such an extent that the producer is no 

longer materially participating in the management of the livestock 

operation. The prohibition does not apply to: packers who enter 

into arrangements within 14 days before slaughter; cooperatives 

where the majority of ownership interest is held by active cooperative members; packers not required to report to USDA under section 212 of the Agricultural Marketing Act of 1946 (7 U.S.C. 

1635a); or a packer that only owns one livestock processing plant. 

The provision provides that a packer of swine would be in violation 

of this provision if it owns, feeds or controls swine later than 18 

months after the enactment of this Act. It provides that a packer 

of livestock, other than swine, would be in violation of this provision if it owns, feeds or controls livestock later than 180 days after 

enactment of this Act. (Section 10207) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(24) Regulations 

The Senate amendment directs USDA to promulgate rules and 

regulations, including regulations dealing with discrimination 

against smaller volume producers. It provides that regulations 

shall also be promulgated to require that live poultry dealers provide written notice to poultry growers if the live poultry dealer imposes an extended layout period in excess of 30 days prior to removal of the previous flock. (Section 10208) 


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The House bill contains no comparable provision. 

The Conference substitute provides for the promulgation of 

regulations under the Packers and Stockyards Act, 1921 not later 

than two years after enactment, to establish criteria that the Secretary of Agriculture will consider when developing the regulations 

enumerated in this section (Section 11006) 

(25) Sense of Congress regarding pseudorabies eradication program 

The House bill expresses the sense of Congress that the eradication of pseudorabies is a high priority that should be carried out 

under the authorities of the Animal Health Protection Act. (Section 

11101) 

The Senate amendment is similar to House provision but expands upon the House language to recognize the threat that feral 

swine pose to not only swine, but also the entire livestock industry. 

Senate language also details the importance of pseudorabies surveillance funding to assist the swine industry in monitoring, surveillance, and eradication of pseudorabies, including the monitoring 

and surveillance of other diseases effecting swine production and 

trade. (Section 10301) 

The Conference substitute adopts the House provision with an 

amendment to recognize the threat that feral swine pose to not 

only the domestic swine population but also the entire livestock industry. (Section 11007) 

(26) Sense of Congress regarding the cattle fever tick eradication 

program 

The House bill expresses the sense of Congress that implementing a national strategic plan for the cattle fever tick eradication program is a high priority in order to identify and procure 

the necessary tools to prevent and eradicate fever ticks in the 

United States. (Section 11106) 

The Senate amendment is the same as the House bill. (Section 

10302) 

The Conference substitute adopts the House provision. (Section 

11008) 

(27) National Sheep and Goat Industry Improvement Center 

The House bill amends section 375 of the Consolidated Farm 

and Rural Development Act (7 U.S.C. 2008j by eliminating the requirement that the National Sheep Industry Improvement Center 

privatize its revolving fund. An authorization of appropriations of 

$10 million is authorized for each of the fiscal years 2008 through 

2012. (Section 6015) 

The Senate amendment: (1) amends section 375 of the Consolidated Farm and Rural Development Act (7 U.S.C. 2008j) by eliminating the requirement that the National Sheep Industry Improvement Center privatize its revolving fund, (2) renames the Center 

as the National Sheep and Goat Industry Improvement Center, and 

(3) provides for new mandatory funding of $1,000,000 for FY2008, 

to be available until expended, and authorizes $10,000,000 for each 

FY2008–2012. (Section 10303) 

The Conference substitute adopts the Senate provision with an 

amendment to delete the renaming of the Center. (Section 11009) 


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(28) Trichinae certification program 

The Senate amendment amends section 10409 of the Animal 

Health Protection Act, to direct the USDA to establish and implement a trichinae certification program to certify farm operations 

that are trichinae free to be eligible for export or other market opportunities. It authorizes appropriations of $1.25 million for each 

of fiscal years 2008 through 2012. (Section 10304) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to require the Secretary of Agriculture to provide an 

explanation should the final rule not be promulgated within 90 

days of enactment of this Act. Subject to appropriation of funds, the 

Secretary is authorized to use $6,200,000 to carry out the certification program. (Section 11010) 

(29) Protection of information in the animal identification program 

The Senate amendment directs the Secretary of Agriculture to 

promulgate regulations consistent with the Freedom of Information 

Act regarding the disclosure of information submitted by farmers 

and ranchers who participate in the national animal identification 

system. The regulations promulgated are subject to public comment 

and should address the protection of trade secrets and other proprietary and or confidential business information. (Section 10305) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(30) Sense of Congress regarding the voluntary control program for 

low pathogenic avian influenza 

The House bill expresses the sense of Congress that the voluntary control program for low pathogenic avian influenza is a critical component of the animal health protection system, and that 

the Secretary should continue to provide 100 percent compensation 

for eligible costs to owners of poultry and cooperating States. (Section 11105) 

The Senate amendment amends section 10407(d)(2) of the Animal Health Protection Act. It defines ‘‘eligible costs’’ for the purpose of low pathogenic avian influenza indemnification as ‘‘costs determined eligible for indemnity under part 56 of title 9, Code of 

Federal Regulations, as in effect on the date of enactment of this 

clause.’’ The Senate provision also provides that, subject to subparagraphs (B) and (D), with respect to compensation provided to 

an owner of an animal required to be destroyed under section 

10407 of the Animal Health Protection Act, the compensation to 

any owner or contract grower of poultry participating in the voluntary control program for low pathogenic avian influenza under 

the National Poultry Improvement Plan, and payments to cooperating State agencies, shall be made in an amount equal to 100 percent of the eligible costs. (Section 10306) 

The Conference substitute provides that the Secretary compensate industry participants and States that cooperate with the 

Secretary in conducting livestock pest or disease detection, control 

or eradication measures for 100 percent of eligible costs. 

It is the intent of the Managers that compensation under this 

section go to any owner or contract grower of poultry participating 


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in the voluntary control program for low pathogenic avian influenza under the National Poultry Improvement Plan, and payments 

to cooperating state agencies in an amount equal to 100 percent of 

the eligible costs. Eligible costs are defined in accordance with part 

56 of title 9, Code of Federal Regulations, as in effect on the date 

of enactment of this section. (Section 11011) 

CHRONIC WASTING DISEASE

The Managers expect the Secretary to promulgate, as soon as 

practicable, a final rule to establish a herd certification program to 

combat chronic wasting disease in farmed and captive deer, elk and 

moose. The Managers expect the rule to include appropriate certification procedures to allow for the interstate movement of participating deer, elk, and moose. 

(31) Study on bioenergy operations 

The Senate amendment directs USDA to submit to the House 

and Senate Agriculture Committees a report describing the potential economic issues (including potential costs) associated with animal manure used in normal agricultural operations and as a feedstock in bioenergy production. (Section 10307) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to require the study to evaluate the extent to which 

animal manure is utilized as fertilizer in agricultural operations, 

the potential impact on consumers and on agricultural operations 

resulting from limitations being placed on the utilization of animal 

manure as a fertilizer, and the effects on agriculture production 

contributable to the increased competition for animal manure use 

due to bioenergy production, including as a feedstock or a replacement for fossil fuels. The study is to be submitted to the respective 

House and Senate Committees within 1 year of enactment of this 

Act. (Section 11014) 

(32) Sense of the Senate on indemnification of livestock producers 

The Senate amendment expresses the sense of the Senate that 

the USDA should ‘‘partner with the private insurance industry to 

implement an approach for expediting the indemnification of livestock producers in the case of catastrophic disease outbreaks.’’ (Section 10308) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(33) State-inspected meat and poultry 

The House bill requires the Secretary to submit a report to 

Congress with the results of a review of each State meat and/or 

poultry inspection program in section 11103(a). Such review will include a determination of the effectiveness of the program, and an 

identification of the changes necessary for the program to meet and 

enforce Federal inspection standards. Subsections (b) and (c) of section 11103 amend the Federal Meat Inspection Act (FMIA) and the 

Poultry Products Inspection Act (PPIA), respectively, with regard to 

State inspection programs. Authorizes the Secretary to approve a 

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gram in interstate commerce, if such State inspection program has 

implemented identical requirements to those contained in the 

FMIA and/or PPIA and Federal regulations under such statutes. 

The House bill provides requirements for new State inspection programs, including that the Secretary shall review all new State inspection programs within one year after such State inspection program was approved. Upon such review, the State inspection program must implement all recommendations from the review. The 

provision provides that a State inspection program will operate 

subject to a cooperative agreement with the Secretary, and establishes the terms of such cooperative agreement, including: State 

must adopt requirements identical to Federal inspection requirements; State mark of inspection will be deemed an official mark; 

State will comply with labeling requirements issued by the Secretary; Secretary will have authority to detain and seize products 

under the State program; Secretary will have access to facilities 

and records of State program; and other provisions as determined 

by the Secretary. The provision also provides that the Secretary 

shall reimburse a State for not more than 50 percent of the State’s 

costs for the State meat inspection program, and not more than 60 

percent of the State’s costs for the State poultry inspection program. The House bill requires the Secretary to take action if the 

Secretary determines that a State inspection program is not in 

compliance with the cooperative agreement, including suspending 

or revoking the approval of the State inspection program. Authorizes the Secretary to institute Federal inspection at a State-inspected plant if the Secretary determines that such State plant is 

not operating in accordance with the cooperative agreement and requirements herein. It also requires the Secretary to conduct annual 

review of each State inspection program. It provides that no State 

may prohibit or restrict the movement or sale of meat or poultry 

products that have been inspected and passed in accordance with 

this section. (Section 11103) 

The Senate amendment amends the Federal Meat Inspection 

Act (21 U.S.C. 601 et seq.) and the Poultry Products Inspection Act 

(21 U.S.C. 451 et seq.) to create an option for state inspected plants 

that are 25 employees or less to ship in interstate commerce. This 

will not replace the existing state inspection programs. Plants that 

are selected by the Secretary to ship in interstate commerce using 

this option must follow the Federal Meat Inspection Act and Poultry Products Inspection Act in the same manner as expected of a 

federally inspected establishment. Establishments that are larger 

than 25 employees but less than 35 employees are eligible for this 

option, but must transition to a federal establishment three years 

after promulgation of the final rule. Establishments that are currently under Federal inspection are not eligible for this option. The 

Secretary shall reimburse a state for costs related to the inspection 

of selected establishments in the state at an amount not less than 

60 percent of eligible state costs. The Secretary may also reimburse 

a state for 100 percent of the eligible state costs if the selected establishment provides additional verification microbiological testing 

in excess of typical Federal establishments. The Secretary shall 

designate a Federal employee as a state coordinator for each state 

agency that has a state inspection program. The state coordinator 


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will be under direct supervision of the Secretary. The state coordinator will visit selected establishments with a frequency appropriate to ensure that these establishments are operating in a manner consistent with the Federal Meat Inspection Act and Poultry 

Products Inspection Act. The state coordinator shall provide on a 

quarterly basis a report that describes the status of each selected 

state establishment in regard to compliance with the Federal Meat 

Inspection Act and Poultry Products Inspection Act. If a state coordinator finds any selected establishment in violation of the Federal 

Meat Inspection Act or Poultry Products Inspection Act, the state 

coordinator shall notify the Secretary of the violation and deselect 

the selected establishment or suspend inspection. The Senate provision requires USDA’s Inspector General not later than two years 

after the effective date of enactment, and not less than every two 

years, conduct an audit of each activity taken by the Secretary to 

determine compliance of this program with the law. The Government Accountability Office shall also conduct an audit of the implementation of this program. It also authorizes the Secretary of Agriculture to establish within the Food Safety Inspection Service 

(FSIS) at USDA an inspection training division to coordinate outreach, education, training and technical assistance of very small 

and certain small establishments. The Senate language allows the 

Secretary to provide grants to appropriate state agencies to help establishments covered by intrastate inspection under title III of the 

Federal Meat Inspection Act to transition to the new program 

under title V. (Section 11067) 

The Conference substitute adopts the Senate provision with an 

amendment to strike section (c)(2) of the Senate amendment regarding microbiological verification testing. Periodic audits required of the Inspector General under Senate section (e)(1) was 

changed from two years to not less often than every three years. 

(Section 11015) 

(34) Food Safety Commission 

The Senate amendment establishes a Congressional Bipartisan 

Food Safety Commission to review the food safety system of the 

United States and to prepare a report that makes recommendations on ways to: modernize the U.S. food safety system; harmonize 

and update food safety statutes; improve Federal, State, local, and 

interagency coordination of food safety personnel, activities, budgets, and leadership; allocate scarce resources according to risk; ensure that regulations directives, guidance, and other standards and 

requirements are based on best-available science and technology; 

emphasize preventative strategies; provide to Federal agencies 

funding mechanisms necessary to effectively carry out food safety 

responsibilities; and to draft specific statutory language that would 

implement recommendations of the Commission. The Commission 

is required to review and consider statutes, studies and reports as 

listed in legislative language to understand the U.S. food safety 

system. The initial meeting is required to take place 30 days after 

the final Commission member is appointed. One year after its initial meeting, the Commission is required to publish a report on its 

findings, upon which the Commission will dissolve. The members 

of the Commission will be appointed 60 days after the enactment 


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of this legislation. Members are required to have training, education or experience in food safety research, food safety law and 

policy, or program design and implementation. Members must consist of the Secretary of Agriculture (or a designee), the Secretary 

of Health and Human Services (or a designee), one Member of the 

House of Representatives, one Member of the Senate, and 15 members that represent consumer organizations, agricultural and livestock production, public health professionals, State regulators, Federal employees, and the livestock and food manufacturing and processing industry. Two members of the Commission are appointed by 

the President, 13 are appointed by Congress. The Commission is 

required to hold at least five stakeholder meetings, and can hold 

hearings and secure information from Federal agencies to carry out 

its work. Commission members who are not officers or employees 

of the Federal government can be compensated for serving on the 

Commission. Commission members are allowed travel expenses 

while away from home or place of business. The Chairperson of the 

Commission can appoint an executive director and additional personnel to carry out the work of the commission. Federal Government employees can be detailed to the Commission without reimbursement. This provision authorizes appropriations to carry out 

this section. (Section 11060) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(35) Action by President and Congress based on report 

The Senate amendment states: (1) the President is required to 

review the report from the Congressional Bipartisan Food Safety 

Commission established by the Senate amendment, and is required 

to submit to Congress proposed legislation based on the recommendations for statutory language contained in the Commission’s report and proposed legislation, and (2) Congress may hold 

hearings and other activities for consideration of the statutory language from the Commission and the President. It also contains a 

Sense of the Senate expressing: the need for additional resources 

and direction for the food safety agencies of the Federal Government; the need for additional food safety inspectors; the need for 

food safety agreements between the United States and its trading 

partners; the need for Congress to work on comprehensive food 

safety legislation. (Section 11072) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(36) Food safety improvement 

The Senate amendment modifies the FMIA and PPIA to create 

a reporting requirement for establishments regulated by USDA–

FSIS to provide information to the Secretary upon determining 

that a meat and/or poultry product it manufactured had entered 

the stream of commerce and was reasonably likely to cause serious 

adverse health events or death (the Class I recall standard). Reports are not required if products are under the control of the establishment and corrective actions are taken to ensure that the 

product is no longer adulterated, or if the product never enters into 

the stream of commerce. Upon receipt of a report, the Secretary 


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would be able to use existing authority to request additional information related to the incident, issue a public health alert, and 

work with the establishment to notify relevant members of the supply chain and pursue a corrective action plan. The language encourages USDA to coordinate such efforts with State and local public health officials. The provision: (1) requires all establishments 

regulated by USDA–SIS to have in place a recall plan per USDA 

Directive 8080.1, Revision 4, (2) requires all beef establishments 

regulated by USDA–FSIS to have in place an E. coli reassessment 

as described in 67 Federal Register 62325 (October 7, 2002), (3) directs the Secretaries of Agriculture and HHS to promulgate sanitary food transportation regulations, as described in section 416(b) 

of the Federal Food, Drug, and Cosmetics Act, and (4) directs 

USDA, HHS, and DOT to enter into a Memorandum of Understanding related to sanitary food transportation. (Section 11087) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to add a new section 12 to the Federal Meat Inspection 

Act (21 U.S.C. 611) to require immediate notification of the Secretary if an establishment believes or has reason to believe that an 

adulterated or misbranded meat or meat food product has entered 

commerce; add a new section 13 to the Federal Meat Inspection Act 

(21 U.S.C. 611) to require establishments to prepare and maintain, 

in writing, a recall plan and any reassessments of their hazard 

analysis and critical control point plans, and to have those plans 

and reassessments available to USDA inspectors. Identical changes 

were made to the Poultry Products Inspection Act (21 U.S.C. 459) 

by modifying section 10 of the PPIA. (Section 11017) 

(37) Oversight of national aquatic animal health plan 

The Senate amendment establishes a General advisory Committee for Oversight of National Aquatic Animal Health (composed 

of not more than 20 members). The advisory committee is to make 

recommendations to the Secretary on: 

• the establishment and membership of appropriate experts 

to efficiently implement the national aquatic animal health 

plan developed by the National Aquatic Animal Health Task 

Force 

• disease and species-specific best management practices related to activities carried out under the national aquatic animal health plan developed by the National Aquatic Animal 

Health Task Force 

• the establishment and administration of an indemnification fund (see below) 

The Senate amendment requires the Secretary to promulgate 

regulations establishing the national aquatic animal health improvement program, in accordance with the Animal Health Protection Act. The provision allows for participation by State and Tribal 

Governments and the Private Sector who upon election to participate will enter into agreements with the Secretary to assume responsibility for a portion of the non-Federal share of the costs of 

carrying out the national aquatic animal health plan developed by 

the National Aquatic Animal Health Task Force. It establishes an 

indemnification fund to compensate aquatic farmers for specified 


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purposes. It also requires a report not later than 2 years after the 

date of enactment to describe: • activities carried out under the national aquatic animal 

health plan developed by the National Aquatic Animal Health 

Task Force • activities carried out by the advisory committee • recommendations for subsequent years’ funding 

The Senate amendment authorizes appropriations of $15,000,000 for fiscal years 2008 and 2009, of which not less than 

50 percent is to be deposed into the indemnification fund and not 

more than 50 percent shall be used to carry out the national aquatic animal health plan developed by the National Aquatic Animal 

Health Task Force. (Section 11086) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment. (Section 11013) 

The Managers are conscious of the need for an aquatic animal 

health plan. The United States is facing a seafood trade deficit of 

over $9 billion, and faces loss of export markets in Europe, partially due to the lack of a coordinated industry health program. 

Without an effective control program in place, the United States 

faces difficulty in safeguarding against pest and disease incursions. 

The Managers therefore encourage the Animal and Plant Health 

Inspection Service to implement a National Aquatic Animal Health 

Plan (NAAHP) within 18 months of enactment of this Act. It is further expected that NAAHP should be based on the existing plan 

developed by the National Aquatic Animal Health Task Force, and 

to be refined with extensive consultation of cooperators, including 

state agencies, tribal governments, industry, and fish health professionals. 

The Managers note the potential benefits of an advisory board 

to ensure the success of such a Plan; such a board should have a 

balanced representation of state and tribal governments and commercial aquaculture interests. The Managers likewise recognize the 

potential benefits of an appropriate number of representative expert committees. Such expert committees would be charged with 

recommending disease- and species-specific plans, taking into account any existing aquaculture-related projects undertaken under 

the aegis of the Plan as of the date of enactment of this legislation. 

TITLE XII—CROP INSURANCE 

(1) Premiums and reinsurance requirements 

(a) Premium Adjustments (Section 508(a) of the Federal Crop 

Insurance Act) 

The House bill: prohibits paying premiums, offering rebates for 

premiums, or making other inducements to purchase crop insurance or after crop insurance has been purchased, except for administrative fees pursuant to section 508(b)(5)(B) of the Federal Crop 

Insurance Act or performance-based discounts under section 

508(d)(3) of the same Act. (Section 11001(a)) 

The Conference substitute adopts the House provision, with 

the following modification—the rebating rules are modified so as to 

permit certain cooperatives that were authorized to offer payments 


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in accordance with section (b)(5)(B) as in effect the day before the 

date of enactment by the Risk Management Agency (RMA) in the 

2005, 2006, and 2007 reinsurance years to continue to do so. (Section 12004) 

The Managers’ intent in including clause (9)(B)(iii) is to 

‘‘grandfather in’’ entities that have previously been approved by the 

Federal Crop Insurance Corporation (Corporation) to make payments in accordance with subsection (b)(5)(B) as in effect on the 

day before the date of enactment. These entities must provide payments or patronage dividends in a consistent manner with the payment plan previously approved in accordance with such subsection 

for the entity by the Corporation. The Managers expect the Corporation to notify, in writing and on an annual basis, entities covered under the grandfather clause as well as 508(b)(5)(B) as 

amended of their ability to provide such payments and the scope 

of providing such payments. The Managers expect the Corporation 

to exercise strict oversight to ensure that these entities are operating consistent with federal and state law and the payment plan 

submitted and approved. The Managers understand through discussions with RMA that the parties covered by the grandfather 

clause represent the universe of parties engaged in this activity. 

The Managers also understand from RMA that, while two submissions are still under review, no further requests are pending or expected from additional parties seeking to engage in the activities 

of those parties covered by the grandfather clause. 

(b) Administrative Fee (Section 508(b) of the Federal Crop Insurance Act) 

Section 11001(b) of the House bill amends the Federal Crop Insurance Act to limit the ability of an insurance provider, cooperative association, or trade association to pay for only catastrophic 

risk protection administrative fees on behalf of a producer. The 

Senate amendment clarifies language that permits cooperatives or 

trade associations to pay premiums on behalf of farmer-members to 

make it clear that the provision applies only to fees for catastrophic 

coverage. It also strikes clause (ii) which requires that licensing 

fees in connection with the issuance of catastrophic risk protection 

or additional coverage to be paid to cooperatives or trade associations from insurance providers shall be subject to laws regarding 

rebates in the various states in which the fee or other payment is 

made. (Section 1905) 

The Conference substitute adopts the Senate provision (Section 

12006). 

(c) Time for Payment (Section 508(d) of the Federal Crop Insurance Act) 

Section 11001(c) of the House bill requires that beginning with 

the 2012 reinsurance year, the Corporation must establish August 

1 as the billing date for crop insurance premiums. 

Paragraph (1) of section 1906 of the Senate amendment establishes the date when policyholder premiums must be paid, beginning in the 2012 reinsurance year, to no later than September 30. 

(Section 1906) 


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The Conference substitute adopts the House provision, with a 

date change to August 15. (Section 12007) 

(d) Reimbursement rate (Section 508(k) of the Federal Crop 

Insurance Act) 

Paragraph (1) of Section 11001(d) of the House bill amends section 508(k)(4)(A) of the Federal Crop Insurance Act to provide that 

beginning with the 2009 reinsurance year, the Corporation shall reimburse insurance providers and agents for administrative and operating (A&O) expenses at a rate 2.9 percentage points below the 

rates in effect on the day of enactment of this Act. 

Section 1912 of the Senate amendment reduces the reimbursement rate for existing plans of insurance by 2 percentage points 

below the rates in effect at the time of enactment of this Act, except that the reduction shall not be applied in any reinsurance year 

for a state in which the loss ratio exceeds 1.2, beginning in the 

2009 reinsurance year. It also reduces the reimbursement rate for 

area policies (such as Group Risk Plan (GRP) and Group Risk Income Protection (GRIP)) to 17 percent of premiums because delivery costs are not as high relative to delivery costs for other products. (Section 1912) 

The Conference substitute adopts the Senate provision, with 

the following modification—it provides for a 2.3 percentage point 

reduction from current levels for the overall A&O reduction, with 

a snapback that restores one half of the reduction to states in years 

in which their overall loss ratio exceeds 1.2. In addition, it includes 

the reduction to the reimbursement rate for area policies from the 

Senate provision, with the rate lowered to 12 percent of total premiums. (Section 12016) 

The Managers intend for the limitation in paragraph (F) to 

apply only to plans of insurance that are established and widely 

available at the time of enactment, and not apply to area plans 

such as the Pasture, Rangeland, and Forage program that have 

higher delivery costs than policies such as GRIP and GRP. 

(e) Renegotiation of the Standard Reinsurance Agreement 

(Section 508(k) of the Federal Crop Insurance Act) 

Paragraph (2) of Section 11001(d) of the House bill provides 

that during the year following the reinsurance year ending June 

30, 2012, the Corporation may renegotiate the financial terms of 

the Standard Reinsurance Agreement (SRA), and subsequently conduct such renegotiations once during each period of five reinsurance years thereafter and stipulates that changes in Federal law 

that require the Corporation to revise the financial terms of the 

SRA will not be considered to be a renegotiation of the agreement. 

It also provides that approved insurance providers may confer with 

each other during the renegotiation process. 

The Senate amendment allows the Federal Crop Insurance 

Corporation to renegotiate the SRA, which contains the contractual 

obligations and financial terms of the relationship between RMA 

and the crop insurance companies, every five years, the first occurring not sooner than the end of the 2012 reinsurance year. It provides an exception to allow the SRA to be renegotiated more frequently if necessary to address unexpected adverse circumstances 


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experienced by the companies. The Secretary is required to notify 

the relevant Congressional Committees before invoking this exception. This section also allows crop insurance companies to confer 

with each other in the course of the renegotiation process, as well 

as collectively with RMA. (Section 1913) 

The Conference substitute adopts the Senate provision with 

modifications, incorporating the House language on treatment of 

changes in the SRA due to changes in Federal law. It moves up the 

time when the next SRA can be negotiated, to be effective for the 

2011 reinsurance year. It also requires the RMA to consider certain 

alternative mechanisms for compensating companies for delivery 

expenses, when negotiating the SRA. (Section 12017) 

(f) Time for Reimbursement (Section 508(k) of the Federal 

Crop Insurance Act) 

Section 11001(e) of the House bill requires that beginning with 

the 2012 reinsurance year, the Corporation make administrative 

and operating expense payments during October 2012, and every 

October thereafter. 

Paragraph (2) of section 1906 of the Senate amendment establishes the date when the Federal Crop Insurance Corporation 

makes payments to crop insurance companies to reimburse them 

for administrative and operating expenses, beginning in the 2012 

reinsurance year, allowing payments to be made as soon as practicable after October 1 of the year following the reinsurance year, 

but not later than October 30. 

The Conference substitute adopts the Senate provision. (Section 12015) 

(g) Premium Reduction Authority (Section 508(e) of the Federal Crop Insurance Act) 

Paragraph (1) of Section 11001(f) of the House bill strikes the 

authority for the Premium Reduction Plan (PRP) and the Premium 

Rate Reduction Pilot. The Senate amendment repeals the authority 

for the Premium Reduction Plan (PRP) and requires RMA to commission an independent study of the feasibility of offering a discount to farmers in the Federal crop insurance program. This study 

is to be completed within 18 months of enactment of the farm bill. 

(Section 1908) 

The Conference substitute adopts the House provision, but 

drops the elimination of the Premium Rate Reduction Pilot language. (Section 12010) 

The Managers repeal the authority for the Premium Reduction 

Plan. The Managers believe it would serve a useful purpose for the 

Risk Management Agency to evaluate the process that led to the 

promulgation of the regulations under which PRP has been operated, to try to determine where mistakes might have been made, 

in either concept or execution. 

(2) Catastrophic risk protection administrative fee 

The House bill amends section 508(b)(5)(A) of the Federal Crop 

Insurance Act to provide for a $200 catastrophic risk protection administrative fee. (Section 11002) 


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The Senate amendment increases the fee for catastrophic risk protection coverage from its current $100 per crop per county to 

$200 per crop per county, and strikes language allowing a higher 

fee to be charged as a function of imputed premium. (Section 

1905(a)) 

The Conference substitute adopts the Senate provision, with 

modifications—it increases the fee to $300 per crop per county, and 

repeals an annual appropriations rider barring charges fees based 

on imputed premium levels. (Section 12006) 

(3) Funding for reimbursement, contracting, risk management education, and information technology 

The House bill amends section 516 of the Federal Crop Insur- ance Act to provide that the Corporation use not more than $30 

million in each fiscal year for costs associated with: research and 

development and partnerships for risk management in section 522 

of such Act; education and information programs in section 524 of 

such Act; and information technology. Further, it provides that the 

Corporation use no more than $5 million to carry out contracting 

for research and development for underserved states, pursuant to 

section 522(c)(1)(A) of such Act. It also prohibits the Corporation 

from conducting research and development for any new policy for 

a commodity under this title. (Section 11003) 

The Senate amendment reduces mandatory funding available 

to reimburse research and development of new crop insurance 

products from its current $15 million annually to $7.5 million annually in paragraph (1). Paragraph (2) reduces mandatory funding 

availability for contracting and partnerships from its current $25 

million annually to $12.5 million annually. Paragraph (3) permits 

the Corporation to use up to $5 million of otherwise unused funds 

available for reimbursement, contracting, or partnership payments 

to strengthen crop insurance compliance oversight activities, including information technology and data mining. (Section 1919) 

The Conference substitute adopts the Senate provision. (Section 12024) 

(4) Reimbursement of research and development costs related to new 

crop insurance products 

The House bill authorizes the Corporation to reimburse an applicant for research and development costs related to a policy that 

is submitted pursuant to a Federal Crop Insurance Corporation 

(FCIC) Reimbursement Grant or is submitted to the FCIC Board 

and approved in section 11004(a). 

Section 11004(b) authorizes the Corporation to provide FCIC 

Reimbursement Grants to persons proposing to prepare crop insurance policies for submission to the Board, and who have applied 

and been approved for such grants. The provision stipulates the required materials for a grant application, including: a concept paper; 

an explanation of the need for the product, including the product’s 

marketability, the projected impact of the product, and that no 

similar product is offered by the private sector; and an identification of the risks the product will cover and that the risks are insurable under the Federal Crop Insurance Act. Approval of a grant is 

by majority vote of the Board, and the Board shall approve an apVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00962 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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plication only if: the proposal establishes the need for the policy; 

the applicant has the qualifications to successfully complete the 

project; the proposal can reasonably be expected to be actuarially 

appropriate; the Board has sufficient funding; and the proposed 

budget and timeline are reasonable. 

The provision requires payment for work performed under this 

section to be based on rates determined by the Corporation. Either 

the Corporation or applicant may terminate any grant for just 

cause. (Section 11004) 

The Senate amendment authorizes the reimbursement of development costs related to a policy through a Federal Crop Insurance Reimbursement Grant or is submitted to the FCIC Board and 

is approved in subsection (a). Subsection (b) provides an alternative 

process for policy development, by establishing a grant-making 

mechanism (called FCIC Reimbursement Grants). This mechanism 

permits eligible applicants to submit a concept proposal, to be reviewed by crop insurance experts, for consideration by the Board 

of the Federal Crop Insurance Corporation. If the grant request is 

approved, the development work is ensured of funding and when 

completed, submitted to the Board for approval. The Board can require an interim feasibility study before allowing development 

work to proceed. Rates for work performed shall be based on rates 

determined by the Corporation for products submitted under section 508(h) or research contracted for under section 522(c). The 

grant can be terminated at any time for just cause. Subsection (c) 

eliminates language in section 523(b)(10) of the FCIA that provides 

an exception for research and development costs in livestock program funding caps. (Section 1918) 

The Conference substitute adopts the House provision, with 

significant modifications. The provision as adopted provides an opportunity for applicants with approved concept papers to receive up 

to 50 percent of their estimated expenses in advance. If their proposed crop insurance product is subsequently approved by the 

Board, they then are reimbursed for the remainder of their expenses. If they submit a proposed product to the Board and it is 

rejected, they receive no additional funds but are not required to 

repay the advance. Only if they fail to submit a completed submission without just cause would they be required to repay the advance. Applicants with poor track records on submissions may be 

prohibited from receiving advance payments, but would still be eligible to develop crop insurance products under 508(h) procedures 

in current law. (Section 12022) 

The Managers intend for the Corporation to develop the procedures to implement this section as soon as practicable so that the 

Corporation may start accepting applications for advanced reimbursement of research and development costs 180 days after this 

section’s enactment. Since under current law, crop insurance products approved under 508(h) procedures are eligible, at the Corporation’s discretion under appropriate circumstances, for reimbursement at U.S. General Services Administration competitive rates, 

the Managers intend for reimbursements made under this section 

to be equally eligible for such rates, still subject to the Corporation’s discretion. 


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(5) Research and development contract for organic production coverage improvements 

The House bill mandates that the Corporation enter into one 

or more contracts for the development of improvements in Federal 

crop insurance policies for organically raised crops. Any such contracts must review the underwriting, risk, and loss experience of 

organic crops in order for the Corporation to determine variation 

in loss history between organic and non-organic production. The 

Corporation shall eliminate or reduce the premium surcharge for 

coverage of organic crops, unless the Corporation’s review documents significant, consistent, and systemic variations in loss history between organic and non-organic crops. The House provision 

provides that a contract include the development of a procedure to 

offer producers of organic crops an additional price election reflecting actual retail or wholesale prices received by organic producers, 

and requires that the Corporation submit an annual report to Congress on the progress made in developing and improving Federal 

crop insurance for organic crops. (Section 11005) 

The Senate amendment adds a new paragraph (12) which requires the Federal Crop Insurance Corporation to offer to enter 

into one or more contracts to improve crop insurance coverage for 

organic crops. New paragraph (10) requires the Federal Crop Insurance Corporation to offer to enter into one or more contracts to develop policies to insure dedicated energy crops such as switchgrass. 

New paragraph (11) requires the Federal Crop Insurance Corporation to offer to enter into one or more contracts to develop policies 

to insure aquaculture operations. New paragraph (13) requires the 

Federal Crop Insurance Corporation to offer to enter into a contract 

to study how to incorporate the use of skiprow cropping practices 

to grow corn and sorghum in the Central Great Plains into existing 

policies and plans of insurance offered in the Federal crop insurance program. (Section 1917) 

Section 1907 prohibits the Federal Crop Insurance Corporation 

from charging a surcharge on premiums paid to insure organic 

crops. It allows surcharges to be required only when consistent evidence of greater loss variability is validated on a crop by crop basis. 

(Section 1907) 

The Conference substitute adopts the House provision, with 

the inclusion of Senate provisions requiring contracts regarding 

dedicated energy crops, aquaculture, skiprow cropping practices, 

and the following additions: the Corporation is also required to 

offer to enter into contracts for developing a poultry policy, a policy 

for bee-keepers, and a study on what modifications might be need 

for Adjusted Gross Revenue policies to make them more useful for 

beginning farmers. In the subsection addressing development of 

aquaculture policies, more details are provided about what species 

should be considered. (Section 12023) 

The Managers are concerned that producers in the Central 

Great Plains seeking to utilize skip row planting patterns are being 

offered crop insurance coverage for less than 100% of the planted 

fields despite ongoing research showing that skip row planting results in no loss in overall yields. In including this provision in 

paragraph (16), the Managers are seeking to have RMA review existing and soon-to-be completed skip row research and production 


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histories, develop crop insurance rules and policies that adequately 

reflect this research, and thus better capture the actual productive 

capability of skip row planting patterns. 

The Managers are also concerned how recent natural disasters 

in the Southeastern United States have revealed that existing crop 

insurance products and programs are not well-tailored to the 

unique horticultural practices of the nursery industry across the 

country. The Managers urge the Risk Management Agency (RMA) 

to work with the nursery industry on crop insurance policies specifically designed for nursery growers and encourage the Administrator of RMA, under his existing authority, to consider initiating 

a pilot program or programs with nursery growers in affected regions to ensure that crop insurance programs avoid in the future 

the issues that arose in the aftermath of these natural disasters. 

(6) Targeting risk management education for beginning farmers and 

ranchers and certain other farmers and ranchers 

The House bill requires the Secretary to include a special emphasis on risk management strategies and education and outreach 

to beginning farmers and ranchers, immigrant farmers and ranchers attempting to become established producers in the United 

States, socially disadvantaged farmers and ranchers, farmers and 

ranchers who are preparing to retire and are trying to help new 

farmers and ranchers get started, and farmers and ranchers who 

are converting production and marketing systems to new markets. 

(Section 11006) 

The Senate amendment requires the Secretary to place special 

emphasis in utilizing funds available to address the needs of farmers in underserved states to assist in risk management strategies 

of beginning farmers and ranchers, immigrant farmers and ranchers, socially disadvantaged farmers and ranchers, farmers and 

ranchers preparing to retire and engaged in transition strategies to 

help beginning farmers get established, and established farmers 

and ranchers seeking to shift practices and marketing to pursue 

new markets. (Section 1922) 

The Conference substitute adopts the Senate provision, with 

one minor language change. (Section 12026) 

(7) Crop insurance ineligibility related to crop production on noncropland 

The House bill defines ‘‘noncropland’’ as native grassland and 

pasture the Secretary determines has never been used for crop production. It also provides that noncropland acreage planted with an 

agricultural commodity for which insurance is available under this 

title is not eligible for crop insurance under this title for the first 

four years of planting. In the fifth year of planting, the producer 

may purchase crop insurance for the commodity. The yield for such 

insurance shall be determined by using actual production history 

for the farm and, for years without actual production history, using 

the average actual production history for the commodity in the 

county. (Section 11007) 

The Senate amendment denies crop insurance and noninsured 

crop disaster assistance program benefits (NAP) on lands converted 

from native sod after passage of this farm bill. In section 


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2608(a)(1), native sod is defined as land on which the plant cover 

is composed principally of native grasses, grasslike plants, forbs, or 

shrubs suitable for grazing and browsing, and which has never 

been used for production of an agricultural commodity. Section 

2608(a)(2)(B) establishes de minimus exception of 5 acres. Section 

2608(c) directs the Secretary to provide a report to Congress on the 

extent of conversion of noncropland to cropland since 1995 within 

180 days of the passage of the Farm Bill, and to provide annual 

updates by January 1st of each year. (Section 2608) 

The Conference substitute adopts the House bill with modification. At the election of the Governor of a State in the Prairie Pothole Region National Priority Area, native sod acreage that is tilled 

for the production of an annual crop will be ineligible for crop insurance and noninsured crop disaster assistance benefits during 

the first 5 crop years of planting. Native sod is defined as land on 

which the plant cover is composed principally of native grasses, 

grasslike plants, forbs, or shrubs suitable for grazing and browsing; 

and that has not been tilled for the production of an annual crop 

at the date of enactment. The Secretary may exempt conversions 

of 5 acres or less from the terms of the provision. (Section 12020). 

The Managers adopted this modification in recognition of the 

significant interest in conserving native tall-, mixed-, and shortgrass prairie in the Prairie Pothole Region (PPR). Several recent 

reports have analyzed grassland conversion and potential drivers 

in certain areas of the PPR over the past two decades. The analysis 

by the Government Accountability Office (GAO) found that crop insurance program payments may serve as an incentive for conversion, but that many other factors such as crop prices and new 

farming technologies also play a role in producer decisions. GAO 

also identified a general lack of current and comprehensive data on 

land conversions, precluding reliable trend analysis. Correspondingly, GAO’s final recommendations were that USDA should: 1) 

track annual conversion and provide current data to policymakers, 

and 2) conduct a study of the relationship between farm program 

payments and land conversion and report findings to Congress. 

The Managers determined that existing information is insufficient to apply a broad-sweeping national policy to address what 

may be a localized concern. However, where states determine that 

grassland conversion is a present threat and want to create disincentives for conversion, the Managers are making a ‘‘sodsaver’’

program option available at the request of the State. The Managers 

further expect USDA to address the GAO recommendations in 

order to inform future policy decisions on this issue. In addition, 

the Managers reauthorized a number of conservation programs, 

such as the grassland reserve program and the environmental 

quality incentives program, which provide incentives for grassland 

protection and conservation. The Managers encourage States to leverage these programs to provide further incentives to their grassland protection objectives. 

The Managers intend for the Secretary to undertake a study 

on the influence of the crop insurance program on the conversion 

of native sod to crop production. The study should consider as part 

of the review, added land provisions, yield plugs, written agreements, and county T yields. The study should also consider the sufVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00966 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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ficiency of grazing coverage available through crop insurance or the 

non-insurance assistance program as compared to the economics of 

crops planted on converted grazing land. The managers expect the 

Secretary to address specific actions that may be taken by the Department or recommended to Congress to mitigate any identified 

conversion influences of the crop insurance program. The managers 

expect the Secretary to present the results of the study to the Senate Committee on Agriculture, Nutrition, and Forestry and the 

House Committee on Agriculture in early 2009. 

(8) Funds for data mining 

The House bill authorizes the Corporation to use not more 

than $11 million during fiscal year 2008, and not more than $7 

million during fiscal year 2009 and each subsequent fiscal year, for 

crop insurance program compliance and integrity, including data 

mining, for a total of $73 million in outlays over ten years. (Section 

11008) 

The Senate amendment allows RMA to charge a fee to crop insurance companies for access to company-relevant results of datamining analysis, and would require that these funds are used for 

improvements in the crop insurance data mining system. If RMA 

were to require companies to access the data-mining results for 

purposes of compliance, including quality assurance requirements 

under the terms of the SRA, they could not be charged a fee under 

those circumstances. (Section 1915) 

The Conference substitute adopts the House provision, except 

it provides a total of $36 million over ten years for this purpose, 

and it requires periodic competition for these funds. A new subsection provides $60 million for upgrading computer technology at 

the Risk Management Agency. (Section 12021) 

(9) Noninsured crop assistance program 

The House bill amends the Agricultural Market Transition Act 

to provide that service fees producers must pay for the Noninsured 

Crop Insurance Program shall be $200 per crop per county; or $600 

per producer per county, with a limit of $1,800 per producer. (Section 11009) 

The Senate amendment doubles the service fee charged for 

participation in the NAP program from its current $100 to $200, 

or $600 per producer per county, with a limit of $1,500 per producer. (Section 1926) 

The Senate amendment also clarifies that losses from 

aquacultural activities resulting from drought should be indemnified if the farmer has NAP coverage for that production. (Section 

1925) 

The conference substitute adopts the Senate language from 

Section 1925, changing the new fee to $250 per crop per county, or 

$750 per producer per county, with a limit of $1,875 per producer. 

(Section 12028) 

The Conference substitute also adopts the Senate provision on 

eligibility for indemnification for drought losses for aquaculture. 

(Section 12027) 


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(10) Change in due date for corporation payments for underwriting 

gains 

The House bill directs the Corporation to make payments for 

underwriting gains on October 1, 2012, and for each subsequent reinsurance year, on October 1 of the next calendar year, beginning 

with the 2011 reinsurance year. (Section 11010) 

The Senate amendment establishes the date as October 1 that 

the Federal Crop Insurance Corporation makes payments for underwriting gains to crop insurance companies, beginning in the 

2011 reinsurance year. (Section 1914) 

The Conference substitute adopts the Senate provision. (Section 12018) 

(11) Sesame Insurance Pilot Program 

The House bill requires the Secretary to establish a pilot program under which sesame producers in the State of Texas may obtain crop insurance. Under the pilot program, producers obtaining 

the insurance shall pay premiums and administrative fees. (Section 

11011) 

The Senate amendment is the same as the House bill. (Section 

1921) 

The Conference substitute adopts the Senate provision with an 

amendment to strike the end date, and adds the camelina pilot program from Senate Section 1920 and adds a new pilot program for 

grass seed. (Section 12025) 

(12) National Drought Council and drought preparedness plans 

The House bill establishes a National Drought Council within 

the office of the Secretary of Agriculture that will develop a National Drought Policy Action Plan for integrating and coordinating 

drought activities of the Federal government and States, including 

drought preparedness, mitigation, risk management and emergency 

relief. Additional Council duties include reviewing and evaluating 

existing drought programs, making recommendations to the President and Congress, and developing public awareness activities on 

drought. 

The House bill establishes the Drought Assistance Fund within 

the Department of Agriculture to, in part, pay the costs of providing technical and financial assistance to States, Indian Tribes, 

local governments and other groups for the development and implementation of drought preparedness plans, and for the cost of mitigating the risk and impact of droughts. The language provides requirements for the guidelines associated with the distribution of 

funds from the Drought Assistance Fund, including requiring that 

States and/or Indian tribes developing plans for interstate watersheds coordinate with other States and/or Indian tribes in the development of said plans. 

The House bill requires the Secretary, with concurrence of the 

Council, to develop guidelines for administering a national program 

to provide assistance to States, Indian tribes, local governments 

and others for the development, maintenance, and implementation 

of drought preparedness plans. The provision requires the Secretary to develop Federal drought preparedness plans, which will 

integrate with drought plans of State, tribal, local government, and 


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others. The provision stipulates the elements for such drought preparedness plans. The House bill authorizes appropriations of $2 million for fiscal 

year 2008 and each of the subsequent seven fiscal years for the 

Council; authorizes the appropriation of such sums as necessary to 

carry out the Drought Assistance Fund. (Section 11012) 

The Senate amendment contains no comparable provision. 

The Conference substitute drops the House provision. 

(13) Payment of portion of premium for area revenue plans 

The House bill establishes the premium subsidy amount for 

area revenue insurance plans, based on (1) the percentage of the 

recorded county yield indemnified, and (2) the sum of a percentage 

of the premium established for additional catastrophic risk protection and the amount determined to cover operating and administrative expenses for additional catastrophic risk protection. 

The House bill establishes the premium subsidy amount for 

area yield insurance plans, based on (1) the percentage of the recorded country yield indemnified, and (2) the sum of a percentage 

of premium established for additional catastrophic risk protection 

and the amount determined to cover operating and administrative 

expenses for additional catastrophic risk protection. (Section 11013) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision. (Section 

12012) 

(14) Share of risk 

The House bill amends the Federal Crop Insurance Act to require that companies that are being reinsured by the Corporation 

share the risk of loss, such that the underwriting gain or loss and 

the associated premium and losses ceded to the Corporation under 

any reinsurance agreement be not less than 12.5 percent. The provision further requires the Corporation to pay a ceding commission 

to such companies of 2 percent of the premium used to define the 

loss ratio for the approved insurance provider’s book of business. 

(Section 11014) 

The Senate amendment contains no comparable provision. 

The Conference substitute drops the House provision. 

(15) Livestock assistance 

The House bill stipulates that the purchase of a Non-insured 

Assistance Program policy is not a requirement to receive any Federal livestock disaster assistance. (Section 11015) 

The Senate amendment contains no comparable provision. 

The Conference substitute drops the House provision. 

(16) Determination of certain sweet potato production 

The House bill excludes Risk Management Agency Pilot Program data for determining the 2005–2006 Farm Service Agency 

Crop Disaster Program for sweet potatoes. (Section 11016) 

The Senate amendment amends section 9001 of the U.S. Troop 

Readiness, Veterans Care, Katrina Recovery, and Iraq Accountability Appropriations Act of 2007 (P.L. 100–28, 121 Stat. 211). It 

prohibits the Farm Service Agency from utilizing yield data colVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00969 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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lected from a sweet potato crop insurance pilot program to determine losses for the crop disaster assistance program recently enacted for the 2005 and 2006 crop years. If sign-up for that program 

is completed before the 2007 farm bill is enacted, then the sign-up 

period would have to be re-opened for producers of sweet potatoes. 

(Section 1927) 

The Conference substitute adopts the Senate provision. (Section 12029) 

(16A) Report on funds; rate of Federal crop insurance 

The House bill gives the Secretary of the Interior the authority 

to further cut the expense reimbursement rate for crop insurance 

companies if the actual revenue from offshore oil leases fails to 

meet projections beginning in 2012. (Section 13011) 

The Senate amendment contains no comparable provision. 

The Conference substitute drops the House provision. 

(17) Definition of organic crop 

The Senate amendment defines organic crops for the purposes 

of the Federal crop insurance program. (Section 1901) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 12001) 

(18) General powers 

The Senate amendment clarifies in subsection (a)(1) that the 

provision added in the Agricultural Risk Protection Act of 2000 

(section 508(j)(2)(A)), which allows farmers to sue the Corporation 

over a denied claim only in the U.S. District Court for the district 

where the insured farm is located, takes precedence over the more 

general provision in section 506(d). 

Subsection (a)(2) of the Senate amendment strikes subsection 

(n) of the Federal Crop Insurance Act (7 U.S.C. 1506), in order to 

clarify that it is superseded by Section 515(h) added in the Agricultural Risk Protection Act which specifically establishes sanctions 

for producers, agents, and loss adjusters for program noncompliance and fraud. (Section 1902) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 12002) 

(19) Reduction in loss ratio 

The Senate amendment reduces the statutory national loss 

ratio for the Federal crop insurance program to 1.0. (Section 1903) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 12003) 

(20) Controlled business insurance 

The Senate amendment prohibits farmers from collecting commissions as crop insurance agents on policies in which they or 

members of their immediate family have a substantial beneficial 

interest if more than 30 percent of their total commissions are derived from policies sold on operations that they or their immediate 


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family have beneficial interest in. This prohibition is applied on a 

calendar year basis. (Section 1904) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision, with 

modifications to the definitions of immediate family and compensation to clarify the intent of Congress. (Section 12005) 

For individuals meeting the tests in clauses (B)(i) and (B)(ii), 

the Managers’ intent is to prohibit compensation on policies or 

plans of insurance in which they or members of their immediate 

family have a substantial beneficial interest, rather than all policies or plans of insurance that they service. 

The Managers expect the Risk Management Agency (RMA) to 

enforce this section through an effective system of statistical sampling and spot checks rather than through the imposition of blanket new reporting requirements on agents, subagents, or approved 

insurance providers. The Managers further expect that the RMA 

will enforce this section in a manner that does not affect bona fide 

customer service representatives or other such employees of an 

agent who work in a capacity other than as an agent or subagent 

and whose employment with an agent is not intended to merely circumvent the prohibitions under this section. 

(21) Enterprise and whole farm unit pilot program 

The Senate amendment establishes a pilot program to allow 

farmers to convert the value of their crop insurance coverage under 

optional and basic units to higher levels of coverage for enterprise 

or whole farm units. (Section 1909) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision, with 

modifications, so as to allow any farmer to participate in this pilot, 

whether or not they had purchased coverage with optional or basic 

units in previous crop years. It also requires that the farmer-paid 

share of premium under this program be no less than 20 percent. 

(Section 12011) 

(22) Denial of claims 

The Senate amendment clarifies that approved insurance providers are only liable for lawsuits in Federal District courts for denial of claims if that claim is denied at the behest of the Federal 

Crop Insurance Corporation, not if they deny such claims themselves. (Section 1910) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 12013) 

(23) Measurement of farm-stored commodities 

The Senate amendment allows farmers the option to elect to 

have the Farm Service Agency measure the quantity of crops 

stored on farms for the purpose of providing evidence on their level 

of losses, at their own expense. (Section 1911) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision, with 

modifications. It allows farmers basing their crop insurance loss 

claim on measurement of farm-stored commodities to defer settleVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00971 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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ment of that claim for up to 4 months to allow stored grain to settle 

in the bin. (Section 12014) 

(24) Malting barley 

The Senate amendment allows RMA to modify the quality endorsement for malting barley to take into account changing market 

conditions. (Section 1929) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 12019) 

(25) Producer eligibility 

The Senate amendment makes producers who raise livestock 

under contract eligible to purchase coverage, as long as those livestock are not covered by other policies reinsured under the Federal 

crop insurance program. (Section 1916) 

The House bill contains no comparable provision. 

The Conference substitute drops the Senate provision, but includes a requirement that the Risk Management Agency offer to 

enter into a contract to develop an insurance policy for poultry production elsewhere in the title. 

(26) Camelina pilot program 

The Senate amendment requires the Federal Crop Insurance 

Corporation to develop a pilot program under which producers or 

processors of camelina (an oilseed suitable for use as a feedstock 

for biodiesel) may propose for approval by the Board policies or 

plans of insurance in accordance with existing procedures under 

Section 508(h). Camelina producers would be made eligible for the 

Noninsured Crop Assistance Program (NAP) until a crop insurance 

policy is made available. (Section 1920) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

slight modification to simply list camelina as a NAP eligible crop. 

(Section 12025) 

(27) Agricultural management assistance 

The Senate amendment permits the Secretary to utilize funds 

available for agricultural management assistance to provide matching funds to states providing additional discounts on farmer-paid 

premiums in underserved states. (Section 1923) 

The House bill contains no comparable provision. 

The Conference substitute drops the Senate provision. 

(28) Crop insurance mediation 

The Senate amendment allows producers involved in a dispute 

over a crop insurance claim to utilize both informal agency review 

and mediation to reach a resolution, so the producer would not necessarily have to choose between the two paths. (Section 1924) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 12032) 


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(29) Perennial crop report 

The Senate amendment requires the Secretary to submit a report within 180 days of enactment to the Senate Committee on Agriculture, Nutrition and Forestry and the House Committee on Agriculture that addresses issues relating to declining yields in producers’ actual production histories (APH), and declining and variable yields for perennial crops, including pecans. (Section 1928) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision, with a 

title change. (Section 12030) 

The Managers recognize risk management challenges faced by 

producers, especially with respect to declining yields in light of increases in premiums. The Managers also understand that there are 

unique issues with yield variability for perennial crops, such as pecans. The Managers are interested in the Department of Agriculture’s activities to address these issues and options that the Department has to address these issues administratively. 

(30) Definition of basic unit 

The Senate amendment maintains definition of basic unit in 

crop insurance for producers of tobacco. (Section 1930) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 12031) 

SUBTITLE B

(31) Short title and definitions (12051 and 12052) 

(32) Disaster loans to nonprofits 

The Senate amendment provides the Small Business Administration (SBA) Administrator with the discretion to make loans to 

non-profit organizations located or operating in a declared disaster 

area, and to provide services to persons evacuated from any disaster area. (Section 11121) 

The House bill contains no comparable provision. 

The Conference substitute amends the Senate provision and 

renames the provision ‘‘Economic Injury Disaster Loans to Nonprofits’’, with alternate language that will permit private nonprofit 

organizations to qualify for disaster assistance within the disaster 

area. (Section 12061) 

The Managers do not, however, intend for this amendment to 

extend SBA disaster assistance to private nonprofit organizations 

located outside designated disaster areas. 

The Conference substitute also adds a section titled ‘‘Applicants That Have Become a Major Source of Employment Due to 

Changed Economic Circumstances’’. This provision permits small 

businesses that were not a major source of employment prior to the 

disaster, but which subsequently are a major source of employment 

following the disaster, to qualify for disaster loans beyond the current statutory limit. (Section 12077) 

The Managers intend for this provision to authorize the SBA 

to administer the disaster loan program with reference to the borrower’s circumstances relative to the local area’s economic condiVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00973 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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tions when the loan application is made and not rely solely upon 

the loan applicant’s status as a major source of employment prior 

to the disaster. 

(33) Disaster loan amounts 

The Senate amendment raises the maximum outstanding loan 

amounts available to borrowers from the current level of 

$1,500,000, capping it at $2,000,000 subject to the discretion of the 

SBA based upon the economic conditions in the affected disaster region. (Section 11122) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment. (Section 12078) 

The Conference substitute adds a provision titled, ‘‘Increased 

Deferment Period’’, which will provide disaster victims with an option of receiving a four year deferment period for disaster loans. 

(Section 12068) 

The Managers intend for this provision to provide the SBA 

with authority to provide disaster victims with a deferment beyond 

the current two-year deferment authority so that they may rebuild 

homes and businesses and reestablish income streams before beginning repayment of their SBA disaster loan. The Managers intend 

for extended deferment periods to be implemented at the discretion 

of the Administrator. Additionally, while the Managers do not intend for loan repayments to occur during deferments, interest 

should continue to accrue on loans during the deferment period. 

The Conference substitute also adds a provision titled, ‘‘Net 

Earnings Clauses Prohibited’’, which will preclude the imposition of 

loan terms that require supplemental repayment amounts on disaster assistance loans during the first five years of repayment. 

(Section 12070) 

The Managers believe that this provision will benefit capitalintensive businesses that receive SBA disaster assistance loans and 

require earnings for reinvestment in the business to remain profitable. The Managers do not, however, intend for this provision to 

completely prohibit the SBA from imposing a net earnings clause, 

it simply precludes imposing these terms within the first five years 

of loan repayment. 

And the Conference substitute adds a provision called, ‘‘Gulf 

Coast Disaster Loan Refinancing Program’’, which enables the 

SBA, at their discretion, to institute a program to refinance Gulf 

Coast disaster loans resulting from Hurricanes Katrina, Rita, or 

Wilma up to an amount no greater than the original loan. (Section 

12086) 

(34) Small Business Development Center portability grants 

The Senate amendment grants the SBA the ability to make an 

award to a Small Business Development Center (SBDC) greater 

than $100,000 due to extraordinary circumstances after a catastrophic disaster. (Section 11123) 

The House bill contains no comparable provision. 

The Conference substitute adopts the House provision. 


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(35) Assistance to out-of-state businesses 

The Senate amendment authorizes SBDCs outside of the geographic region of a disaster area to provide assistance to small 

businesses located within a declared disaster area at the discretion 

of the Administrator. (Section 11124) 

The House bill contains no comparable provision. 

The Conference substitute adopts the House provision. 

(36) Outreach programs 

The Senate amendment establishes a procurement outreach 

and technical assistance program at the discretion of the Administrator following a disaster declaration. (Section 11125) 

The House bill contains no comparable provision. 

The Conference substitute adopts the House provision. 

(37) Small business bonding threshold 

The Senate permits the Administrator to guarantee any surety 

against loss on a bid bond, payment bond, or performance bond 

that does not exceed $5,000,000. 

Additionally, the provision would authorize the Administrator 

to guarantee bonds related to reconstruction efforts following a 

major disaster in amounts of up to $10,000,000 upon the request 

by the head of any Federal Agency involved in reconstruction efforts (Section 11126) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment but 

requires that these initiatives only be carried out with amounts appropriated in advance specifically for their purpose. (Section 12079) 

(38) Termination of program 

The Senate amendment terminates the Small Business Competitive Demonstration Program Act of 1988. (Section 11127) 

The House bill contains no comparable provision. 

The Conference substitute adopts the House provision. 

(39) Increasing collateral requirements 

The Senate amendment increases the loan amount under 

which collateral is not required from $10,000 to $14,000 (or higher 

as deemed appropriate by the Administrator). (Section 11128) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 12065) 

(40) Public awareness of disaster declaration and application periods 

The Senate amendment enhances coordination between the 

SBA and Federal Emergency Management Agency (FEMA) disaster 

assistance application periods, and outlines a Congressional reporting requirement on information relating to SBA and FEMA disaster assistance applications. The provision also requires that the 

SBA communicate information on disaster assistance availability to 

the public through all available channels of communication. The 

section also requires that the SBA create a marketing and outreach 


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plan to convey disaster assistance eligibility and application requirements. (Section 11129) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 12063) 

The Conference substitute adds a provision titled, ‘‘Coordination of Disaster Assistance Programs with FEMA’’ that will require 

the SBA to establish uniform guidelines in consultation with the 

director of the FEMA to provide for the coordination of their assistance programs. Specifically, the provision requires the SBA to establish regulations to ensure that applications for disaster assistance are submitted to the appropriate agency as quickly as is practicable. 

The Managers intend for these regulations to remedy problems 

that arise when the SBA’s disaster loan program is used as a 

screening mechanism for FEMA’s disaster assistance grants. Additionally, the Managers intend for these regulations to limit the 

need for the SBA to first consider disaster loan applications from 

victims who are patently ineligible for SBA assistance as a precondition to consideration for FEMA assistance. (Section 12062) 

The Conference substitute also adds a provision titled, ‘‘Information Tracking and Follow-up System’’, which will require the 

SBA to develop, implement, or maintain a centralized information 

system to track all communications (written, e-mail and phone) between disaster victims and SBA personnel concerning the status of 

their application. At a minimum, this system must record the 

method and date of communication and the identity of the SBA employee involved and a summary of the communication. It also requires the SBA to provide follow-up communications to disaster victims as their disaster loan proceeds through critical stages of the 

origination, approval and disbursement process. 

The Managers intend for this section to address deficiencies in 

the SBA’s current systems for tracking and organizing information 

that result in lost documentation, repeated status updates from applicants, and misinformed SBA personnel. (Section 12067) 

The Conference substitute also adds a provision titled, ‘‘Economic Injury Disaster Loans in Cases of Ice Storms and Blizzards’’, 

which will add ice storms and blizzards to the list of enumerated 

disasters for which a small business disaster may be declared. (Section 12071) 

(41) Consistency between administration regulations and standard 

operating procedures 

The Senate amendment contains a provision requiring the SBA 

to conduct a study of whether the standard operating procedures 

for administering disaster loan assistance are consistent with the 

Administration’s regulations for administering the disaster loan 

program. (Section 11130) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 12064) 


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(42) Processing disaster loans 

The Senate amendment authorizes the SBA to enter into 

agreements to pay qualified private contractors a fee for processing 

SBA disaster loan applications during any major disaster declaration. This provision would also authorize the Administrator to 

enter into agreements to pay qualified lenders or loss verification 

professionals a fee for performing loan loss verification services. 

Additionally, this section would require the SBA Administrator and 

the Internal Revenue Service Commissioner to ensure that all relevant and allowable tax records for loan approval are shared with 

loan processors in an expedited manner upon request by the Administrator. 

The Managers do not intend for this provision to authorize the 

SBA to delegate all their disaster loan disbursement or servicing 

functions with private contractors. Nor do the Managers intend for 

this provision to abrogate the SBA’s authority to approve or disapprove disaster loan applications. (Section 11131) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 12066) 

The Conference substitute adds a provision titled, ‘‘Disaster 

Processing Redundancy’’, which will require the SBA to maintain 

a backup disaster processing operation in a separate geographic location from the primary processing operation. The backup facility 

must be capable of taking over all disaster loan processing from the 

SBA’s primary facility within two days following a disaster, which 

renders the primary facility inoperable. (Section 12069) 

The Managers intend for this provision to mitigate the risk associated with the practice of maintaining a single primary disaster 

processing facility. 

The Conference substitute also adds a provision titled, ‘‘Plans 

to Secure Additional Office Space’’, which requires the SBA to develop long-term plans to secure sufficient space to accommodate an 

expanded workforce in times of disaster. (Section 12076) 

(43) Development and implementation of major disaster response 

plan 

The Senate amendment contains a provision that would require the SBA to amend the 2006 Atlantic Hurricane Season Disaster Response Plan to apply to all major disasters, and report to 

Congress on its progress. Additionally, this provision would require 

the SBA to develop and execute simulation exercises within six 

months of submitting its report to Congress to demonstrate the effectiveness of the updated response plan. (Section 11132) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment and 

requires the SBA to conduct a disaster simulation exercise at least 

once every two fiscal years that includes, at a minimum, the participation of not less than half of the agency’s disaster reserve 

corps. Additionally, the biennial disaster simulation exercise should 

include stress-testing of the agency’s vital information technology 

and telecommunications system, including various aspects of the 

SBA’s current loan processing and call support systems, the DCMS 

system, the core application functions, and additional components 


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such as loss verification and scanning systems. This stress-testing 

should simulate an increased number of concurrent users to determine whether the complete system, operating at maximum capacity 

will meet the agency’s needs for effective and accurate operations 

in a major disaster. Additionally, the biennial disaster simulation 

exercise should be based upon the most serious disaster scenarios 

that the agency has identified in the comprehensive disaster response plan and the agency should change the disaster scenario 

and the geographic region upon which each disaster simulation is 

predicated. (Section 12072) 

The Conference substitute adds a provision titled ‘‘Comprehensive Disaster Response Plan’’, which requires the SBA to develop, 

implement, or maintain a comprehensive written disaster response 

plan. The plan should include a risk-based assessment of the various types of disasters likely to occur in each of the agency’s 10 districts. Each assessment should include an analysis of the SBA’s 

needs for an effective response to each disaster scenario, with emphasis on strategies to meet rapidly expanding demand for information technology, telecommunications, human resources, and office space needs. Additionally, the comprehensive plan should include appropriate guidelines for coordination with other federal 

agencies as well as with State and local authorities to effectively 

respond to each disaster and best utilize agency resources. In developing the comprehensive plan, the SBA should integrate the results of disaster simulation exercises and catastrophe modeling 

programs to generate its disaster risk assessments and estimate 

the demand on agency resources. Additionally, the agency must include a report on the status of the disaster plan, highlighting any 

changes and developments from previous years, in its annual report to Congress as required by this Act. (Section 12075) 

(44) Disaster planning responsibilities 

The Senate amendment requires the SBA to assign disaster 

planning responsibilities to a qualified employee who is not an employee of the Office of Disaster Assistance. (Section 11133) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment with 

changes. The SBA must create a new position within the agency 

that is solely and exclusively dedicated to the function of disaster 

planning and readiness. The individual appointed to this position 

will be appointed by the Administrator and will report directly and 

solely to the Administrator. The individual must have substantial 

expertise in the field of disaster readiness and emergency response 

and should have proven management ability. (Section 12073) 

The Managers intend for this individual to serve as a highlevel administration official who operates independently from all of 

the agency’s existing offices and who has exclusive authority over 

the disaster planning function. Additionally, this provision mandates that the Administrator ensure that the individual assigned 

the disaster planning function has adequate resources to carry out 

their enumerated duties. 


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(45) Additional authority for the district offices of the administration 

The Senate amendment gives the SBA the ability to grant district offices permission to process disaster loans and requires the 

SBA to designate an employee in each district office to act as a disaster loan liaison between the processing center and the applicants. 

(Section 11134) 

The House bill contains no comparable provision. 

The Conference substitute adopts the House provision. 

(46) Assignment of employees of the Office of Disaster Assistance 

and Disaster Cadre 

The Senate amendment requires that the Administrator may, 

where practicable, ensure that the number of full-time equivalent 

employees be maintained at 800 for the Office of Disaster Assistance and at 750 for the SBA’s Disaster Cadre. If the staffing level 

for either of those offices falls below the statutorily mandated limit, 

the Administrator is required to submit a report to Congress and 

request additional funds if necessary. (Section 11135) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision, but 

raises the minimum staffing levels for the Disaster Cadre to 1,000. 

(Section 12074) 

(47) Small Business Act Catastrophic National Disaster Declaration 

The Senate amendment establishes a new Presidential disaster 

declaration that would have existed solely within the Small Business Act known as a ‘‘Small Business Act Catastrophic National 

Disaster Declaration.’’ The Senate amendment would also give the 

Administrator the authority to make economic injury disaster to 

loans to businesses located outside the designated disaster area. 

(Section 11141) 

The House bill contains no comparable provision. 

The Conference substitute amends the Catastrophic Disaster 

Declaration and entitles it ‘‘Eligibility for Additional Disaster Assistance,’’ which authorizes the Administrator to declare eligibility 

for additional disaster assistance following a Presidential major 

disaster declaration that rises to the level of a catastrophic incident. The Managers do not intend for every major disaster to give 

rise to a declaration of eligibility for additional disaster assistance, 

but intend that the SBA authorize this additional disaster assistance only in the most extraordinary and devastating of catastrophic 

incidents that render the SBA’s conventional disaster assistance 

programs inadequate or ineffective. The Managers intend that, 

when determining whether additional disaster assistance is to be 

made available, the SBA should ensure that the eligible disaster 

must be similar in size or scope to the terrorist attacks that occurred on September 11, 2001 or hurricanes ‘‘Katrina’’ or ‘‘Rita’’

that struck the U.S. Gulf Coast in 2005. (Section 12081) 

The Conference substitute adopts a portion of this Senate provision and adds a section titled, ‘‘Additional Economic Injury Disaster Loan Assistance,’’ which authorizes the Administrator to 

make economic injury disaster loans to small businesses located 

outside the disaster area that have suffered identifiable economic 


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injury as a direct result of a major disaster for which the Administrator has declared eligibility for additional disaster assistance. 

The Managers intend that businesses receiving assistance 

under this provision have suffered damage that was proximately 

caused by the disaster. Additionally, the Managers do not intend 

for this provision to displace the timely processing and disbursement of disaster assistance applications for businesses that are actually located within the designated disaster area. This provision 

further details eligibility requirements for affected businesses and 

provides for the suspension of the program if it has a significant 

negative impact on normal SBA loan processing times. (Section 

12082) 

(48) Private disaster loans 

The Senate amendment provides definitions of key terms and 

defines the parameters for authorization and use of Private Disaster Loans. The provision allows the SBA to guarantee timely payment of principal and interest on private loans issued to eligible 

small businesses and homeowners within an eligible disaster area, 

and the provision establishes an online application. The SBA may 

guarantee no more than 85 percent of a loan, worth a maximum 

amount of $2 million. Within one year the SBA must issue permanent regulations and criteria. The SBA is also given the authority 

to reduce the interest rate on any loan. (Section 11142) 

The House bill contains no comparable provision. 

The Conference substitute adopts a portion of the Senate provision and further requires the SBA to implement a Private Disaster 

Assistance program, whereby the SBA may guarantee timely payment of principal and interest of up to 85 percent of disaster loans 

made to eligible small businesses and homeowners within an eligible disaster area following a major disaster for which the Administrator declares eligibility for additional assistance. The SBA is also 

given authority to establish an online application process for private disaster loans and may permit lenders to use their own documentation. Loans administered under the program, however, must 

carry the same interest rate and be made on the same terms and 

conditions as SBA disaster loans made under the existing 7(b) disaster assistance program, and the SBA may use funds appropriated 

to the 7(b) program to fulfill this requirement. Private disaster 

loans for homeowners, however, may only be made by lenders who 

participate in the SBA’s Preferred Lender Program. By contrast, 

loans for small businesses may be made by any lender who meets 

the agency’s qualification requirements, or by a Preferred Lender 

who also makes loans to homeowners. (Section 12083) 

(49) Technical and conforming amendments 

(Section 11143) 

(50) Expedited Disaster Assistance Loan Program 

The Senate amendment requires the Administrator to set up 

an Expedited Disaster Assistance Loan program in consultation 

with Congress, appropriate lenders and creditors, SBDC’s, and appropriate offices within the Small Business Administration. The 

loans, made to borrowers otherwise eligible for loans under the 


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Small Business Act, shall not exceed $150,000, exceed 180 days in 

length, and be more then one percent over the prime rate. (Section 

11144) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment and 

requires that the loans only be made by private institutions and 

the Administrator may guarantee timely payments of principal and 

interest. (Section 12085) 

The Conference substitute also adds a provision titled ‘‘Immediate Disaster Assistance Program,’’ which will establish an SBA 

disaster loan program to provide small businesses with immediate, 

small-dollar loans administered through private sector lenders 

after any disaster. Loans made under the program would carry an 

85 percent guarantee on amounts up to $25,000. Loans made under 

this program would also be contingent upon the business applying 

for and meeting basic criteria for a subsequent SBA disaster loan, 

and the outstanding loan balance must be repaid with the proceeds 

of the conventional SBA loan. (Section 12084) 

The Managers intend for both the Immediate Disaster Assistance Program and the Expedited Disaster program to function as 

bridge financing programs for businesses that are awaiting approval or disbursement of funds under the SBA’s conventional disaster loan program. The Immediate Disaster assistance program is 

intended to provide eligible small business concerns with emergency, small-dollar financing within 36 hours following a disaster 

pending the victim’s receipt of a conventional disaster loan. This 

contrasts the SBA’s current loan program which has a target approval timeframe of 21 days and is intended to provide the disaster 

victim with long-term, low-interest assistance. The Expedited Disaster program is intended to provide bridge loans to disaster victims eligible for the 7(b) program who need a greater amount of 

funding. The loans are also intended to be disbursed more quickly 

then a standard SBA disaster loan. 

(51) HUBZones 

The Senate amendment makes any area designated as a Catastrophic National Disaster Area a HUBZone, as well as all disaster 

areas designated as a result of Hurricane Katrina or Rita. This 

designation shall persist for the two- year period beginning on the 

date of the designation of the area as a Small Business catastrophic national disaster area, or longer at the discretion of the 

SBA. (Section 11145) 

The House bill contains no comparable provision. 

The Conference substitute adopts the House provision. 

(52) Congressional oversight 

The Senate amendment requires the submission of monthly reports on disaster loan programs to Congress detailing lending volume and activity, as well as a daily updates during a Presidential 

disaster declaration. The SBA would also be required to submit a 

report to Congress every six months (for up to 18 months after the 

President declares a major disaster), detailing the numbers of contracts awarded to various types of small businesses in the area, as 

well as a report that details how the SBA can improve the procVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00981 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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essing of applications under the Disaster Loan Program. (Section 

11161) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment and 

requires the SBA to submit to Congress a report on the Disaster 

Assistance Program performance during the previous fiscal year. 

This report will cover changes in staffing, technology, and a review 

of challenges encountered and overall results. Additionally, during 

any period for which the Administrator has declared eligibility for 

additional assistance, the SBA is required to make monthly reports 

to Congress with basic information on their disaster response. During a Presidential disaster declaration period, the SBA must submit weekly updates to Congress, as opposed to daily updates in the 

original Senate amendment. The Conference substitute changes the 

name to ‘‘Reports on Disaster Assistance’’. (Section 12091) 

TITLE XIII—AMENDMENTS TO COMMODITY EXCHANGE ACT 

(1) Short title 

The Senate amendment cites this title as the ‘‘CFTC Reauthorization Act of 2008’’. (Section 13001) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 13001) 

(2) Commission authority over off-exchange retail foreign currency 

transactions 

The Senate amendment amends section 2(c)(2) of the Commodity Exchange Act (CEA) (7 U.S.C. 2(c)(2)) by clarifying that the 

Commodity Futures Trading Commission’s (Commission) anti-fraud 

authority applies to retail off-exchange foreign currency (forex) 

transactions that are: (i) offered to, or entered into with, a person 

that is not an eligible contract participant (i.e., a retail customer); 

and (ii) offered or entered into on a leveraged or margined basis, 

or financed by the offeror, the counterparty, or a person acting in 

concert with the offeror or counterparty, on a similar basis. 

If the test in new section 2(c)(2)(C) is met, courts will no longer 

have to decide whether forex transactions that meet these requirements are futures contracts in order to permit the Commission to 

pursue an action for fraud. But since CEA section 4b remains limited by its terms to futures, a new provision (section 2(c)(2)(C)(iv)) 

is added to ensure that section 4b applies to all covered forex transactions (e.g., ‘‘rolling spot’’ or other futures look-like products) ‘‘as 

if’’ they were futures contracts. Under this provision, the Commission need not prove that such transactions are futures in order to 

establish a fraud violation. However, this provision is not intended 

to suggest, nor does it create a negative inference, that such contracts are not futures contracts. 

The phrase ‘‘leveraged or margined basis’’ is not limited to the 

same type of leverage or margin that exists for trading in on-exchange markets. The fact that off-exchange transactions are at 

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Excluded from new section 2(c)(2)(C) are: (i) transactions offered or entered into by certain otherwise-regulated entities, such 

as financial institutions, broker-dealers, and insurance companies; 

(ii) securities that are not security futures products; and (iii) transactions that create an enforceable obligation to deliver between a 

seller and buyer that have the ability to deliver and accept delivery, respectively, in connection with their line of business. The 

term ‘‘line of business’’ in new section 2(c)(2)(C)(i)(II)(bb)(BB) refers 

to any legitimate line of business, not just a foreign exchange business. The reference to ‘‘an enforceable obligation to deliver’’ in connection with a ‘‘line of business’’ emphasizes the commercial nature 

of this exclusion. 

The Senate amendment explicitly reserves CEA sections 

2(a)(1)(B) (principal-agent liability); 4(b) (foreign markets); 4o 

(fraud by commodity pool operators and commodity trading advisors); 13(a) (aiding and abetting liability); and 13(b) (controlling 

person liability) with respect to fraudulent forex activities. 

While the secondary liability provisions of principal-agent, aiding-abetting, and controlling-person liability were implied in the 

Commodity Futures Modernization Act of 2000 (CFMA), these 

amendments make that reservation of Commission anti-fraud authority explicit. The amendments are not intended to suggest, nor 

do they create a negative inference, that these secondary liability 

provisions are not available in actions brought under other sections 

of the CEA where Commission anti-fraud or anti-manipulation authority is reserved, such as CEA sections 2(h)(2), 2(h)(4), and 5d(c). 

The Senate amendment also provides authority to the Commission to issue rules proscribing fraud in connection with any agreement, contract or transaction in an exempt or agricultural commodity that is (i) offered to, or entered into with, a person that is 

not an eligible contract participant (i.e., a retail customer); and (ii) 

offered or entered into on a leveraged or margined basis, or financed by the offeror, the counterparty, or a person acting in concert with the offeror or counterparty, on a similar basis. (Section 

13101) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendment. 

With the amendment, the managers intend to address several 

additional problems currently resulting in consumers being the victims of fraud related to off-exchange foreign currency transactions. 

The CFMA permitted registered Futures Commission Merchants 

(FCM) to offer foreign currency trading to the public without requiring that they be substantially or primarily engaged in the business of exchange-traded futures. 

Since passage of the CFMA, the Managers note that an inordinate number of fraudulent schemes are currently implemented 

through shell FCMs and their unregistered affiliates. These shell 

FCMs meet minimal requirements for FCMs and typically conduct 

little, if any, traditional on-exchange business of an FCM. Their 

purpose instead is to serve as the parent company for their unregistered affiliates. It is the unregistered affiliates that will typically 

conduct the retail sale of foreign currency contracts. Unregistered 


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affiliates of a shell FCM are subject to little if any regulatory oversight, making them harbors for fraudulent schemes. 

The amendment addresses the problem of shell FCMs and unregistered affiliates by providing that only FCMs that are primarily 

or substantially or primarily engaged in the buying and/or selling 

of futures contracts on a Designated Contract Market or Derivatives Transaction Execution Facility, or a material affiliate of such 

an FCM are lawful FCM or FCM-affiliate counterparties for a retail transaction in foreign currency. 

The Managers intend that the Commission will utilize the 

rulemaking authority provided in this section to define when a registered futures commission merchant is primarily or substantially 

engaged in the buying and/or selling of futures contracts as described in CEA section 1a(20) for the purposes of new provisions 

2(c)(2)(B)(i)(II)(cc)(AA) and (BB). 

A material affiliate is an affiliate for which an FCM is required 

to keep records relating to an affiliate’s futures and financial activities under CEA section 4f(c)(2)(B). The amendment provides that 

FCMs and FCM-affiliates must maintain minimum net capital of 

$20 million to be a lawful counterparty. This capital requirement 

is phased in over a period of one year. 

The amendment provides for a new category of dealer known 

as a ‘‘retail foreign exchange dealer’’ (RFED). The amendment provides that RFEDs also must maintain a minimum of $20 million 

in net capital to be a lawful counter party for a retail off-exchange 

foreign transaction. This capital requirement is phased in over a 

period of one year. 

The purpose of imposing a $20 million minimum capital requirement on FCMs, FCM-affiliates, and RFEDs is to ensure that 

forex dealers utilizing these classifications to conduct retail foreign 

currency business are sufficiently capitalized to ensure their financial soundness—especially given that many entities in this area 

run what are essentially off-exchange, retail forex markets. 

In addition, to maintaining a minimum of $20 million in adjusted net capital, the managers expect the Commission to use the 

rulemaking authority provided under this section to promulgate 

any other requirements necessary to ensure the financial soundness of RFEDs. 

The rules and regulations issued under this section should appropriately address the level of financial risk posed by RFEDs and 

their operations. To the extent their risk profiles are similar, the 

managers intend for FCMs and RFEDs to be regulated substantially equivalently in terms of their off-exchange retail foreign currency business. The managers do not intend for the Commission to 

provide either FCMs or RFEDs with a more favorable regulatory 

environment over the other or create two significantly different regulatory regimes for similar business models—to the extent the financial risks posed by such operations are similar. 

In addition to regulatory authority over FCMs and RFEDs, the 

amendment provides the Commission with greater authority over 

participants in the off-exchange foreign currency trading industry 

who are not the actual counterparty to the transaction to ensure 

that the Commission has authority needed over these industry parVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00984 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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ticipants to take action to address fraudulent or deceptive practices. 

The amendment strikes the Senate provision to provide authority to the Commission to issue rules proscribing fraud in connection with any agreement, contract or transaction in an exempt 

or agricultural commodity that is (i) offered to, or entered into 

with, a person that is not an eligible contract participant (i.e., a retail customer); and (ii) offered or entered into on a leveraged or 

margined basis, or financed by the offeror, the counterparty, or a 

person acting in concert with the offeror or counterparty, on a similar basis. (Section 13101) 

(3) Liaison with Department of Justice 

The Senate amendment requires the Attorney General to designate a liaison between the Department of Justice and the Commission to coordinate civil and criminal investigations and prosecutions of violations of the CEA. (Section 13102) 

The House bill contains no comparable provision. 

The Senate recedes. 

(4) Anti-fraud authority over principal-to-principal transactions 

The Senate amendment amends section 4b of the CEA (7 

U.S.C. section 6b) to clarify that the CEA gives the Commission the 

authority to bring fraud actions in off-exchange ‘‘principal-to-principal’’ futures transactions. Subsection 4b(a)(2) is amended by adding the words ‘‘or with’’ to address principal-to-principal transactions on the new markets and trading venues permitted under 

the CFMA. This new language clarifies that the Commission has 

the authority to bring anti-fraud actions in off-exchange principalto-principal futures transactions, including exempt commodity 

transactions in energy under section 2(h), as well as transactions 

conducted on derivatives transaction execution facilities. The prohibitions in subparagraphs (A) through (D) of the new section 4b(a) 

would apply to all transactions covered by paragraphs (1) and (2). 

Derivatives clearing organizations are not subject to fraud actions under section 4b in connection with their clearing activities. 

The amendments to CEA section 4b(a) regarding transactions 

currently prohibited under subparagraph (iv) (found in new subparagraph (D)) are not intended to affect in any way the Commission’s historical ability to prosecute cases of indirect bucketing of 

orders executed on designated contract markets. (See, e.g., Reddy 

v. CFTC, 191 F.3d 109 (2nd Cir. 1999); In re DeFrancesco, et al., 

CFTC Docket No. 02–09 (CFTC May 22, 2003) (Order Making 

Findings and Imposing Remedial Sanctions as to Respondent Brian 

Thornton)). 

These amendments should not be interpreted or understood as 

calling into question the Commission’s historical use of section 4b 

to address principal-to-principal trading in the retail context on 

regulated futures exchanges. (Section 13103) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 13102) 


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(5) Criminal and civil penalties 

The Senate amendment amends the CEA to double the civil 

and criminal penalties available for certain violations of the CEA 

such as manipulation, attempted manipulation, and false reporting. 

The increased civil monetary penalties in the Reauthorization Act 

are intended to render the CEA’s penalty provisions comparable to 

the penalty provisions that Congress enacted in the Energy Policy 

Act of 2005 for manipulation cases brought by the Federal Energy 

Regulatory Commission with respect to physical energy markets. 

(Section 13104) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendment. The amendment addresses technical drafting issues. 

(Section 103103) 

(6) Authorization of appropriations 

The Senate amendment authorizes such sums as may be necessary to carry out the Act for fiscal years 2008 through 2013. (Section 13105) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision. (Section 13104) 

(7) Technical and conforming amendments 

The Senate amendment contains various amendments to correct statutory errors and other conforming changes. (Section 13106) 

The House bill contains no comparable provision. 

The Conference substitute Adopts the Senate provision with 

amendment. The amendment makes additional technical and conforming changes to the CEA. 

The amendment amends section 1(a)(33) of the CEA (7 U.S.C. 

1). The definition of ‘‘trading facility’’ under the CEA is a key criterion for defining a number of categories of regulated markets 

(e.g., designated contract markets, derivatives transaction execution facilities), exempt markets (e.g., exempt commercial markets, 

exempt boards of trade) and excluded markets (e.g., CEA section 

2(d)(2)). By amending the definition of trading facility, the Managers address a concern where the Commission’s jurisdiction could 

be compromised if novel auction systems which aggregate the market sentiments of multiple participants to derive a market price according to a pre-determined algorithm were to fall outside the 

agency’s regulatory ambit. The definition of ‘‘trading facility’’ has 

been amended to anticipate and include, prospectively, markets 

which utilize automated trade matching and execution algorithms. 

Section 4a(e) of the CEA provides, among other things, that it 

is a violation of the CEA, for any person to violate a speculative 

limit rule of a designated contract market, derivatives transaction 

execution facility, or other board of trade if that rule has been approved by the Commission. Section 5c(c) of the CEA, though, permits exchanges to certify such rules rather than submit them for 

prior Commission approval. The Managers amend section 4a(e) to 

bring it into harmony with the CEA provisions regarding certification of exchange rules. Specifically, the Managers amend section 

4a(e) to provide that it is a violation of the CEA, for which the 


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Commission may bring an enforcement action, for any person to 

violate a speculative limit rule that has been certified by a registered entity. 

The Managers are concerned that complainants seeking to enforce an award received through the Commission’s reparations 

process are facing difficulties in obtaining relief from Federal District courts. Accordingly, the Managers include language in this 

amendment amending section 14(d) of the Commodity Exchange 

Act (7 U.S.C. 18) to provide that Commission reparations awards 

are directly enforceable in Federal District courts as if they were 

local judgments pursuant to 29 U.S.C. 1963. The Managers also 

provide that the amendment shall operate retroactively. (Section 

13105) 

(8) Portfolio margining and security index issues 

Following enactment of the CFMA, the Commission and Securities and Exchange Commission (SEC) jointly promulgated rules 

relating to the margining of security futures products (SFP). Under 

those rules, SFPs have been subject to the same fixed-rate strategy-based margining scheme applicable to security options customer accounts, rather than the risk-based portfolio margining system typical in the futures industry. Many have argued that this 

has contributed to the low volume of trading in SFPs which, by 

contrast, have been successful in Europe. The Senate amendment 

directs the Commission and SEC to use their existing authorities 

by September 30, 2008, to allow customers to benefit from the use 

of a risk-based portfolio margining system for both security options 

and SFPs. 

The detailed statutory test of a narrow-based security index 

was tailored to fit the U.S. equity markets, which are by far the 

largest, deepest and most liquid securities markets in the world. 

The amendment provides clarity in this area by requiring the Commission and the SEC to take action under their existing authorities 

to promulgate, by June 30, 2008, final rules providing criteria that 

will exclude broad-based indexes on foreign equities from the definition of narrow-based security index as appropriate. (Section 

13107) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to extend the deadlines to September 30, 2009 for implementing portfolio margining and June 30, 2009 for promulgating 

criteria for excluding broad-based indexes on foreign equities from 

the definition of narrow-based security index as appropriate. (Section 13106) 

(9) Significant price discovery contracts 

The Senate amendment provided for greater regulation of contracts traded on exempt commercial markets (ECM) that fulfill a 

price discovery function. It sets forth criteria for the Commission 

to consider in determining whether an ECM contract qualifies as 

a significant price discovery contract (SPDC). These criteria include: (i) price linkage; (ii) arbitrage; (iii) material price reference; 

and (iv) material liquidity and other such material factors as the 

Commission specifies by rule. 


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The amendment applies core principles to ECM contracts that 

are determined to perform a significant price discovery function by 

the Commission. These Core Principles are derived from selected 

DCM core principles and designation criteria set forth in CEA section 5. These core principles include those relating to: contracts not 

being readily susceptible to manipulation, monitoring of trading, 

the ability of the Commission to obtain information, position limitations or accountability limitations, emergency authority, daily publication of trading information, compliance with rules, and conflict 

of interest. 

The amendment gives the electronic trading facility the explicit 

discretion to take into account differences between cleared and 

uncleared SPDCs only in applying the emergency authority and the 

position limits or accountability core principles and directs the 

Commission to take such differences into consideration when reviewing implementation of such principles by the electronic trading 

facility in (7)(D); 

The amendment requires an electronic trading facility to notify 

the Commission whenever it has reason to believe that an agreement, contract or transaction conducted in reliance on the exemption provided in 2(h)(3) displays any of the factors relating to a significant price discovery function described in subparagraph (7)(B); 

and directs the Commission to conduct an evaluation at least once 

a year to determine whether any agreement, contract or transaction conducted on an electronic trading facility in reliance on the 

exemption in 2(h)(3) performs a significant price discovery function 

in (7)(E). (Section 13201) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendment. With the amendment the Managers make several 

changes to the Senate provision. 

The Managers provide that the Commission shall promulgate 

rules and regulations to implement the authorities provided by this 

Act regarding significant price discovery contracts. The Senate provision had originally made such promulgation discretionary. The 

Managers also allow the Commission to consider the potential for 

arbitrage between a potential SPDC and an existing SPDC in making a determination whether a contract is a SPDC. 

The Managers amend the Senate provision to make clear that 

an electronic trading facility shall have reasonable discretion to account for differences between cleared and uncleared contracts in 

complying with all the core principles applicable under this Act to 

SPDCs. 

The Managers amend the Senate provision to make clear that 

in determining appropriate position limits or position accountability limits under this Act, an electronic trading facility shall consider cleared swaps transactions that are treated by a derivatives 

clearing organization as fungible with significant price discovery 

contracts. The Managers also amend the Senate language to apply 

the conflict of interest and antitrust considerations core principles 

to electronic trading facilities only with respect to SPDCs traded on 

such facilities. 

Not all the listed factors must be present to make a determination that a contract performs a significant price discovery function. 


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However, the Managers intend that the Commission should not 

make a determination that an agreement, contract or transaction 

performs a significant price discovery function on the basis of the 

price linkage factor unless the agreement, contract or transaction 

has sufficient volume to impact other regulated contracts or to become an independent price reference or benchmark that is regularly utilized by the public. 

The core principles that apply to SPDCs are derived from selected DCM core principles and designation criteria set forth in 

CEA section 5, and the Managers intend that they will be construed in like manner as the DCM core principles. 

The Managers do not intend that the Commission conduct an 

exhaustive annual examination of every contract traded on an electronic trading facility pursuant to the section 2(h)(3) exemption, 

but instead to concentrate on those contracts that are most likely 

to meet the criteria for performing a significant price discovery 

function. 

The Managers further intend that the Commission should conduct such examinations in the course of its normal monitoring of 

ECM contracts and surveillance of designated contract market and 

derivatives transaction execution facility contracts when considering the potential for arbitrage or price linkage as the basis for 

an SPDC determination. (Section 13201) 

(10) Large trader reporting 

The Senate amendment amends CEA section 4g to require reporting and recordkeeping of every person registered with the Commission regarding the transactions and positions of such person in 

any SPDC traded or executed on an electronic trading facility. It 

also amends CEA section 4i to make any person buying or selling 

SPDCs on an electronic trading facility subject to reporting requirements set by the Commission and to require such person to report 

and keep records on transactions or positions equal to or in excess 

of any reporting threshold the Commission has set. (Section 13202) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate Provision with 

amendment. The amendment provides that large trader reporting 

requirements imposed by this Act for SPDCs shall include contracts, transactions, or agreements that are treated by a derivatives clearing organization as fungible with SPDCs. (Section 13202) 

(11) Conforming amendments 

The Senate amendment provides various amendments to conform other areas of current law based on changes made in sections 

13201 and 13202. The amendment provides that an electronic trading facility shall be considered as a registered entity for the purposes of the CEA and provides that the Commission shall have exclusive jurisdiction over significant price discovery contracts. (Section 13203) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendment. 

The amendment included by the managers clarifies that the 

CEA’s grant of exclusive jurisdiction to the Commission in CEA 


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section 2(a)(1)(A) applies to significant price discovery contracts 

traded on ECMs. The amendment further clarifies that the provisions of the CEA made applicable to SPDCs traded on ECMs by 

this Act are not precluded by CEA section 2(h)(3). 

The Managers note that in creating the new authorities contained in this Act, it is the intent of the Managers to enhance the 

Commission’s authority over (2)(h)(3) markets under the CEA. It is 

the Managers’ intent that this provision not affect FERC authority 

over the activities of regional transmission organizations or independent system operators because such activities are not conducted 

in reliance on section 2(h)(3). (Section 13203) 

(12) Effective date 

The Senate amendment: (1) provides that this subtitle shall become effective on the date of enactment of this Act, (2) requires the 

Commission to issue a proposed rule regarding the significant price 

discovery standards in section 13201(b) within 180 days of the date 

of enactment of this Act and a final rule within 270 days, and (3) 

requires the Commission to complete a review of the agreements, 

contracts and transactions of any electronic trading facility operating on the effective date of the final rule described in 13204(b) 

within 180 days after that effective date to determine whether such 

agreement, contract or transaction performs a significant price discovery function. (Section 13204) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendment. 

The amendment directs the Commission to conduct a rulemaking to implement a process for determining whether ECM contracts are SPDCs. 

The managers note that although status as a registered entity 

would attach to an ECM upon the Commission’s determination that 

a particular ECM contract serves a significant price discovery function, the managers intend that the Commission rulemaking include 

a grace period after a significant price discovery determination to 

enable the ECM to come into compliance with its newly-applicable 

core principles. Such a grace period, which need only be made 

available to ECMs that have been determined to have a SPDC for 

the first time, should ensure that such ECMs have sufficient time 

to implement the necessary regulatory requirements and operations. (Section 13204) 

TITLE XIV—MISCELLANEOUS 

* For items 1 through 52 of the House bill and Senate amendment, see title XII—Crop Insurance. 

* For items 53 through 79 and item 120 of the House bill and 

Senate amendment, see title XI—Livestock. 

(1) Prohibition on use of live animals for marketing of medical devices; fines under the Animal Welfare Act 

The House bill amends the Animal Welfare Act to prohibit 

using a live animal to demonstrate a medical device or product for 

marketing purposes or to train a sales representative to use such 

product. The prohibition does not apply to the training of medical 


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personnel for a purpose other than marketing. The House language 

amends the Animal Welfare Act to set a cap for violations at not 

more than $10,000 for each violation. It specifies that each violation, each day that a violation continues, and each animal that is 

subject to each violation, shall be a separate offense. The House 

language also amends the Animal Welfare Act to require that the 

report to Congress also identify all research facilities, intermediate 

handlers, carriers, and exhibitors registered under section 6 of the 

Act. It strikes the provision requiring information and recommendations related to the Horse Protection Act. (Section 11316) 

The Senate amendment contains no comparable provision. 

The Conference substitute provides that fines under the Ani- mal Welfare Act are increased from $2500 to $10,000. (Section 

14214) 

(2) Protection of pets 

The House bill amends the Animal Welfare Act by replacing 

section 7. The new section provides a definition for person to be 

used only in this section. Person includes any individual, partnership, firm, joint stock company, corporation, association, trust, estate, pound, shelter, or other legal entity. This section prohibits research facilities or Federal research facilities from using a cat or 

dog for educational or research purposes if it was obtained from a 

permissible source. Also, no person may donate, sell, or offer a dog 

or cat to any research facility or Federal research facility unless it 

came from a permissible source. A permissible source is defined to 

mean a dealer licensed under AWA; a publicly owned pound registered with the Secretary and in compliance with the protection of 

pet standards outlines in the Act and has obtained the cat or dog 

from a legal owner, other than a pound or shelter; or a person that 

is donating the dog or cat that bred and raised it and owned it for 

not less than one year preceding donation; a research facility or 

Federal research facility licensed by the Secretary. In addition to 

existing penalties for violating the Animal Welfare Act this provision establishes an additional fine of $1,000 for each violation of 

this section. Nothing in this section requires a pound or shelter to 

donate, sell, or offer a dog or cat to a research facility. (Section 

11317) 

The Senate amendment is the same as the House bill. It adds 

a provision that would phase out the use of random source dogs 

and cats from class B dealers within five years after enactment of 

this act. (Section 11079) 

The Conference substitute adopts the House provision with an 

amendment that defines Class B dogs and cats and requires the 

Secretary to review any independent reviews and recommendations 

by a nationally recognized panel on the use of Class B dogs and 

cats in federal research. 

The Managers are aware of the concerns relating to the use of 

random source animals from Class-B dealers for medical research. 

As part of the Consolidated Appropriations Act, 2008 (P.L. 110–

161), Congress requested an independent review by a nationally 

recognized panel of experts of the use of Class B dogs and cats in 

federally supported research. The National Academy of Science is 

in the process of conducting this review. Results from the review 


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are expected to be finalized in the spring of 2009. The results of 

this study will help provide Congress information regarding the 

value of Class B dogs and cats in medical research. It is the Managers view upon completion of the review the House Committee on 

Agriculture and United States Senate Committee on Agriculture, 

Nutrition and Forestry should address whether to continue Class 

B dealers as a legitimate vendor of random source animals for medical research. 

The Managers are also aware of concerns relating to how Class 

B dealers acquire random source animals. Under 9 CFR 2.132(d) 

dealers are prohibited from obtaining a dog or cat from any person 

who is not licensed (other than a pound or shelter), unless they obtain a certification (source record) that the animals were born and 

raised on that person’s premises and, if the animals are for research purposes, that the person has sold fewer than 25 dogs and/ 

or cats that year. The Animal and Plant Health Inspection Service 

(APHIS) conducts four unannounced inspections of each Class B 

dealer on an annual basis. During these inspections, APHIS conducts random trace back of source records. In addition, every 2 to 

3 years APHIS does 100 percent trace back of every source record 

of all Class B dealers. APHIS data indicates a 95 percent trace 

back of these records. Understanding concerns raised about the validity of these source records, the Managers intend to ask the Government Accountability Office to review APHIS regulations to ensure they are sufficiently assuring the source of random source animals. 

The Managers are also concerned with the humane handling 

and treatment of all animals. In section 14114, fines for violating 

the Animal Welfare Act are increased for the first time since 1985. 

(Section 14216) 

(3) Sense of the Senate on the U.S. Department of Agriculture’s 

wildlife services competing against private industry for nuisance bird control work 

The Senate amendment contains a Sense of the Senate that 

USDA Wildlife Services should not compete nor condone competition with the private sector for business regarding the management 

of nuisance wildlife problems in urban areas where private sector 

services are available. Wildlife Services should inform cooperators 

of the availability of and their right to acquire services from private service providers prior to entering into any cooperative agreement for wildlife damage management activities. The Secretary of 

Agriculture should ensure that Wildlife Services does not aggressively compete with private pest management industry for European starling, house sparrow, and pigeon control work in urban 

areas where private sector services are available. The Secretary of 

Agriculture should rely on the scientific and widely excepted definitions to define the term urban rodent in order to clarify the express 

restrictions in law on Wildlife Services activities. Finally, the Secretary should direct Wildlife Service to work with private industry, 

through a Memorandum of Understanding, to delineate common 

areas of cooperation so that issue of competition are addresses, taking into account the interests of the wildlife resources and the need 

to manage damage caused by that resource. (Section 11085) 


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The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

The Managers expect the Secretary to continue and strictly enforce the current Wildlife Service Directive 3.101, ‘‘Interfacing with 

Business and Establishing Cooperatives Programs,’’ dated May 25, 

2005. The Managers intend that the Secretary, consistent with this 

Directive, shall inform service requesters of the availability of other 

private service providers and their right to choose. The Managers 

strongly encourage the Secretary to ensure that Wildlife Services 

does not compete with professional pest management companies 

which manage nuisance birds such as European starlings, house 

sparrows, and pigeons in urban areas. The Managers strongly encourage the Secretary to enter into a Memorandum of Understanding with industry to address issues of competition for service, 

taking into account the ability of private entities to respond to requests for wildlife damage management and the common goal of 

both the Department and the private sector to meet the increasing 

need of managing damages caused by pests in urban areas. 

(4) Prohibitions on dog fighting ventures 

The Senate amendment amends section 26 of the Animal Welfare Act to strengthen penalties for dog fighting. Section 26(a)(1) of 

the AWA is amended to make it unlawful to knowingly sponsor or 

exhibit an animal in a dog fighting venture as defined later in this 

section. Section 26(b) of the AWA is amended to add it is illegal 

to knowingly sell, buy, posses, train, transport, deliver or receive 

any dog, other animal or offspring of the dog or other animal for 

the purpose of having them participate in a dog fighting venture. 

Section 26(f) of the AWA is amended to allow costs incurred for the 

care of animals seized or forfeited under this section to be recoverable from the owner. Subsection (g) is amended to include a definition for a dog fighting venture to mean any event that involves a 

fight between at least two animals, one being a dog, which is conducted for purposes of sport, wagering, or entertainment. An exclusion for hunting is also added. Section 49 of title 18, United States 

Code, is also amended to increase the penalty for violations of section 26 of the Animal Welfare Act to not more than five years imprisonment. (Section 11076) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with a 

minor amendment. (Section 14207) 

(5) Domestic pet turtle market access; review, report and action on 

the sale of baby turtles 

The Senate amendment requires the Secretary of Health and 

Human Services, acting though the Commissioner of Food and 

Drugs, to determine the prevalence of salmonella in each species of 

reptile and amphibian sold legally in the United States to determine whether or not the prevalence of salmonella in these animals 

is not more than 10 percent less than the percentage of salmonella 

in pet turtles. If the prevalence is not more than 10 percent less 

than the percentage of salmonella in pet turtles the Secretary of 

Agriculture shall conduct a study of how pet turtles can be sold 

safely as pets in the United States. In conducting the study the 


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Secretary shall consult with all relevant stakeholders. (Sections 

11101, 11102, and 11103) 

If the prevalence of salmonella in other amphibians and reptiles is greater than that of salmonella in pet turtles the Secretary 

shall prohibit the sale of those amphibians and reptiles. 

The House bill contains no comparable provision. 

The Conference substitute strikes this provision. 

(6) Importation of live dogs 

The Senate amendment adds a new section to the Animal Welfare Act (7 U.S.C. 2147) to restrict the importation of certain dogs 

for resale. This provision defines ‘‘importer’’ as any person who, for 

purposes of resale, transports into the United States puppies from 

a foreign country. Resale is defined to mean any transfer of ownership or control of an imported dog of less than 6 months of age to 

another person, for more than de minimis consideration. No dog 

shall be imported into the United States for purposes of resale unless the Secretary of Agriculture determines the dog is in good 

health; has received all necessary vaccinations; and is at least 6 

months of age, if imported for resale. Exemptions are provided for 

dogs imported for research purposes or veterinary treatment. The 

Secretaries of Agriculture, Health and Human Services, Commerce, 

and Homeland Security will promulgate regulations necessary to 

implement this section. Failure to comply by an importer will result in the importer being subject to fines under section 19 of the 

Animal Welfare Act and providing for the care, forfeiture, and 

adoption of each applicable dog at the expense of the importer. 

(Section 3205) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendment. The Managers recognizes that Hawaii may have a 

unique situation arising out of Hawaii’s current quarantine regulations. In the case of Hawaii, so long as the state continues to quarantine dogs imported from the mainland United States, the Secretary may permit an exception to allow the import of dogs under 

the age of 6 months from jurisdictions currently exempt from the 

Hawaii quarantine (i.e. Guam, Australia, New Zealand, and the 

British Isles) for resale in Hawaii, provided all other regulations of 

the Secretary, and of the State of Hawaii, are complied with. Any 

dogs imported into Hawaii pursuant to this exception shall not be 

shipped to any other jurisdiction within the United States for resale at less than 6 months of age. 

The Managers do not intend for the exception for veterinary 

treatment to be used for routine veterinary care. This exemption is 

in place for emergency situations where the dogs in question are 

in need of immediate veterinary treatment and may not have the 

required vaccinations. Congress expects that such dogs would also 

be properly quarantined until the dogs are determined to be in 

good health as defined by regulations promulgated by the Secretary. Further, it is not the intent of Managers to prevent organizations from importing dogs under the age of 6 months in the event 

of an emergency, and transferring ownership or control of such 

dogs under the age of 6 months, provided such organization does 


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not receive more than de minimus consideration for such adopted 

or transferred dogs. (Section 14210) 

(7) Outreach and technical assistance for socially disadvantaged 

farmers and ranchers and limited resource farmers and ranchers 

The House bill amends section 2501 of the Food, Agriculture, 

Conservation, and Trade Act (FACT Act) to specify that the 2501 

Technical and Outreach Assistance Program is to be used to enhance the coordination, outreach, technical assistance, and education efforts authorized under USDA programs. 

The House bill authorizes agencies within USDA to make 

grants and enter into contracts and cooperative agreements with a 

community-based organization in order to utilize the communitybased organization to provide outreach and technical assistance. It 

requires the Secretary to submit to the House and Senate Agriculture Committees an annual report that includes the following: 

the recipients of funds made available under the 2501 Outreach 

and Technical Assistance Program; the activities undertaken and 

services provided; the number of producers served and the outcomes of such service; and the problems and barriers identified by 

entities in trying to increase participation by socially disadvantaged farmers and ranchers. 

Section 11201(1)(C) provides mandatory funding in the amount of $15 million for each of the fiscal years 2008 through 2012. No 

more than 5 percent of the funds made available in each fiscal year 

are to be used for administrative expenses related to administering 

the 2501 Program. 

Eligible entities are defined as any community-based organizations, networks, or coalition of community based organizations that 

have demonstrated experience in providing agricultural education 

or other agriculturally related services to and on behalf of socially 

disadvantaged farmers and ranchers and have provided to the Secretary documentary evidence of work with socially disadvantaged 

farmers and ranchers. (Section 11201) 

The Senate amendment amends section 2501 of the Food, Agriculture, Conservation, and Trade Act (FACT Act) to specify that 

the 2501 Technical and Outreach Assistance Program is to be used 

to enhance the coordination, outreach, technical assistance, and 

education efforts authorized under USDA programs. The 2501 Program is to assist the Secretary in reaching socially disadvantaged 

farmers and ranchers and prospective socially disadvantaged farmers and ranchers, and improving the participation of those farmers 

and ranchers in USDA programs. The Secretary is required to submit and make publicly available a report that describes: (A) the accomplishments of the 2501 program, and (B) any gaps or problems 

in program service delivery, as reported by program grantees. Appropriations of up to $50,000,000 annually are authorized for fiscal 

years 2008–2012. No more than 5 percent of the funds made available in each fiscal year are to be used for administrative expenses 

related to administering The 2501 Outreach and Technical Assistance Program. The provision changes eligibility guidelines for potential grantees by extending from 2 to 3 years the period of time 

for which documentary evidence of work with socially disadvanVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00995 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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taged farmers must be provided. The Secretary is authorized to 

provide for the renewal of a grant, contract, or other agreement 

under this section to an entity that: (A) has previously received 

2501 funding; (B) has demonstrated an ability to reach socially disadvantaged farmers and increase the participation of such farmers 

in USDA programs; and (C) demonstrates to the satisfaction of the 

Secretary that an entity will continue to fulfill the purposes of the 

2501 Program. This section requires the Secretary to promulgate 

regulations establishing criteria for grants under this program. 

This section requires the Secretary, following consultation with entities eligible for the 2501 Program to co-locate the 2501 Program 

and the Office of Outreach within 18 months of enactment. (Section 

11052) 

The Conference substitute adopts the Senate amendment with 

modifications to delete language from the Senate amendment pertaining to renewal of contracts, review of proposals, and coordination with the Office of Outreach of the Department of Agriculture, 

which is now addressed in Section 14013, Office of Advocacy and 

Outreach. The Conference substitute also provides $75 million in 

mandatory funding for the 2501 Program. (Section 14004) 

(8) Improved program delivery by Department of Agriculture on Indian reservations 

The House bill amends section 2501(g) of the FACT Act by authorizing the Secretary to require the Agricultural Stabilization 

and Conservation Service, the Soil Conservation Service, the Farmers Home Administration offices, and any such offices and functions that the Secretary chooses to include, establish a consolidated 

suboffice at tribal headquarters on Indian reservations, where 

there is a demonstrated need. (Section 11202) 

The Senate amendment is the same as the House bill, with 

technical differences. (Section 11054) 

The Conference substitute adopts the House provision with a 

technical change to correct the agency names in the statute. (Section 14001) 

(9) Transparency and accountability for socially disadvantaged 

farmers and ranchers 

The House bill amends section 2501A of the FACT Act by requiring the Secretary to annually compile, for each county and 

State in the United States, program application and participation 

rate data regarding socially disadvantaged farmers or ranchers by 

computing for each USDA program that serves agricultural producers and landowners: (A) raw numbers of applicants and participants by race, ethnicity, and gender; and (B) the application and 

participation rate by race, ethnicity, and gender, as a percentage 

of the total participation rate of all agricultural producers and 

landowners. 

The Secretary, using the technologies and systems of the National Agricultural Statistics Service, is authorized to compile and 

present application and participation rate data regarding socially 

disadvantaged farmers or ranchers in a manner that includes the 

raw numbers and participation rates for: the entire United States; 

each State; and, each county in each State. The Secretary is reVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00996 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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quired to make the data (i.e., report) available to the public, via a 

website and otherwise in electronic and paper form. (Section 11203) 

The Senate amendment amends section 2501A of the FACT 

Act by requiring the Secretary to annually compile, for each county 

and State in the United States, program application and participation rate data regarding socially disadvantaged farmers and ranchers by computing for each USDA program that serves agricultural 

producers and landowners: (A) raw numbers of applicants and participants by race, ethnicity, and gender; and (B) the application and 

participation rate by race, ethnicity, and gender, as a percentage 

of the total participation rate of all agricultural producers and 

landowners. 

The Secretary, using the technologies and systems of the National Agricultural Statistics Service, is authorized to compile and 

present application and participation rate data regarding socially 

disadvantaged farmers or ranchers in a manner that includes the 

raw numbers and participation rates for: the entire United States; 

each State; and, each county in each State. (Section 11056) 

The Conference substitute adopts the House provision. (Section 

14006) 

(10) Beginning farmer and rancher development program 

The House bill provides that mandatory funding in the amount of $15 million is to be provided for each of the fiscal years 2008 

through 2012 to carry out the program. (Section 11204) 

The Senate amendment incorporates energy conservation efficiency and transition to organic farming into the programs and 

services eligible to receive competitive grants under this program. 

It limits grants under this program to $250,000. The provision adds 

a set of evaluation criteria the Secretary shall consider when 

awarding grants under this program. The Secretary is also required to ensure, to the maximum extent practicable, geographic 

diversity of grantees under this program. Organizations that work 

with refugee or immigrant beginning farmers or ranchers are 

added to be eligible to receive grants. This provision authorizes 

$30,000,000 in annual appropriations for the BFRDP. (Section 

7309) 

The Conference substitute adopts the Senate provision with an 

amendment to move the program into the research title of this Act, 

to delete the incorporation of energy conservation efficiency and 

transition to organic farming into the program, to delete the clarification on organizations that work with refugee or immigrant beginning farmers, and to add $15,000,000 in mandatory funding for 

each fiscal year from 2009 and $20 million for each of fiscal years 

2010 through 2012. 

The Managers encourage the Secretary to include asset- based 

farming opportunity strategies in the grant categories of the Beginning Farmer and Rancher Development Program (BFRDP) in order 

to aid with the overall purposes of the program, which include financial management training, the acquisition and management of 

agricultural credit, and innovative farm and ranch transfer strategies. 

The Managers expect the panels that will review the grant applications through the BFRDP to include a broad range of individVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 00997 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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uals with appropriate expertise and experience in delivering beginning farmer and rancher programs. 

The Managers intend for the BFRDP to include immigrant beginning farmers and ranchers in the funding set-aside for socially 

disadvantaged and limited resource farmers and ranchers. 

The Managers are aware of and fully support the goals of the 

National Young Farmers Education Association National Forum on 

Identifying Issues and Enhancing Success for America’s Young and 

Beginning Agricultural Producers. To the extent practicable, the 

Managers encourage the Secretary to provide support to this important forum. (Section 7410) 

(11) Provision of receipt for service or denial of service 

The House bill authorizes the Secretary to provide a receipt for 

service to a producer or landowner, or prospective producer or landowner, in any case where the producer or landowner, or prospective 

producer or landowner, requests any benefit or service offered by 

USDA to agricultural producers or landowners. The receipt for 

service is to be issued on the date the request is made and must 

contain the date, place, and subject of the request, as well as the 

action taken, not taken, or recommendations made in response to 

the request. (Section 11205) 

The Senate amendment differs from the House version in that 

it: (1) specifies that Farm Service Agency and Natural Resources 

Conservation Service are the agencies subject to this provision, and 

(2) requires the receipt upon request. Section 11057 amends Section 2501A of the Food, Agriculture, Conservation, and Trade Act 

of 1990 (7 U.S.C.2279–1)(as amended by section 11056). This section requires the Secretary of Agriculture to issue to farmers and 

ranchers seeking a benefit or service offered by the Farm Service 

Agency or the Natural Resources Conservation Services of USDA, 

a receipt upon request that contains the date, place, and subject of 

the request as well as the action taken, not taken, or recommended 

to the farmer or rancher. (Section 11057) 

The Conference substitute adopts the Senate amendment but 

modifies the language to include ‘‘current or prospective producer 

or landowner’’ and adds Rural Development to the agencies that 

are subject to the provision. (Section 14003) 

(12) Tracking of socially disadvantaged farmers or ranchers and 

limited resource farmers or ranchers in Census of Agriculture 

and certain studies 

The House bill requires the Secretary to ensure, to the maximum extent possible, that the Census of Agriculture accurately 

documents the number, location, and economic contributions of socially disadvantaged and limited resource farmers or ranchers. 

(Section 11206) 

The Senate amendment amends section 2501 of the Food, Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279). The 

Secretary is required to ensure, to the maximum extent possible, 

that the Census of Agriculture accurately documents the number, 

location, and economic contributions of socially disadvantaged and 

limited resource farmers or ranchers. (Section 11055) 


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The Conference substitute adopts the Senate amendment. (Section 14005) 

(13) Farmworker coordinator 

The House bill authorizes the Secretary to establish the position of Farmworker Coordinator, to be located in USDA’s Office of 

Outreach. The Farmworker Coordinator is to have a number of duties, including: serving as a liaison to community-based, non-profit 

organizations that represent low-income migrant and seasonal 

farmworkers; coordinating with USDA and State and local governments to assure that farmworker needs are met during declared 

disasters and emergencies; and assuring that farmworkers have access to services and support that will assist them in entering agriculture as producers. An appropriation of such sums as necessary 

is authorized for fiscal years 2008 through 2012. (Section 11207) 

The Senate amendment is the same as the House bill, with 

technical differences. The Senate provision amends section 296(b) 

of the Department of Agriculture Reorganization Act of 1994 (7 

U.S.C. 7014(b)). (Section 11059) 

The Conference substitute adopts the Senate provision with an 

amendment to specify that the Farmworker Coordinator shall have 

responsibility for assisting farmworkers in becoming agricultural 

producers or landowners, and to make other technical changes. The 

Farmworker Coordinator has been relocated into the Office of Advocacy and Outreach as described in (93) of this document. (Section 

14013) 

(14) Office of Outreach relocation 

The House bill authorizes the Secretary to develop a proposal 

to relocate USDA’s Office of Outreach. The Office of Outreach is to 

be responsible for the 2501 Outreach and Technical Assistance Program and the Beginning Farmer and Rancher Development Program. (Section 11208) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House amendment with 

modification. The substitute establishes a new Office of Advocacy 

and Outreach, the purpose of which is to improve the viability and 

profitability of small farms and ranches, beginning farmers or 

ranchers, and socially disadvantaged farmers or ranchers, as well 

as to improve access to programs of the Department of Agriculture. 

The Office of Advocacy and Outreach is to be overseen by a director appointed by the Secretary from among the competitive service and to have two distinct groups, a Socially Disadvantaged 

Farmer Group and a Small Farms and Beginning Farmers and 

Ranchers Group. The Socially Disadvantaged Farmers Group is to 

carry out the 2501 Program, oversee the Minority Farmer Advisory 

Committee, oversee the Farmworker Coordinator, and carry out the 

functions of the Office of Outreach and Diversity previously carried 

out by the Office of the Assistant Secretary for Civil Rights. The 

Small Farms and Beginning Farmers and Ranchers Group is to 

oversee the Office of Small Farms Coordination, consult with the 

National Institute for Food and Agriculture on the administration 

of the Beginning Farmer and Rancher Development Program, coordinate with the Advisory Committee for Beginning Farmers and 


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Ranchers, and carry out other such duties as determined appropriate by the Secretary of Agriculture. (Section 14013) 

(15) Minority farmer advisory committee 

The House bill authorizes the Secretary to establish a minority 

advisory committee, to be overseen by USDA’s Office of Outreach. 

The committee is to have a number of duties, including: reviewing 

civil rights cases to ensure that they are processed in a timely 

manner; reporting quarterly to the Secretary on civil rights enforcement and outreach; recommending to the Secretary corrective 

actions to prevent civil rights violations; and reviewing the operations of the 2501 Outreach and Technical Assistance Program. 

The Committee is to be composed of the following: 

(A) 3 members appointed by the Secretary; 

(B) 2 members appointed by the chairman of the Committee on Agriculture, Nutrition, and Forestry, of the Senate— in consultation with the ranking member; 

(C) 2 members appointed by the chairman of the House 

Agriculture Committee—in consultation with the Ranking 

member; 

(D) a civil rights professional; 

(E) a socially disadvantaged farmer or rancher; and 

(F) such other persons or professionals that the Secretary 

determines to be appropriate. (Section 11209) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with 

amendment. The substitute specifies that the duty of the committee is to provide advice to the Secretary on implementation of 

the 2501 Program, methods of maximizing the participation of minority farmers and ranchers in Department of Agriculture programs, and civil rights activities at the Department of Agriculture. 

The substitute deletes components of the House bill pertaining to 

review of civil rights cases, the processing of civil rights cases, 

quarterly reporting to the Secretary on civil rights enforcement, annual reporting to the Secretary on civil rights compliance, recommendations to the Secretary regarding corrective actions to prevent civil rights violations, review of operations of the 2501 Program, and review of outreach efforts in the agencies and programs 

of the Department. 

The substitute also revises the membership of the committee, 

specifying not less than four socially disadvantaged farmers and 

ranchers, not less than two representatives of nonprofit organizations, not less than two civil rights professionals, not less than two 

representatives of higher education, and other such persons as 

deemed appropriate by the Secretary. The substitute also provides 

the Secretary of Agriculture with authority to appoint employees of 

the Department of Agriculture as ex-officio members. (Section 

14008) 

(16) Coordinator for chronically underserved rural areas 

The House bill authorizes the Secretary to establish a Coordinator for Chronically Underserved Rural Areas, to be located in 

USDA’s Office of Outreach. The mission of the Coordinator is to direct USDA’s resources to high need, high poverty rural areas. The 


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Coordinator’s duties are to include consulting with other USDA offices in directing technical assistance, strategic planning, at the 

State and local level, for developing rural economic development 

that leverages the resources of State and local governments and 

non-profit and community development organizations. An appropriation of such sums as necessary is authorized for each of the fiscal years 2008 through 2012. (Section 11210) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to locate the Coordinator in Rural Development instead of the Office of Outreach. (Section 14118) 

(17) Foreclosure 

The Senate amendment states that currently there is a USDA 

guidance that prohibits loan foreclosures when there is a pending 

claim of racial discrimination against the Department. This provision amends section 307 of the Consolidated Farm and Rural Development Act (7 U.S.C. 1927) to put into law what is already in 

place in a guidance at USDA. 

Subsection (a) Moratorium. This section mandates a moratorium on all loan acceleration and foreclosure proceedings where 

there is a pending claim of discrimination against the Department 

related to a loan acceleration or foreclosure. This section also 

waives any interest and offsets that might accrue on all loans 

under this title for which loan and foreclosure proceedings have 

been instituted for the period of the moratorium. If a farmer or 

rancher does not prevail on his claim of discrimination, then the 

farmer or rancher will be liable for any interest and offsets that accrued during the period that the loan was in abeyance. The moratorium will terminate on either the date the Secretary resolves the 

discrimination claim or the court renders a final decision on the 

claim, whichever is earlier. 

Subsection (b) Report. This section requires the Inspector General of USDA to determine whether loan foreclosure proceedings of 

socially disadvantaged farmers have been implemented according 

to applicable laws and regulations. The Inspector General shall 

submit a report of its determination to the Senate and House Committees on Agriculture not later than a year after this legislation’s 

enactment. (Section 11051) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment with 

an amendment that the farmer or rancher is required to have a 

program discrimination claim and that the Department makes a 

procedural determination to accept the claim as a valid one. The 

determination to accept the claim by the Department is intended 

to be procedural and not a statement as to the merits of the claim. 

The Conference substitute amends Section 331A of the Consolidated Farm and Rural Development Act (7 U.S.C. 1981a) and 

specifies that the provision applies to farmer program loans made 

under subtitle A, B, or C. (Section 14002) 

(18) Additional contracting authority 

The Senate amendment amends section 2501(a)(3) of the Food, 

Agriculture, Conservation, and Trade Act of 1990 (7 U.S.C. 


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2279(a)(3)). This section clarifies that the agencies and programs of 

the Department of Agriculture are authorized to enter into contracts and cooperative agreements with community-based organizations to provide service to socially-disadvantaged farmers and 

ranchers, clarifies that the Secretary is not required to require 

matching funds for such agreements, and allows federal agencies to 

contribute to grants or cooperative agreements made under the 

2501 Program as the agency determines that contributing funds for 

such purpose will further the authorized programs of the contributing agency. (Section 11053) 

The House bill contains a similar provision in section 11201. 

The Conference substitute deletes both House and Senate provisions. 

(19) Emergency grants to assist low-income migrant and seasonal 

farmworkers 

The Senate amendment amends Section 2281 of the Food, Agriculture, Conservation and Trade Act of 1990 (42 U.S.C. 5177a). 

This section requires the Secretary to maintain a disaster fund of 

$2,000,000, and authorizes discretionary funding to maintain it. 

This section further requires that public or private entities eligible 

to receive funding under this section must have at least five years 

demonstrated experience in representing and providing emergency 

services to low-income migrant or seasonal farmworkers. Types of 

allowable assistance are specified, in addition to such other priorities that the Secretary determines to be appropriate. (Section 

11061) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate amendment. 

(20) National appeals division 

The Senate amendment amends section 280 of the Department 

of Agriculture Reorganization Act of 1994 (7 U.S.C. 7000). This section establishes a reporting requirement that states the head of 

each agency shall report to the House and Senate Agriculture Committees, and post on the Department’s website information that includes a description of all cases returned to the agency by the National Appeals Division, the status of implementation of each final 

determination and if the final determination has not been implemented then the reason and the projected date of implementation. 

The reporting requirement to Congress should be every 180 days 

and the website should be updated not less than monthly. (Section 

11058) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment. (Section 14009) 

(21) Oversight and compliance 

The Senate amendment requires the Secretary of Agriculture 

to use the reports required under section 2501 of the FACT Act in 

the conduct of program oversight regarding the participation of socially disadvantaged farmers in USDA programs as well as in the 

evaluation of civil rights performance. (Section 11064) 

The House bill contains no comparable provision. 


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The Conference substitute adopts the Senate amendment. (Section 14007) 

(22) Report of civil rights complaints, resolutions, and actions 

The Senate amendment requires the Secretary of Agriculture 

to issue an annual report on program and employment civil rights 

complaints, including the number of complaints filed, the length of 

time required to process complaints, the number of complaints resolved with a finding of discrimination, and the personnel actions 

taken by the agency following resolution of civil rights complaints. 

(Section 11065) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment. The 

Managers intend that if the Secretary, in compiling determines the 

aggregate data does not accurately reflect the scope of complaints, 

then the Secretary may note in the report that multiple complaints 

came from a single individual, in order to provide clear picture of 

the scope of the complaints. (Section 14010) 

(23) Grants to improve supply, stability, safety, and training of agricultural labor force 

The Senate amendment directs the Secretary to make grants 

to nonprofit organizations to assist agricultural employers and 

farmworkers with services that help improve the quality of the agricultural labor force through job training, short-term housing, 

workplace literacy and ESL training, and health and safety instruction, among other purposes. Discretionary funding is authorized to carry out this section. (Section 11066) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with 

amendments to clarify the eligible services that may be provided 

with grant funds through the program; to specify that assistance 

may be provided to farmworkers who are citizens or otherwise legally present in the United States; and to establish a 15 percent 

limit on administrative expenses for the program. (Section 14204) 

(24) Office of small farms and beginning farmers and ranchers 

The Senate amendment establishes an office at USDA to be 

known as the Office of Small Farms and Beginning Farmers and 

Ranchers. Section (b) outlines the purposes of the office including 

enduring coordination across all agencies; ensure small, beginning, 

and socially disadvantaged farmers and ranchers access to all 

USDA programs; unsure the number and economic contributions of 

small, limited resource, beginning and socially disadvantaged farmers and ranchers are accurately reflected in the Census of Agriculture; and to assess and enhance the effectiveness of outreach 

programs the department. Subsection (c) establishes the office 

should be headed by a director. Subsection (d) outlines the duties 

of the office including to establish cross cutting and strategic departmental goals and objectives for small, beginning, and socially 

disadvantaged farmer and rancher programs. Subsection (e) requires the office to maintain a website to share information with 

interested producers and to collect and respond to comments from 

small and beginning farmers and ranchers. Subsection (f) requires 


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the Secretary to provide the office human and capital resources sufficient to allow the office to carry out its duties using funds made 

available to the Secretary through appropriations acts. Subsection 

(g) requires and annual report to the Committee on Agriculture of 

the House of Representatives and the Committee on Agriculture, 

Nutrition, and Forestry in the Senate. (Section 11088) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment that Section 14013 subsumes this office into the Office 

of Advocacy and Outreach. (Section 14013) 

(25) Designation of separate cotton-producing States under Cotton 

Research and Promotion Act 

The House bill amends the definition of ‘‘cotton-producing 

State’’ in the Cotton Research and Promotion Act to include Kansas, Virginia, and Florida as each being considered separate cotton 

producing States under the Act, beginning with the 2008 crop of 

cotton. (Section 11301) 

The Senate amendment designates Kansas, Virginia, and Florida as each being considered separate cotton-producing States effective beginning with the 2008 crop of cotton for purposes of the Cotton Research and Promotion Act. (Section 1713) 

The Conference substitute adopts the Senate provision. (Section 14202) 

(26) Cotton classification services 

The House bill extends the authority of the Secretary to make 

cotton classification services available to producers of cotton and to 

collect classification fees from participating producers through FY 

2012. The provision authorizes the Secretary to enter into longterm lease agreements that exceed five years or take title to property in order to obtain offices used for the classification of cotton. 

(Section 11302) 

The Senate amendment authorizes cotton classing services 

without any fiscal year restrictions. Similar to the House bill, the 

Senate amendment authorizes the Secretary to enter into longterm lease agreements that exceed five years or take title to property in order to obtain offices used for the classification of cotton. 

The provision requires the Secretary to consult with the cotton industry in establishing the fees. It ensures that the Federal Advisory Committee Act requirements do not apply to consultations 

with the US Cotton industry. It also provides greater discretion to 

the Secretary in establishing the fees. (Section 1712) 

The Conference substitute adopts the Senate provision with an 

amendment to ensure that the Secretary announces the classification fee and any applicable surcharge for classification services not 

later than June 1 of the year in which the fee applies. 

The Managers expect the cotton classification fee to be established in the same manner as was applied during the 1992 through 

2007 fiscal years. The classification fee should continue to be a 

basic, uniform per bale fee as determined necessary to maintain 

cost-effective cotton classification service. In consulting with the 

cotton industry, the Secretary should demonstrate the level of fees 

necessary to maintain effective cotton classification services and 


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provide the Department of Agriculture with an adequate operating 

reserve, while also working to limit adjustments in the year-to-year 

fee. (Section 14201). 

(27) Availability of excess and surplus computers in rural areas 

The House bill provides that the Secretary may make surplus 

USDA computers or technical equipment available to any city or 

town in a rural area. (Section 11303) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to ensure that the activities authorized under this section are in addition to, and would not replace, activities conducted 

under other existing authorities of the Secretary with regard to 

property disposal. 

The Managers expect the Secretary to use this authority to 

continue to make available excess or surplus computers to city or 

towns located in rural areas through organizations that are able to 

refurbish such equipment and supply it to rural schools, libraries, 

and city halls in need. 

The intent of the conferees is that local governments include 

independent school districts. (Section 14220) 

(28) Permanent debarment from participation in Department of Agriculture programs for fraud 

The House bill authorizes the Secretary to permanently debar 

an individual or entity convicted of knowingly defrauding the 

United States in connection with any program administered by the 

Department of Agriculture from any subsequent participation in 

such programs. (Section 11304) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment. The amendment provides the Secretary the authority 

to limit the debarment to not less than ten years. The amendment 

further provides that debarment shall not have any effect on the 

receipt of domestic food assistance. (Section 14211) 

(29) No discrimination against use of registered pesticide products 

or classes of pesticide products 

The House bill prohibits the Secretary from discriminating 

against the use of specified registered pesticide products or classes 

of pesticide products in establishing priorities and evaluation criteria for approval of plants, contracts and agreements under the 

conservation title of this Act. (Section 11305) 

The Senate amendment contains no comparable provision. 

The Conference substitute strikes this provision. Insomuch as 

the underlying House provision was a restatement of long-standing 

policy of the Natural Resources Conservation Service (NRCS), the 

managers recognize that statutory language is unnecessary. 

The House provision referred to pesticides registered by the 

Environmental Protection Agency (EPA) in accordance with the 

Federal Insecticide, Fungicide and Rodenticide Act (FIFRA) and 

the Food Quality Protection Act (FQPA). A FIFRA registration implies that uses of pesticides have been deemed by EPA to have met 


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established standards of safety to human health and the environment when used in accordance with the label. 

Under various conservation programs authorized in Title II, 

the managers have directed the Secretary to establish priorities 

and evaluation criteria to ensure the efficient and effective use of 

resources. 

However, it is not the intent of the managers to undermine the 

regulatory framework for the legal use of registered pesticides 

while implementing various conservation programs in this Title. 

Therefore, in establishing priorities and evaluation criteria for 

the approval of plans, contracts and agreements under Title II of 

this Act, it is the expectation of the managers that the NRCS shall 

neither prohibit the use of specific registered pesticides or classes 

of pesticides, nor advocate for the use of alternatives to registered 

pesticides or classes of pesticides. 

The managers intend for NRCS to assist farmers wishing to 

adopt new technologies and specific pest management strategies 

that contribute to agricultural production and environmental quality. For example, programs that assist farmers in developing risk 

mitigation measures regarding pesticide use are entirely consistent 

with the current regulatory program administered by EPA and 

would not be in conflict with Congressional intent. 

(30) Prohibition on closure or relocation of county offices for the 

Farm Service Agency, Rural Development Agency, and Natural 

Resources Conservation Service 

The House bill prohibits the Secretary from closing or relocating a county or field office of the Farm Service Agency, Rural 

Development Agency, or Natural Resources Conservation Service 

for one year following the date of enactment of this Act. (Section 

11306) 

The Senate amendment defines ‘‘critical access county FSA office’’ in subsection (a) as an office of the Farm Service Agency proposed to be closed during the period beginning on November 10, 

2005 and ending on December 31, 2007; proposed to be closed with 

the closing delayed until after January 1, 2008; or included on a 

list of critical access county FSA offices. FSA offices that are located not more than 20 miles from another FSA office or that employ no full-time equivalent employees are excepted from the definition of critical access county FSA office. Subsection (b) prohibits 

the Secretary from using any funds to pay the salaries or expenses 

of any USDA officer or employee to close any critical access county 

FSA office during the period from the date of enactment through 

September 30, 2012. The Secretary is required to maintain a staff 

of not less than 3 full-time equivalent employees in each critical access county FSA office although the staff may be located in any 

other county office of the FSA in that State. However, a critical access county FSA office must have at least 1 full-time equivalent 

employee. 

Subsection (c) allows the Secretary to close a critical access 

county FSA office only on concurrence by Congress and the applicable State Farm Service Agency committee. (Section 11071) 

The Conference substitute adopts the House provision with an 

amendment. 


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The Managers have provided the exception paragraph to allow 

the Secretary to review offices meeting the criteria and close those 

offices if justified; the language in the exception paragraph does 

not require the Secretary to close offices meeting the criteria. The 

Managers expect that the Department will communicate with Congressional delegations about proposed closures and respond to concerns about such closures. (Section 14212) 

(31) Regulation of exports of plants, plant products, biological control organisms, and noxious weeds 

The House bill amends the Agricultural Risk Protection Act of 

2000 to require the Secretary to coordinate fruit and vegetable 

market analyses with the private sector and Foreign Agricultural 

Service. Further requires the Secretary to list on an Internet 

website the status of export petitions, an explanation of associated 

sanitary or phytosanitary issues, and information on the import requirements of foreign countries for fruits and vegetables. (Section 

11307) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to strike the original language and insert a provision 

in the Technical Assistance for Specialty Crops program requiring 

the Secretary to submit an annual report on sanitary and 

phytosanitary trade barriers. (Section 3203) 

(32) Grants to reduce production of methamphetamines from anhydrous ammonia 

The House bill authorizes the Secretary to make grants to eligible entities to enable such entities to obtain and add to an anhydrous ammonia fertilizer nurse tank a substance that will reduce 

the amount of methamphetamine that can be produced from such 

tank. It provides that the grant amount be between $40 and $60, 

multiplied by the number of nurse tanks for each eligible entity. 

The provision also authorizes appropriations of not more than $15 

million for each of fiscal years 2008 through 2012. (Section 11308) 

The Senate amendment is the same as the House bill, except 

it provides that a grant can be used either for a physical lock or 

a chemical substance. (Section 11062) 

The Conference substitute adopts the Senate amendment. (Section 14203) 

(33) USDA Graduate School 

The House bill amends the Federal Agriculture Improvement 

and Reform Act of 1996 to prohibit the Department of Agriculture 

from establishing, maintaining, or operating a non-appropriated 

fund instrumentality of the United States to develop, administer, 

or provide educational training and professional development activities, including educational activities for Federal agencies, Federal employees and other entities, effective October 1, 2008. (Section 11309) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment. The modification keeps the House language but extends the deadline for the General Administrative Board of the 


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Graduate School to transition the Graduate School into a non-governmental nonappropriated fund instrumentality to October 1, 

2009. It further authorizes the Secretary to use available appropriated funds and other resources to assist in the Graduate 

School’s transition. Effective immediately, the Graduate School 

shall be subject to Federal procurement procedures in the same 

manner and subject to the same requirements as a commercial entity. (Section 14213) 

(34) Prevention and investigation of payment and fraud and error 

The House bill amends the Right to Financial Privacy Act of 

1978 to allow financial institutions to disclosure an individual’s financial records to any Government entity that certifies, disburses 

or collects payments, when such disclosure is necessary for the 

proper administration of programs. The provision expands the permitted use of the disclosed financial information to include the 

verification of the identity of any person in connection with Federal 

payment or collection of funds, or the investigation or recovery of 

improper Federal payments, improperly collected funds, or an improperly negotiated Treasury check. (Section 11310) 

The Senate amendment is the same as the House bill except: 

(1) The provision does not change paragraph (k)(1) of the 

existing exception in the Right to Financial Privacy Act of 

1978, which allows disclosure of the name and address of any 

financial institution customer if the disclosure is necessary for 

the proper administration of section 1441 of Title 26, title II 

of the Social Security Act, or the Railroad Retirement Act. 

(2) New paragraph (2) allows disclosure of a customer’s financial records, rather than just a customer’s name and address as permitted under paragraph (1), to reflect the fact that 

electronic payments are not directed to customers by means of 

a name and address, in contrast to paper checks. 

(3) Information may be disclosed under the new paragraph 

(2)(A) not only to the extent that the information is necessary 

to verify the identity of any person making or receiving a Federal payment, but also to verify the proper routing and delivery 

of funds. 

(4) New paragraph (3) applies to a request authorized by 

paragraph (k)(1) or (2). Similar to the House version, the provision does not allow for the disclosure by a financial institution 

of the customer’s financial records in their entirety, but only 

the information contained in the records that are relevant to 

the purpose of the request. (Section 11068) 

The Conference substitute adopts the Senate provision. (Section 14205) 

(35) Sense of Congress regarding food deserts, geographically isolated neighborhoods and communities with limited or no access 

to major chain grocery stores 

The House bill expresses the sense of Congress that the Secretary of Agriculture, in conjunction with the National Institutes of 

Health, Centers for Disease Control and Prevention, Institute of 

Medicine, and faith-based organizations, should assess ‘‘food 

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hoods and communities with limited or no access to major-chain 

grocery stores), and develop recommendations for eliminating 

them. (Section 11311) 

The Senate amendment requires the Secretary to study and report on areas in the United States with limited access to affordable 

and nutritious food, with a focus on predominantly lower-income 

neighborhoods and communities. (Section 7504) 

The Conference substitute adopts the Senate provision with an 

amendment to move this provision to the Research Title of this Act, 

to include and define the term ‘‘food desert,’’ and to include an authorization of appropriations for the study. (Section 7527) 

(36) Pigford claims 

The House bill provides that Pigford claimants who have not 

had their cases determined on the merits may, in a civil action, obtain such a determination. Payments or debt relief are to be exclusively made from mandatory funds provided to carry out this section. The total amount of payments and debt relief are prohibited 

from exceeding $100 million; additionally, payments and debt relief 

provided under this section are not to be made from Judgment 

Fund established by 31 U.S.C. 1304. The intent of Congress is to 

have this section liberally construed. Not later than 60 days after 

the Secretary receives notice that a Pigford claimant desires to 

have a determination made on the merits of a claim, the Secretary 

is to provide the claimant with a report on farm credit loans made 

within the claimant’s county, or adjacent county, by USDA for a period beginning on Jan. 1 of the year or years covered by the complaint and ending on Dec. 31 of the following year or years. 

The report is to contain information on all person whose loans 

were accepted, including: 

(a) the race of the applicant; 

(b) the date of the application; 

(c) the date of the loan decision; 

(d) the location of the office making the loan decision; and 

(e) all data relevant to the process of deciding the loan. 

The reports provided by USDA are not to contain identifying 

information regarding the person that applied for a USDA loan. 

Claimants who allege discrimination in the application for, or making or servicing of, a farm loan are permitted to seek liquidated 

damages of $50,000, or a discharge of the debt that was incurred 

under, or affected by, the alleged discrimination that is the subject 

of the complaint, and a tax payment in an amount of the liquidated 

damages and loan principal discharged only if: 

(1) the claimant is able to prove his or her case by substantial evidence; and 

(2) the court decides the case based on documents, submitted by the claimant, that are relevant to the issue of liability and damages. 

The Secretary is prohibited from beginning acceleration on or 

foreclosure of a loan if the borrower is a Pigford claimant and, during an administrative proceeding, the claimant makes a prima facie 

case that the foreclosure is related to a Pigford claim. A ‘‘Pigford 

claimant’’ is defined as an individual who previously submitted a 

late-filing request under section 5(f) of the Pigford consent decree, 


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in the case of Pigford v. Glickman, approved by the U.S. District 

Court for DC on April 14, 1999. A ‘‘Pigford claim’’ is defined as a 

discrimination complaint, as defined by section 1(h) of the Pigford 

consent decree and documented under section 5(b) of the decree. 

Mandatory funding of $100 million is to be made for fiscal year 

2008. The funding is to remain available until it has been expended 

for payments and debt relief in satisfaction of claims against the 

U.S, with respect to a Pigford claimants who have their claims determined on the merits, and for any actions made related to the 

prohibition regarding foreclosures related to Pigford claims. (Section 11312) 

The Senate amendment is the same as the House bill except: 

(1) Subsection (a)(1) requires all claimants to file in United 

States District Court for the District of Columbia. 

(2) Subsection (a)(2) connects the definition of ‘‘substantial 

evidence to the one used in the original consent decree. 

(3) Authorizes appropriate funds as necessary beyond the 

$100 million in mandatory funding. (Section 5402) 

The Conference substitute adopts the Senate amendment with 

modifications. The Secretary will have 120 days to provide the 

claimant a report, or may petition the court for an extension. The 

modification requires the Secretary to retrieve data from within the 

claimant’s county, or, if no documents are found then within an adjacent county as determined by the claimant. 

The modification provides for those who are filing a claim for 

discrimination involving a noncredit benefit to be able to obtain a 

report from the Secretary. It also provides for those claimants to 

receive a maximum of $3,000 irrespective of the number of noncredit claims on which the claimant prevails. 

The modification provides for those filers who chose not to go 

through the expedited resolutions process, to be entitled to actual 

damages if the claimant prevails. 

The modification also provides a requirement for the Secretary 

to report once every six months to both the House and Senate Committees on the Judiciary the status of available funds and the number of pending claims under the expedited resolutions process. It 

further requires the Secretary to notify those Committees once 75% 

of the funds have been depleted. It further provides for a 2-year 

statute of limitations to file a claim under this section. (Section 

14012) 

(37) Sense of Congress relating to claims brought by socially disadvantaged farmers or ranchers 

The Senate amendment contains a sense of Congress that the 

Secretary should resolve all claims and class actions brought 

against the United States Department of Agriculture by socially 

disadvantaged farmers or ranchers including Native Americans, 

Hispanics, and female farmers regarding discrimination in farm 

loan program participation. (Section 5403) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate amendment with 

a modification that all pending claims should be resolved expeditiously. (Section 14011) 


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(38) Comptroller General study of wastewater infrastructure near 

United States-Mexico border 

The House bill mandates that the Comptroller General study 

wastewater infrastructure in rural communities within 150 miles of 

the United States-Mexico border to determine how the Government 

can assist these communities in updating the wastewater infrastructure. (Section 11313) 

The Senate amendment contains no comparable provision. 

The Conference substitute deletes this provision. 

(39) Elimination of statute of limitations applicable to collection of 

debt by administrative offset 

The House bill amends 31 U.S.C. 3716(e) to eliminate the statute of limitations within which a government agency can initiate 

the collection of an outstanding claim by administrative offset. 

(Section 11314) 

The Senate amendment is the same as the House bill. (Section 

11069) 

The Conference substitute adopts the House provision. (Section 

14219) 

(40) Pollinator protection 

The House bill cites this section as the ‘‘Pollinator Protection 

Act of 2007’’. It states Congress’ findings regarding the importance 

of bee pollination to agriculture and the concerns related to colony 

collapse disorder in the bee population. The provision authorizes 

appropriations, as follows: • For the Agricultural Research Service at USDA—$3 million 

for each of fiscal years 2008 through 2012 for new personnel, facilities improvement, and additional research at the USDA Bee Research Laboratories; $2.5 million for each of fiscal years 2008 and 

2009 for research on honey and native bee physiology, and other 

research; and $1.75 million for each of fiscal years 2008 through 

2010 for an area-wide research program to identify causes and solutions for colony collapse disorder. • For the Cooperative State Research, Education, and Extension Service—$10 million to fund grants to investigate honey bee 

biology, immunology, ecology, genomics, bioinformatics, crop pollination and habitat conservation, the effects of insecticides, herbicides and fungicides, and other research. • For the Animal and Plant Health Inspection Service—$2.25 

million for each of fiscal years 2008 through 2012 to conduct a 

honey bee pest and pathogen surveillance program. 

The House bill requires the Secretary to submit a report to 

Congress on the status and progress of bee research projects. It 

amends the Food Security Act of 1985 to require the Secretary, 

when carrying out a conservation program other than the farmland 

protection program, to establish a priority and provide incentives 

for increasing habitat for pollinators and to establish practices to 

protect native and managed pollinators. (Section 11315) 

The Senate amendment contains no comparable provision. 

The Conference substitute adopts the House provision with an 

amendment to move the research-related items of this provision to 

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riculture, Conservation, and Trade Act of 1990 (7 U.S.C. 5925), and 

to move the conservation-related item of this provision to the conservation title of this Act.. (Section 7204) 

(41) Exemption from AQI user fees 

The Senate amendment exempts commercial trucks from payment of agricultural quarantine and inspection user fees if it originates in Alaska and reenters the United States directly from Canada or if it originates in the United States and transits through 

Canada before entering Alaska. Commercial trucks exempt from 

user fees are required to remain sealed during transit through 

Canada. (Section 11080) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(42) Regulations to improve management and oversight of certain 

regulated articles 

The Senate amendment requires the Secretary to promulgate 

regulations for improved management and oversight of articles regulated under the Plant Protection Act. (Section 11077) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to change the timeframe for the promulgation of regulations and to make technical changes. This provision can be found 

in the horticulture and organic agriculture title. (Section 10204) 

(43) Invasive pest and disease emergency response funding clarification 

The Senate amendment clarifies that the Secretary may provide emergency funding to States to combat invasive pest and disease outbreaks for any appropriate period after initial detection of 

the pest or disease, as determined by the Secretary. (Section 11078) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(44) Invasive species management, Hawaii 

The Senate amendment requires cooperation among the federal 

agencies involved in preventing the introduction of and controlling 

invasive species in the State of Hawaii; requires the development 

of collaborative federal and state procedures to minimize the introduction of invasive species into Hawaii, and requires a report to 

Congress on the development of those procedures; establishes a 

process for Hawaii to seek approval from the federal government 

to impose restrictions on the introduction or movement of invasive 

species or disease into the State that are in addition to federal restrictions; in the event of an emergency or imminent invasive species threat, allows Hawaii to impose restrictions of up to 2 years 

to prevent introduction of the threat upon approval by the federal 

government. (Section 11063) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. The 

Managers remain concerned about the serious and growing 

invasive species problem in the State of Hawaii. The Managers are 

aware of the threats that invasive species present to Hawaii’s 


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unique ecosystem, which is highly susceptible to invasive species 

because of the combination of isolation of the Hawaiian islands and 

high passenger, baggage and cargo traffic to the islands. The Managers encourage the Secretaries of the Department of Agriculture, 

Interior and Homeland Security to work together in close cooperation with the State of Hawaii to effectively reduce the number of 

invasive species in Hawaii. The Managers emphasize this collaboration is critical at Hawaiian ports of entry. 

(45) Invasive species revolving loan fund 

The Senate amendment establishes an invasive species revolving loan fund. This loan fund allows eligible units of local government to finance purchases of authorized equipment to monitor, remove, dispose of, and replace infested trees on land under the jurisdiction of the eligible local government and within the borders of 

a quarantine area infested by an invasive pest. These loans can be 

no more than $5,000,000 and shall have an interest rate of two percent. An eligible unit of local government shall work with the Secretary to establish a loan repayment schedule. This schedule requires that not later than one year after the eligible unit of local 

government received a loan they must repay the loan. The payments can be scheduled semiannually after. (Section 11090) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to move this provision to the horticulture and organic 

title of this Act, to replace all references to ‘‘invasive species’’ with 

the term ‘‘pest and disease,’’ and to strike the provision allowing 

the unit of local government to use the financing of contracts with 

individuals and entities as part of the matching requirement in 

this program. (Section 10205) 

(46) Cooperative agreements relating to invasive species prevention 

activities 

The Senate amendment allows States to provide cost-sharing 

assistance or financing mechanism to a unit of local of the State 

through any cooperative agreement entered into between the Secretary and a State relating to the prevention of invasive species infestation. (Section 11091) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to move this section to the horticulture and organic 

title of this Act, to amend section 431 of the Plant Protection Act 

(7 U.S.C. 7751), and to make technical changes. (Section 10206) 

(47) Report relating to the ending of childhood hunger in the United 

States 

The Senate amendment includes a sense of Congress regarding 

childhood hunger in the United States. This section specifies that, 

not later than one year after the date of enactment of the Act, the 

Secretary shall submit to Congress a report that describes the best 

and most cost-effective manner by which the federal government 

could allocate funds to achieve the goal of abolishing childhood 

hunger and food insecurity by 2013. (Section 11082) 

The House bill contains no comparable provision. 


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The Conference substitute deletes this provision. 

(48) GAO report on access to health care for farmers 

The Senate amendment provides that the GAO shall provide a 

report on rural Americans access to health care with a focus on 

farmers by November 30, 2008. (Section 11074) 

The House bill contains no comparable provision. 

The Conference substitute deletes this provision. 

(49) Conveyance of land to Chihuahuan Desert Natural Park 

The Senate amendment conveys 935.62 acres of land in Dona 

Ana County, New Mexico to the Chihuahuan Desert Nature Park, 

Inc., a non-profit organization in New Mexico. The land is to be 

conveyed within one year after enactment of this Act. Subsection 

(c) outlines the conditions for the land conveyance. The United 

States reserves all mineral and subsurface rights of the land. The 

Chihuahuan Desert Nature Board must pay any costs associated 

relating to the conveyance. Also this subsection requires the land 

to be used for only educational or scientific purposes. Subsection (d) 

states if the land is not used for educational or scientific purposes 

the land may revert to the United States. If the land is environmentally contaminated, the Chihuahuan Desert Nature Park, Inc. 

or successor is responsible for the contamination and shall be required to remediate the contamination. (Section 11075) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to authorize the conveyance, without consideration, of 

certain lands in the George Washington National Forest. (Section 

8302) 

(50) Department of Agriculture conference transparency 

The Senate amendment requires the Secretary to quarterly report to the Inspector General costs and contracting procedures relating to conferences held by USDA for which the cost to the Federal Government was over $10,000. Subsection (c) requires the Secretary to annually report to the Senate and House Agriculture 

Committees a detailed report about each conference where the 

USDA paid travel expenses. (Section 11081) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment. The modification provides reporting guidelines for conferences that are held by the Department or attended by employees 

of the Department. For conferences held by the Department, the 

Secretary will have to include a description of the contracting procedures related to the conference. The provision is not intended to 

apply to any training program for employees of the Department, or 

to conferences held outside the United States and attended by the 

Secretary or a designee as an official representative of the U.S. 

government. Travel under (c)(1)(d) does not apply to local travel for 

conferences. (Section 14208) 


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(51) National emergency grant to address effects of Greensburg, 

Kansas tornado 

The Senate amendment states the Department of Labor awarded Greensburg, KS a $20 million grant to assist with cleanup 

from a F5 tornado that hit the town in May of 2007. The language 

allows the planning process to begin and allow federal funds that 

have already been awarded to flow more smoothly and efficiently. 

(Section 11083) 

The House bill contains no comparable provision. 

The Conference substitute deletes this provision. 

(52) Report on program results 

The Senate amendment requires the Secretary to report information regarding programs that have received a Program Assessment Rating Tool score of ‘‘results not demonstrated’’ and for each 

program provide reasons that the program has not been able to 

demonstrate results, steps taken to demonstrate results and what 

might be necessary to facilitate the demonstration of results. (Section 11084) 

The House bill contains no comparable provision. 

The Conference substitute deletes this section. The Managers 

recognize that the reporting requirements in the Senate amendment may duplicate actions already taken by the Secretary in regards to the Program Assessment Rating Tool and that information 

on Program Assessment Rating Tool scores is publicly available. 

However, in order to raise greater awareness about such evaluation, the Managers encourage the Secretary to provide progress reports to Congress on the programs that have received a Program 

Assessment Rating Tool of ‘‘results not demonstrated.’’

(53) Study of impacts of local food systems and commerce 

The Senate amendment requires the Secretary of Agriculture 

to evaluate the potential community, economic, health and nutrition, environmental, food safety, and food security impacts of advancing local food systems and commerce, the challenges that prevent local foods from comprising a larger share of the per capita 

food consumption in the United States, and existing and potential 

strategies, policies, and programs to address those challenges. (Section 11089) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate amendment. 

USDA’s Economic Research Service (ERS) has indicated that 

the Agency is in the process of conducting a study of local food systems, thereby mitigating the need for a statutory mandate in this 

conference agreement. The ERS study will address issues raised in 

the Senate amendment including an evaluation of the effects of 

local food systems on economic activity, nutrition, and environmental resources. ERS has likewise indicated that the study will 

consider possible reasons for government policies to support local 

food markets and reduce barriers to growth of that sector. 

The Managers are aware of the budgetary constraints ERS is 

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propriate Federal agencies, farm operators serving local markets, 

institutions of higher education, non-governmental organizations, 

and state and local agencies. To the extent resources and data are 

available, the Managers also encourage ERS to examine regional 

market trends and production, processing and distribution needs 

and evaluate the role and successes of relevant Federal, State, and 

local policies in areas where the production, processing and consumption of locally grown produce, meat, dairy, and other agricultural products is above normative levels. 

(54) Disclosure of country of harvest for ginseng 

The Senate amendment amends the Agricultural Marketing 

Act of 1946 (7 U.S.C. 1621 et seq.). It requires persons that sell 

ginseng at retail to provide the country of harvest by means of a 

label, stamp, mark, placard, or other easily legible and visible sign 

on the ginseng or on the package, display, holding unit, or bin containing the ginseng. The Secretary may levy fines for not more 

than $1,000 for willful violations of this provision. (Section 10004) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

The Managers have included ginseng in section 11002 of the 

Livestock Title. 

(55) Definitions 

The Senate amendment defines the following terms used in the 

subtitle: agent; agricultural biosecurity; agricultural countermeasure; agricultural disease; agriculture; agroterrorist act; animal; department; development; plant; and qualified agricultural 

countermeasure. (Section 11011) 

The House has no comparable provision. 

The Conference substitute adopts the Senate provision with 

technical amendments to the definitions and incorporates this provision into the Agricultural Security Improvement Act of 2008. 

(Section 14102) 

The Managers have serious concerns regarding the efforts of 

the Department of Homeland Security (DHS) to absorb the critical 

agricultural security functions of the USDA, and DHS’ ability to 

successfully incorporate and manage functions previously housed 

within the USDA. The USDA is best equipped to handle routine 

agricultural disease emergencies and emergency response activities 

in the agricultural sector. While the Managers fully appreciate the 

vital importance of the broad DHS mandate, DHS has ignored critical expertise within USDA and of the agriculture sector in managing agricultural disease response activities. In doing so, DHS has 

ignored and failed to incorporate the concerns of the agriculture 

sector. For example, independent investigations carried out by the 

House Committee on Agriculture and the Government Accountability Office, as well as a joint audit by the Inspector’s General of 

USDA and DHS, have revealed numerous deficiencies in the agricultural port inspection program. Under DHS leadership, this program has suffered a marked decline in its capability to prevent and 

detect the movement of agricultural pests and diseases into the 

United States. This decline in mission capabilities is primarily due 

to an exodus of experienced staff after the transfer of agricultural 


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inspections from USDA to DHS, declining morale and resources, 

and the lack of importance placed on the program’s mission by 

DHS management. The Managers believe if this trend continues 

unabated, the security of the U.S. agriculture sector will be seriously, perhaps irreversibly, jeopardized. In addition, DHS is currently increasing their role in routine agricultural disease response 

activities and has claimed Federal jurisdiction as the lead agency 

for these activities traditionally managed by the USDA. Rather 

than attempt to duplicate the existing functions and capacities of 

USDA in this critical area, DHS would be better served, and scarce 

financial resources could be better allocated, if USDA and DHS effectively partnered in securing the Nation’s agriculture sector. The 

Department of Agriculture has over 146 years of valuable experience in preventing the introduction of agricultural pests and diseases and effectively managing agricultural disease outbreaks 

when they occur. To ignore this history is to do a disservice to the 

agriculture sector, and the Nation at large. 

The Managers are concerned about efforts to reorganize USDA 

in an attempt to heighten the Department’s response and management capabilities regarding threats to agricultural biosecurity. The 

Managers recognize that the existing structure at USDA to address 

such threats is adequate, and will continue to successfully prevent, 

control, and eradicate agricultural diseases. However, the Managers have codified the Office of Homeland Security at USDA in 

this Act in response to the concerns of other Committees. All homeland security-related activities at USDA will be coordinated by this 

office, ensuring that USDA will maintain its long tradition of protecting the U.S. agriculture sector from foreign and domestic agricultural pests and diseases. In addition, the Director of the Office 

of Homeland Security will serve as the primary liaison with other 

Federal agencies on homeland security coordination efforts, providing USDA with a unified voice on agricultural security matters 

of Federal concern. 

The Managers expect the Secretary, in establishing the Agricultural Biosecurity Communications Center, to use, to the maximum extent practicable, the existing resources and infrastructure 

of the Emergency Operations Center of the Animal and Plant 

Health Inspection Service located in Riverdale, Maryland. In addition, the Managers expect the Secretary to share and coordinate 

the dissemination of information with the National Operations 

Center, the National Biosurveillance Integration Center, the National Response Coordination Center, and the National Infrastructure Coordination Center of DHS, as appropriate. The Managers 

recognize that existing communication activities at DHS will not be 

hampered by the creation of the Agricultural Biosecurity Communications Center. However, the Managers also recognize the critical 

need for USDA to maintain and govern its own communication system given the subject matter expertise of USDA officials and their 

close ties to the domestic agriculture sector and international trading partners who trust their guidance and input. 

The Managers understand that any successful agricultural disease interdiction, prevention, or mitigation effort is largely dependent on local response capabilities. State and regional entities play 

a critical role in any agricultural disease emergency; however, the 


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Federal government must provide them with the necessary expertise and information to establish successful local programs. The 

Managers recognize that no Federal agency is better equipped to 

assist in this endeavor than the Department of Agriculture. USDA 

enjoys an established network of local veterinarians, plant health 

professionals, producers, farmers and ranchers who view the Department as a partner in agricultural disease response activities. 

These long-established relationships will be buttressed by the Agricultural Biosecurity Task Force and will strengthen the Nation’s 

disease response capabilities at the local and regional level. The 

Managers encourage the Secretary to collaborate with DHS in the 

provision of agricultural biosecurity best practices to State and 

tribal regulatory authorities. In doing so, DHS will be afforded the 

opportunity to benefit from the expertise of USDA in this area of 

national security. 

The Managers are especially concerned with the degradation of 

the AQI program following its transfer from USDA to DHS in 2002, 

and are aware that the agriculture sector continues to raise serious 

concerns about the ability and willingness of DHS to prioritize agricultural quarantine and inspection activities at ports of entry. In 

light of the broad mandate given to DHS, the Managers understand that limiting the introduction of agricultural pests and diseases into the United States is not a top priority for DHS. While 

some observers have concluded that the scientific nature of the AQI 

program does not fit well with the police function of the Customs 

and Border Protection Program, the Managers have nevertheless 

chosen to maintain the program within the Department of Homeland Security. As such, the Managers encourage the Secretary to 

increase USDA’s oversight regarding this vitally important program to ensure that the concerns of the agricultural sector are 

given a priority status commensurate with the threat that these 

diseases pose to the U.S. economy. To do so, the Managers encourage the Secretary to establish a comprehensive activity reporting 

mechanism detailing how DHS uses funds transferred by USDA to 

carry out the AQI program. In order to keep Congress and the public informed about the use of these funds, the Managers encourage 

the Secretary to provide a detailed accounting to the Senate and 

House Agriculture Committees on how DHS uses these funds. The 

Managers strongly encourage the Secretary of Agriculture and the 

Secretary of Homeland Security to revise the transfer agreement 

mandated under section 421(e) of the Homeland Security Act of 

2002 so that the financial information requested is provided in a 

timely manner. The Managers intend that any information provided to the Secretary on the use of funds by DHS be scrutinized 

not only by Congress, but also by the senior leadership of the 

USDA and DHS to ensure expedient and comprehensive improvements in this program. 

The Managers also encourage the Secretary to seek detailed information to track the promotion of CBP field officers, import specialists, and agricultural specialists into supervisorial and managerial grades since the transfer of function in 2003. The information 

provided should break out, by fiscal year and by series, the number 

of employees who have been permanently promoted into supervisor, 

chief, program manager, assistant port director, and port director 


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positions at ports of entry throughout the country. The information 

provided should also cite whether the affected employees were legacy customs, immigration, or agriculture personnel. 

(56) National plant disease recovery system and national veterinary 

stockpile 

The Senate amendment establishes the National Plant Disease 

Recovery System (NPDRS) in subsection (a). The NPDRS will include agricultural countermeasures, available within a single growing season, to respond to an outbreak of plant disease that poses 

a significant biosecurity threat. Subsection (b) establishes the National Veterinary Stockpile (NVS). The NVS will include agricultural countermeasures, available to any State veterinarian not 

later than 24 hours after an official request, to leverage the infrastructure of the strategic national stockpile. (Section 11012) 

The House bill contains no comparable provision. 

The Conference substitute deletes the Senate provision. 

(57) Research and development of agricultural countermeasures 

The Senate amendment establishes a competitive grant program 

at USDA to stimulate research and development activity for qualified agricultural countermeasures. It provides for a waiver of the 

competitive grant process in the case of emergencies and permits 

the use of foreign animal and plant diseases in research and development activities. USDA will provide information to DHS on each 

grant funded through this authorization. The provision authorizes 

appropriations of $50,000,000 for each fiscal year from 2008 

through 2012. (Section 11013) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to make technical changes. (Section 14121) 

(58) Veterinary workforce grant program 

The Senate amendment establishes a veterinary workforce grant 

program at USDA to increase the number of veterinarians trained 

in biosecurity. It authorizes such sums as necessary for each fiscal 

year from 2008 through 2012. (Section 11014) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to establish a program of competitive grants to veterinarians and food science professionals to increase agricultural biosecurity capacity. (Section 14122) 

(59) Assistance to build local capacity in biosecurity planning, preparedness, and response 

The Senate amendment requires USDA to provide grants to 

support the development and expansion of advanced training programs in agricultural biosecurity planning and response for food 

science professionals and veterinarians. The Section also requires 

USDA to provide grant and low-interest loan assistance to States 

for use in assessing agricultural disease response capability for 

food science and veterinary biosecurity planning. (Section 11015) 

The House bill contains no comparable provision. 


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The Conference substitute adopts the Senate provision and incorporates this section into the Agricultural Security Improvement 

Act of 2008 (Section 14113). 

(60) Plant protection 

The Senate amendment modifies penalties in the Plant Protection Act (PPA) as follows: $500,000 for each violation adjudicated 

in a single proceeding; $1,000,000 for each violation adjudicated in 

a single proceeding involving a genetically modified organism. The 

provision requires an action, suit or proceeding regarding a violation of the PPA to be considered no later than 5 years after the 

date the violation is initially discovered by the Secretary. (Section 

11017) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to strike the change to the statute of limitations, to expand the penalties to cover any willful violation of the PPA, and 

to clarify subpoena authorities of the Department under the PPA. 

The Conference substitute also modifies the ability of the executive 

branch to delay the provision of compensation for economic losses 

under this section. This provision can be found in the horticulture 

and organic agriculture title of this Act. (Section 10203) Identical 

amendments were made to the Animal Health Protection Act, and 

this provision can be found in the livestock title of this Act. (Section 11012) 

The Managers intend for the Secretary or the Secretary’s designee to continue to possess the ability to review actions of officers, 

employees, and agents of the Secretary with regards to the payment of compensation under the Plant Protection Act. 

Further, the Managers expect the additional subpoena authority provided in this section to be used to assist the Secretary in 

compiling such information, assembling such evidence, and conducting such investigations as the Secretary determines is necessary and proper for the administration and enforcement of this 

Title. 

(61) Report on stored quantities of propane 

The Senate amendment requires the Secretary of Homeland 

Security to submit to Congress a report of the effects of DHS interim or final regulations regarding possession of quantities of propane that exceed the screening threshold set by the DHS rules. The 

provision includes number of agricultural facilities and total number of facilities affected, numbers of facilities filing security assessments, alternative security programs, and appeals, as well as costs 

of compliance. (Section 11070) 

The House bill contains no comparable provision. 

The Conference substitute adopts the Senate provision with an 

amendment to limit the report to the Committees on Agriculture 

of the House and Senate, and to strike the subparagraph on the 

use of the Food and Agricultural Sector Coordinating Council. (Section 14206) 


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TITLE XV—HEARTLAND, HABITAT, HARVEST, AND HORTICULTURE ACT 

OF 2008 

CONTENTS 

Page 

I. DISASTER ASSISTANCE TRUST FUND (Sec. 12101 of the Senate 

amendment, (Sec. 901 of the Trade Act of 1974 and sec. 15101 of 

the conference agreement) ........................................................................... 1019 

II. REVENUE PROVISIONS FOR AGRICULTURE PROGRAMS ................... 1028 

A. Extension of Custom User Fees (Sec. 15201 of the conference agreement) .............................................................................................................. 1028 

B. Modifications to Corporate Estimated Tax Payments (Sec. 15202 of 

the conference agreement) ........................................................................... 1029 

III. TAX PROVISIONS ........................................................................................... 1030 

A. Conservation ................................................................................................ 1030 

1. Exclusion of Conservation Reserve Program Payments from SECA 

tax for individuals receiving Social Security retirement or disability 

payments (Sec. 12202 of the Senate amendment, sec. 15301 of 

the conference agreement and sec. 1402(a) of the Code) .................... 1030 

2. Make permanent the special rule encouraging contributions of 

capital gain real property for conservation purposes (Sec. 12203 

of the Senate amendment, sec. 15302 of the conference agreement 

and sec. 170 of the Code) ...................................................................... 1030 

3. Deduction for endangered species recovery expenditures (Sec. 

12205 of the Senate amendment, sec. 15303 of the conference 

agreement and sec. 175 of the Code) .................................................... 1034 

4. Temporary reduction in corporate tax rate for qualified timber 

gain; timber REIT provisions (Secs. 12212–12217 of the Senate 

amendment, secs. 15311–15315 of the conference agreement and 

secs. 856, 857, and 1201 of the Code) .................................................. 1035 

5. Qualified forestry conservation bonds (Sec. 12808 of the Senate 

amendment, and sec. 15316 of the conference agreement and new 

secs. 54A and 54B of the Code) ............................................................ 1041 

B. Energy Provisions ........................................................................................ 1047 

1. Credit for production of cellulosic biofuel (Sec. 12312 of the Senate 

amendment, sec. 15321 of the conference agreement and sec. 40 

of the Code) ............................................................................................ 1047 

2. Comprehensive study of biofuels (Sec. 15322 of the conference 

agreement) .............................................................................................. 1049 

3. Modification of alcohol credit (Sec. 12315 of the Senate amendment, and sec. 15331 of the conference agreement and secs. 40 

and 6426 of the Code) ............................................................................ 1050 

4. Calculation of volume of alcohol for fuel credits (Sec. 12316 of 

the Senate amendment, and sec. 15332 of the conference agreement and sec. 40 of the Code) ............................................................... 1053 

5. Ethanol tariff extension (Sec. 12317 of the Senate amendment 

and sec. 15333 of the conference agreement) ...................................... 1053 

6. Limitations on duty drawback on certain imported ethanol (Sec. 

12318 of the Senate amendment and sec. 15334 of the conference 

agreement) .............................................................................................. 1054 

C. Agricultural Provisions ................................................................................ 1055 

1. Qualified small issue bonds for farming (Sec. 12401 of the Senate 

amendment, sec. 15341 of the conference agreement and sec. 144 

of the Code) ............................................................................................ 1055 

2. Allowance of section 1031 for exchanges involving certain mutual 

ditch, reservoir, or irrigation company stock (Sec. 12403 of the 

Senate amendment, sec. 15342 of the conference agreement and 

sec. 1031 of the Code) ............................................................................ 1056 

3. Agricultural chemicals security tax credit (Sec. 12405 of the Senate 

amendment, sec. 15343 of the conference agreement and new sec. 

45O of the Code) .................................................................................... 1057 

4. Three-year depreciation for all race horses (Sec. 12509(a) of the 

Senate amendment, and sec. 15344 of the conference agreement 

and sec. 168 of the Code) ...................................................................... 1058 

5. Temporary relief for Kiowa County, Kansas and surrounding area . 1059 


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(a) Suspension of certain limitations on personal casualty losses 

(Sec.12701 of the Senate amendment, sec. 15345 of the conference agreement and sec. 1400S(b) of the Code) ...................... 1059 

(b) Extension of replacement period for nonrecognition of gain 

(Sec. 12701 of the Senate amendment, and sec. 15345 of the 

conference agreement) .................................................................... 1060 

(c) Employee retention credit (Sec. 12701 of the Senate amendment, sec. 15345 of the conference agreement and sec. 

1400R(a) of the Code) ..................................................................... 1061 

(d) Special depreciation allowance (Sec. 12701 of the Senate 

amendment, sec. 15345 of the conference agreement and sec. 

1400N(d) of the Code) ..................................................................... 1062 

(e) Increase in expensing under section 179 (Sec. 12701 of the 

Senate amendment, sec. 15345 of the conference agreement 

and sec. 1400N(e) of the Code) ...................................................... 1065 

(f) Expensing for certain demolition and clean-up costs (Sec. 

12701 of the Senate amendment, sec. 15345 of the conference 

agreement and sec. 1400N(f) of the Code) .................................... 1067 

(g) Treatment of public utility property disaster losses (Sec. 

12701 of the Senate amendment, sec. 15345 of the conference 

agreement and sec. 1400N(o) of the Code) ................................... 1068 

(h) Treatment of net operating losses attributable to storm losses 

(Sec. 12701 of the Senate amendment, sec. 15345 of the conference agreement and sec. 1400N(k) of the Code) ...................... 1069 

(i) Representations regarding income eligibility for purposes of 

qualified residential rental project requirements (Sec. 12701 

of the Senate amendment, sec. 15345 of the conference agreement and sec. 1400N(n) of the Code) ............................................ 1072 

(j) Use of retirement funds from retirement plans relating to 

the Kansas Disaster Zone (Sec. 12701 of the Senate amendment, sec. 15345 of the conference agreement and sec. 1400Q 

of the Code) ..................................................................................... 1073 

6. Modification of the advanced coal project credit and the gasification project credit (Sec. 15346 of the conference agreement and 

secs. 48A and 48B of the Code) ............................................................ 1079 

D. Other Revenue Provisions ........................................................................... 1081 

1. Limitation on farming losses of certain taxpayers (Sec. 12501 

of the Senate amendment, sec. 15351 of the conference agreement 

and sec. 461 of the Code) ...................................................................... 1081 

2. Increase and index dollar thresholds for farm optional method 

and nonfarm optional method for computing net earnings from 

self-employment (Sec. 12502 of the Senate amendment, sec. 15352 

of the conference agreement and sec. 1402(a) of the Code) ................ 1084 

3. Information reporting for commodity credit corporation transactions (Sec. 12503 of the Senate amendment, sec. 15353 of the 

conference agreement and new sec. 6039J of the Code) ..................... 1087 

E. Protection of Social Security (Sec. 15361 of the conference agreement) . 1088 

IV. TRADE PROVISIONS ...................................................................................... 1088 

A. Extension of Certain Trade Benefits (secs. 15401–15407 and 15410–

15411 of the conference agreement) ............................................................ 1088 

B. Extension of CBTPA (Sec. 15408–15409 of the conference agreement) .. 1094 

C. Unused Merchandise Drawback (Sec. 15421 of the conference agreement) .............................................................................................................. 1094 

D. Requirements Relating to Determination of Transaction Value of Imported Merchandise (Sec. 15422 of the conference agreement) ................. 1095 

V. TAX COMPLEXITY ANALYSIS ..................................................................... 1097 


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1The statement of managers does not contain descriptions of the provisions in the House bill 

and Senate amendment that were not agreed to by the conferees. 

I. DISASTER ASSISTANCE TRUST FUND 1

(Sec. 12101 of the Senate amendment, sec. 901 of the Trade Act of 

1974 and sec. 15101 of the conference agreement) 

PRESENT LAW

The Farm Service Agency (‘‘FSA’’) of the United States Department of Agriculture (‘‘USDA’’) offers various ongoing programs for 

agricultural producers to facilitate recovery from losses caused by 

natural events. Ongoing programs include the Emergency Conservation Program (‘‘ECP’’), the Noninsured Crop Disaster Assistance Program (‘‘NAP’’), the Disaster Debt Set-Aside Program 

(‘‘DSA’’), and the Emergency Loan Program (‘‘EM’’). 

ECP is a discretionary program funded through annual appropriations that provides funding for farmers and ranchers to rehabilitate farmland damaged by natural disaster and for carrying out 

emergency water conservation measures during severe drought. 

The natural disaster must create new conservation problems that 

if untreated would 1) impair or endanger the land; 2) materially affect the productive capacity of the land; 3) represent unusual damage which, except for wind erosion, is not the type likely to recur 

frequently in the same area; and 4) be so costly to repair that federal assistance is, or will be required, to return the land to productive agricultural use. 

NAP provides a low level of insurance to producers who grow 

otherwise noninsurable crops. NAP provides coverage for crop 

losses and planting prevented by disasters. Landowners, tenants, 

or sharecroppers who share in the risk of producing an eligible crop 

may qualify for this program. Before payments can be issued, applications must first be received and approved, generally before the 

crop is planted, and the crop must have suffered a minimum of 50 

percent loss in yield. Payments are 55 percent of the commodities’

average market price on crop losses beyond 50 percent. Eligible 

crops include commercial crops and other agricultural commodities 

produced for food, including livestock feed or fiber for which the 

catastrophic level of crop insurance is unavailable. Also eligible for 

NAP coverage are controlled-environment crops (mushroom and floriculture), specialty crops (honey and maple sap), and value loss 

crops (aquaculture, Christmas trees, ginseng, ornamental nursery, 

and turfgrass sod). 

DSA is available to those producers who are borrowers from 

the Farm Service Agency in primary or contiguous counties that 

have been declared by the President or designated by the Secretary 

of Agriculture (‘‘Secretary’’) as a disaster area. When borrowers affected by natural disasters are unable to make their scheduled payments on any debt, FSA is authorized to consider the set-aside of 

some payments to allow the farming operation to continue. After a 

disaster designation is made, FSA will notify borrowers of the 

availability of the DSA. Borrowers who are notified have eight 

months from the date of designation to apply. FSA borrowers may 

also request a release of income proceeds to meet current operating 


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and family living expenses or may request special servicing provisions from their local FSA county offices to explore other options. 

EM provides emergency loans to help producers recover from 

production and physical losses due to drought, flooding, other natural disasters, or quarantine. Emergency loans may be made to 

farmers and ranchers who own or operate land located in a county 

declared by the President as a disaster area or designated by the 

Secretary as a disaster area or quarantine area (for physical losses 

only, the FSA administrator may authorize emergency loan assistance). EM funds may be used to: 1) restore or replace essential 

property; 2) pay all or part of production costs associated with the 

disaster year; 3) pay essential family expenses; 4) reorganize the 

farming operation; and 5) refinance certain debts. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

In general 

The provision amends the Trade Act of 1974 to create a permanent Agriculture Disaster Relief Trust Fund (‘‘PADTF’’) that would 

provide payments to farmers and ranchers who suffer losses in 

areas that are declared disaster areas by the USDA. The trust fund 

will be funded by an amount equal to 3.34 percent of the amounts 

received in the general fund of the Treasury that are attributable 

to the duties collected on articles entered, or withdrawn from warehouse, for consumption under the Harmonized Tariff Schedule. The 

PADTF could make payments under four new disaster assistance 

programs: the permanent crop disaster assistance program, the 

permanent livestock indemnity program, the tree assistance program, and the emergency assistance program for livestock, honey 

bees, and farm raised fish. In addition, the PADTF will also fund 

a new pest and disease management and disaster prevention program. Amounts not required to meet current withdrawals may be 

invested in U.S. Treasury obligations with interest credited to the 

PADTF. The PADTF may also borrow, with interest, as repayable 

advances sums necessary to carry out the purposes of the fund. 

Permanent Crop Disaster Assistance Program (‘‘PCDP’’) 

Generally, PCDP payments will be paid to producers located in 

disaster counties on 52 percent of the difference between the disaster program guarantee and the sum of total farm revenue. Disaster counties include counties receiving disaster declarations by 

the Secretary due to production losses resulting directly or indirectly from adverse weather, counties contiguous to such counties, 

and any farm whose production due to weather was less than 50 

percent of normal production. To be eligible for PCDP payments, 

the producer must have purchased or enrolled in both crop insurance for insurable crops at a minimum of 50 percent of yield at 55 

percent of price and NAP for uninsurable crops. The Secretary may 

waive this requirement under certain conditions. 

The disaster program guarantee for insurable crops is equal to 

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ance yield guarantee, the percentage of crop insurance 2 price 

elected by the producer, the crop insurance price, and 115 percent. 

The disaster program guarantee for noninsured crops is equal to 

the product of the yield as determined by NAP for each crop, 100 

percent of the NAP established price, and 115 percent. The disaster 

program guarantee is the sum of the disaster program guarantee 

for insurable and noninsured crops. 

Total farm revenue includes the sum of the estimated value of 

crops and grazing, crop insurance and NAP indemnities accruing to 

the farm, the value of prevented planting payments, the amount of 

other natural disaster assistance payments provided by the federal 

government to a farm for the same loss, and an amount equal to 

20 percent of any direct payments made to the producer under section 1103 of the Farm Security and Rural Investment Act of 2002. 

The estimated value of crops is generally the product of actual crop 

acreage grazed or harvested, estimated actual yields of grazing 

land or crop production, and the average market price during the 

first five months of the marketing year in which a farm or portion 

of a farm is located. 

Permanent Livestock Indemnity Program 

The PADTF may also make payments under the permanent 

livestock indemnity program to eligible producers on farms that 

have incurred livestock death losses in excess of normal mortality 

rates during the calendar year due to adverse weather, as determined by the Secretary. Indemnity payments are made at a rate 

of 75 percent of the fair market value of the livestock on the day 

before the date of death of the livestock as determined by the Secretary. 

Tree Assistance Program 

The Secretary shall make payments to eligible orchardists as 

follows. Assistance is in the form of 1) 75 percent reimbursement 

for the cost of replanting trees lost due to a natural disaster if tree 

mortality is in excess of 15 percent, adjusted for normal mortality, 

or sufficient seedlings to reestablish a stand; and 2) 50 percent reimbursement of the cost of pruning, removal, and other costs incurred to salvage existing trees or to prepare land to replant trees 

lost due to a natural disaster in excess of 15 percent damage and/ 

or mortality adjusted for normal tree damage and/or mortality. 

Buy-up NAP coverage 

Under NAP, FSA compensates eligible producers for losses of 

noninsurable crops exceeding 50 percent of the expected yield 

based on 55 percent of the average market price of the commodity. 

This provision permits producers to buy additional NAP coverage. 

Producers could purchase additional coverage guarantee up to 60 

or 65 percent, as elected by the producers, of expected yield, and 

up to 100 percent of the average market price of the commodity. 

Fees would be established and collected by the Secretary to fully 

offset the cost of supplemental NAP coverage. 


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Emergency Assistance for livestock, honey bees, and farm-raised fish 

The Secretary shall use up to $35,000,000 annually from the 

trust fund to provide emergency relief to producers of livestock (including horses), honey bees, and farm-raised fish due to losses from 

adverse weather or other environmental conditions, such as blizzards and wildfires, as determined by the Secretary, that are not 

covered under the authority of the Secretary to make qualifying 

natural disaster declarations. For purposes of the provision, farmraised fish includes the propagation and rearing of aquatic species 

(including any species of finfish, mollusk, crustacean, or other 

aquatic invertebrate, amphibian, reptile, or aquatic plant) in controlled or semi-controlled environments. 

Limitations 

No eligible producer may receive more than $100,000 annually 

in total disaster assistance under this Act. A producer is not eligible for benefits under the provision if, as determined by the Secretary, such producer’s adjusted gross income (as defined in section 

1001D(a) of the Food Security Act of 1985 or any successor provision) exceeds $2.5 million, unless not less than 75 percent of the 

average adjusted gross income of such producer is derived from 

farming, ranching or forestry operations. 

Pest and disease management and disaster prevention 

The provision also establishes a new program under which 

USDA will conduct early pest detection and surveillance activities 

in coordination with State departments of agriculture, will 

prioritize and create action plans to address pest and disease 

threats to specialty crops, and will create an audit-based certification approach to protect against the spread of plant pests. 

Sunset of provision 

The authority provided by the provision expires at the same 

time as the 2007 Farm Bill. 

CONFERENCE AGREEMENT

Supplemental Agricultural Disaster Assistance Program description 

and provisions (For crop years 2008–2011) 

The provision amends the Trade Act of 1974 to create a Supplemental Agricultural Disaster Assistance trust fund (‘‘Trust 

Fund’’) that would provide payments to farmers and ranchers who 

suffer losses in areas that are designated disaster areas by the 

USDA. The Trust Fund could make payments under five new disaster assistance programs: the Supplemental Revenue Program 

(‘‘SURE’’), the Livestock Forage Disaster Program (‘‘LFP’’), the 

Livestock Indemnity Program (‘‘LIP’’), the Tree Assistance Program 

(‘‘TAP’’), and the Emergency Assistance Program for Livestock, 

Honey bees, and Farm raised fish. 

Supplemental revenue assistance payments (SURE) 

Section 901(b) SURE Assistance will be available to eligible 

producers on farms in disaster determined and contiguous counties 


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that have incurred crop production losses and/or crop quality 

losses. 

901(a)(5) For purposes of the supplemental revenue assistance 

program, disaster counties are counties that received Secretarial 

Disaster declarations due to production losses resulting directly or 

indirectly from adverse weather. However, Secretarial designations 

are waived for farms with greater than 50% production losses. 

901(b)(2)(A) SURE Assistance payments will be issued on 60% 

of the difference between the disaster assistance program guarantee AND total farm revenue (as defined). 

The conferees expect that when payments are calculated, 

USDA will not discount any final payments for any activity that 

has already been deducted as an adjustment to a crop insurance 

indemnity or noninsured assistance payment such as harvest costs, 

packing, or transportation. 

901(b)(3) The SURE Assistance Program Guarantee is the sum 

obtained by adding: 

For each insurable commodity, the product obtained by multiplying: the higher of the Adjusted APH yield, or the counter-cyclical program payment yield the percentage of crop insurance yield 

guarantee, the crop insurance price election, the acres planted or 

prevented from being planted, and 115%, AND for each non-insurable commodity on the farm, the product obtained by multiplying: 

the higher of the adjusted noninsured assistance program yield 

guarantee or the counter-cyclical program payment yield, 100% of 

the NAP established price, the acres planted or prevented from 

being planted, and 120%. 

The conferees intend the price election for revenue products to 

be the price the crop insurance indemnity would be calculated for 

the plan of insurance obtained by the producer. 

901(a)(2) The Adjusted APH Yield and Section 901(a)(3) the 

Adjusted Noninsured Crop Disaster Assistance Yield are determined by dropping replacement yields for producers with at least 

four years of actual production history. For producers with four 

years or less, one replacement yield may be dropped from the calculation. 

The SURE Assistance guarantee will be adjusted in the following manners. 901(b)(2)(B) The guarantee may not exceed 90% 

of the expected revenue for the whole farm. 901(b)(3)(B)&(C) Where 

crop insurance or the NAP makes adjustments for prevented planting or un-harvested production, the adjusted guarantee will be the 

basis for calculating the SURE Assistance guarantee. 

901(b)(3)(D) The Secretary is also charged with the responsibility to establish equitable treatment for non-standard crop insurance products like AgriLite. 

901(b)(4) The total Farm Revenue for the farm shall be equal 

to the sum obtained by adding: the estimated actual value of the 

production for each crop produced by multiplying the actual crop 

acreage harvested; the estimated actual yield; the national average 

market price for the marketing year for each commodity, as determined by the Secretary; the crop insurance or NAP indemnities accruing to the farm; the value of any other natural disaster assistance payments provided by the federal government on a farm for 

the same loss; 15% of direct payments accruing to the farm; all 


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marketing loan proceeds (including certificate gains); and all 

counter-cyclical or average crop revenue payments. 

The conferees encourage the Secretary to accept Loss Adjustment yields to determine estimated actual yield when available 

with the understanding that all of the units for the crop on the 

farm would need to be adjusted to arrive at total farm production. 

When loss adjusted yields are not available, the conferees expect the Secretary to obtain APH certified yields submitted to the 

Risk Management Agency through participating crop insurance 

companies. 

901(b)(4)(B) The Secretary shall adjust the average market 

price received to reflect average quality discounts applied to the 

local or regional market price of the crop during the year of production. The Secretary shall also account for crop value reduced due 

to excess moisture resulting from a disaster related condition. 

The conferees expect the Secretary, assisted by Farm Service 

Agency State and County committees, will determine local or regional discounts for the marketing year in a manner similar to 

what has been used to administer recent ad hoc quality loss programs. 

The conferees encourage the Secretary to consider salvage values when quality factors prevent the commodity from being marketed for its originally intended purpose. 

901(b)(5) Expected crop revenue is used to calculate the 90% 

limit of the SURE Assistance Guarantee and is equal to the sum 

obtained by adding: 

For each insured commodity, the product obtained by multiplying: the higher of the Actual Production History (APH) yield, the 

Adjusted APH yield, or the counter-cyclical program payment yield; 

the acreage planted or prevented from being planted; and the insurance price guarantee, AND for each noninsured crop, the product obtained by multiplying: the adjusted non-insurable assistance 

program (NAP) yield, the adjusted Actual Production History 

(APH) NAP yield; the acreage planted or prevented from being 

planted; and 100% of the NAP protection price. 

The entire farm constitutes unit structure for this program including all crops in all counties in the farming operation and 

shared production. 

Livestock Indemnity Program (LIP) 

901(c)(1) The Trust Fund may also make payments under the 

Livestock Indemnity program (LIP) to eligible producers on farms 

that have incurred livestock death losses in excess of normal mortality rates during the calendar year due to adverse weather, as determined by the Secretary. 

901(c)(2) Indemnity payments are made at a rate of 75 percent 

of the fair market value of the livestock on the day before the date 

of death of the livestock as determined by the Secretary. 

It is the intent of the conferees that the Secretary shall make 

LIP payments based upon individual producers’ eligible losses. No 

state, county, or other trigger shall be used by the Secretary to define an eligible LIP area. 

It is expected that the Secretary, through the State Farm Service Agency Committee will obtain recommendations from applicable 


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state livestock organizations, state Cooperative Extension Service, 

and other knowledgeable and credible sources to establish the normal mortality rate for each type of livestock on a state-by-state 

basis. 

When determining the market value of applicable livestock in 

order to determine payment rates for LIP, the Secretary shall establish market values for each type of livestock from credible livestock markets. Credible livestock markets include sale barns, local 

sales as well as terminal market centers or slaughtering facilities. 

Livestock Forage Disaster Program (LFP) 

901(d) The Livestock Forage Program provides ranchers assistance for forage losses due to drought. Ranchers in counties with 

droughts designated by the Drought Monitor as severe, extreme or 

exceptional qualify for assistance. Producers in a severe drought 

will receive one month’s payment. Producers experiencing extreme 

drought will get two month’s payment and producers in a county 

with an exceptional drought will receive three month’s payment. 

The payment is 60 percent of either 1) the monthly feed cost for 

the total number of livestock covered or, 2) the monthly feed cost 

calculated by using the normal carrying capacity of the eligible 

grazing land, whichever is smaller. 

901(d)(4) LFP also covers losses to ranchers whose livestock 

utilize federal grazing permits. Payments are available to eligible 

livestock producers whose livestock are prohibited by a Federal 

agency from grazing due to fire. Payments will be made for the 

time period beginning on the date the Federal Agency excludes the 

eligible livestock producer and ending on the last day of the eligible 

producer’s the Federal lease. The payment rate is 50 percent of the 

monthly feed costs for the total number of livestock covered by the 

Federal lease. 

The conferees intend this section to also apply to trust property 

and range units managed under the authority of the Department 

of Interior through the Bureau of Indian Affairs. 

901(d)(1)(D) In order to disallow excessive payments to livestock producers who overgraze pasture and grazing lands the Secretary shall calculate the normal carrying capacity of the eligible 

livestock producer’s grazing and pasture land and issue payments 

based on the lesser of the actual number of the livestock producer’s 

eligible livestock or the maximum carrying capacity of the eligible 

livestock producer’s pasture and grazing land for the type and 

weight of the eligible producer’s livestock. 

901(d)(5) One of the eligibility requirements for the LFP is that 

a livestock producer shall have timely applied for and obtained, if 

available, either crop insurance, including pilot programs implemented by the Risk Management Agency such as the Pastureland 

Rangeland Forage Program; or coverage under the NAP on the pasture or grazing land which suffered an eligible loss. Producers are 

not required to purchase any pilot program if they purchase NAP. 

901(d)(5)(C) For the 2008 crop year only, if a livestock producer 

had not timely obtained either crop insurance or NAP coverage, if 

it was available, the Secretary shall waive this requirement if the 

livestock producer pays any fee that would have been required to 

enroll in either crop insurance or NAP. 


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901(d)(5)(D) For any year after 2008, the Secretary may on a 

case-by-case basis provide equitable relief for producers who the 

county Farm Service Agency Committee determines unintentionally failed to obtain crop insurance or NAP coverage on applicable 

grazing and pasture land. 

The conferees recommend that for LFP applications for which payment would be less than $25,000, the State Farm Service Agency Committee may provide equitable relief; and that for LFP applications for which payments exceed $25,000 the Secretary or designee shall review a recommendation from the county and state 

Farm Service Agency committees and determine whether equitable 

relief applies. 

Emergency assistance for livestock, honey bees, and farm-raised fish 

901(e)(1) The Secretary shall use up to $50,000,000 annually 

from the Trust Fund to provide emergency relief to producers of 

livestock (including horses), honey bees, and farm-raised fish due 

to losses from adverse weather or other conditions, such as blizzards and wildfires, as determined by the Secretary. 

The conferees wish to clarify that program is intended to cover 

disasters that are not adequately covered by any other disaster program. 

Tree Assistance Program (TAP) 

901(f) The Secretary shall make payments to eligible orchardists and nursery tree growers as follows. Assistance is in the form 

of (1) 70 percent reimbursement for the cost of replanting trees lost 

due to a natural disaster if tree mortality is in excess of 15 percent, 

adjusted for normal mortality, or sufficient seedlings to reestablish 

a stand; and (2) 50 percent reimbursement of the cost of pruning, 

removal, and other costs incurred to salvage existing trees or to 

prepare land to replant trees lost due to a natural disaster in excess of 15 percent damage and/or mortality adjusted for normal 

tree damage and/or mortality. 

The conferees wish to clarify that the insurance requirement for 

TAP eligibility refers to insurance on the crop and not on the underlying vines or trees. 

Rick management purchase requirements 

901(g) To be eligible for SURE Assistance, the producer must 

have purchased or be enrolled in (at a minimum) the Catastrophic 

crop insurance (CAT) for insurable crops and the Noninsured Assistance Program (NAP) for uninsurable crops. 

901(g)(4) For the 2008 crop year, the Secretary will waive the 

purchase requirement if producers pay a fee equal to the administrative fees for CAT and NAP on crops for which no coverage has 

been purchased within 90 days after the enactment of this subtitle. 

The conferees intend that participation in pilot crop insurance 

programs may establish linkage, but pilot participation would not 

be necessary to establish linkage if CAT or NAP coverage is secured. 

901(g)(5) The Secretary may provide equitable relief to producers who unintentionally fail to meet the crop insurance or NAP 

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by-case basis. For 2008, the Secretary will have additional authority for producers who failed purchase requirements of this subtitle. 

The conferees that the Secretary will use equitable relief provisions in circumstances where severe weather events result in revised planting intentions for crops for which the producer had not 

obtained a minimum CAT or NAP coverage. 

901(g)(3) The Secretary may waive the crop insurance purchase requirement for limited resource, minority and/or beginning 

farmers and provide disaster assistance benefits at a level deemed 

appropriate by the Secretary. 

The conferees do not expect the Secretary to conduct an annual 

signup to participate in the SURE Assistance program. The conferees anticipate an effective public information effort will be conducted by USDA with the cooperation of the Farm Service Agency, 

the Natural Resources Conservation Service, the Risk Management 

Agency (including crop insurance companies), the Cooperative 

State Research, Education, and Extension Service, and State Departments of Agriculture. 

Limitations 

901(h) No eligible producer may receive more than $100,000 

annually in total disaster assistance under this section, excluding 

subsection 901(f). A producer is not eligible for benefits under the 

provision if, as determined by the Secretary, such producer’s adjusted gross income (as defined in section 1001D(a) of the Food Security Act of 1985 or any successor provision). Direct attribution of 

benefits as described in subsection (e) and (f) of Section 1001 of the 

Food Security Act of 1985 (7 U.S.C. 1308) or any successor provision shall apply. 

The conferees anticipate that the AGI limit would be consistent 

with limitations for the noninsured assistance program. 

The conferees note that the Tree Assistance Program (TAP) has a separate $100,000 annual limitation. 

Period of effectiveness 

Section 901(i) states that the Supplemental Agricultural Disaster Assistance program shall cover disaster related losses occurring on or before September 30, 2011. 

The conferees expect the Secretary to cover all losses for which 

disaster conditions were evident on or before September 30, 2011. 

Duplicate payments 

Section 901(j) instructs the Secretary to prevent duplicative 

payments. 

The conferees expect Emergency Conservation Programs 

(ECP), or any other similar program not directed to production or 

revenue losses of the farm, are not intended to be covered by this 

section. 

Agricultural Disaster Relief Trust Fund (Trust Fund) 

902(b) The Trust Fund will be funded by an amount equal to 

3.08 percent of the amounts received in the general fund of the 

Treasury that are attributable to the duties collected on articles entered, or withdrawn from warehouse, for consumption under the 


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Harmonized Tariff Schedule. Amounts not required to meet current 

withdrawals may be invested in U.S. Treasury obligations with interest credited to the trust fund. The Trust Fund may also borrow, 

with interest, as repayable advances sums necessary to carry out 

the purposes of the fund. 

902(b)(3) Funds will not be appropriated to the Trust Fund if 

any changes are made to the operation of the programs within the 

Trust Fund that are not permitted by the Trust Fund. 

Jurisdiction 

Section 903 requires legislation in the Senate of the United 

States that amends section 901 or section 902 be referred to the 

Committee on Finance of the Senate. 

II. REVENUE PROVISIONS FOR AGRICULTURE 

PROGRAMS 

A. EXTENSION OF CUSTOM USER FEES

(Sec. 15201 of the conference agreement) 

PRESENT LAW

Section 13031 of the Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c) (‘‘COBRA’’) authorizes the Secretary of the Treasury to collect certain customs services fees. Section 412 of the Homeland Security Act of 2002 authorizes the Secretary of the Treasury to delegate such authority to the Secretary 

of Homeland Security. Customs user fees include passenger and 

conveyance processing fees (e.g., fees for processing air and sea 

passengers, commercial trucks, rail cars, private aircraft and vessels, commercial vessels, dutiable mail packages, barges and bulk 

carriers, cargo, and Customs broker permits) and merchandise 

processing fees. Congress has authorized collection of the passenger 

and conveyance processing fees through December 27, 2014. The 

current authorization for the collection of the merchandise processing fees is through December 27, 2014. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

No provision. 

CONFERENCE AGREEMENT

The conference agreement amends Section 13031 of the Consolidated Omnibus Budget Reconciliation Act of 1985 to extend the 

passenger and conveyance processing fees through September 30, 

2017, and extend the merchandise processing fees through November 14, 2017. The conference agreement would require remittance, 

by no later than September 25, 2017, of passenger and conveyance 

fees for the period July 1, 2017 though September 20, 2017. It 

would also require an estimated prepayment of the merchandise 

processing fees no later than September 25, 2017 for merchandise 

entered on or after October 1, 2017 and before November 15, 2017. 


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The estimated prepayment will be based on the amount paid in the 

equivalent period of the previous year, as determined by the Secretary of the Treasury. The conference agreement also holds service 

users harmless for overpayments or underpayments of merchandise 

processing fees by requiring the Secretary of Treasury to reconcile 

the fees paid with the actual fees incurred for services rendered. 

The Secretary of Treasury must then refund any overpayments 

with interest, and make adjustments for any underpayments of 

such merchandise processing fees. 

EFFECTIVE DATE

The provision is effective on the date of enactment. 

B. MODIFICATIONS TO CORPORATE ESTIMATED TAX PAYMENTS

(Sec. 15202 of the conference agreement) 

PRESENT LAW

In general 

In general, corporations are required to make quarterly estimated tax payments of their income tax liability. For a corporation 

whose taxable year is a calendar year, these estimated tax payments must be made by April 15, June 15, September 15, and December 15. 

Tax Increase Prevention and Reconciliation Act of 2005 (‘‘TIPRA’’) 

TIPRA provided the following special rules: 

In case of a corporation with assets of at least $1 billion, the 

payments due in July, August, and September, 2012, shall be increased to 106.25 percent of the payment otherwise due and the 

next required payment shall be reduced accordingly. 

In case of a corporation with assets of at least $1 billion, the 

payments due in July, August, and September, 2013, shall be increased to 100.75 percent of the payment otherwise due and the 

next required payment shall be reduced accordingly. 

Subsequent legislation 

Several public laws have been enacted since TIPRA which further increase the percentage of payments due under each of the 

two special rules enacted by TIPRA described above. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

No provision. 

CONFERENCE AGREEMENT

The provision makes a modification to the corporate estimated 

tax payment rules. 

In case of a corporation with assets of at least $1 billion, the 

payments due in July, August, and September, 2012, are increased 


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2Sec. 1402. 

by 73⁄4 percentage points of the payment otherwise due and the 

next required payment shall be reduced accordingly. 

EFFECTIVE DATE

The provision is effective on the date of enactment. 

III. TAX PROVISIONS 

A. CONSERVATION

1. Exclusion of Conservation Reserve Program Payments from 

SECA tax for individuals receiving Social Security retirement or 

disability payments. (Sec. 12202 of the Senate amendment, sec. 

15301 of the conference agreement and sec. 1402(a) of the Code) 

PRESENT LAW

Generally, the Self-Employment Contributions Act (‘‘SECA’’) 

tax is imposed on an individual’s net earnings from self-employment income within the Social Security wage base. Net earnings 

from self-employment generally mean gross income (including the 

individual’s net distributive share of partnership income) derived 

by an individual from any trade or business carried on by the individual less applicable deductions.2

HOUSE BILL

No provision. 

SENATE AMENDMENT

The provision excludes conservation reserve program payments 

from self-employment income for purposes of the SECA tax in the 

case of individuals who are receiving Social Security retirement or 

disability benefits. The treatment of conservation reserve program 

payments received by other taxpayers is not changed. 

Effective date.—The provision is effective for payments made 

after December 31, 2007. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 

2. Make permanent the special rule encouraging contributions of 

capital gain real property for conservation purposes (Sec. 12203 

of the Senate amendment, sec. 15302 of the conference agreement and sec. 170 of the Code) 

PRESENT LAW

Charitable contributions generally 

In general, a deduction is permitted for charitable contributions, subject to certain limitations that depend on the type of taxpayer, the property contributed, and the donee organization. The 

amount of deduction generally equals the fair market value of the 


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3Secs. 170, 2055, and 2522, respectively. Unless otherwise provided, all section references are 

to the Internal Revenue Code of 1986, as amended (the ‘‘Code’’). 

contributed property on the date of the contribution. Charitable deductions are provided for income, estate, and gift tax purposes.3

In general, in any taxable year, charitable contributions by a 

corporation are not deductible to the extent the aggregate contributions exceed 10 percent of the corporation’s taxable income computed without regard to net operating or capital loss carrybacks. 

For individuals, the amount deductible is a percentage of the taxpayer’s contribution base, (i.e., taxpayer’s adjusted gross income 

computed without regard to any net operating loss carryback). The 

applicable percentage of the contribution base varies depending on 

the type of donee organization and property contributed. Cash contributions of an individual taxpayer to public charities, private operating foundations, and certain types of private nonoperating 

foundations may not exceed 50 percent of the taxpayer’s contribution base. Cash contributions to private foundations and certain 

other organizations generally may be deducted up to 30 percent of 

the taxpayer’s contribution base. 

In general, a charitable deduction is not allowed for income, estate, or gift tax purposes if the donor transfers an interest in property to a charity while also either retaining an interest in that 

property or transferring an interest in that property to a noncharity for less than full and adequate consideration. Exceptions to 

this general rule are provided for, among other interests, remainder interests in charitable remainder annuity trusts, charitable remainder unitrusts, and pooled income funds, present interests in 

the form of a guaranteed annuity or a fixed percentage of the annual value of the property, and qualified conservation contributions. 

Capital gain property 

Capital gain property means any capital asset or property used 

in the taxpayer’s trade or business the sale of which at its fair market value, at the time of contribution, would have resulted in gain 

that would have been long-term capital gain. Contributions of capital gain property to a qualified charity are deductible at fair market value within certain limitations. Contributions of capital gain 

property to charitable organizations described in section 

170(b)(1)(A) (e.g., public charities, private foundations other than 

private non-operating foundations, and certain governmental units) 

generally are deductible up to 30 percent of the taxpayer’s contribution base. An individual may elect, however, to bring all these 

contributions of capital gain property for a taxable year within the 

50-percent limitation category by reducing the amount of the contribution deduction by the amount of the appreciation in the capital 

gain property. Contributions of capital gain property to charitable 

organizations described in section 170(b)(1)(B) (e.g., private nonoperating foundations) are deductible up to 20 percent of the taxpayer’s contribution base. 

For purposes of determining whether a taxpayer’s aggregate 

charitable contributions in a taxable year exceed the applicable 

percentage limitation, contributions of capital gain property are 


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4Sec. 170(b)(1)(E). 

taken into account after other charitable contributions. Contributions of capital gain property that exceed the percentage limitation 

may be carried forward for five years. 

Qualified conservation contributions 

Qualified conservation contributions are not subject to the ‘‘partial interest’’ rule, which generally bars deductions for charitable contributions of partial interests in property. A qualified conservation contribution is a contribution of a qualified real property 

interest to a qualified organization exclusively for conservation purposes. A qualified real property interest is defined as: (1) the entire 

interest of the donor other than a qualified mineral interest; (2) a 

remainder interest; or (3) a restriction (granted in perpetuity) on 

the use that may be made of the real property. Qualified organizations include certain governmental units, public charities that meet 

certain public support tests, and certain supporting organizations. 

Conservation purposes include: (1) the preservation of land areas 

for outdoor recreation by, or for the education of, the general public; (2) the protection of a relatively natural habitat of fish, wildlife, 

or plants, or similar ecosystem; (3) the preservation of open space 

(including farmland and forest land) where such preservation will 

yield a significant public benefit and is either for the scenic enjoyment of the general public or pursuant to a clearly delineated Federal, State, or local governmental conservation policy; and (4) the 

preservation of an historically important land area or a certified 

historic structure. 

Qualified conservation contributions of capital gain property 

are subject to the same limitations and carryover rules of other 

charitable contributions of capital gain property. 

Special rule regarding contributions of capital gain real property for 

conservation purposes 

In general 

Under a temporary provision that is effective for contributions 

made in taxable years beginning after December 31, 2005,4 the 30- 

percent contribution base limitation on contributions of capital gain 

property by individuals does not apply to qualified conservation 

contributions (as defined under present law). Instead, individuals 

may deduct the fair market value of any qualified conservation contribution to an organization described in section 170(b)(1)(A) to the 

extent of the excess of 50 percent of the contribution base over the 

amount of all other allowable charitable contributions. These contributions are not taken into account in determining the amount of 

other allowable charitable contributions. 

Individuals are allowed to carry over any qualified conservation contributions that exceed the 50-percent limitation for up to 15 

years. 

For example, assume an individual with a contribution base of $100 makes a qualified conservation contribution of property with 

a fair market value of $80 and makes other charitable contributions subject to the 50-percent limitation of $60. The individual is 

allowed a deduction of $50 in the current taxable year for the nonVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01036 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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5Sec. 170(b)(2)(B). 

conservation contributions (50 percent of the $100 contribution 

base) and is allowed to carry over the excess $10 for up to 5 years. 

No current deduction is allowed for the qualified conservation contribution, but the entire $80 qualified conservation contribution 

may be carried forward for up to 15 years. 

Farmers and ranchers 

In the case of an individual who is a qualified farmer or rancher for the taxable year in which the contribution is made, a qualified conservation contribution is allowable up to 100 percent of the 

excess of the taxpayer’s contribution base over the amount of all 

other allowable charitable contributions. 

In the above example, if the individual is a qualified farmer or rancher, in addition to the $50 deduction for non-conservation contributions, an additional $50 for the qualified conservation contribution is allowed and $30 may be carried forward for up to 15 

years as a contribution subject to the 100-percent limitation. 

In the case of a corporation (other than a publicly traded corporation) that is a qualified farmer or rancher for the taxable year 

in which the contribution is made, any qualified conservation contribution is allowable up to 100 percent of the excess of the corporation’s taxable income (as computed under section 170(b)(2)) 

over the amount of all other allowable charitable contributions. 

Any excess may be carried forward for up to 15 years as a contribution subject to the 100-percent limitation.5

As an additional condition of eligibility for the 100 percent limitation, with respect to any contribution of property in agriculture 

or livestock production, or that is available for such production, by 

a qualified farmer or rancher, the qualified real property interest 

must include a restriction that the property remain generally available for such production. (There is no requirement as to any specific use in agriculture or farming, or necessarily that the property 

be used for such purposes, merely that the property remain available for such purposes.) Such additional condition does not apply 

to contributions made on or before August 17, 2006. 

A qualified farmer or rancher means a taxpayer whose gross 

income from the trade or business of farming (within the meaning 

of section 2032A(e)(5)) is greater than 50 percent of the taxpayer’s 

gross income for the taxable year. 

Termination 

The special rule regarding contributions of capital gain real 

property for conservation purposes does not apply to contributions 

made in taxable years beginning after December 31, 2007. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment makes permanent the special rule regarding contributions of capital gain real property for conservation 

purposes. 


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6Sec. 175. 

7 16 U.S.C. 1533(f)(B). 

Effective date.—The provision is effective for contributions 

made in taxable years beginning after December 31, 2007. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment by 

extending the special rule regarding contributions of capital gain 

real property for conservation purposes. However, under the conference agreement, the special rule does not apply for contributions 

made in taxable years beginning after December 31, 2009. 

3. Deduction for endangered species recovery expenditures (Sec. 

12205 of the Senate amendment, sec. 15303 of the conference 

agreement and sec. 175 of the Code) 

PRESENT LAW

Under present law, a taxpayer engaged in the business of 

farming may treat expenditures that are paid or incurred by him 

during the taxable year for the purpose of soil or water conservation in respect of land used in farming, or for the prevention of erosion loss of land used in farming, as expenses that are not chargeable to capital account. Such expenditures are allowed as a deduction, not to exceed 25 percent of the gross income derived from 

farming during the taxable year.6 Any excess above such percentage is deductible for succeeding taxable years, not to exceed 25 percent of the gross income derived from farming during such succeeding taxable year. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment provides that expenditures paid or incurred by a taxpayer engaged in the business of farming for the 

purpose of achieving site-specific management actions pursuant to 

the Endangered Species Act of 1973 7 are to be treated the same 

as expenditures for the purpose of soil or water conservation in respect of land used in farming, or for the prevention of erosion of 

land used in farming, i.e., such expenditures are treated as not 

chargeable to capital account and are deductible subject to the limitation that the deduction may not exceed 25 percent of the farmer’s 

gross income derived from farming during the taxable year. 

Effective date.—The provision is effective for expenditures paid 

or incurred after the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment, except that the conference agreement provision is effective for expenditures paid or incurred after December 31, 2008. 


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8 Net capital gain is defined as the excess of net long-term capital gain over net short-term 

capital gain for the taxable year. Sec. 1222(11). 9 Because the entire amount of the capital gain is included in alternative minimum taxable 

income (‘‘AMTI’’), for taxpayers subject to the alternative minimum tax with AMTI in excess 

of $112,500 ($150,000 in the case of a joint return), the gain may cause a reduction in the minimum tax exemption amount and thus effectively tax the gain at rates of 21.5 or 22 percent. 

Also the gain may cause the phase-out of certain benefits in computing the regular tax. 10Secs. 11 and 1201. 11 A distribution to a corporate shareholder out of current or accumulated earnings and profits 

of the corporation is a dividend, unless the distribution is a redemption that terminates the 

shareholder’s stock interest or reduces the shareholder’s interest in the distributing corporation 

to an extent considered to result in treatment as a sale or exchange of the shareholder’s stock. 

Secs. 301 and 302. A distribution in excess of corporate earnings and profits is treated by shareholders as first a recovery of their stock basis and then, to the extent the distribution exceeds 

Continued 

4. Temporary reduction in corporate tax rate for qualified timber 

gain; timber REIT provisions (Secs. 12212–12217 of the Senate 

amendment, secs. 15311–15315 of the conference agreement and 

secs. 856, 857, and 1201 of the Code) 

PRESENT LAW

Treatment of certain timber gain 

Under present law, if a taxpayer cuts standing timber, the taxpayer may elect to treat the cutting as a sale or exchange eligible 

for capital gains treatment (sec. 631(a)). The fair market value of 

the timber on the first day of the taxable year in which the timber 

is cut is used to determine the gain attributable to such cutting. 

Such fair market value is also considered the taxpayer’s cost of the 

cut timber for all purposes, such as to determine the taxpayer’s income from later sales of the timber or timber products. Also, if a 

taxpayer disposes of the timber with a retained economic interest 

or makes an outright sale of the timber, the gain is eligible for capital gain treatment (sec. 631(b)). This treatment under either section 631(a) or (b) requires that the taxpayer has owned the timber 

or held the contract right for a period of more than one year. 

Under present law, for taxable years beginning before January 

1, 2011, the maximum rate of tax on long term capital gain (‘‘net 

capital gain’’) 8 of an individual, estate, or trust is 15 percent. Any 

net capital gain that otherwise would be taxed at a 10- or 15-percent rate is taxed at a zero-percent rate. These rates apply for purposes of both the regular tax and the alternative minimum tax.9

For taxable years beginning after December 31, 2010, the maximum rate of tax on the net capital gain of an individual is 20 percent. Any net capital gain that otherwise would be taxed at a 10- 

or 15-percent rate is taxed at a 10-percent rate. In addition, any 

gain from the sale or exchange of property held more than five 

years that would otherwise have been taxed at the 10-percent rate 

is taxed at an 8-percent rate. Any gain from the sale or exchange 

of property held more than five years and the holding period for 

which began after December 31, 2000, which would otherwise have 

been taxed at a 20-percent rate, is taxed at an 18-percent rate. 

The net capital gain of a corporation is taxed at the same rates 

as ordinary income, up to a maximum rate of 35 percent.10

Real estate investment trusts (‘‘REITs’’) are subject to a special 

taxation regime. Under this regime, a REIT is allowed a deduction 

for dividends paid to its shareholders.11 As a result, REITs genVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01039 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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a shareholder’s stock basis, as a sale or exchange of the stock. Sec. 301. These rules generally 

apply to REITs. 12Sec. 857(b)(3)(D). The shareholders also obtain a basis increase in their REIT stock for 

the gross amount of the deemed distribution that is included in their income less the amount 

of corporate tax deemed paid by them that was paid by the REIT on the retained gain. Sec. 

857(b)(3)(D)(iii). 13Section 4981. The definition is the excess of gains from sales or exchanges of capital assets over losses from such sales or exchanges for the calendar year, reduced by any net ordinary 

loss. 14Section 856(c) and section 1221(a). Income from sales that are not prohibited transactions 

solely by virtue of section 857(b)(6) is also qualified REIT income. 15Section 856(c)(5)(C). 

erally do not pay tax on distributed income, but the income is taxed 

to the REIT shareholders. A REIT that has long-term capital gain 

can declare a dividend that shareholders are entitled to treat as 

long-term capital gain. 

REITs generally are required to distribute 90 percent of their 

taxable income (other than net capital gain). A REIT generally 

must pay tax at regular corporate rates on any undistributed income. However, a REIT that has net capital gain can retain that 

gain without distributing it, and the shareholders can report the 

net capital gain as if it were distributed to them. In that case the 

REIT pays a C corporation tax on the retained gain, but the shareholders who report the income are entitled to a credit or refund for 

the difference between the tax that would be due if the income had 

been distributed and the 35-percent rate paid by the REIT.12 In effect, net capital gain of a REIT (including but not limited to timber 

gain) can be taxed as net capital gain of the shareholders, whether 

or not the gain is distributed. 

Other REIT provisions 

A REIT is also subject to a 4-percent excise tax to the extent 

it does not distribute specified percentages of its income within any 

calendar year. The required distributed percentage is 85 percent in 

the case of the REIT ordinary income, and 95 percent in the case 

of the REIT capital gain net income (as defined).13 The amount of 

the excess of the required distribution over the actual distribution 

is subject to the 4-percent tax. 

A REIT generally is restricted to earning certain types of passive income. Among other requirements, at least 75 percent of the 

gross income of a REIT in a taxable year must consist of certain 

types of real estate related income, including rents from real property, income from the sale or exchange of real property (including 

interests in real property) that is not stock in trade, inventory, or 

held by the taxpayer primarily for sale to customers in the ordinary course of its trade or business, and interest on mortgages secured by real property or interests in real property.14 Interests in 

real property are specifically defined to exclude mineral, oil, or gas 

royalty interests.15 A REIT will not qualify as a REIT, and will be 

taxable as a C corporation, for any taxable year if it does not meet 

this income test. 

Some REITs have been formed to hold land on which trees are 

grown. Upon maturity of the trees, the standing trees are sold by 

the REIT. The Internal Revenue Service has issued private letter 

rulings in particular instances stating that the income from the 

sale of the trees under section 631(b) can qualify as REIT real 


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16Timber income under section 631(b) has also been held to be qualified real estate income 

even if the one year holding period is not met. See, e.g., PLR 200052021, see also PLR 

199945055, PLR 199927021, PLR 8838016. A private letter ruling may be relied upon only by 

the taxpayer to which the ruling is issued. However, such rulings provide an indication of administrative practice. 17Sections 857(b)(6) and 1221(a)(1). There is an exception for certain foreclosure property. 18 Aggregate expenditures (other than timberland acquisition expenditures) during such period made by the REIT or a partner of the REIT, which are includible in basis, may not exceed 

30 percent of the net selling price in the case of expenditures that are directly related to operation of the property for the production of timber or the preservation of the property for use 

as timberland, and may not exceed 5 percent of the net selling price in the case of expenditures 

that are not directly related to those purposes. 19Section 857(b)(6)(D). 20Section 857(b)(6)(C). 21Section 856(c)(4)(B)(ii) and (iii). Certain interests are not treated as ‘‘securities’’ for purposes of the rule forbidding the REIT to hold securities representing more than 10 percent of 

the value of securities of any one issuer. Sec. 856(m). 

property income because the uncut timber and the timberland on 

which the timber grew is considered real property and the sale of 

uncut trees can qualify as capital gain derived from the sale of real 

property.16

A REIT is subject to a 100-percent excise tax on gain from any 

sale that is a ‘‘prohibited transaction,’’ defined as a sale of property 

that is stock in trade, inventory, or property held by the taxpayer 

primarily for sale to customers in the ordinary course of its trade 

or business.17 This determination is based on facts and circumstances. However, a safe-harbor provides that no excise tax is 

imposed if certain requirements are met. In the case of timber 

property, the safe harbor is met, regardless of the number of sales 

that occur during the taxable year, if (i) the REIT has held the 

property for not less than four years in connection with the trade 

or business of producing timber; (ii) the aggregate adjusted bases 

of the property sold (other than foreclosure property) during the 

taxable year does not exceed 10 percent of the aggregate bases of 

all the assets of the REIT as of the beginning of the taxable year, 

and if certain other requirements are met. These include requirements that limit the amount of expenditures the REIT can make 

during the 4-year period prior to the sale that are includible in the 

adjusted basis of the property,18 that require marketing to be done 

by an independent contractor, and that forbid a sales price that is 

based on the income or profits of any person.19 There is a similar 

but separate safe harbor for sales of non-timber property, with 

similar rules, including a 4-year holding period requirement and a 

limit on the percentage of the aggregate adjusted basis of property 

that can be sold in one taxable year.20

A REIT is not generally permitted to hold securities representing more than 10 percent of the voting power or value of the 

securities of any one issuer; nor may more than 5 percent of the 

fair market value of REIT assets be securities of any one issuer.21

However, under an exception, a REIT may hold any amount of securities of one or more ‘‘taxable REIT subsidiary’’ (TRS) corporations, provided that such TRS securities do not represent more 

than 20 percent of the fair market value of REIT assets at the end 

of any quarter. A TRS is a C corporation that is subject to regular 

corporate tax on its income and that meets certain other requirements. A taxable REIT subsidiary may conduct activities that 

would produce disqualified non-passive or non-real estate income 

that could disqualify the REIT if conducted by a REIT itself. Such 


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22 A 100-percent excise tax is imposed on the amount of certain transactions involving a 

TRS and a REIT, to the extent such amount would exceed an arm’s length amount under section 

482. Sec. 857(b)(7). 23 Under the provision, because only 40 percent of the gain is included in adjusted gross 

income and AMTI, only that amount of gain would result in the phase-out of tax benefits. 24For purposes of the section 4981 excise tax on undistributed REIT income, the amount 

treated as subject to the 95 percent distribution requirement is the 40 percent of timber gain 

income that remains after allowing the deduction. 

business could include business relating to processing timber, or 

holding timber products or other assets for sale to customers in the 

ordinary course of business. Such income would be subject to regular corporate rates of tax as income of the TRS.22

HOUSE BILL

No provision. 

SENATE AMENDMENT

Elective deduction for 60 percent of qualified timber gain 

The Senate amendment allows a taxpayer to elect to deduct an 

amount equal to 60 percent of the taxpayer’s qualified timber gain 

(or, if less, the net capital gain) for a taxable year. In the case of 

an individual, the deduction reduces adjusted gross income. Qualified timber gain means the net gain described in section 631(a) and 

(b) for the taxable year. 

The deduction is allowed in computing the regular tax and the 

alternative minimum tax (including the adjusted current earnings 

of a corporation). 

If a taxpayer elects the deduction, the 40 percent of the gain 

subject to tax is taxed at ordinary income tax rates.23

In the case of a pass-thru entity other than a REIT, the election may be made separately by each taxpayer subject to tax on the 

gain. The Treasury Department may prescribe rules appropriate to 

apply this provision to gain taken into account by a pass-thru entity. 

In the case of a REIT, the election to take the 60-percent deduction is made by the REIT. If a REIT makes the election, then 

the timber gain is excluded from the computation of capital gain 

or loss of the REIT and can no longer be designated as a capital 

gain dividend to shareholders. Instead, the gain is treated as ordinary income for purposes of applying the REIT income distribution 

requirements, but for this purpose 60-percent of the amount of the 

gain is deductible by the REIT in computing its income. REIT earnings and profits also exclude the portion of the timber gain that is 

deductible. Thus, 40 percent of the gain is subject to the REIT distribution requirements,24 and 40 percent of the gain increases 

REIT earnings and profits. Accordingly, because REIT earnings 

and profits have been increased by the 40-percent amount, there is 

sufficient earnings and profits that a distribution of that 40-percent 

amount that otherwise qualifies as a dividend would be treated as 

an ordinary dividend distribution to shareholders. Since this dividend is from a REIT and is not derived from an entity that was 

taxed as a C corporation, it would not qualify for the current 15- 

percent qualified dividend rates and would be taxed at the ordinary 

income rates of the shareholders. 


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REIT shareholders obtain an upward basis adjustment in their 

REIT interests, equal to the 60 percent of the timber gain that is 

deductible by the electing REIT. Because the 60 percent of timber 

gain that was deductible by the REIT does not increase REIT earnings and profits, a distribution of such 60 percent to the shareholder generally will not be treated as a dividend (in the absence 

of other retained earnings) but as a return of basis under the general rules of section 301(c). Because the shareholders’ basis has 

been increased by this 60 percent, this distribution would not exceed the shareholders’ basis and thus would be nontaxable return 

of basis, rather than capital gain in excess of basis. However, if a 

REIT shareholder has obtained such an upward basis adjustment 

for a REIT interest and disposes of the interest before having held 

the interest for at least 6 months, then any loss on disposition of 

the interest is disallowed to the extent of such upward basis adjustment. 

Additional REIT provisions 

Timber gain qualified REIT income without regard to 1 year 

holding period 

The Senate amendment specifically includes timber gain under 

section 631(a) as a category of statutorily recognized qualified real 

estate income of a REIT if the cutting is provided by a taxable 

REIT subsidiary, and also includes gain recognized under section 

631(b). For purposes of such qualified income treatment under 

those provisions, the requirement of a one-year holding period is 

removed. Thus, for example, a REIT can acquire timber property 

and harvest the timber on the property within one year of the acquisition, with the resulting income being qualified real estate income for REIT qualification purposes, even though such income is 

not eligible for long-term capital gain treatment under sections 

631(a) or (b). The provision specifically provides, however, that for 

all purposes of the Code, such income shall not be considered to be 

gain described in section 1221(a)(1), that is, it shall not be treated 

as income from the sale of stock in trade, inventory, or property 

held by the REIT primarily for sale to customers in the ordinary 

course of the REITs trade or business. 

For purposes of determining REIT income, if the cutting is 

done by a taxable REIT subsidiary, the cut timber is deemed sold 

on the first day of the taxable year to the taxable REIT subsidiary 

(with subsequent gain, if any, attributable to the taxable REIT subsidiary). 

REIT prohibited transaction safe harbor for timber property 

For sales to a qualified organization for conservation purposes, 

as defined in section 170(h), the provision reduces to two years the 

present law four-year holding period requirement under section 

857(b)(6)(D), which provides a safe harbor from ‘‘prohibited transaction’’ treatment for certain timber property sales. Also, in the 

case of such sales, the safe-harbor limitations on how much may 

be added, within the four-year period prior to the date of sale, to 

the aggregate adjusted basis of the property, are changed to refer 

to the two-year period prior to the date of sale. 


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25The conference agreement does not contain the 60 percent deduction for qualified timber 

income that was contained in the Senate amendment, nor does it make any change to section 

4981. 

The Senate amendment also removes the safe-harbor requirement that marketing of the property must be done by an independent contractor, and permits a taxable REIT subsidiary of the 

REIT to perform the marketing. 

The Senate amendment states that any gain that is eligible for 

the timber property safe harbor is considered for all purposes of the 

Code not to be described in section 1221(a)(1), that is, it shall not 

be treated as income from the sale of stock in trade, inventory, or 

property held by the REIT primarily for sale to customers in the 

ordinary course of the REITs trade or business. 

Special rules for timber REITs 

The Senate amendment contains several provisions applicable 

only to a ‘‘timber REIT,’’ defined as a REIT in which more than 50 

percent of the value of its total assets consists of real property held 

in connection with the trade or business of producing timber. 

First, mineral royalty income from real property owned by a 

timber REIT and held, or once held, in connection with the trade 

or business of producing timber by such REIT, is included as qualifying real estate income for purposes of the REIT income tests. 

Second, a timber REIT is permitted to hold TRS securities with 

a value up to 25 percent, (rather than 20 percent) of the value of 

the total assets of the REIT. 

Effective date 

The provision applies to taxable years beginning after the date 

of enactment, but does not apply after the last day of the first taxable year beginning after the date of enactment. 

CONFERENCE AGREEMENT

Corporate rate reduction for qualified timber gain 

The conference agreement provides a 15-percent alternative 

tax rate for corporations on the portion of a corporation’s taxable 

income that consists of qualified timber gain (or, if less, the net 

capital gain) for a taxable year.25

The alternative 15-percent tax rate applies to both the regular 

tax and the alternative minimum tax. 

Qualified timber gain means the net gain described in section 

631(a) and (b) for the taxable year, determined by taking into account only trees held more than 15 years. 

Effective date.—The provision applies to taxable years ending 

after the date of enactment and beginning on or before the date 

which is one year after the date of enactment. In the case of a taxable year that includes the date of enactment, qualified timber gain 

may not exceed the qualified timber gain properly taken into account for the portion of the year after that date. In the case of a 

taxable year that includes the date that is one year after the date 

of enactment, qualified timber gain may not exceed the qualified 

timber gain properly taken into account for the portion of the year 

on or before that date. 


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26Sec. 141(b) and (c). 27The 10-percent private business use and payment threshold is reduced to five percent for 

private business uses that are unrelated to a governmental purpose also being financed with 

proceeds of the bond issue. In addition, as described more fully below, the 10-percent private 

Continued 

Additional REIT provisions 

The conference agreement follows the additional REIT provisions in the Senate amendment. 

Effective date.—The additional REIT provisions apply only for 

the first taxable year of the REIT that begins after the date of enactment and before the date that is one year after the date of enactment. The provisions terminate after that time. 

5. Qualified forestry conservation bonds (Sec. 12808 of the Senate 

amendment, and sec. 15316 of the conference agreement and new 

secs. 54A and 54B of the Code) 

PRESENT LAW

Tax-exempt bonds 

In general 

Subject to certain Code restrictions, interest on bonds issued 

by State and local government generally is excluded from gross income for Federal income tax purposes. Bonds issued by State and 

local governments may be classified as either governmental bonds 

or private activity bonds. Governmental bonds are bonds the proceeds of which are primarily used to finance governmental functions or which are repaid with governmental funds. Private activity 

bonds are bonds in which the State or local government serves as 

a conduit providing financing to nongovernmental persons. For this 

purpose, the term ‘‘nongovernmental person’’ generally includes the 

Federal Government and all other individuals and entities other 

than States or local governments. The exclusion from income for interest on State and local bonds does not apply to private activity 

bonds, unless the bonds are issued for certain permitted purposes 

(‘‘qualified private activity bonds’’) and other Code requirements 

are met. 

Private activity bond tests 

Present law provides two tests for determining whether a State 

or local bond is in substance a private activity bond, the private 

business test and the private loan test.26

Private business tests 

Private business use and private payments result in State and 

local bonds being private activity bonds if both parts of the twopart private business test are satisfied—

1. More than 10 percent of the bond proceeds is to be used 

(directly or indirectly) by a private business (the ‘‘private business use test’’); and 

2. More than 10 percent of the debt service on the bonds 

is secured by an interest in property to be used in a private 

business use or to be derived from payments in respect of such 

property (the ‘‘private payment test’’).27


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business use and private payment thresholds are phased-down for larger bond issues for the financing of certain ‘‘output’’ facilities. The term output facility includes electric generation, transmission, and distribution facilities. 28See Treas. Reg. sec. 1.141–3(b)(4) and Rev. Proc. 97–13, 1997–1 C.B. 632. 

Private business use generally includes any use by a business 

entity (including the Federal government), which occurs pursuant 

to terms not generally available to the general public. For example, 

if bond-financed property is leased to a private business (other than 

pursuant to certain short-term leases for which safe harbors are 

provided under Treasury regulations), bond proceeds used to finance the property are treated as used in a private business use, 

and rental payments are treated as securing the payment of the 

bonds. Private business use also can arise when a governmental 

entity contracts for the operation of a governmental facility by a 

private business under a management contract that does not satisfy Treasury regulatory safe harbors regarding the types of payments made to the private operator and the length of the contract.28

Private loan test 

The second standard for determining whether a State or local 

bond is a private activity bond is whether an amount exceeding the 

lesser of (1) five percent of the bond proceeds or (2) $5 million is 

used (directly or indirectly) to finance loans to private persons. Private loans include both business and other (e.g., personal) uses and 

payments by private persons; however, in the case of business uses 

and payments, all private loans also constitute private business 

uses and payments subject to the private business test. Present law 

provides that the substance of a transaction governs in determining 

whether the transaction gives rise to a private loan. In general, any 

transaction which transfers tax ownership of property to a private 

person is treated as a loan. 

Qualified private activity bonds 

As stated, interest on private activity bonds is taxable unless 

the bonds meet the requirements for qualified private activity 

bonds. Qualified private activity bonds permit States or local governments to act as conduits providing tax-exempt financing for certain private activities. The definition of qualified private activity 

bonds includes an exempt facility bond, or qualified mortgage, veterans’ mortgage, small issue, redevelopment, 501(c)(3), or student 

loan bond (sec. 141(e)). The definition of exempt facility bond includes bonds issued to finance certain transportation facilities (airports, ports, mass commuting, and high-speed intercity rail facilities); qualified residential rental projects; privately owned and/or 

operated utility facilities (sewage, water, solid waste disposal, and 

local district heating and cooling facilities, certain private electric 

and gas facilities, and hydroelectric dam enhancements); public/private educational facilities; qualified green building and sustainable 

design projects; and qualified highway or surface freight transfer 

facilities (sec. 142(a)). 

In most cases, the aggregate volume of these tax-exempt private activity bonds is restricted by annual aggregate volume limits 

imposed on bonds issued by issuers within each State. For calendar 


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29Sec. 103(a) and (b)(2). 30Sec. 148. 31Sec. 7871. 32Sec. 7871(c). 33 In addition, Notice 2006–7 provides that qualified projects include any facility owned by 

a qualified borrower that is functionally related and subordinate to any facility described in section 45(d)(1) through (d)(9) and owned by such qualified borrower. 

year 2007, the State volume cap, which is indexed for inflation, 

equals $85 per resident of the State, or $256.24 million, if greater. 

Arbitrage restrictions 

The tax exemption for State and local bonds also does not 

apply to any arbitrage bond.29 An arbitrage bond is defined as any 

bond that is part of an issue if any proceeds of the issue are reasonably expected to be used (or intentionally are used) to acquire 

higher yielding investments or to replace funds that are used to acquire higher yielding investments.30 In general, arbitrage profits 

may be earned only during specified periods (e.g., defined ‘‘temporary periods’’) before funds are needed for the purpose of the borrowing or on specified types of investments (e.g., ‘‘reasonably required reserve or replacement funds’’). Subject to limited exceptions, investment profits that are earned during these periods or on 

such investments must be rebated to the Federal Government. 

Indian tribal governments 

Indian tribal governments are provided with a tax status similar to State and local governments for specified purposes under the 

Code.31 Among the purposes for which a tribal government is treated as a State is the issuance of tax-exempt bonds. However, bonds 

issued by tribal governments are subject to limitations not imposed 

on State and local government issuers. Tribal governments are authorized to issue tax-exempt bonds only if substantially all of the 

proceeds are used for essential governmental functions or certain 

manufacturing facilities.32

Clean renewable energy bonds 

As an alternative to traditional tax-exempt bonds, States and 

local governments may issue clean renewable energy bonds 

(‘‘CREBs’’). CREBs are defined as any bond issued by a qualified 

issuer if, in addition to the requirements discussed below, 95 percent or more of the proceeds of such bonds are used to finance capital expenditures incurred by qualified borrowers for qualified 

projects. ‘‘Qualified projects’’ are facilities that qualify for the tax 

credit under section 45 (other than Indian coal production facilities), without regard to the placed-in-service date requirements of 

that section.33 The term ‘‘qualified issuers’’ includes (1) governmental bodies (including Indian tribal governments); (2) mutual or 

cooperative electric companies (described in section 501(c)(12) or 

section 1381(a)(2)(C), or a not-for-profit electric utility which has 

received a loan or guarantee under the Rural Electrification Act); 

and (3) clean renewable energy bond lenders. The term ‘‘qualified 

borrower’’ includes a governmental body (including an Indian tribal 

government) and a mutual or cooperative electric company. A clean 

renewable energy bond lender means a cooperative which is owned 


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by, or has outstanding loans to, 100 or more cooperative electric 

companies and is in existence on February 1, 2002. 

Unlike tax-exempt bonds, CREBs are not interest-bearing obligations. Rather, the taxpayer holding CREBs on a credit allowance 

date is entitled to a tax credit. The amount of the credit is determined by multiplying the bond’s credit rate by the face amount on 

the holder’s bond. The credit rate on the bonds is determined by 

the Secretary and is to be a rate that permits issuance of CREBs 

without discount and interest cost to the qualified issuer. The credit accrues quarterly and is includible in gross income (as if it were 

an interest payment on the bond), and can be claimed against regular income tax liability and alternative minimum tax liability. 

CREBs are subject to a maximum maturity limitation. The 

maximum maturity is the term which the Secretary estimates will 

result in the present value of the obligation to repay the principal 

on a CREBs being equal to 50 percent of the face amount of such 

bond. In addition, the Code requires level amortization of CREBs 

during the period such bonds are outstanding. 

CREBs also are subject to the arbitrage requirements of section 148 that apply to traditional tax-exempt bonds. Principles 

under section 148 and the regulations thereunder apply for purposes of determining the yield restriction and arbitrage rebate requirements applicable to CREBs. 

In addition to the above requirements, at least 95 percent of 

the proceeds of CREBs must be spent on qualified projects within 

the five-year period that begins on the date of issuance. To the extent less than 95 percent of the proceeds are used to finance qualified projects during the five-year spending period, bonds will continue to qualify as CREBs if unspent proceeds are used within 90 

days from the end of such five-year period to redeem any ‘‘nonqualified bonds.’’ The five-year spending period may be extended by 

the Secretary upon the qualified issuer’s request demonstrating 

that the failure to satisfy the five-year requirement is due to reasonable cause and the projects will continue to proceed with due 

diligence. 

Issuers of CREBs are required to report issuance to the IRS in 

a manner similar to the information returns required for tax-exempt bonds. There is a national CREB limitation of $1.2 billion. 

The maximum amount of CREBs that may be allocated to qualified 

projects of governmental bodies is $750 million. CREBs must be 

issued before January 1, 2009. 

HOUSE BILL

No provision 

SENATE AMENDMENT

The Senate amendment creates a new category of tax-credit 

bonds, qualified forestry conservation bonds. Qualified forestry conservation bonds are bonds issued by qualified issuers to finance 

qualified forestry conservation projects. The term ‘‘qualified issuer’’

means a State or a section 501(c)(3) organization. The term ‘‘qualified forestry conservation project’’ means the acquisition by a State 

or section 501(c)(3) organization from an unrelated person of forest 

and forest land that meets the following qualifications: (1) some 


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portion of the land acquired must be adjacent to United States Forest Service Land; (2) at least half of the land acquired must be 

transferred to the United States Forest Service at no net cost and 

not more than half of the land acquired may either remain with or 

be donated to a State; (3) all of the land must be subject to a habitat conservation plan for native fish approved by the United States 

Fish and Wildlife Service; and (4) the amount of acreage acquired 

must be at least 40,000 acres. 

There is a national limitation on qualified forestry conserva- tion bonds of $500 million. Allocations of qualified forestry conservation bonds are among qualified forestry conservation projects 

in the manner the Secretary determines appropriate so as to ensure that all of such limitation is allocated before the date that is 

24 months after the date of enactment. The Senate amendment 

also requires the Secretary to solicit applications for allocations of 

qualified forestry conservation bonds no later than 90 days after 

the date of enactment. 

The Senate amendment requires 100 percent of the available 

project proceeds of qualified forestry conservation bonds to be used 

within the three-year period that begins on the date of issuance. 

The Senate amendment defines available project proceeds as proceeds from the sale of the issue less issuance costs (not to exceed 

two percent) and any investment earnings on such sale proceeds. 

To the extent less than 100 percent of the available project proceeds are used to finance qualified forestry conservation purposes 

during the three-year spending period, bonds will continue to qualify as qualified forestry conservation bonds if unspent proceeds are 

used within 90 days from the end of such three-year period to redeem bonds. The three-year spending period may be extended by 

the Secretary upon the issuer’s request demonstrating that the failure to satisfy the three-year requirement is due to reasonable cause 

and the projects will continue to proceed with due diligence. 

Qualified forestry conservation bonds generally are subject to 

the arbitrage requirements of section 148. However, available 

project proceeds invested during the three-year spending period are 

not subject to the arbitrage restrictions (i.e., yield restriction and 

rebate requirements). In addition, amounts invested in a reserve 

fund are not subject to the arbitrage restrictions to the extent: (1) 

such fund is funded in a manner reasonably expected to result in 

an amount not greater than an amount necessary to repay the 

issue; and (2) the yield on such fund is not greater than the average annual interest rate of tax-exempt obligations having a term 

of 10 years or more that are issued during the month the qualified 

forestry conservation bonds are issued. 

The maturity of qualified forestry conservation bonds is the 

term that the Secretary estimates will result in the present value 

of the obligation to repay the principal on such bonds being equal 

to 50 percent of the face amount of such bonds, using as a discount 

rate the average annual interest rate of tax-exempt obligations 

having a term of 10 years or more that are issued during the 

month the qualified forestry conservation bonds are issued. 

As with present-law tax credit bonds, the taxpayer holding 

qualified forestry conservation bonds on a credit allowance date is 

entitled to a tax credit. The credit rate is set by the Secretary at 


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70 percent of the rate that would permit issuance of qualified forestry conservation bonds without discount and interest cost to the 

issuer. The amount of the tax credit to the holder is determined by 

multiplying the bond’s credit rate by the face amount on the holder’s bond. The credit accrues quarterly, is includible in gross income (as if it were an interest payment on the bond), and can be 

claimed against regular income tax liability and alternative minimum tax liability. Unused credits in one year may be carried forward to succeeding taxable years. In addition, credits may be separated from the ownership of the underlying bond similar to how interest coupons can be stripped for interest-bearing bonds. 

Issuers of qualified forestry conservation bonds are required to 

certify that the financial disclosure requirements that apply to 

State and local bonds offered for sale to the general public are satisfied with respect to any Federal, State, or local government official directly involved with the issuance of such bonds. The Senate 

amendment authorizes the Secretary to impose additional financial 

reporting requirements by regulation. 

Effective date.—The provision is effective for bonds issued after 

the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement includes the Senate amendment 

with modifications. Under the conference agreement, the credit 

rate on qualified forestry conservation bonds is determined by the 

Secretary at the rate that permits issuance of such bonds without 

discount and interest cost to the qualified issuer. 

The conference agreement also provides that a qualified issuer 

receiving an allocation to issue qualified forestry conservation 

bonds may, in lieu of issuing bonds, elect to treat such allocation 

as a deemed payment of tax (regardless of whether the issuer is 

subject to tax under chapter 1 of the Code) that is equal to 50 percent of the amount of such allocation. An election to treat an allocation of qualified forestry conservation bonds as a deemed payment 

is not valid unless the qualified issuer certifies to the Secretary 

that any payment of tax refunded to the issuer will be used exclusively for one or more qualified forestry conservation purposes. The 

deemed tax payment may not be used as an offset or credit against 

any other tax and shall not accrue interest. In addition, if the 

qualified issuer fails to use any portion of the overpayment for 

qualified forestry conservation purposes, the issuer shall be liable 

to the United States in an amount equal to such portion, plus interest, for the period from the date such portion was refunded to 

the date such amount is paid. 

Effective date.—The provision is effective for bonds issued after 

the date of enactment. 


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B. ENERGY PROVISIONS

1. Credit for production of cellulosic biofuel (Sec. 12312 of the Senate amendment, sec. 15321 of the conference agreement and sec. 

40 of the Code) 

PRESENT LAW

In the case of ethanol, the Code provides a separate 10-centsper-gallon credit for up to 15 million gallons per year for small producers, defined generally as persons whose production capacity 

does not exceed 60 million gallons per year. The ethanol must (1) 

be sold by such producer to another person (a) for use by such 

other person in the production of a qualified alcohol fuel mixture 

in such person’s trade or business (other than casual off-farm production), (b) for use by such other person as a fuel in a trade or 

business, or, (c) who sells such ethanol at retail to another person 

and places such ethanol in the fuel tank of such other person; or 

(2) used by the producer for any purpose described in (a), (b), or 

(c). A cooperative may pass through the small ethanol producer 

credit to its patrons. The credit is includible in income and is treated as a general business credit, subject to the ordering rules and 

carryforward/carryback rules that apply to business credits generally. The alcohol fuels tax credit, of which the small producer 

credit is a part, is scheduled to expire after December 31, 2010. 

Under the Renewable Fuels Standard Program all renewable 

fuel produced or imported on or after September 1, 2007 must have 

a renewable identification number (RIN) associated with it. Producers and importers must generate RINs to represent all the renewable fuel they produce or import and provide those RINs to the 

EPA. For cellulosic ethanol, 2.5 RINs are generated for every gallon produced. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment provides an income tax credit for each 

gallon of qualified cellulosic fuel production of the producer for the 

taxable year. The amount of the credit per gallon is $1.25 less the 

credit amount for alcohol fuel and the credit amount for small ethanol producers as of the date the cellulosic biofuel fuel is produced. 

This credit is in addition to any credit that may be available under 

section 40 of the Code. 

Qualified cellulosic biofuel production is any cellulosic biofuel 

which is produced by the taxpayer and which is sold by such producer to another person (a) for use by such other person in the production of a qualified biofuel fuel mixture in such person’s trade or 

business (other than casual off-farm production), (b) for use by such 

other person as a fuel in a trade or business, or, (c) who sells such 

biofuel at retail to another person and places such biofuel in the 

fuel tank of such other person; or (2) used by the producer for any 

purpose described in (a), (b), or (c). 

Cellulosic biofuel means any alcohol, ether, ester, or hydrocarbon that is produced in the United States and is derived from 


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34For this purpose, ‘‘United States’’ includes any possession of the United States. 

any lignocellulosic or hemicellulosic matter that is available on a 

renewable or recurring basis. However, it does not include any alcohol with a proof of less than 150. Examples of lignocellulosic or 

hemicellulosic matter that is available of a renewable or recurring 

basis include dedicated energy crops and trees, wood and wood residues, plants, grasses, agricultural residues, fibers, animal wastes 

and other waste materials, and municipal solid waste. A qualified 

cellulosic biofuel mixture is a mixture of cellulosic biofuel and any 

petroleum fuel product which is sold by the person producing such 

mixture to any person for use as a fuel, or is used as a fuel by the 

person producing such mixture. 

The credit terminates on April 1, 2015. 

The Senate amendment waives the 15 million gallon limitation 

of the small ethanol producer credit for cellulosic biofuel that is 

ethanol. 

Effective date.—The provision is effective for fuel produced 

after December 31, 2007. 

CONFERENCE AGREEMENT

The conference agreement adds a new component to section 40 

of the Code, the ‘‘cellulosic biofuel producer credit.’’ This credit is 

a nonrefundable income tax credit for each gallon of qualified cellulosic fuel production of the producer for the taxable year. The 

amount of the credit per gallon is $1.01, except in the case of cellulosic biofuel that is alcohol. In the case of cellulosic biofuel that 

is alcohol, the $1.01 credit amount is reduced by (1) the credit 

amount applicable for such alcohol under the alcohol mixture credit 

as in effect at the time cellulosic biofuel is produced and (2) in the 

case of cellulosic biofuel that is ethanol, the credit amount for small 

ethanol producers as in effect at the time the cellulosic biofuel fuel 

is produced. The reduction applies regardless of whether the producer claims the alcohol mixture credit or small ethanol producer 

credit with respect to the cellulosic alcohol. When the alcohol mixture credit and small ethanol producer credit expire after December 

31, 2010, cellulosic biofuel will receive the $1.01 without reduction. ‘‘Qualified cellulosic biofuel production’’ is any cellulosic biofuel 

which is produced by the taxpayer and which is sold by the taxpayer to another person (a) for use by such other person in the production of a qualified biofuel fuel mixture in such person’s trade or 

business (other than casual off-farm production), (b) for use by such 

other person as a fuel in a trade or business, or, (c) who sells such 

biofuel at retail to another person and places such biofuel in the 

fuel tank of such other person; or (2) used by the producer for any 

purpose described in (a), (b), or (c). ‘‘Cellulosic biofuel’’ means any liquid fuel that (1) is produced 

in the United States and used as fuel in the United States,34 (2) 

is derived from any lignocellulosic or hemicellulosic matter that is 

available on a renewable or recurring basis and (3) meets the registration requirements for fuels and fuel additives established by 

the Environmental Protection Agency under section 211 of the 

Clean Air Act. Thus, to qualify for the credit the fuel must be approved by the Environmental Protection Agency. Cellulosic biofuel 


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35 A provision requiring a comprehensive study on biofuels was included in section 402 of 

H.R. 5351, passed by the House on February 27, 2008. 

does not include any alcohol with a proof of less than 150. Examples of lignocellulosic or hemicellulosic matter that is available of 

a renewable or recurring basis include dedicated energy crops and 

trees, wood and wood residues, plants, grasses, agricultural residues, fibers, animal wastes and other waste materials, and municipal solid waste. 

A ‘‘qualified cellulosic biofuel mixture’’ is a mixture of cellulosic 

biofuel and a special fuel or of cellulosic biofuel and gasoline, which 

is sold by the person producing such mixture to any person for use 

as a fuel, or is used as a fuel by the person producing such mixture. The term ‘‘special fuel’’ includes any liquid fuel (other than 

gasoline) which is suitable for use in an internal combustion engine. 

The cellulosic biofuel producer credit terminates on December 

31, 2012. The conference agreement requires cellulosic biofuel producers to be registered with the IRS. The cellulosic biofuel producer 

credit cannot be claimed unless the taxpayer is registered with the 

IRS as a producer of cellulosic biofuel. 

With respect to the small ethanol producer credit, the conference agreement also waives the 15 million gallon limitation for 

cellulosic biofuel that is ethanol. Thus the small ethanol producer 

credit may be claimed for cellulosic ethanol in excess of 15 million 

gallons. The other requirements for the small ethanol producer 

credit continue to apply for ethanol other than cellulosic ethanol, 

including the 15 million gallon limitation. 

Under the conference agreement, cellulosic biofuel and alcohols 

cannot qualify as biodiesel, renewable diesel, or alternative fuel for 

purposes of the credit and payment provisions relating to those 

fuels. 

Effective date.—The provision is effective for fuel produced 

after December 31, 2008. 

2. Comprehensive study of biofuels (sec. 15322 of the conference 

agreement) 

PRESENT LAW

The National Academy of Sciences serves to investigate, examine, experiment and report upon any subject of science whenever 

called upon to do so by any department of the government. The National Research Council is part of the National Academies. The National Research Council was organized by the National Academy of 

Sciences in 1916 and is its principal operating agency for conducting science policy and technical work. 

HOUSE BILL

No provision.35

SENATE AMENDMENT

No provision. 


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CONFERENCE AGREEMENT

The conference agreement requires the Secretary, in consultation with the Department of Energy and the Department of Agriculture and the Environmental Protection Agency, to enter into an 

agreement with the National Academy of Sciences to produce an 

analysis of current scientific findings to determine: 

1. Current biofuels production, as well as projections for future production; 

2. The maximum amount of biofuels production capable on 

U.S. forests and farmlands, including the current quantities 

and character of the feedstocks and including such information 

as regional forest inventories that are commercially available, 

used in the production of biofuels; 

3. The domestic effects of a increase in biofuels production 

on, for example, (a) the price of fuel, (b) the price of land in 

rural and suburban communities, (c) crop acreage and other 

land use, (d) the environment, due to changes in crop acreage, 

fertilizer use, runoff, water use, emissions from vehicles utilizing biofuels, and other factors, (e) the price of feed, (f) the 

selling price of grain crops, and forest products, (g) exports and 

imports of grains and forest products, (h) taxpayers, through 

cost or savings to commodity crop payments, and (i) the expansion of refinery capacity; 

4. The ability to convert corn ethanol plants for other uses, 

such as cellulosic ethanol or biodiesel; 

5. A comparative analysis of corn ethanol versus other 

biofuels and renewable energy sources, considering cost, energy 

output, and ease of implementation; 

6. The impact of the credit for production of cellulosic biofuel 

(as established by this Act) on the regional agricultural and silvicultural capabilities of commercially available forest inventories; and 

7. The need for additional scientific inquiry, and specific 

areas of interest for future research. 

The Secretary shall submit an initial report of the findings to 

the Congress not later than six months after the date of enactment, 

and a final report not later than 12 months after the date of enactment. In the case of information relating to the impact of the tax 

credits established by the Act on the regional agricultural and silvicultural capabilities of commercially available forest inventories, 

the initial report is due 36 months after the date of enactment and 

the final report is due 42 months after the date of enactment. 

Effective date.—The provision is effective on the date of enactment. 

3. Modification of alcohol credit (Sec. 12315 of the Senate amendment, and sec. 15331 of the conference agreement and secs. 40 

and 6426 of the Code) 

PRESENT LAW

Income tax credit 

The alcohol fuels credit is the sum of three credits: the alcohol 

mixture credit, the alcohol credit, and the small ethanol producer 


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36The alcohol fuels credit is unavailable when, for any period before January 1, 2011, the 

tax rates for gasoline and diesel fuels drop to 4.3 cents per gallon. 37 In the case of any alcohol (other than ethanol) with a proof that is at least 150 but less 

than 190, the credit is 45 cents per gallon (the ‘‘low-proof blender amount’’). For ethanol with 

a proof that is at least 150 but less than 190, the low-proof blender amount is 37.78 cents. 

credit. Generally, the alcohol fuels credit expires after December 

31, 2010.36

Taxpayers are eligible for an income tax credit of 51 cents per 

gallon of ethanol (60 cents in the case of alcohol other than ethanol) used in the production of a qualified mixture (the ‘‘alcohol 

mixture credit’’). A ‘‘qualified mixture’’ means a mixture of alcohol 

and gasoline, (or of alcohol and a special fuel) sold by the taxpayer 

as fuel, or used as fuel by the taxpayer producing such mixture. 

The term ‘‘alcohol’’ includes methanol and ethanol but does not include (1) alcohol produced from petroleum, natural gas, or coal (including peat), or (2) alcohol with a proof of less than 150. 

Taxpayers may reduce their income taxes by 51 cents for each 

gallon of ethanol, which is not in a mixture with gasoline or other 

special fuel, that they sell at the retail level as vehicle fuel or use 

themselves as a fuel in their trade or business (‘‘the alcohol credit’’). For alcohol other than ethanol, the rate is 60 cents per gallon.37

In the case of ethanol, the Code provides an additional 10–

cents-per-gallon credit for up to 15 million gallons per year for 

small producers. Small producer is defined generally as persons 

whose production capacity does not exceed 60 million gallons per 

year. The ethanol must (1) be sold by such producer to another person (a) for use by such other person in the production of a qualified 

alcohol fuel mixture in such person’s trade or business (other than 

casual off-farm production), (b) for use by such other person as a 

fuel in a trade or business, or, (c) who sells such ethanol at retail 

to another person and places such ethanol in the fuel tank of such 

other person; or (2) used by the producer for any purpose described 

in (a), (b), or (c). A cooperative may pass through the small ethanol 

producer credit to its patrons. 

The alcohol fuels credit is includible in income and is treated 

as a general business credit, subject to the ordering rules and 

carryforward/carryback rules that apply to business credits generally. The credit is allowable against the alternative minimum 

tax. 

Excise tax credit and payment provision for alcohol fuel mixtures 

The Code also provides an excise tax credit and payment provision for alcohol fuel mixtures. Like the income tax credit, the 

amount of the credit is 60 cents per gallon of alcohol used as part 

of a qualified mixture (51 cents in the case of ethanol). For purposes of the excise tax credit and payment provisions, alcohol includes methanol and ethanol but does not include (1) alcohol produced from petroleum, natural gas, or coal (including peat), or (2) 

alcohol with a proof of less than 190. Such term also includes an 

alcohol gallon equivalent of ethyl tertiary butyl either or other 

ethers produced from alcohol. In lieu of a tax credit, a person making a qualified mixture eligible for the credit may seek a payment 

from the Secretary in the amount of the credit. The payment proviVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01055 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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38The low-proof blender amount is adjusted accordingly to 33.33 cents. 

sions and credits are coordinated such that the incentive is not 

claimed more than once for each gallon of alcohol used as part of 

qualified mixture. 

RENEWABLE FUELS STANDARD PROGRAM

Under the Renewable Fuels Standard Program all renewable 

fuel produced or imported on or after September 1, 2007 must have 

a renewable identification number (RIN) associated with it. Producers and importers must generate RINs to represent all the renewable fuel they produce or import and provide those RINs to the 

Environmental Protection Agency. For cellulosic ethanol, 2.5 RINs 

are generated for every gallon produced. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

Under the Senate amendment, the 51–cent-per-gallon incentive 

for ethanol is adjusted to 46 cents per gallon beginning with the 

first calendar year after the year in which 7.5 billion gallons of ethanol (including cellulosic ethanol) have been produced in or imported into the United States after the date of enactment, as certified by the Secretary in consultation with the Administrator of 

the Environmental Protection Agency. 

Effective date.—The provision is effective on the date of enactment. 

CONFERENCE AGREEMENT

Under the conference agreement, the 51–cent-per-gallon incentive for ethanol is adjusted to 45 cents per gallon for the calendar 

year 2009 and thereafter.38 If the Secretary makes a determination, in consultation with the Administrator of the Environmental 

Protection Agency, that 7,500,000,000 gallons of ethanol (including 

cellulosic ethanol) were not produced in or imported into the 

United States in 2008, the reduction in the credit amount will be 

delayed. If a determination is made that the threshold was not 

reached in 2008, the reduction for 2010 also will be delayed if the 

Secretary determines 7,500,000,000 gallons were not produced or 

imported in 2009. In the absence of a determination, the reduction 

remains in effect. In the event the determination is made subsequent to the start of a calendar year, those persons claiming the 

reduced amount prior to the Secretary’s determination will be entitled to the difference between the correct credit amount for that 

year and the credit amount claimed, e.g. between 51 cents per gallon and 45 cents per gallon. 

Effective date.—The provision is effective on the date of enactment. 


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39Sec. 40(d)(4). 

4. Calculation of volume of alcohol for fuel credits (Sec. 12316 of 

the Senate amendment, and sec. 15332 of the conference agreement and sec. 40 of the Code) 

PRESENT LAW

The Code provides a per-gallon credit for the volume of alcohol 

used as a fuel or in a qualified mixture. For purposes of determining the number of gallons of alcohol with respect to which the 

credit is allowable, the volume of alcohol includes any denaturant, 

including gasoline.39 The denaturant must be added under a formula approved by the Secretary and the denaturant cannot exceed 

five percent of the volume of such alcohol (including denaturants). 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment reduces the amount of allowable denaturants to two percent of the volume of the alcohol. 

Effective date.—The provision is effective for fuel sold or used 

after December 31, 2007. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 

Effective date.—The provision is effective for fuel sold or used 

after December 31, 2008. 

5. Ethanol tariff extension (Sec. 12317 of the Senate amendment 

and sec. 15333 of the conference agreement) 

PRESENT LAW

Heading 9901.00.50 of the Harmonized Tariff Schedule of the 

United States imposes a cumulative general duty of 14.27 cents per 

liter (approximately 54 cents per gallon) to imports of ethyl alcohol, 

and any mixture containing ethyl alcohol, if used as a fuel or in 

producing a mixture to be used as a fuel, that are entered into the 

United States prior to January 1, 2009. 

Taxpayers who blend ethanol with gasoline are eligible to 

claim an alcohol fuels tax credit of 51 cents per gallon, irrespective 

of whether the ethanol used is produced domestically or imported. 

Heading 9901.00.50 applies a temporary duty to ethanol imports 

that offsets the benefit of the alcohol fuels tax credit to imported 

ethanol. 

Heading 9901.00.52 of the Harmonized Tariff Schedule of the 

United States imposes a general duty of 5.99 cents per liter to imports of ethyl tertiary-butyl ether, and any mixture containing 

ethyl tertiary-butyl ether, that are entered into the United States 

prior to January 1, 2009. 

HOUSE BILL

No provision. 


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SENATE AMENDMENT

The Senate amendment modifies the existing effective period 

for ethyl alcohol as classified under heading 9901.00.50 and 

9901.00.52 of the Harmonized Tariff Schedule of the United States 

from before January 1, 2009 to before January 1, 2011. 

Effective date.—The provision is effective on the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 

Effective date.—The provision is effective on the date of enactment. 

6. Limitations on duty drawback on certain imported ethanol (Sec. 

12318 of the Senate amendment and sec. 15334 of the conference 

agreement) 

PRESENT LAW

Subheading 9901.00.50 of the Harmonized Tariff Schedule of 

the United States (‘‘HTSUS’’), imposes an additional duty on ethanol that is used as fuel or used to make fuel. Subsection (b) of Section 313 of the Tariff Act of 1930 permits the refund of duty if the 

duty-paid good, or a substitute good, is used to make an article 

that is exported. Subsection (j)(2) of Section 313 permits the refund 

of duty if the duty-paid good, or a substitute good, is exported. Subsection (p) of section 313 permits the substitution on exportation 

for drawback eligibility of one motor fuel for another motor fuel. A 

person who manufactures or acquires gasoline with ethanol subject 

to the duty imposed by subheading 9901.00.50, HTSUS, can export 

jet fuel (which does not involve the use of ethanol) and obtain a refund of the duty paid under subheading 9901.00.50, HTSUS. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment eliminates the ability to obtain a refund of the duty imposed by subheading 9901.00.50, HTSUS, by 

substitution of ethanol not subject to the duty under 9901.00.50 of 

the HTSUS for ethanol subject to the duty imposed under subheading 9901.00.50, HTSUS, for drawback purposes. Also, under 

the provision, an exported article that does not contain ethyl alcohol or a mixture of ethyl alcohol shall not be treated as the same 

kind and quality as a qualified article that does contain ethyl alcohol or a mixture of ethyl alcohol, for substitution duty drawback 

purposes under section 313(p) of the Tariff Act of 1930. In particular, this eliminates the ability to export jet fuel as a substitute 

for motor fuel made with imports of ethyl alcohol or a mixture of 

ethyl alcohol, and receive duty drawback based upon the import 

duty paid under subheading 9901.00.50, HTSUS. 

Effective date.—Effective for articles exported on or after the 

date that is 15 days after the date of enactment. 


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CONFERENCE AGREEMENT

Under the conference agreement, any duty paid under subheading 9901.00.50, HTSUS, on imports of ethyl alcohol or a mixture of ethyl alcohol may not be refunded if the exported article 

upon which a drawback claim is based does not contain ethyl alcohol or a mixture of ethyl alcohol. In particular, the provision eliminates the ability to export jet fuel as a substitute for motor fuel 

made with imports of ethyl alcohol or a mixture of ethyl alcohol, 

and then receive duty drawback based upon the import duty paid 

on the ethyl alcohol or the mixture of ethyl alcohol under subheading 9901.00.50, HTSUS. 

Effective date.—The provision applies to imports of ethyl alcohol or a mixture of ethyl alcohol entered for consumption, or withdrawn from warehouse for consumption, on or after October 1, 

2008. With respect to claims for substitution duty drawback that 

are based upon imports of ethyl alcohol or a mixture of ethyl alcohol entered for consumption, or withdrawn from warehouse for consumption, before October 1, 2008, such claims must be filed not 

later than September 30, 2010; otherwise, such claims are disallowed. 

C. AGRICULTURAL PROVISIONS

1. Qualified small issue bonds for farming (Sec. 12401 of the Senate 

amendment, sec. 15341 of the conference agreement and sec. 144 

of the Code) 

PRESENT LAW

Qualified small issue bonds are tax-exempt bonds issued by 

State and local governments to finance private business manufacturing facilities (including certain directly related and ancillary facilities) or the acquisition of land and equipment by certain firsttime farmers. A first-time farmer means any individual who has 

not at any time had any direct ownership interest in substantial 

farmland in the operation of which such individual materially participated. In addition, an individual does not qualify as a first-time 

farmer if such individual has received more than $250,000 in qualified small issue bond financing. Substantial farmland means any 

parcel of land unless (1) such parcel is smaller than 30 percent of 

the median size of a farm in the county in which such parcel is located and (2) the fair market value of the land does not at any time 

while held by the individual exceed $125,000. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment increases the maximum amount of 

qualified small issue bond proceeds available to first-time farmers 

to $450,000 and indexes this amount for inflation. The provision 

also eliminates the fair market value test from the definition of 

substantial farmland. 


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40Sec. 1031(a)(1). 41Sec. 1031(a)(2). 

Effective date.—The provision is effective for bonds issued after 

the date of enactment. Conference Agreement The conference 

agreement follows the Senate amendment. 

2. Allowance of section 1031 for exchanges involving certain mutual 

ditch, reservoir, or irrigation company stock (sec. 12403 of the 

Senate amendment, sec. 15342 of the conference agreement and 

sec. 1031 of the Code) 

PRESENT LAW

An exchange of property, like a sale, generally is a taxable 

event. However, no gain or loss is recognized if property held for 

productive use in a trade or business or for investment is exchanged for property of a ‘‘like-kind’’ which is to be held for productive use in a trade or business or for investment.40 If section 1031 

applies to an exchange of properties, the basis of the property received in the exchange is equal to the basis of the property transferred, decreased by any money received by the taxpayer, and further adjusted for any gain or loss recognized on the exchange. In 

general, section 1031 does not apply to any exchange of stock in 

trade or other property held primarily for sale; stocks, bonds or 

notes; other securities or evidences of indebtedness or interest; interests in a partnership; certificates of trust or beneficial interests; 

or choses in action.41

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment provides that the general exclusion 

from section 1031 treatment for stocks shall not apply to shares in 

a mutual ditch, reservoir, or irrigation company, if at the time of 

the exchange: (1) the company is an organization described in section 501(c)(12)(A) (determined without regard to the percentage of 

its income that is collected from its members for the purpose of 

meeting losses and expenses); and (2) the shares in the company 

have been recognized by the highest court of the State in which 

such company was organized or by applicable State statute as constituting or representing real property or an interest in real property. 

Effective date.—The provision is effective for transfers after the 

date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 


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42Sec. 38(b)(1). 43The term taxpayer includes controlled groups under rules similar to the rules set out in 

section 41(f)(1) and (2). 

3. Agricultural chemicals security tax credit (Sec. 12405 of the Senate amendment, sec. 15343 of the conference agreement and new 

sec. 45O of the Code) 

PRESENT LAW

Present law does not provide a credit for agricultural chemicals 

security. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment establishes a 30 percent credit for 

qualified chemical security expenditures for the taxable year with 

respect to eligible agricultural businesses. The credit is a component of the general business credit.42

The credit is limited to $100,000 per facility, this amount is reduced by the aggregate amount of the credits allowed for the facility in the prior five years. In addition, each taxpayer’s annual credit is limited to $2,000,000.43 The credit only applies to expenditures 

paid or incurred before December 31, 2012. The taxpayer’s deductible expense is reduced by the amount of the credit claimed. 

Qualified chemical security expenditures are amounts paid for: 

1) employee security training and background checks; (2) limitation 

and prevention of access to controls of specific agricultural chemicals stored at a facility; (3) tagging, locking tank valves, and chemical additives to prevent the theft of specific agricultural chemicals 

or to render such chemicals unfit for illegal use; (4) protection of 

the perimeter of areas where specified agricultural chemicals are 

stored; (5) installation of security lighting, cameras, recording 

equipment and intrusion detection sensors (6) implementation of 

measures to increase computer or computer network security; (7) 

conducting security vulnerability assessments; (8) implementing a 

site security plan; and (9) other measures provided for by regulation. Amounts described in the preceding sentences are only eligible to the extent they are incurred by an eligible agricultural business for protecting specified agricultural chemicals. 

Eligible agricultural businesses are businesses that: (1) sell agricultural products, including specified agricultural chemicals, at 

retail predominantly to farmers and ranchers; or (2) manufacture, 

formulate, distribute, or aerially apply specified agricultural chemicals. 

Specified agricultural chemicals means: (1) fertilizer commonly 

used in agricultural operations which is listed under section 

302(a)(2) of the Emergency Planning and Community Right-to 

know Act of 1986, section 101 or part 172 of title 49, Code of Federal Regulations, or part 126, 127 or 154 of title 33, Code of Federal Regulations; and (2) any pesticide (as defined in section 2(u) 

of the Federal Insecticide, Fungicide, and Rodenticide Act) includVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01061 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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44Sec. 168. 45 1987–2 C.B. 674 (as clarified and modified by Rev. Proc. 88–22, 1988–1 C.B. 785). 46Sec. 168(e)(3)(A)(i). 47 Rev. Proc. 87–56, 1987–2 C.B. 674, asset class 01.225. 

ing all active and inert ingredients which are used on crops grown 

for food, feed or fiber. 

Effective date.—The provision is effective for expenses paid or 

incurred after date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 

4. Three-year depreciation for all race horses (Sec. 12509(a) of the 

Senate amendment, and sec. 15344 of the conference agreement 

and sec. 168 of the Code) 

PRESENT LAW

A taxpayer is allowed to recover, through annual depreciation 

deductions, the cost of certain property used in a trade or business 

or for the production of income. The amount of the depreciation deduction allowed with respect to tangible property for a taxable year 

is determined under the modified accelerated cost recovery system 

(‘‘MACRS’’).44 The class lives of assets placed in service after 1986 

are generally set forth in Revenue Procedure 87–56.45 Any race 

horse that is more than two years old at the time it is placed in 

service is assigned a three-year recovery period.46 A seven year recovery period is assigned to any race horse that is two years old 

or younger at the time it is placed in service.47

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment provides a three year recovery period 

for any race horse. 

Effective date.—The provision applies to property placed in 

service on or after the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment, except that the provision applies to any race horse that is two years 

old or younger at the time that it is placed in service after December 31, 2008 and before January 1, 2014. 


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48The provisions of this Act generally provide tax relief similar to certain other disaster 

areas. They do not modify the otherwise applicable tax relief to those other disaster areas. 

5. Temporary relief for Kiowa County, Kansas and surrounding 

area 48

(a) Suspension of certain limitations on personal casualty losses 

(Sec. 12701 of the Senate amendment, sec. 15345 of the conference agreement and sec. 1400S(b) of the Code) 

PRESENT LAW

Under present law, a taxpayer may generally claim a deduction for any loss sustained during the taxable year and not compensated by insurance or otherwise (sec. 165). For individual taxpayers, deductible losses must be incurred in a trade or business 

or other profit-seeking activity or consist of property losses arising 

from fire, storm, shipwreck, or other casualty, or from theft. Personal casualty or theft losses are deductible only if they exceed 

$100 per casualty or theft (the ‘‘$100 limitation’’) (sec. 165(h)). In 

addition, aggregate net casualty and theft losses are deductible 

only to the extent they exceed 10 percent of an individual taxpayer’s adjusted gross income (the ‘‘AGI limitation’’) (sec. 165(h)). 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment removes two limitations on personal 

casualty or theft losses to the extent those losses arose from such 

events in the Kansas disaster area after May 4, 2007, and are attributable to the disaster occurring at that time. For purposes of 

the provisions of this Act, the term ‘‘Kansas disaster area’’ means 

an area with respect to which a major disaster has been declared 

by the President under section 401 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (FEMA–1699–DR, as in 

effect on the date of enactment of this Act) by reason of severe 

storms and tornadoes beginning on May 4, 2007, and determined 

by the President to warrant individual or individual and public assistance from the Federal Government under such Act with respect 

to damages attributable to storms and tornadoes. These personal 

casualty or theft losses are deductible without regard to either the 

$100 limitation or the AGI limitation. For purposes of applying the 

AGI limitation to other personal casualty or theft losses, losses deductible under this provision are disregarded. Thus, the provision 

has the effect of treating personal casualty or theft losses from the 

disaster separate from all other casualty losses. 

Effective date.—The provision is effective for losses arising on 

or after May 4, 2007. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 


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49Sec. 1033(g)(4). 50Sec. 1033(h)(1)(B). 51Sec. 1033(e)(2). 

(b) Extension of replacement period for nonrecognition of gain (Sec. 

12701 of the Senate amendment, and sec. 15345 of the conference agreement) 

PRESENT LAW

Generally, a taxpayer realizes gain to the extent the sales price 

(and any other consideration received) exceeds the taxpayer’s basis 

in the property. The realized gain is subject to current income tax 

unless the gain is deferred or not recognized under a special tax 

provision. 

Under section 1033, gain realized by a taxpayer from an involuntary conversion of property is deferred to the extent the taxpayer 

purchases property similar or related in service or use to the converted property within the applicable period. The taxpayer’s basis 

in the replacement property generally is the cost of such property, 

reduced by the amount of gain not recognized. 

The applicable period for the taxpayer to replace the converted 

property begins with the date of the disposition of the converted 

property (or if earlier, the earliest date of the threat or imminence 

of requisition or condemnation of the converted property) and ends 

two years after the close of the first taxable year in which any part 

of the gain upon conversion is realized (the ‘‘replacement period’’). 

Special rules extend the replacement period for certain real 

property 49 and principal residences damaged by a Presidentially 

declared disaster 50 to three years and four years, respectively, 

after the close of the first taxable year in which gain is realized. 

Similarly, the replacement period for livestock sold on account of 

drought, flood, or other weather-related conditions is extended from 

two years to four years after the close of the first taxable year in 

which any part of the gain on conversion is realized.51

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment extends from two to five years the replacement period in which a taxpayer may replace converted property, in the case of property that is in the Kansas disaster area and 

that is compulsorily or involuntarily converted on or after May 4, 

2007, by reason of the May 4, 2007, storms and tornadoes. Substantially all of the use of the replacement property must be in this 

area. 

Effective date.—The provision is effective on the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 


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(c) Employee retention credit (Sec. 12701 of the Senate amendment, sec. 15345 of the conference agreement and sec. 1400R(a) 

of the Code) 

PRESENT LAW

For employers affected by Hurricanes Katrina, Rita, or Wilma, 

section 1400R provides a credit of 40 percent of the qualified wages 

(up to a maximum of $6,000 in qualified wages per employee) paid 

by an eligible employer to an eligible employee. 

Hurricane Katrina 

An eligible employer is any employer (1) that conducted an active trade or business on August 28, 2005, in the GO Zone and (2) 

with respect to which the trade or business described in (1) is inoperable on any day after August 28, 2005, and before January 1, 

2006, as a result of damage sustained by reason of Hurricane 

Katrina. 

An eligible employee is, with respect to an eligible employer, 

an employee whose principal place of employment on August 28, 

2005, with such eligible employer was in the GO Zone. An employee may not be treated as an eligible employee for any period 

with respect to an employer if such employer is allowed a credit 

under section 51 with respect to the employee for the period. 

Qualified wages are wages (as defined in section 51(c)(1) of the 

Code, but without regard to section 3306(b)(2)(B) of the Code) paid 

or incurred by an eligible employer with respect to an eligible employee on any day after August 28, 2005, and before January 1, 

2006, during the period (1) beginning on the date on which the 

trade or business first became inoperable at the principal place of 

employment of the employee immediately before Hurricane 

Katrina, and (2) ending on the date on which such trade or business has resumed significant operations at such principal place of 

employment. Qualified wages include wages paid without regard to 

whether the employee performs no services, performs services at a 

different place of employment than such principal place of employment, or performs services at such principal place of employment 

before significant operations have resumed. 

The credit is a part of the current year business credit under 

section 38(b) and therefore is subject to the tax liability limitations 

of section 38(c). Rules similar to sections 51(i)(1) and 52 apply to 

the credit. 

Hurricane Rita and Wilma 

The credit for employers affected by Hurricanes Rita and 

Wilma is subject to the same rules as Katrina, except the reference 

dates for affected employers, comparable to the August 28, 2005 

date for Katrina, are September 23, 2005, and October 23, 2005, respectively. 

HOUSE BILL

No provision. 


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52Sec. 168. 53Sec. 1400N(d). 

SENATE AMENDMENT

The Senate amendment extends the retention credit, as modified to include an employer size limitation, for employers affected 

by the Kansas storms and tornados. The reference dates for these 

employers, comparable to the August 28, 2005 and January 1, 2006 

dates of present law for employers affected by Hurricane Katrina, 

are May 4, 2007, and January 1, 2008, respectively. 

The retention credit for employers affected by the Kansas 

storms and tornados includes an employer size limitation. The 

credit only applies to eligible employers who employed an average 

of not more than 200 employees on business days during the taxable year before May 4, 2007. 

Effective date.—The provision is effective on the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 

(d) Special depreciation allowance (Sec. 12701 of the Senate amendment, sec. 15345 of the conference agreement and sec. 1400N(d) 

of the Code) 

PRESENT LAW

A taxpayer is allowed to recover, through annual depreciation 

deductions, the cost of certain property used in a trade or business 

or for the production of income. The amount of the depreciation deduction allowed with respect to tangible property for a taxable year 

is determined under the modified accelerated cost recovery system 

(‘‘MACRS’’).52 Under MACRS, different types of property generally 

are assigned applicable recovery periods and depreciation methods. 

The recovery periods applicable to most tangible personal property 

(generally tangible property other than residential rental property 

and nonresidential real property) range from 3 to 20 years. The depreciation methods generally applicable to tangible personal property are the 200-percent and 150-percent declining balance methods, switching to the straight-line method for the taxable year in 

which the depreciation deduction would be maximized. 

For qualified Gulf Opportunity Zone property, the Code provides an additional first-year depreciation deduction equal to 50 

percent of the adjusted basis.53 In order to qualify, property generally must be placed in service on or before December 31, 2007 

(December 31, 2008 in the case of nonresidential real property and 

residential rental property). 

The additional first-year depreciation deduction is allowed for 

both regular tax and alternative minimum tax purposes for the 

taxable year in which the property is placed in service. The additional first-year depreciation deduction is subject to the general 

rules regarding whether an item is deductible under section 162 or 

subject to capitalization under section 263 or section 263A. The 

basis of the property and the depreciation allowances in the year 

of purchase and later years are appropriately adjusted to reflect 


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54 Used property may constitute qualified property so long as it has not previously been 

used within the Gulf Opportunity Zone. In addition, it is intended that additional capital expenditures incurred to recondition or rebuild property the original use of which in the Gulf Opportunity Zone began with the taxpayer would satisfy the ‘‘original use’’ requirement. See Treasury Regulation sec. 1.48–2, Example 5. 55Such personal property must be placed in service by the taxpayer not later than 90 days 

after such building is placed in service. 

the additional first-year depreciation deduction. In addition, the 

provision provides that there is no adjustment to the allowable 

amount of depreciation for purposes of computing a taxpayer’s alternative minimum taxable income with respect to property to 

which the provision applies. A taxpayer is allowed to elect out of 

the additional first-year depreciation for any class of property for 

any taxable year. 

In order for property to qualify for the additional first-year depreciation deduction, it must meet all of the following requirements. First, the property must be property to which the general 

rules of the Modified Accelerated Cost Recovery System (‘‘MACRS’’) 

apply with (1) an applicable recovery period of 20 years or less, (2) 

computer software other than computer software covered by section 

197, (3) water utility property (as defined in section 168(e)(5)), (4) 

certain leasehold improvement property, or (5) certain nonresidential real property and residential rental property. Second, substantially all of the use of such property must be in the Gulf Opportunity Zone and in the active conduct of a trade or business by the 

taxpayer in the Gulf Opportunity Zone. Third, the original use of 

the property in the Gulf Opportunity Zone must commence with 

the taxpayer on or after August 28, 2005.54 Finally, the property 

must be acquired by purchase (as defined under section 179(d)) by 

the taxpayer on or after August 28, 2005 and placed in service on 

or before December 31, 2007 (December 31, 2008, for qualifying 

nonresidential real property and residential rental property). Property does not qualify if a binding written contract for the acquisition of such property was in effect before August 28, 2005. However, property is not precluded from qualifying for the additional 

first-year depreciation merely because a binding written contract to 

acquire a component of the property is in effect prior to August 28, 

2005. 

Property that is manufactured, constructed, or produced by the 

taxpayer for use by the taxpayer qualifies if the taxpayer begins 

the manufacture, construction, or production of the property after 

August 27, 2005, and before January 1, 2008, and the property is 

placed in service on or before December 31, 2007 (and all other requirements are met). In the case of qualified nonresidential real 

property and residential rental property, the property must be 

placed in service on or before December 31, 2008. Property that is 

manufactured, constructed, or produced for the taxpayer by another person under a contract that is entered into prior to the manufacture, construction, or production of the property is considered 

to be manufactured, constructed, or produced by the taxpayer. 

The special allowance for Gulf Opportunity Zone property was 

extended for certain nonresidential real property and residential 

rental property, and certain personal property if substantially all 

of the use of such property is in such building,55 placed in service 

in specified portions of the GO Zone by the taxpayer on or before 


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56Sec. 1400N(d)(6). 57Sec. 1400N(d)(6)(D). 58 Used property may constitute qualified property so long as it has not previously been 

used within the Kansas Disaster Zone. In addition, it is intended that additional capital expenditures incurred to recondition or rebuild property the original use of which in the Kansas Disaster Zone began with the taxpayer would satisfy the ‘‘original use’’ requirement. See Treasury 

Regulation sec. 1.48–2, Example 5. 

December 31, 2010.56 The extension only applies to nonresidential 

real property and residential rental property to the extent of the 

adjusted basis attributable to manufacture, construction, or production before January 1, 2010.57

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment provides an additional first-year depreciation deduction equal to 50 percent of the adjusted basis for 

qualified Recovery Assistance property. In order for property to 

qualify for the additional first-year depreciation deduction, it must 

meet all of the following requirements: (1) The property must be 

property to which the general rules of the MACRS apply with (a) 

an applicable recovery period of 20 years or less, (b) computer software other than computer software covered by section 197, (c) 

water utility property (as defined in section 168(e)(5)), (d) certain 

leasehold improvement property, or (e) certain nonresidential real 

property and residential rental property; (2) substantially all of the 

use of such property must be in the Kansas Disaster Zone and in 

the active conduct of a trade or business by the taxpayer in the 

Kansas Disaster Zone. Third, the original use of the property in the 

Kansas Disaster Zone must commence with the taxpayer on or 

after May 5, 2007.58 Finally, the property must be acquired by purchase (as defined under section 179(d)) by the taxpayer on or after 

May 5, 2007 and placed in service on or before December 31, 2008 

(December 31, 2009, for qualifying nonresidential real property and 

residential rental property). Property does not qualify if a binding 

written contract for the acquisition of such property was in effect 

before May 5, 2007. However, property is not precluded from qualifying for the additional first-year depreciation merely because a 

binding written contract to acquire a component of the property is 

in effect prior to May 5, 2007. 

Property that is manufactured, constructed, or produced by the 

taxpayer for use by the taxpayer qualifies if the taxpayer begins 

the manufacture, construction, or production of the property after 

May 4, 2007, and before January 1, 2009, and the property is 

placed in service on or before December 31, 2008 (and all other requirements are met). In the case of qualified nonresidential real 

property and residential rental property, the property must be 

placed in service on or before December 31, 2009. Property that is 

manufactured, constructed, or produced for the taxpayer by another person under a contract that is entered into prior to the manufacture, construction, or production of the property is considered 

to be manufactured, constructed, or produced by the taxpayer. 

Effective date.—The provision is effective on the date of enactment. 


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59 Additional section 179 incentives are provided with respect to qualified property meeting 

applicable requirements that is used by a business in an empowerment zone (sec. 1397A), a renewal community (sec. 1400J), or the Gulf Opportunity Zone (sec. 1400N(e)). 60Sec. 179(c)(1). Under Treas. Reg. sec. 1.179–5, applicable to property placed in service in 

taxable years beginning after 2002 and before 2008, a taxpayer is permitted to make or revoke 

an election under section 179 without the consent of the Commissioner on an amended Federal 

tax return for that taxable year. This amended return must be filed within the time prescribed 

by law for filing an amended return for the taxable year. T.D. 9209, July 12, 2005. 61Sec. 179(c)(2). 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 

(e) Increase in expensing under section 179 (Sec. 12701 of the Senate amendment, sec. 15345 of the conference agreement and sec. 

1400N(e) of the Code) 

PRESENT LAW

In lieu of depreciation, a taxpayer with a sufficiently small 

amount of annual investment may elect to deduct (or ‘‘expense’’) 

such costs under section 179. Present law provides that the maximum amount a taxpayer may expense, for taxable years beginning 

in 2007 through 2010, is $125,000 of the cost of qualifying property 

placed in service for the taxable year.59 In general, qualifying property is defined as depreciable tangible personal property that is 

purchased for use in the active conduct of a trade or business. Offthe-shelf computer software placed in service in taxable years beginning before 2010 is treated as qualifying property. The $125,000 

amount is reduced (but not below zero) by the amount by which the 

cost of qualifying property placed in service during the taxable year 

exceeds $500,000. The $125,000 and $500,000 amounts are indexed 

for inflation in taxable years beginning after 2007 and before 2011. 

The amount eligible to be expensed for a taxable year may not 

exceed the taxable income for a taxable year that is derived from 

the active conduct of a trade or business (determined without regard to this provision). Any amount that is not allowed as a deduction because of the taxable income limitation may be carried forward to succeeding taxable years (subject to similar limitations). 

No general business credit under section 38 is allowed with respect 

to any amount for which a deduction is allowed under section 179. 

An expensing election is made under rules prescribed by the Secretary.60

For taxable years beginning in 2011 and thereafter (or before 

2003), the following rules apply. A taxpayer with a sufficiently 

small amount of annual investment may elect to deduct up to 

$25,000 of the cost of qualifying property placed in service for the 

taxable year. The $25,000 amount is reduced (but not below zero) 

by the amount by which the cost of qualifying property placed in 

service during the taxable year exceeds $200,000. The $25,000 and 

$200,000 amounts are not indexed. In general, qualifying property 

is defined as depreciable tangible personal property that is purchased for use in the active conduct of a trade or business (not including off the-shelf computer software). An expensing election may 

be revoked only with consent of the Commissioner.61

For qualified section 179 Gulf Opportunity Zone property, the 

maximum amount that a taxpayer may elect to deduct is increased 


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62Sec. 1400N(e). 

by the lesser of $100,000 or the cost of qualified section 179 Gulf 

Opportunity Zone property for the taxable year.62 The provision applies with respect to qualified section 179 Gulf Opportunity Zone 

property acquired on or after August 28, 2005, and placed in service on or before December 31, 2007. This placed in service date was 

extended to December 31, 2008 for property substantially all of the 

use of which is in one or more specified portions of the GO Zone. 

The threshold for reducing the amount expensed is computed by increasing the $500,000 present-law amount by the lesser of (1) 

$600,000, or (2) the cost of qualified section 179 Gulf Opportunity 

Zone property placed in service during the taxable year. Neither 

the $100,000 nor $600,000 amounts are indexed for inflation. 

Qualified section 179 Gulf Opportunity Zone property means 

section 179 property (as defined in section 179(d)) that also meets 

the following requirements: (1) The property must be property to 

which the general rules of the MACRS apply with (a) an applicable 

recovery period of 20 years or less, (b) computer software other 

than computer software covered by section 197, (c) water utility 

property (as defined in section 168(e)(5)), (d) certain leasehold improvement property; (2) substantially all of the use of which is in 

the Gulf Opportunity Zone and is in the active conduct of a trade 

or business by the taxpayer in that Zone; (3) the original use of 

which commences with the taxpayer on or after August 28, 2005; 

(4) which is acquired by the taxpayer by purchase on or after August 28, 2005, but only if no written binding contract for the acquisition was in effect before August 28, 2005; and (5) which is placed 

in service by the taxpayer on or before December 31, 2007. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment increases the amount that a taxpayer 

may elect for qualified section 179 Recovery Assistance property. 

The maximum amount that a taxpayer may elect to deduct under 

section 179 is increased by the lesser of $100,000 or the cost of 

qualified section 179 Recovery Assistance property for the taxable 

year. The provision applies with respect to qualified section 179 Recovery Assistance property acquired on or after May 5, 2007, and 

placed in service on or before December 31, 2008. The threshold for 

reducing the amount expensed is computed by increasing the 

$500,000 present-law amount by the lesser of (1) $600,000, or (2) 

the cost of qualified section 179 Recovery Assistance property 

placed in service during the taxable year. Neither the $100,000 nor 

$600,000 amounts are indexed for inflation. 

Qualified section 179 Recovery Assistance property means section 179 property (as defined in section 179(d)) that also meets the 

following requirements: (1) The property must be property to which 

the general rules of the MACRS apply with (a) an applicable recovery period of 20 years or less, (b) computer software other than 

computer software covered by section 197, (c) water utility property 

(as defined in section 168(e)(5)), or (d) certain leasehold improveVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01070 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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63Sec. 280B. 64 1971–1 C.B. 76. 

ment property; (2) substantially all of the use of which is in the 

Kansas Disaster Zone and is in the active conduct of a trade or 

business by the taxpayer in that Zone; (3) the original use of which 

commences with the taxpayer on or after May 5, 2007; (4) which 

is acquired by the taxpayer by purchase on or after May 5, 2007, 

but only if no written binding contract for the acquisition was in 

effect before May 5, 2007; and (5) which is placed in service by the 

taxpayer on or before December 31, 2008. 

Effective date.—The provision is effective on the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 

(f) Expensing for certain demolition and clean-up costs (Sec. 12701 

of the Senate amendment, sec. 15345 of the conference agreement and sec. 1400N(f) of the Code) 

PRESENT LAW

Under present law, the cost of demolition of a structure is capitalized into the taxpayer’s basis in the land on which the structure 

is located.63 Land is not subject to an allowance for depreciation or 

amortization. 

The treatment of the cost of debris removal depends on the nature of the costs incurred. For example, the cost of debris removal 

after a storm may in some cases constitute an ordinary and necessary business expense which is deductible in the year paid or incurred. In other cases, debris removal costs may be in the nature 

of replacement of part of the property that was damaged. In such 

cases, the costs are capitalized and added to the taxpayer’s basis 

in the property. For example, Revenue Ruling 71–161 64 permits 

the use of clean-up costs as a measure of casualty loss but requires 

that such costs be added to the post-casualty basis of the property. 

Under section 1400N(f), a taxpayer is permitted a deduction 

for 50 percent of any qualified Gulf Opportunity Zone clean-up cost 

paid or incurred during the period beginning on August 28, 2005, 

and ending on December 31, 2007. The remaining 50 percent is 

capitalized and treated as described above. A qualified Gulf Opportunity Zone clean-up cost is an amount paid or incurred for the removal of debris from, or the demolition of structures on, real property located in the Gulf Opportunity Zone to the extent that the 

amount would otherwise be capitalized. In order to qualify, the 

property must be held for use in a trade or business, for the production of income, or as inventory. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

Under the Senate amendment, a taxpayer is permitted a deduction for 50 percent of any qualified Recovery Assistance cleanVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01071 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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up cost paid or incurred during the period beginning on May 4, 

2007, and ending on December 31, 2009. The remaining 50 percent 

is treated as under present law. A qualified Recovery Assistance 

clean-up cost is an amount paid or incurred for the removal of debris from, or the demolition of structures on, real property located 

in the Kansas disaster area to the extent that the amount would 

otherwise be capitalized. In order to qualify, the property must be 

held for use in a trade or business, for the production of income, 

or as inventory. 

Effective date.—The provision is effective on the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 

(g) Treatment of public utility property disaster losses (Sec. 12701 

of the Senate amendment, sec. 15345 of the conference agreement and sec. 1400N(o) of the Code) 

PRESENT LAW

Under section 165(i), certain losses attributable to a disaster 

occurring in a Presidentially declared disaster area may, at the 

election of the taxpayer, be taken into account for the taxable year 

immediately preceding the taxable year in which the disaster occurred. 

Section 6411 provides a procedure under which taxpayers may 

apply for tentative carryback and refund adjustments with respect 

to net operating losses, net capital losses, and unused business 

credits. 

Section 1400N(o) provides an election for taxpayers who incurred casualty losses attributable to Hurricane Katrina with respect to public utility property located in the Gulf Opportunity 

Zone. Under the election, such losses may be taken into account in 

the fifth taxable year (rather than the 1st taxable year) immediately preceding the taxable year in which the loss occurred. If the 

application of this provision results in the creation or increase of 

a net operating loss for the year in which the casualty loss is taken 

into account, the net operating loss may be carried back or carried 

over as under present law applicable to net operating losses for 

such year. 

For purposes of section 1400N(o), public utility property is 

property used predominantly in the trade or business of the furnishing or sale of electrical energy, water, or sewage disposal services; gas or steam through a local distribution system; telephone 

services, or other communication services if furnished or sold by 

the Communications Satellite Corporation for purposes authorized 

by the Communications Satellite Act of 1962; or transportation of 

gas or steam by pipeline. Such property is eligible regardless of 

whether the taxpayer’s rates are established or approved by any 

regulatory body. 

A taxpayer making the election under the provision is eligible 

to file an application for a tentative carryback adjustment of the 

tax for any prior taxable year affected by the election. As under 

present law with respect to tentative carryback and refund adjustVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01072 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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65Sec. 172(b)(1)(A). 66Sec. 172(b)(2). 

ments, the IRS generally has 90 days to act on the refund claim. 

Under the provision, the statute of limitations with respect to such 

a claim can not expire earlier than one year after the date of enactment. Also, a taxpayer making the election with respect to a loss 

is not entitled to interest with respect to any overpayment attributable to the loss. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment provides an election for taxpayers who 

incurred casualty losses attributable to the Kansas storms and tornados with respect to public utility property located in the Kansas 

Disaster Zone. Under the election, such losses may be taken into 

account in the fifth taxable year (rather than the 1st taxable year) 

immediately preceding the taxable year in which the loss occurred. 

If the application of this provision results in the creation or increase of a net operating loss for the year in which the casualty 

loss is taken into account, the net operating loss may be carried 

back or carried over as under present law applicable to net operating losses for such year. The other definitions and rules that 

apply under section 1400N(o) shall apply to the losses claimed in 

the Kansas Disaster Zone. 

Effective date.—The provision is effective on the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 

(h) Treatment of net operating losses attributable to storm losses 

(Sec. 12701 of the Senate amendment, sec. 15345 of the conference agreement and sec. 1400N(k) of the Code) 

PRESENT LAW

Under present law, a net operating loss (‘‘NOL’’) is, generally, 

the amount by which a taxpayer’s business deductions exceed its 

gross income. In general, an NOL may be carried back two years 

and carried over 20 years to offset taxable income in such years.65

NOLs offset taxable income in the order of the taxable years to 

which the NOL may be carried.66

Different rules apply with respect to NOLs arising in certain 

circumstances. A three-year carryback applies with respect to 

NOLs (1) arising from casualty or theft losses of individuals, or (2) 

attributable to Presidentially declared disasters for taxpayers engaged in a farming business or a small business. A five-year 

carryback applies to NOLs (1) arising from a farming loss (regardless of whether the loss was incurred in a Presidentially declared 

disaster area), or (2) certain amounts related to Hurricane Katrina 

and the Gulf Opportunity Zone. Special rules also apply to real estate investment trusts (no carryback), specified liability losses (10- 


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year carryback), and excess interest losses (no carryback to any 

year preceding a corporate equity reduction transaction). Additionally, a special rule applies to certain electric utility companies. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment provides rules in connection with certain net operating losses similar to the rules provided for Gulf Opportunity Zone losses under section 1400N(k). The rules, as applied 

to qualified Recovery Assistance losses, are as follows: 

In General 

The provision provides a special five-year carryback period for 

NOLs to the extent of certain specified amounts related to the Kansas storms and tornados. The amount of the NOL which is eligible 

for the five year carryback (‘‘eligible NOL’’) is limited to the aggregate amount of the following deductions: (i) qualified Recovery Assistance casualty losses; (ii) certain moving expenses; (iii) certain 

temporary housing expenses; (iv) depreciation deductions with respect to qualified Recovery Assistance property for the taxable year 

the property is placed in service; and (v) deductions for certain repair expenses resulting from the Kansas storms and tornados. The 

provision applies for losses paid or incurred after May 3, 2007, and 

before January 1, 2010; however, an irrevocable election not to 

apply the five-year carryback under the provision may be made 

with respect to any taxable year. 

Qualified Recovery Assistance casualty losses 

The amount of qualified Gulf Opportunity Zone casualty losses 

which may be included in the eligible NOL is the amount of the 

taxpayer’s casualty losses with respect to (1) property used in a 

trade or business, and (2) capital assets held for more than one 

year in connection with either a trade or business or a transaction 

entered into for profit. In order for a casualty loss to qualify, the 

property must be located in the Kansas Disaster Zone and the loss 

must be attributable to Kansas storms or tornados. As under 

present law, the amount of any casualty loss includes only the 

amount not compensated for by insurance or otherwise. In addition, 

the total amount of the casualty loss which may be included in the 

eligible NOL is reduced by the amount of any gain recognized by 

the taxpayer from involuntary conversions of property located in 

the Kansas Disaster Zone caused by the Kansas storms or tornados. 

To the extent that a casualty loss is included in the eligible 

NOL and carried back under the provision, the taxpayer is not eligible to also treat the loss as having occurred in the prior taxable 

year under section 165(i). Similarly, the five-year carryback under 

the provision does not apply to any loss taken into account for purposes of the ten-year carryback of public utility casualty losses 

which is provided under another provision in the Act. 


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Moving expenses 

Certain employee moving expenses of an employer may be included in the eligible NOL. In order to qualify, an amount must be 

paid or incurred after May 3, 2007, and before January 1, 2010 

with respect to an employee who (i) lived in the Kansas Disaster 

Zone before May 4, 2007, (ii) was displaced from their home either 

temporarily or permanently as a result of the Kansas storms or tornados, and (iii) is employed in the Kansas Disaster Zone by the 

taxpayer after the expense is paid or incurred. 

For this purpose, moving expenses are defined, as under 

present law, to include only the reasonable expenses of moving 

household goods and personal effects from the former residence to 

the new residence, and of traveling (including lodging) from the 

former residence to the new place of residence. However, for purposes of the provision, the former residence and the new residence 

may be the same residence if the employee initially vacated the 

residence as a result of the Kansas storms or tornados. It is not 

necessary for the individual with respect to whom the moving expenses are incurred to have been an employee of the taxpayer at 

the time the expenses were incurred. Thus, assuming the other requirements are met, a taxpayer who pays the moving expenses of 

a prospective employee and subsequently employs the individual in 

the Kansas Disaster Zone may include such expenses in the eligible 

NOL. 

Temporary housing expenses 

Any deduction for expenses of an employer to temporarily 

house employees who are employed in the Kansas Disaster Zone 

may be included in the eligible NOL. It is not necessary for the 

temporary housing to be located in the Kansas Disaster Zone in 

order for such expenses to be included in the eligible NOL; however, the employee’s principal place of employment with the taxpayer must be in the Kansas Disaster Zone. So, for example, if a 

taxpayer temporarily houses an employee at a location outside of 

the Kansas Disaster Zone, and the employee commutes into the 

Kansas Disaster Zone to the employee’s principal place of employment, such temporary housing costs will be included in the eligible 

NOL (assuming all other requirements are met). 

Depreciation of Gulf Opportunity Zone property 

The eligible NOL includes the depreciation deduction (or amortization deduction in lieu of depreciation) with respect to qualified 

Recovery Assistance property placed in service during the year. 

The special carryback period applies to the entire allowable depreciation deduction for such property for the year in which it is 

placed in service, including both the regular depreciation deduction 

and the additional first-year depreciation deduction, if any. An election out of the additional first-year depreciation deduction for 

qualified Recovery Assistance property does not preclude eligibility 

for the five-year carryback. 

Repair expenses 

The eligible NOL includes deductions for repair expenses (including the cost of removal of debris) with respect to damage 


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caused by the Kansas storms or tornados. In order to qualify, the 

amount must be paid or incurred after May 3, 2007 and before January 1, 2010, and the property must be located in the Kansas Disaster Zone. 

Other rules 

The amount of the NOL to which the five-year carryback period applies is limited to the amount of the corporation’s overall 

NOL for the taxable year. Any remaining portion of the taxpayer’s 

NOL is subject to the general two-year carryback period. Ordering 

rules similar to those for specified liability losses apply to losses 

carried back under the provision. 

In addition, the general rule which limits a taxpayer’s NOL deduction to 90 percent of AMTI does not apply to any NOL to which 

the five-year carryback period applies under the provision. Instead, 

a taxpayer may apply such NOL carrybacks to offset up to 100 percent of AMTI. 

Effective date.—The provision is effective on the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 

(i) Representations regarding income eligibility for purposes of 

qualified residential rental project requirements (Sec. 12701 of 

the Senate amendment, sec. 15345 of the conference agreement 

and sec. 1400N(n) of the Code) 

PRESENT LAW

In general 

Under present law, gross income does not include interest on 

State or local bonds (sec. 103). State and local bonds are classified 

generally as either governmental bonds or private activity bonds. 

Governmental bonds are bonds which are primarily used to finance 

governmental functions or are repaid with governmental funds. 

Private activity bonds are bonds with respect to which the State or 

local government serves as a conduit providing financing to nongovernmental persons (e.g., private businesses or individuals). The 

exclusion from income for State and local bonds does not apply to 

private activity bonds, unless the bonds are issued for certain permitted purposes (‘‘qualified private activity bonds’’). 

Qualified private activity bonds 

The definition of a qualified private activity bond includes an 

exempt facility bond, or qualified mortgage, veterans’ mortgage, 

small issue, redevelopment, 501(c)(3), or student loan bond. The 

definition of exempt facility bond includes bonds issued to finance 

certain transportation facilities (airports, ports, mass commuting, 

and high-speed intercity rail facilities); qualified residential rental 

projects; privately owned and/or operated utility facilities (sewage, 

water, solid waste disposal, and local district heating and cooling 

facilities, certain private electric and gas facilities, and hydroelectric dam enhancements); public/private educational facilities; 


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qualified green building and sustainable design projects; and qualified highway or surface freight transfer facilities. 

Subject to certain requirements, qualified private activity 

bonds may be issued to finance residential rental property or 

owner-occupied housing. Residential rental property may be financed with exempt facility bonds if the financed project is a 

‘‘qualified residential rental project.’’ A project is a qualified residential rental project if 20 percent or more of the residential units 

in such project are occupied by individuals whose income is 50 percent or less of area median gross income (the ‘‘20–50 test’’). Alternatively, a project is a qualified residential rental project if 40 percent or more of the residential units in such project are occupied 

by individuals whose income is 60 percent or less of area median 

gross income (the ‘‘40–60 test’’). The issuer must elect to apply either the 20–50 test or the 40–60 test. Operators of qualified residential rental projects must annually certify that such project 

meets the requirements for qualification, including meeting the 20–

50 test or the 40–60 test. 

HOUSE BILL

No provision 

SENATE AMENDMENT

Under the provision, the operator of a qualified residential 

rental project may rely on the representations of prospective tenants displaced by reason of the severe storms and tornados in the 

Kansas disaster area beginning on May 4, 2007 for purposes of determining whether such individual satisfies the income limitations 

for qualified residential rental projects and, thus, the project is in 

compliance with the 20–50 test or the 40–60 test. This rule only 

applies if the individual’s tenancy begins during the six-month period beginning on the date when such individual was displaced. 

Effective date.—The provision is effective on the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement includes the Senate amendment provision. 

(j) Use of retirement funds from retirement plans relating to the 

Kansas Disaster Zone (Sec. 12701 of the Senate amendment, sec. 

15345 of the conference agreement and sec. 1400Q of the Code) 

PRESENT LAW

In general 

Withdrawals from retirement plans 

Under present law, a distribution from a qualified retirement 

plan under section 401(a), a qualified annuity plan under section 

403(a), a tax-sheltered annuity under section 403(b) (a ‘‘403(b) annuity’’), an eligible deferred compensation plan maintained by a 

State or local government under section 457 (a ‘‘governmental 457 

plan’’), or an individual retirement arrangement under section 408 


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(an ‘‘IRA’’) generally is included in income for the year distributed 

(secs. 402(a), 403(a), 403(b), 408(d), and 457(a)). (These plans are 

referred to collectively as ‘‘eligible retirement plans’’.) In addition, 

a distribution from a qualified retirement or annuity plan, a 403(b) 

annuity, or an IRA received before age 591⁄2, death, or disability 

generally is subject to a 10-percent early withdrawal tax on the 

amount includible in income, unless an exception applies (sec. 

72(t)). 

An eligible rollover distribution from a qualified retirement or 

annuity plan, a 403(b) annuity, or a governmental 457 plan, or a 

distribution from an IRA, generally can be rolled over within 60 

days to another plan, annuity, or IRA. The IRS has the authority 

to waive the 60-day requirement if failure to waive the requirement 

would be against equity or good conscience, including cases of casualty, disaster, or other events beyond the reasonable control of the 

individual. Any amount rolled over is not includible in income (and 

thus also not subject to the 10-percent early withdrawal tax). 

Distributions from a qualified retirement or annuity plan, 

403(b) annuity, a governmental 457 plan, or an IRA are generally 

subject to income tax withholding unless the recipient elects otherwise. An eligible rollover distribution from a qualified retirement or 

annuity plan, 403(b) annuity, or governmental 457 plan is subject 

to income tax withholding at a 20-percent rate unless the distribution is rolled over to another plan, annuity or IRA by means of a 

direct transfer. Any distribution is an eligible rollover distribution 

unless specifically excepted. Exceptions include a distribution that 

is part of a series of substantially equal periodic payments made 

at least annually for the life of the employee. 

Certain amounts held in a qualified retirement plan that includes a qualified cash-or-deferred arrangement (a ‘‘401(k) plan’’) or 

in a 403(b) annuity may not be distributed before severance from 

employment, age 591⁄2, death, disability, or financial hardship of 

the employee. Amounts deferred under a governmental 457 plan 

may not be distributed before severance from employment, age 

701⁄2, or an unforeseeable emergency of the employee. 

Loans from retirement plans 

An individual is permitted to borrow from a qualified plan in 

which the individual participates (and to use his or her accrued 

benefit as security for the loan) provided the loan bears a reasonable rate of interest, is adequately secured, provides a reasonable 

repayment schedule, and is not made available on a basis that discriminates in favor of employees who are officers, shareholders, or 

highly compensated. 

Subject to certain exceptions, a loan from a qualified employer 

plan to a plan participant is treated as a taxable distribution of 

plan benefits. A qualified employer plan includes a qualified retirement plan under section 401(a), a qualified annuity plan under section 403(a), a tax-deferred annuity under section 403(b), and any 

plan that was (or was determined to be) a qualified employer plan 

or a governmental plan. 

An exception to this general rule of income inclusion is provided to the extent that the loan (when added to the outstanding 

balance of all other loans to the participant from all plans mainVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01078 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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67The relief with respect to Hurricane Katrina was initially provided in the Katrina Emergency Relief Act of 2005 (Pub. L. No. 109–73). The IRS provided guidance on those relief provisions in Notice 2005–92, 2005–2 CB 1165. The relief was codified in section 1400Q and was expanded to the Hurricanes Rita and Wilma Disaster Areas in the Gulf Opportunity Zone Act of 

2005 (Pub. L. No. 109–135) 

tained by the employer) does not exceed the lesser of (1) $50,000 

reduced by the excess of the highest outstanding balance of loans 

from such plans during the one-year period ending on the day before the date the loan is made over the outstanding balance of 

loans from the plan on the date the loan is made or (2) the greater 

of $10,000 or one half of the participant’s accrued benefit under the 

plan (sec. 72(p)). This exception applies only if the loan is required, 

by its terms, to be repaid within five years. An extended repayment 

period is permitted for the purchase of the principal residence of 

the participant. Plan loan repayments (principal and interest) must 

be amortized in level payments and made not less frequently than 

quarterly, over the term of the loan. 

Plan amendments 

Present law provides a remedial amendment period during 

which, under certain circumstances, a plan may be amended retroactively in order to comply with the qualification requirements (sec. 

401(b)). In general, plan amendments required to reflect changes in 

the law generally must be made by the time prescribed by law for 

filing the income tax return of the employer for the employer’s taxable year in which the change in law occurs. The Secretary of the 

Treasury may extend the time by which plan amendments need to 

be made. 

Use of retirement funds related to disaster relief for Hurricanes 

Katrina, Rita, and Wilma 

In general 

Section 1400Q provides exceptions to certain rules regarding 

distributions from retirement plans, for loans from retirement 

plans, and for plan amendments to retirement plans.67

Tax favored withdrawals from retirement plans 

Section 1400Q(a) provides an exception to the 10-percent early 

withdrawal tax in the case of a qualified hurricane distribution 

from a qualified retirement or annuity plan, a 403(b) annuity, or 

an IRA. In addition, as discussed more fully below, income attributable to a qualified hurricane distribution may be included in income ratably over three years, and the amount of a qualified hurricane distribution may be recontributed to an eligible retirement 

plan within three years. 

A qualified hurricane distribution includes certain distributions from an eligible retirement plan related to Hurricanes 

Katrina, Wilma, and Rita. Specifically, qualified hurricane distributions include the following distributions from an eligible retirement 

plan: any distribution made on or after August 25, 2005, and before 

January 1, 2007, to an individual whose principal place of abode 

on August 28, 2005, is located in the Hurricane Katrina Disaster 

Area and who has sustained an economic loss by reason of Hurricane Katrina; any distribution made on or after September 23, 


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2005, and before January 1, 2007, to an individual whose principal 

place of abode on September 23, 2005, is located in the Hurricane 

Rita Disaster Area and who has sustained an economic loss by reason of Hurricane Rita; and any distribution made on or after October 23, 2005, and before January 1, 2007, to an individual whose 

principal place of abode on October 23, 2005, is located in the Hurricane Wilma Disaster Area and who has sustained an economic 

loss by reason of Hurricane Wilma. 

The total amount of qualified hurricane distributions that an 

individual can receive from all plans, annuities, or IRAs is 

$100,000. Thus, any distributions in excess of $100,000 during the 

applicable periods are not qualified hurricane distributions. 

Any amount required to be included in income as a result of 

a qualified hurricane distribution is included in income ratably 

over the three-year period beginning with the year of distribution 

unless the individual elects not to have ratable inclusion apply. 

Any portion of a qualified hurricane distribution may, at any 

time during the three-year period beginning the day after the date 

on which the distribution was received, be recontributed to an eligible retirement plan to which a rollover can be made. Any amount 

recontributed within the three-year period is treated as a rollover 

and thus is not includible in income. For example, if an individual 

receives a qualified hurricane distribution in 2005, that amount is 

included in income, generally ratably over the year of the distribution and the following two years, but is not subject to the 10-percent early withdrawal tax. If, in 2007, the amount of the qualified 

hurricane distribution is recontributed to an eligible retirement 

plan, the individual may file an amended return (or returns) to 

claim a refund of the tax attributable to the amount previously included in income. In addition, if, under the ratable inclusion provision, a portion of the distribution has not yet been included in income at the time of the contribution, the remaining amount is not 

includible in income. 

A qualified hurricane distribution is a permissible distribution 

from a 401(k) plan, 403(b) annuity, or governmental 457 plan, regardless of whether a distribution would otherwise be permissible. 

A plan is not treated as violating any Code requirement merely because it treats a distribution as a qualified hurricane distribution, 

provided that the aggregate amount of such distributions from 

plans maintained by the employer and members of the employer’s 

controlled group does not exceed $100,000. A plan is not treated as 

violating any Code requirement merely because an individual 

might receive total distributions in excess of $100,000, taking into 

account distributions from plans of other employers or IRAs. 

Qualified hurricane distributions are subject to the income tax 

withholding rules applicable to distributions other than eligible 

rollover distributions. Thus, 20-percent mandatory withholding 

does not apply. 

Recontributions of withdrawals for home purchases 

Section 1400Q(b) generally provides that a distribution received from a 401(k) plan, 403(b) annuity, or IRA in order to purchase a home in the Hurricane Katrina, Rita, or Wilma disaster 


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areas may be recontributed to such a plan, annuity, or IRA in certain circumstances. 

The ability to recontribute applies to an individual who receives a qualified distribution. A qualified distribution is a hardship distribution from a 401(k) plan or 403(b) annuity, or a qualified first-time homebuyer distribution from an IRA, that is a qualified Katrina distribution, a qualified Rita distribution, or a qualified Wilma distribution. 

A qualified Katrina distribution is a distribution: (1) that is received after February 28, 2005, and before August 29, 2005; and (2) 

that was to be used to purchase or construct a principal residence 

in the Hurricane Katrina disaster area, but the residence is not 

purchased or constructed on account of Hurricane Katrina. Any 

portion of a qualified Katrina distribution may, during the period 

beginning on August 25, 2005, and ending on February 28, 2006, 

be recontributed to a plan, annuity or IRA to which a rollover is 

permitted. 

A qualified Hurricane Rita distribution is a distribution: (1) 

that is received after February 28, 2005, and before September 24, 

2005; and (2) that was to be used to purchase or construct a principal residence in the Hurricane Rita disaster area, but the residence is not purchased or constructed on account of Hurricane 

Rita. Any portion of a qualified Hurricane Rita distribution may, 

during the period beginning on September 23, 2005, and ending on 

February 28, 2006, be recontributed to a plan, annuity or IRA to 

which a rollover is permitted. 

A qualified Hurricane Wilma distribution is a distribution: (1) 

that is received after February 28, 2005, and before October 24, 

2005; and (2) that was to be used to purchase or construct a principal residence in the Hurricane Wilma disaster area, but the residence is not purchased or constructed on account of Hurricane 

Wilma. Any portion of a qualified Hurricane Wilma distribution 

may, during the period beginning on October 23, 2005, and ending 

on February 28, 2006, be recontributed to a plan, annuity or IRA 

to which a rollover is permitted. 

Any amount recontributed is treated as a rollover. Thus, that 

portion of the qualified distribution is not includible in income (and 

also is not subject to the 10-percent early withdrawal tax). 

Loans from qualified plans to individuals sustaining an economic loss 

Section 1400Q(c) provides an exception to the income inclusion 

rule for loans from a qualified employer plan related to Hurricanes 

Katrina, Rita, and Wilma made to a qualified individual during an 

applicable period and provides a repayment delay for loans that are 

outstanding on or after a qualified beginning date if the due date 

for any repayment with respect to such loan occurs after the qualified beginning date and December 31, 2006. 

The exception to the general rule of income inclusion is provided to the extent that the loan (when added to the outstanding 

balance of all other loans to the participant from all plans maintained by the employer) does not exceed the lesser of (1) $100,000 

reduced by the excess of the highest outstanding balance of loans 

from such plans during the one-year period ending on the day beVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01081 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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fore the date the loan is made over the outstanding balance of 

loans from the plan on the date the loan is made or (2) the greater 

of $10,000 or the participant’s accrued benefit under the plan. 

In the case of a qualified individual with an outstanding loan 

on or after the qualified beginning date from a qualified employer 

plan, if the due date for any repayment with respect to such loan 

occurs during the period beginning on the qualified beginning date, 

and ending on December 31, 2006, such due date is delayed for one 

year. Any subsequent repayments with respect to such loan shall 

be appropriately adjusted to reflect the delay in the due date and 

any interest accruing during such delay. The period during which 

required repayment is delayed is disregarded in complying with the 

requirements that the loan be repaid within five years and that 

level amortization payments be made. 

A qualified individual entitled to this plan loan relief includes 

a qualified Katrina individual, a qualified Rita individual, or a 

qualified Wilma individual. A qualified Hurricane Katrina individual is an individual whose principal place of abode on August 

28, 2005, is located in the Hurricane Katrina disaster area and who 

has sustained an economic loss by reason of Hurricane Katrina. 

The qualified beginning date for a qualified Katrina individual is 

August 25, 2005 and the applicable period is the period beginning 

on September 24, 2005, and ending December 31, 2006. 

A qualified Hurricane Rita individual is an individual whose 

principal place of abode on September 23, 2005, is located in a Hurricane Rita disaster area and who has sustained an economic loss 

by reason of Hurricane Rita. The qualified beginning date for a 

qualified Hurricane Rita individual is September 23, 2005, and the 

applicable period is the period beginning on September 23, 2005, 

and ending on December 31, 2006. 

A qualified Hurricane Wilma individual is an individual whose 

principal place of abode on October 23, 2005, is located in a Hurricane Wilma disaster area and who has sustained an economic loss 

by reason of Hurricane Wilma. The qualified beginning date for a 

qualified Hurricane Wilma individual is October 23, 2005, and the 

applicable period is the period beginning on October 23, 2005, and 

ending on December 31, 2006. 

An individual cannot be a qualified individual with respect to 

more than one hurricane. 

Plan amendments relating to Hurricanes Katrina, Rita, and 

Wilma 

Section 1400Q(d) permits certain plan amendments made pursuant to any provision in section 1400Q, or regulations issued 

thereunder, to be retroactively effective. If the plan amendment 

meets the requirements of section 1400Q, then the plan will be 

treated as being operated in accordance with its terms. In order for 

this treatment to apply, the plan amendment is required to be 

made on or before the last day of the first plan year beginning on 

or after January 1, 2007, or such later date as provided by the Secretary of the Treasury. Governmental plans are given an additional 

two years in which to make required plan amendments. If the 

amendment is required to be made to retain qualified status as a 

result of the changes made by section 1400Q (or regulations), the 


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68Sec. 48A. 69For advanced coal project certification applications submitted after October 2, 2006, an 

electric generation unit using advanced coal-based generation technology designed to use subbituminous coal can meet the performance requirement relating to the removal of sulfur dioxide 

if it is designed either to remove 99 percent of the sulfur dioxide or to achieve an emission limit 

of 0.04 pounds of sulfur dioxide per million British thermal units on a 30-day average. 

amendment is required to be made retroactively effective as of the 

date on which the change became effective with respect to the plan, 

and the plan is required to be operated in compliance until the 

amendment is made. Amendments that are not required to retain 

qualified status but that are made pursuant to section 1400Q may 

be made retroactively effective as of the first day the plan is operated in accordance with the amendment. A plan amendment will 

not be considered to be pursuant to section 1400Q (or regulations) 

if it has an effective date before the effective date of the provision 

(or regulations) to which it relates. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment provides relief similar to the relief provided in section 1400Q with respect to use of retirement funds in 

connection with the tornadoes and storms that occurred in the 

Kansas disaster area. 

Effective date. The provision is effective on the date of enactment. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 

6. Modification of the advanced coal project credit and the gasification project credit (Sec. 15346 of the conference agreement and 

secs. 48A and 48B of the Code) 

PRESENT LAW

Advanced coal project credit 

An investment tax credit is available for power generation 

projects that use integrated gasification combined cycle (‘‘IGCC’’) or 

other advanced coal-based electricity generation technologies.68 The 

credit amount is 20 percent for investments in qualifying IGCC 

projects and 15 percent for investments in qualifying projects that 

use other advanced coal-based electricity generation technologies. 

To qualify, an advanced coal project must be located in the 

United States and use an advanced coal-based generation technology to power a new electric generation unit or to retrofit or 

repower an existing unit. Generally, an electric generation unit 

using an advanced coal-based technology must be designed to 

achieve a 99 percent reduction in sulfur dioxide and a 90 percent 

reduction in mercury, as well as to limit emissions of nitrous oxide 

and particulate matter.69

The fuel input for a qualifying project, when completed, must 

use at least 75 percent coal. The project, consisting of one or more 

electric generation units at one site, must have a nameplate generVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01083 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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70The Secretary issued guidance establishing the certification program on February 21, 

2006 (IRS Notice 2006–24). 71Sec. 48B. 

ating capacity of at least 400 megawatts, and the taxpayer must 

provide evidence that a majority of the output of the project is reasonably expected to be acquired or utilized. 

Credits are available only for projects certified by the Secretary 

of the Treasury, in consultation with the Secretary of Energy. Certifications are issued using a competitive bidding process. The Secretary of Treasury must establish a certification program no later 

than 180 days after August 8, 2005,70 and each project application 

must be submitted during the three-year period beginning on the 

date such certification program is established. An applicant for certification has two years from the date the Secretary accepts the application to provide the Secretary with evidence that the requirements for certification have been met. Upon certification, the applicant has five years from the date of issuance of the certification to 

place the project in service. The Secretary of the Treasury may allocate $800 million of credits to IGCC projects and $500 million to projects using other 

advanced coal-based electricity generation technologies. Qualified 

projects must be economically feasible and use the appropriate 

clean coal technologies. With respect to IGCC projects, credit-eligible investments include only investments in property associated 

with the gasification of coal, including any coal handling and gas 

separation equipment. Thus, investments in equipment that could 

operate by drawing fuel directly from a natural gas pipeline do not 

qualify for the credit. 

In determining which projects to certify that use IGCC technology, the Secretary must allocate power generation capacity in 

relatively equal amounts to projects that use bituminous coal, subbituminous coal, and lignite as primary feedstock. In addition, the 

Secretary must give high priority to projects which include greenhouse gas capture capability, increased by-product utilization, and 

other benefits. 

Gasification project credit 

A 20-percent investment tax credit is also available for investments in certain qualifying coal gasification projects.71 Only property which is part of a qualifying gasification project and necessary 

for the gasification technology of such project is eligible for the gasification credit. 

Qualified gasification projects convert coal, petroleum residue, 

biomass, or other materials recovered for their energy or feedstock 

value into a synthesis gas composed primarily of carbon monoxide 

and hydrogen for direct use or subsequent chemical or physical conversion. Qualified projects must be carried out by an eligible entity, 

defined as any person whose application for certification is principally intended for use in a domestic project which employs domestic gasification applications related to (1) chemicals, (2) fertilizers, 

(3) glass, (4) steel, (5) petroleum residues, (6) forest products, and 

(7) agriculture, including feedlots and dairy operations. 

Credits are available only for projects certified by the Secretary 

of the Treasury, in consultation with the Secretary of Energy. CerVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01084 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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72The Secretary issued guidance establishing the certification program on February 21, 

2006 (IRS Notice 2006–25). 

tifications are issued using a competitive bidding process. The Secretary of the Treasury must establish a certification program no 

later than 180 days after August 8, 2005,72 and each project application must be submitted during the three-year period beginning 

on the date such certification program is established. The Secretary 

of the Treasury may not allocate more than $350 million in credits. 

In addition, the Secretary may certify a maximum of $650 million 

in qualified investment as eligible for credit with respect to any 

single project. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

No provision. 

CONFERENCE AGREEMENT

In implementing either section 48A (relating to the credit described above) or section 48B (relating to the coal gasification credit), the provision directs the Secretary to modify the terms of any 

competitive certification award and any associated closing agreements in certain cases. Specifically, modification is required when 

it (1) is consistent with the objectives of such section, (2) is requested by the recipient of the award, and (3) involves moving the 

project site to improve the potential to capture and sequester carbon dioxide emissions, reduce costs of transporting feedstock, and 

serve a broader customer base. However, no modification is required if the Secretary determines that the dollar amount of tax 

credits available to the taxpayer under the applicable section would 

increase as a result of the modification or such modification would 

result in such project not being originally certified. In considering 

any such modification, the Secretary must consult with other relevant Federal agencies, including the Department of Energy. 

EFFECTIVE DATE

The provision is effective for credit allocation awards issued before, on, or after the date of enactment. 

D. OTHER REVENUE PROVISIONS

1. Limitation on farming losses of certain taxpayers (sec. 12501 of 

the Senate amendment, sec. 15351 of the conference agreement 

and sec. 461 of the Code) 

PRESENT LAW

For taxpayers who materially participate (as defined in section 

469(h)) in a farming activity, net farming losses are reported in full 

as a reduction to income from both passive and nonpassive sources. 

For taxpayers who do not materially participate in a farming activity, the passive activity rules of section 469 limit the ability to use 

such losses to reduce income from nonpassive sources. 


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73This is the same definition of ‘‘farming business’’ used for averaging of farm income under 

section 1301. 

Farming income generally includes sales of livestock, produce, 

grains, and other products; cooperative distributions; Agricultural 

Program Payments; certain Commodity Credit Corporation (‘‘CCC’’) 

loans (if an election is made to include loan proceeds in income in 

the year received); certain crop insurance proceeds and federal crop 

disaster payments; and other income. Farm expenses generally include feed, fertilizers, gasoline, fuel, and oil; insurance; interest; 

hired labor; rent and lease payments; repairs and maintenance; 

taxes; utilities; depreciation; and other business-related expenses. 

Living expenses and other personal expenses are not deductible 

farming expenses. 

Present law (section 263A(e)(4))73 defines a farming business 

as the trade or business of farming, including the trade or business 

of operating a nursery or sod farm, or the raising or harvesting of 

trees bearing fruit, nuts, or other crops, or ornamental trees (excluding evergreen trees that are more than six years old at the 

time severed from the roots). Treasury regulation section 1.263A– 4(a)(4) further provides that a farming business generally means a 

trade or business involving the cultivation of land or the raising or 

harvesting of any agricultural or horticultural commodity. The raising, shearing, feeding, caring for, training, and management of animals are included in this definition. For example, the raising of cattle for sale is considered a farming business. However, the mere 

buying and reselling of plants or animals grown or raised entirely 

by another is not considered to be raising an agricultural or horticultural commodity. While a farming business does include processing activities that are normally incident to the growing, raising, 

or harvesting of agricultural or horticultural products (e.g., harvesting, washing, inspecting, and packing fruits and vegetables for 

sale), it does not include the processing of commodities or products 

beyond those activities that are normally incident to the growing, 

raising, or harvesting of such products. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment limits the amount of losses that can be 

claimed by an individual, estate, trust, or partnership on Schedule 

F to $200,000 in cases where the taxpayer has received Agricultural Program Payments or CCC loans. Losses that are limited in 

a particular year may be carried forward to subsequent years. 

Effective date.—The provision is effective for taxable years beginning after December 31, 2007. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment with 

modifications. The conference agreement limits the farming loss of 

a taxpayer, other than a C corporation, for any taxable year in 

which any applicable subsidies are received to the greater of (1) 

$300,000 ($150,000 in the case of a married person filing a sepaVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01086 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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74 Under section 172(b)(1)(G), farming losses may be carried back to each of the five taxable 

years preceding the taxable year of the loss. 75The loss carryback to 2010 reduces both the $300,000 of net farm income and $700,000 

of non-farm income to zero. 

rate return), or (2) the taxpayer’s total net farm income for the 

prior five taxable years. For purposes of the provision, applicable 

subsidies are (1) any direct or counter-cyclical payments under title 

I of the Food, Conservation, and Energy Act of 2008 (or any payment elected in lieu of any such payment), or (2) any CCC loan. 

Total net farm income is an aggregation of all income and loss from 

farming businesses for the prior five taxable years. 

The following examples illustrate the operation of this provision: 

Example 1.—Assume an individual taxpayer has $1 million of 

net income from a farming business in each taxable year 2010 to 

2014, and incurs a $5 million farming loss in 2015. For purposes 

of this provision, the farming loss in 2015 is limited to the greater 

of (1) $300,000 or (2) $5 million (total net farm income for the prior 

five taxable years). Thus, the farming loss is allowable in full in 

2015. Assuming the taxpayer had no other income or deductions in 

any of the taxable years 2010 to 2015, the $5 million net operating 

loss for 2015 is carried back to the prior five taxable years under 

the present-law net operating loss carryback rules and reduces the 

taxpayer’s taxable income in each of those years to zero.74

Example 2.—Assume an individual taxpayer has $300,000 of 

net farm income and $700,000 of non-farm income in 2010, and $1 

million of net farm income in each taxable year 2011 to 2014. In 

2015, the taxpayer incurs a $7 million farming loss. For purposes 

of this provision, the farming loss in 2015 is limited to the greater 

of (1) $300,000 or (2) $4.3 million (total net farm income for the 

prior five taxable years). Thus, $2.7 million of the farming loss is 

disallowed under the provision and will be treated as a deduction 

attributable to a farming business in 2016. The $4.3 million farming loss allowed for 2015 is carried back to the prior five taxable 

years and allowed as a deduction under present-law rules. The taxpayer’s taxable income in each of the years 2010 75 to 2013 is reduced to zero and taxable income in 2014 is reduced by the remaining farm loss of $300,000 to $700,000. 

For purposes of calculating total net farm income for the prior 

five years, losses that are limited under the provision are taken 

into account in the year in which they are allowed as a deduction. 

For example, if a taxpayer has a $500,000 excess farm loss in 2010 

that is not allowed as a deduction until 2012, the calculation in 

2011 of total net farm income for the prior five years does not take 

into account the $500,000 as a farm loss. Instead, the $500,000 loss 

would be included in the calculation of prior year’s total net farm 

income for taxable years 2013 through 2017. In the case where the 

filing status of the taxpayer is not the same for the taxable year 

and each of the taxable years in the five-year period, the Treasury 

Department is authorized to provide guidance for the computation 

of total net farm income. 


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76The Treasury Department may provide guidance for the application of this provision to 

any other pass-thru entity to the extent necessary to carry out the purposes of this provision. 

In the case of tiered partnership or pass-thru entity structures, the Treasury Department may 

provide guidance as necessary to carry out the purposes of this provision. 

In the case of a partnership or S corporation, the limit is applied at the partner or shareholder level.76 Therefore, each partner 

or shareholder takes into account its proportionate share of income, 

gain, or deduction from farming businesses of a partnership or S 

corporation, and any applicable subsidies received by a partnership 

or S corporation during the taxable year (regardless of whether 

such items are treated as income for Federal tax purposes). 

For purposes of the provision, the term ‘‘farming business’’ has 

the meaning provided in present-law section 263A(e)(4), with a 

modification for certain processing activities. Thus, for purposes of 

this provision, the conference agreement broadens the definition of 

‘‘farming business’’ to include the processing of commodities, without regard to whether such activity is incidental, by a taxpayer otherwise engaged in a farming business with respect to such commodities. The farming activities of a cooperative are attributed to 

each member for purposes of this rule. Thus, a member of a cooperative who raises a commodity and sells it to the cooperative for 

processing is considered to be the processor of such commodity. In 

this case, patronage dividends received from a cooperative that is 

engaged in a farming business are considered to be income from a 

farming business for purposes of this provision. 

As under the Senate amendment, any loss that is disallowed 

under the provision in a particular year is carried forward to the 

next taxable year and treated as a deduction attributable to farming businesses in that year. 

Farming losses arising by reason of fire, storm, or other casualty, or by reason of disease or drought, are disregarded for purposes of calculating the limitation. 

Treasury regulatory authority is provided to prescribe such additional reporting requirements as appropriate to carry out the purposes of this provision. 

Effective date.—The provision is effective for taxable years beginning after December 31, 2009. 

2. Increase and index dollar thresholds for farm optional method 

and nonfarm optional method for computing net earnings from 

self-employment (sec. 12502 of the Senate amendment, sec. 

15352 of the conference agreement and sec. 1402(a) of the Code) 

PRESENT LAW

In general 

Generally, tax under the Self-Employment Contributions Act 

(SECA) is imposed on the self-employment income of an individual. 

SECA tax has two components. Under the old-age, survivors, and 

disability insurance component, the rate of tax is 12.40 percent on 

self-employment income up to the Social Security wage base 

($97,500 for 2007). Under the hospital insurance component, the 

rate is 2.90 percent of all self-employment income (without regard 

to the Social Security wage base). 


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Self-employment income subject to the SECA tax is determined 

as the net earnings from self-employment. An individual may use 

one of three methods to calculate net earnings from self-employment. Under the generally applicable rule, net earnings from selfemployment means gross income (including the individual’s net distributive share of partnership income) derived by an individual 

from any trade or business carried on by the individual, less the 

deductions attributable to the trade or business that are allowed 

under the SECA tax rules. Alternatively, an individual may elect 

to use one of two optional methods for calculating net earnings 

from self-employment. These methods are: (1) the farm optional 

method; and (2) the nonfarm optional method. The farm optional 

method allows individuals to pay SECA taxes (and secure Social 

Security benefit coverage) when they have low net income or losses 

from farming. The nonfarm optional method is similar to the farm 

optional method. 

Farm optional method 

If an individual is engaged in a farming trade or business, either as a sole proprietor or as a partner, the individual may elect 

to use the farm optional method in one of two instances. The first 

instance is an individual engaged in a farming business who has 

gross farm income of $2,400 or less for the taxable year. In this instance, the individual may elect to report two-thirds of gross farm 

income as net earnings from self-employment. In the second instance, an individual engaged in a farming business may elect the 

farm optional method even though gross farm income exceeds 

$2,400 for the taxable year but only if the net farm income is less 

than $1,733 for the taxable year. In this second instance, the individual may elect to report $1,600 as net earnings from self-employment for the taxable year. In all other instances (i.e., more than 

$2,400 of gross farm income and net farm income of at least 

$1,733) a person engaged in a farming business must compute net 

earnings from self-employment under the generally applicable rule. 

There is no limit on the number of years that an individual may 

elect the farm optional method during such individual’s lifetime. 

The dollar limits in the farm optional method are not indexed 

for inflation. 

Nonfarm optional method 

The nonfarm optional method is available only to individuals 

who have been self-employed for at least two of the three years before the year in which they seek to elect the nonfarm optional 

method and who meet certain other requirements. Specifically, an 

individual may elect the nonfarm optional method if the individual’s: (1) net nonfarm income for the taxable year is less than 

$1,733; and (2) net nonfarm income for the taxable year is less 

than 72.189 percent of gross nonfarm income. If a qualified individual engaged in a nonfarming business who elects the nonfarm 

optional method has gross nonfarm income of $2,400 or less for the 

taxable year, then the individual may elect to report two-thirds of 

gross nonfarm income as net earnings from self-employment. If the 

electing individual engaged in a nonfarming business has gross 

nonfarm income of at least $2,400 for the taxable year, then the 


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individual may elect to report $1,600 as net earnings from self-employment for the taxable year. In all other instances, a person engaged in a nonfarming business must compute net earnings from 

self-employment under the generally applicable rule. An individual 

may elect to use the nonfarm optional method for no more than five 

years in the course of the individual’s lifetime. 

The dollar limits in the nonfarm optional method are not indexed for inflation. 

Other rules applicable to farm optional and nonfarm optional methods 

In the case of a cash method trade or business, gross income 

is defined as the gross receipts from such trade or business less the 

cost or other basis of property sold in carrying out such trade or 

business with certain adjustments. In the case of an accrual method trade or business, gross income is defined as the gross income 

from the trade or business with certain adjustments. If an individual (including a member of a partnership) derives gross income 

from more than one trade or business then such gross income (including the individual’s distributive share of the gross income of 

any partnership) is treated as derived from a single trade or business. 

Social Security benefit eligibility 

Generally, Social Security benefits can be paid to an individual 

(and dependents or survivors) only if that individual has worked 

long enough in covered employment to be insured. Insured status 

is measured in terms of ‘‘credits,’’ previously called ‘‘quarters of coverage.’’ For this purpose, Social Security uses the lifetime record of 

earnings reported for that individual. In the case of a self-employed 

individual, net earnings from self-employment is used to calculate 

Social Security benefit eligibility. 

Up to four quarters of coverage can be earned for a year, depending on covered wages for the year and the amount needed to 

earn each quarter of coverage. For 2007, credit for a quarter of coverage is provided for each $1,000 of wages. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment modifies the farm optional method so 

that electing taxpayers may be eligible to secure four credits of Social Security benefit coverage each taxable year by increasing and 

indexing the thresholds. The provision makes a similar modification to the nonfarm optional method. 

Effective date.—The provision is effective for taxable years beginning after December 31, 2007. 

CONFERENCE AGREEMENT

The conference agreement follows the Senate amendment. 


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77Pub. L. No. 107–171. 78 2007–33 IRB. 

3. Information reporting for commodity credit corporation transactions (Sec. 12503 of the Senate amendment, sec. 15353 of the 

conference agreement and new sec. 6039J of the Code) 

PRESENT LAW

The Farm Security and Rural Investment Act of 2002 77 authorizes a marketing assistance loan program through the Commodity Credit Corporation (‘‘CCC’’). Under such program, the CCC 

may make loans for eligible commodities at a specified rate per 

unit of commodity (the original loan rate). The repayment amount 

for such a loan secured by an eligible commodity generally is based 

on the lower of the original loan rate or the alternative repayment 

rate, as determined by the CCC, as of the date of repayment. The 

alternative repayment rate may be adjusted to reflect quality and 

location for each type of commodity. A taxpayer receiving a CCC 

loan can use cash to repay such a loan, purchase CCC certificates 

for use in repayment of the loan, or deliver the pledged collateral 

as full payment for the loan at maturity. 

If a taxpayer uses cash or CCC certificates to repay a CCC 

loan, and the loan is repaid at a time when the repayment rate is 

less than the original loan rate, the difference between the original 

loan amount and the lesser repayment amount is market gain. Regardless of whether a taxpayer repays a CCC loan in cash or uses 

CCC certificates in repayment of the loan, the market gain is taken 

into account either as income or as an adjustment to the basis of 

the commodity (if the taxpayer has made an election under section 

77). 

If a farmer uses cash instead of certificates, the farmer will receive a Form CCC–1099–G Information Return showing the market 

gain realized. For transactions prior to January 1, 2007, however, 

if a farmer uses CCC certificates to facilitate repayment of a CCC 

loan, the farmer will not receive an information return. For loans 

repaid on or after January 1, 2007, IRS Notice 2007–63 provides 

that the CCC reports market gain associated with the repayment 

of a CCC loan whether the taxpayer repays the loan with cash or 

uses CCC certificates in repayment of the loan.78 The CCC reports 

the market gain on Form 1099–G, Certain Government Payments. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

The Senate amendment codifies the requirements of IRS Notice 2007–63 providing that the CCC reports market gain associated with the repayment of a CCC loan, regardless of whether the 

taxpayer repays the loan with cash or uses CCC certificates in repayment of the loan. 

Effective date.—The provision is effective for loans repaid on or 

after January 1, 2007. 


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CONFERENCE AGREEMENT

The conference agreement includes the Senate amendment provision. 

E. PROTECTION OF SOCIAL SECURITY

(Sec. 15361 of the conference agreement) 

To ensure that the assets of the trust funds established under 

section 201 of the Social Security Act are not reduced as the result 

of the enactment of this Act, the Secretary of the Treasury shall 

transfer certain amounts annually from the general revenues of the 

Federal Government to those trust funds. 

IV. TRADE PROVISIONS 

A. EXTENSION OF CERTAIN TRADE BENEFITS

(Secs. 15401–15407 and 15410–15411 of the conference agreement) 

PRESENT LAW

Sec. 213A of the Caribbean Basin Recovery Act (19 U.S.C. 

2703a) establishes the Haitian Hemispheric Opportunity through 

Partnership Encouragement Act of 2006 (‘‘HOPE I’’). HOPE I extended preferences to Haiti for apparel meeting certain rules of origin, and for certain automotive wire harnesses. 

With respect to apparel, HOPE I extended preferential treatment to three categories of apparel: (1) apparel meeting a valueadded rule of origin; (2) limited quantities of woven apparel wholly 

assembled in Haiti; and (3) brassieres meeting a cut and sew requirement. 

HOPE I (in section 213A(d)) conditions Haiti’s eligibility for 

these preferences on the President determining and certifying that 

Haiti has either established, or is making continual progress towards establishing, protection of internationally recognized worker 

rights. These rights include the right of association, the right to organize and bargain collectively, a prohibition on the use of any 

form of forced or compulsory labor, a minimum age of employment 

of children, and acceptable conditions of work with respect to minimum wages, hours of work, and occupational safety and health. 

The use of the HOPE I preference program has been very limited to date. 

In fact, just 1.6% of Haiti’s apparel exports in 2007 were under 

the HOPE I program. The Conferees believe that the limited use 

of the program is largely attributable to HOPE I’s complex valueadded rule of origin. As a result, the economic benefits—namely, 

new investment and significant new job creation—that the preference program was intended to spread widely to foster stability 

and security in Haiti have not been forthcoming. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

No provision. 


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CONFERENCE AGREEMENT

To address the deficiencies in HOPE I, the conference report 

includes the Haitian Hemispheric Opportunity through Partnership 

Encouragement Act of 2008 (HOPE II), which provides additional 

ways (under simplified rules) that Haitian apparel can qualify for 

duty-free treatment, as well as authorizing a new apparel sector 

labor capacity building and monitoring program (the Technical Assistance Improvement and Compliance Needs Assessment and Remediation Program or ‘‘TAICNAR program’’) to ensure the benefits 

of the new preferences are spread widely. The Conferees intend 

HOPE II to help Haitian industry attract new investment and create immediate jobs, generate income for workers to cover increased 

food costs and pay for other necessities, and continue to provide incentives to encourage the use of inputs manufactured by U.S. companies. 

Key aspects of the HOPE II apparel provisions are outlined 

below. The Conferees note that HOPE II creates six discrete stand 

alone rules for apparel (and some textile) products to qualify for 

preferential treatment: (1) the value-added rule (as provided for in 

HOPE I, subject to a change in the cap); (2) a capped benefit for 

woven apparel meeting a wholly assembled/knit-to-shape rule; (3) 

a capped benefit for certain knit apparel meeting a wholly assembled/knit-to-shape rule; (4) an uncapped benefit for certain types of 

apparel meeting a wholly assembled/knit-to-shape rule; (5) an uncapped benefit for apparel meeting a wholly assembled/knit-toshape rule under the ‘‘3 for 1’’ Earned Import Allowance Program; 

and (6) an uncapped benefit for apparel meeting a wholly assembled/knit-to-shape rule, where the apparel is made from ‘‘short supply’’ yarns or fabrics. The Conferees note that if a capped benefit 

is filled in a given year, an importer can still use one or more of 

the other rules. In addition, apparel from Haiti may also qualify for 

preferential access to the U.S. market under the United StatesCaribbean Basin Trade Partnership Act (Title II of Public Law 

106–200) (CBTPA). 

Ten Year Duration.—The conference report extends most apparel preferences, including all apparel preferences created under 

HOPE II, for 10 years, until September 30, 2018. The ten year duration is aimed at fostering a more stable investment climate for 

businesses seeking to use HOPE I or II preferences. 

Expanded Preferences for Woven Apparel.—The conference report expands the HOPE I ‘‘woven apparel cap’’ to 70 million square 

meters equivalents (‘‘SMEs’’), and extends the benefit for 10 years. 

Apparel exported under this provision can qualify for preferences 

if the apparel is ‘‘wholly assembled’’ or knit-to-shape, or both, in 

Haiti, without regard to the origin of the fabric (or fabric components, or components knit-to-shape, or yarn) comprising the apparel article. The definition of ‘‘wholly assembled’’ is taken from existing Customs regulations. 

New Knit Apparel Cap.—HOPE II creates a new ‘‘knit apparel 

cap’’ of 70 million SMEs, with exclusions for men’s/boys’ cotton tshirts, men’s/boys’ mmf t-shirts, certain men’s/boys’ sweatshirts/ 

pullovers, and certain men’s/boy’s cotton-blend sweatshirts. Apparel 

exported under this provision can qualify for preferences if the apVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01093 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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parel is ‘‘wholly assembled’’ or knit-to-shape, or both, in Haiti, 

without regard to the origin of the fabric (or fabric components, or 

components knit to shape, or yarn) comprising the apparel article. 

Modified Single Transformation Rule for Certain Apparel and 

Certain Luggage.—HOPE II extends preferential treatment to certain apparel articles wholly assembled, or knit-to-shape, or both, in 

Haiti, without regard to the origin of the fabric (or fabric components, or components knit-to-shape, or yarn) comprising the apparel article. The apparel articles covered by this provision are: (1) 

brassieres; (2) those apparel articles covered by the Central America-Dominican Republic-United States Free Trade Agreement 

(CAFTA-DR) ‘‘single transformation’’ rule; (3) headgear; and (4) 

certain sleepwear. 

With regard to covered sleepwear, HOPE II extends preferences to women’s and girls’ pajama bottoms (i.e., sleep pants), regardless of whether such bottoms are a separate garment or are 

part of a set. 

HOPE II also extends preferential treatment to luggage and 

handbags wholly assembled in Haiti, without regard to the source 

of the fabric, materials or components. The Conferees did not include the concept of knit-to-shape in this provision, because such 

processing does not typically occur for such luggage/handbags. ‘‘3 for 1’’ EIA Program for Knit or Woven Apparel.—HOPE II 

creates a ‘‘3 for 1’’ earned import allowance program (EIA) to be developed and administered by the Secretary of Commerce. Under 

the ‘‘3 for 1’’ EIA, Haitian producers or entities controlling production that purchase qualifying fabric for apparel production in Haiti 

may export other apparel to the United States duty-free, and not 

subject to quantitative limitations, regardless of the origin of the 

fabric (or fabric components, components knit to shape, or yarns) 

from which the apparel product is made. Specifically, for every 3 

SMEs of qualifying fabric purchased, a producer or entity controlling production receives a ‘‘credit’’ for 1 SME that can be used in 

the manufacture of apparel using non-qualifying fabric (e.g., Taiwanese fabric). The Secretary of Commerce is to establish electronic ‘‘accounts’’ for producers or entities controlling production 

where such ‘‘credits’’ can be deposited. A producer or entity controlling production can then withdraw these credits for an ‘‘earned import allowance certificate’’ that reflects the requested number of 

credits. Apparel wholly assembled, or knit to shape, or both, in 

Haiti using non-qualifying fabric may enter the United States 

duty-free, if the apparel is accompanied by such an ‘‘earned import 

allowance certificate’’ that reflects the number of credits equal to 

the SMEs of the apparel for which preferential treatment is sought. 

An example may help illustrate the process: Producer A in 

Haiti purchases 300 SMEs of denim fabric woven in the United 

States using U.S. yarns in order to manufacture jeans in Haiti. 

Producer A, upon submission of documentation supporting the purchase of the U.S. denim (such documentation can include information submitted by the U.S. textile mill that exported the fabric), 

will receive 100 credits in Producer A’s Commerce Department account. If Producer A subsequently wants to export jeans that are 

wholly assembled in Haiti to the United States duty-free and such 

jeans are wholly assembled in Haiti from Italian denim, Producer 


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A would redeem all or part of the accrued 100 credits for the requisite earned import allowance certificate. For instance, if the jeans 

made with the Italian fabric account for 50 SMEs, Producer A 

would request a certificate that equaled 50 credits. 

In HOPE II, the Conferees have established principles for the ‘‘3 for 1’’ EIA program. The Conferees expect and intend the Secretary of Commerce to establish additional requirements in order 

to make the program efficient, workable, and administrable, and 

have provided the Secretary with the authority to promulgate and 

enforce such requirements. In addition, the Conferees urge the Secretary of Commerce to establish the ‘‘3 for 1’’ EIA program as an 

electronic program, including with respect to the EIA certificate. 

The Conferees note that woven and knit fabrics are treated differently under the HOPE II-created EIA program. Specifically, 

qualifying woven fabric must be wholly formed in the United 

States, from U.S. yarns (subject to some limited exceptions). Qualifying knit fabric may be wholly formed or knit to shape in the 

United States, U.S. free trade agreement (FTA) partner country or 

U.S. preference partner country (e.g., a beneficiary country under 

the African Growth and Opportunity Act), or any combination, from 

U.S. yarns (subject to some limited exceptions). 

Modified Single Transformation Rule for Apparel Made from ‘‘Short Supply’’ Fabrics/Yarns.—HOPE II also includes a provision 

to extend duty-free treatment to any apparel article wholly assembled or knit to shape, or both, in Haiti where the apparel article 

is made from fabrics or yarns designated as not being available in 

commercial quantities under any U.S. preference program or FTA, 

or is covered by certain provisions of Annex 401 of the NAFTA (i.e., those provisions which extend duty-free treatment to apparel notwithstanding the origin of fabric or yarns). The Conferees note that 

the entire apparel article need not be made from a ‘‘short supply’’ fabric or yarn—only the fabric, fabric components, components knit 

to shape, or yarns that make up the component that determines 

the tariff classification of the article need be made of ‘‘short supply’’

fabrics or yarns for entry under this rule. 

Transition Value-Added Rule.—HOPE II preserves the existing 

value-added rule of origin from HOPE I, but freezes the cap for exports qualifying for this rule at the 2008 level (i.e., 1.25% of U.S. 

apparel imports). Under HOPE II, the value-added rule retains the 

termination date provided for in HOPE I (five years from enactment of HOPE I). The Conferees chose to sunset this provision as 

provided for in HOPE I and not extend the rule for an additional 

ten years, because Haitian exports under the value-added rule 

have been minimal, reflecting the complexity of the rule. The conferee notes that more flexible value-added rules applied to apparel 

in other preferential trade arrangements (e.g., the United StatesJordan Free Trade Agreement) have been effective in increasing 

trade. 

Allow Direct Shipment from and Co-production in the Dominican Republic.—HOPE II recognizes the unique situation of Haiti 

and the Dominican Republic, the two sovereign nations that share 

the Caribbean island of Hispaniola, and the ties between the textile 

and apparel industries of both countries. The Conferees believe 

that existing ties between the textile and apparel industries of both 


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countries should be maintained and strengthened. Toward that 

end, HOPE II allows direct shipment from the Dominican Republic 

of apparel qualifying under section 213A, as amended by HOPE II. 

The direct shipment provision will minimize transit times and costs 

when apparel wholly assembled or knit to shape in Haiti is sent 

to the Dominican Republic for packaging or post-assembly operations. 

The Conferees have included direction to the Commissioner responsible for U.S. Customs and Border Protection to provide technical and other assistance to Haiti and the Dominican Republic to 

develop procedures to prevent unlawful transshipment and use of 

counterfeit documents. The Conferees intend that assistance be 

provided expeditiously and in a manner that facilitates trade, and 

to include assisting Haiti and the Dominican Republic in developing a secure electronic system to combat unlawful transshipment 

and use of counterfeit documents. 

The Conferees also expect the processing requirement necessary for an apparel article to qualify under HOPE II—that is, 

that apparel be wholly assembled or knit to shape, or both, in 

Haiti—to facilitate co-production between Haiti and the Dominican 

Republic. The HOPE II processing requirement does not preclude 

assembly or other operations from occurring outside Haiti. Co-production operations performed in the Dominican Republic could include, but are not limited to, activities such as minor assembly, repair, embellishment, and finishing. 

Clarifications on Administration of Caps.—HOPE II clarifies 

that exports qualifying for preferences under apparel provisions not 

subject to quantitative limitations (e.g., the apparel qualifying 

under the rules contained in section 213A(b)(3), as amended by 

HOPE II) should not be included in the calculation of any quantitative limitations contained in HOPE II. In addition, apparel 

qualifying under a rule subject to a particular cap (e.g., the woven 

or knit apparel caps in section 213A(b)(2), as amended by HOPE 

II), should not be counted against another cap (e.g., the valueadded cap, included in section 213A(b)(1), as amended by HOPE 

II). Finally, the legislation clarifies that HOPE II benefits are in 

addition to preferences extended to Haitian exports under the Caribbean Basin Economic Recovery Act (CBERA), including apparel 

preferences under section 213(b)(2) of the CBERA, as amended, 

and that apparel exports qualifying for preferences under 213(b)(2) 

should not be counted against the quantitative limitations established in HOPE II. 

Labor Provisions. The conference agreement amends Section 

213A of the Caribbean Basin Recovery Act to include new provisions to promote compliance with core labor standards, as enumerated in the legislation, and to improve working conditions, in particular in the textile and apparel sector. The Conferees recognize 

that the core labor standards defined in the legislation refer to the 

rights as listed in the 1998 International Labor Organization Declaration on Fundamental Principles and Rights at Work and Its 

Follow Up. Specifically, HOPE II requires that the President certify, within 16 months of enactment, that Haiti has created an 

independent Labor Ombudsman’s Office responsible for performing 

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lished, with the assistance of the International Labor Organization 

(‘‘ILO’’), the TAICNAR Program. Unless the President extends the 

period for meeting these requirements, which is permitted under 

certain limited conditions set out in the conference agreement, the 

President is required to terminate Haiti’s eligibility for preferential 

treatment under the section. 

The functions of the Labor Ombudsman include overseeing the 

implementation of the TAICNAR Program, maintaining a registry 

of the textile and apparel producers that may seek preferential 

treatment and coordinating a committee comprised of representatives of government agencies, employers, and workers to consult on 

the implementation of the TAICNAR Program and other matters of 

common concern. The Labor Ombudsman is also responsible for receiving comments from interested parties about the labor conditions in the facilities of the registered producers and, where such 

comments are submitted in good faith and supported with evidence, 

directing the comments to the ILO or the appropriate Haitian government official. Further, where registered producers are found to 

have deficiencies, the Labor Ombudsman also shares responsibility 

for assisting them in complying with core labor standards and national labor laws directly relating to the standards and acceptable 

conditions of work with respect to minimum wages, hours of work, 

and occupational health and safety. In performing its functions, the 

Labor Ombudsman is expected to coordinate and consult with other 

appropriate Haitian government officials (e.g., in the Ministry of 

Labor). 

The TAICNAR Program is comprised of two elements. The first 

element of the program is technical assistance from the ILO to 

build Haiti’s own capacity to inspect the facilities of registered textile and apparel producers, enforce its labor laws, and resolve labor 

disputes. The scope of such assistance is broad, including ILO assistance in reviewing national labor laws and regulations and 

bringing them into compliance with core labor standards, increasing awareness of worker rights, and on-the-job training for labor 

inspectors, judicial officers, and other government officials. 

The second element of the TAICNAR Program is ILO assessment of compliance with core labor standards and national labor 

laws in the facilities of the producers registered with the Labor 

Ombudsman and, where necessary, assistance with remediating deficiencies. Consistent with existing practice under its Better Factories Cambodia and Better Works programs, the ILO has a number of tools to perform such assessments, including unannounced 

site visits and confidential interviews with management and workers. The results of the assessment are reported, confidentially in 

the first instance, to the management and workers (or, where there 

is union representation, worker representatives) together with suggestions for remediation of deficiencies. Under the program, the 

ILO then aids the producer in remediating any deficiencies, with 

assistance, if necessary, from the Labor Ombudsman or other parties. Every six months, following implementation of the TAICNAR 

Program by Haiti, the ILO is expected to publish a public report 

on the assessments it has conducted during the preceding six 

months. Such reports will identify the specific factories assessed 

and the conditions in these factories. 


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To encourage compliance with core labor standards and national labor laws directly related to core labor standards, the conference agreement provides for preferential treatment to be denied 

in certain circumstances. Specifically, the conference agreement directs the President to identify (on a biennial basis, beginning in the 

second year after implementation) producers who are failing to 

comply with these compliance conditions. The President is directed 

to offer assistance to any such producers in meeting the compliance 

conditions and, if the assistance is refused or if the producer otherwise fails to come into compliance, to withdraw, suspend, or limit 

preferential treatment to articles of the producer. The preferential 

treatment may be reinstated if the President later determines that 

the producer has come into compliance with core labor standards 

and national labor laws directly related to core labor standards. In 

making both the initial identification of non-compliant producers 

and any later reinstatement determination, the President is to consider the reports of the ILO. 

B. EXTENSION OF CBTPA 

(Sec. 15408–15409 of the conference agreement) 

PRESENT LAW

The Caribbean Basin Economic Recovery Act (19 U.S.C. 

2703(b)), as amended by the United States-Caribbean Basin Trade 

Partnership Act (Title II of Public Law 106–200) (CBTPA), provides 

that eligible textile and apparel articles of a designated CBTPA 

beneficiary country shall enter the United States free of duty and 

free of quantitative limitations, provided that the President determines that the country has implemented the necessary procedures 

and requirements. These preference program provisions expire on 

September 30, 2008. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

No provision. 

CONFERENCE AGREEMENT

The conference agreement amends section 213(b) of the Caribbean Basin Economic Recovery Act to extend the Caribbean Basin 

Trade Partnership Act, including the textile and apparel preference 

program provisions, through September 30, 2010. 

C. UNUSED MERCHANDISE DRAWBACK

(Sec. 15421 of the conference agreement) 

PRESENT LAW

Section 313(j) of the Tariff Act of 1930 (19 U.S.C. 1313(j)) currently provides for unused merchandise drawback. Unused drawback is permitted if imported merchandise is exported or destroyed 

within 3 years of import without being used in the United States. 


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Pursuant to section 313(j)(2) of the Tariff Act of 1930 (19 U.S.C. 

1313(j)(2)), domestic or imported merchandise that is commercially 

interchangeable with the imported merchandise may be substituted 

for the imported merchandise and drawback granted on the export 

or destruction of the substituted merchandise within the 3-year period beginning on the date of importation. The drawback is limited 

to 99% of the duty, tax and fee imposed under Federal law on the 

imported merchandise upon entry or importation. 

Section 313(j)(2) of the Tariff Act of 1930 does not contain a 

definition of ‘‘commercially interchangeable.’’ From late 2001 to 

May 2007, U.S. Customs and Border Protection (CBP) paid drawback claims on wine based on white domestic and imported table 

wine being commercially interchangeable with relatively valued imported white table wine. Red domestic and imported table wine was 

also considered to be commercially interchangeable with relatively 

valued imported red table wine. Relatively valued wine was considered to be wine within a price range of 50%. 

CBP informed wine drawback claimants in May 2007 that, effective immediately, the above standard for commercial interchangeability was no longer applicable. CBP did not provide a definitive new standard but stated that the criterion of the varietal 

wine should have been a determining factor in determining commercial interchangeability. 

The new provision carries forward the standard used for commercial interchangeability from 2001 to May 2007, and provides 

certainty for the filing and processing of unused drawback claims 

for imported and exported wine. 

HOUSE BILL

No provision. 

SENATE AMENDMENT

No provision. 

CONFERENCE AGREEMENT

The conference agreement amends section 313(j)(2) of the Tariff Act of 1930, to provide a standard for what is considered to be 

‘‘commercially interchangeable’’ for purposes of unused merchandise drawback for wine. The provision is effective for claims filed 

for drawback on or after the date of enactment. 

D. REQUIREMENTS RELATING TO DETERMINATION OF TRANSACTION

VALUE OF IMPORTED MERCHANDISE

(Sec. 15422 of the conference agreement) 

PRESENT LAW

No provision. 

HOUSE BILL

No provision. 


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SENATE AMENDMENT

No provision. 

CONFERENCE AGREEMENT

The Conference agreement includes an importer declaration requirement for one year to assist in gathering information on the 

valuation of goods imported into the United States. 

The value of merchandise imported into the United States is 

determined primarily under transaction value. Transaction value is 

defined in section 402(b) of the Tariff Act of 1930 (19 U.S.C. 

1401a(b)(1)) as the price actually paid or payable for the merchandise when sold for exportation to the United States. Import transactions can involve one sale of the imported goods prior to importation or a series of sales. In the multiple sale scenario, Customs and 

Border Protection (‘‘CBP’’) currently permits importers to base 

transaction value on the price paid by the buyer in the first or earlier sale (e.g. the sale between the manufacturer and the intermediary), provided the importer can establish by sufficient evidence that the sale was at arm’s length and that at the time of 

such sale, the merchandise was clearly destined for exportation to 

the United States. 

On January 24, 2008, CBP published in the Federal Register 

a proposed interpretation of the expression ‘‘sold for exportation to 

the United States.’’ 73 Fed. Reg. 4254 (Jan. 24, 2008). In the publication, CBP proposed that when imported merchandise has been 

subject to a series of sales prior to importation, the price actually 

paid or payable for the imported goods when sold for exportation 

is the price paid in the last sale occurring prior to the introduction 

of the goods into the United States. 

Congress has serious concerns that CBP did not provide Congress or the importing community with any notice about its proposed interpretation. Congress also has serious concerns that CBP 

proposed its new interpretation without conducting adequate analysis of the proposed impact of such interpretation. Moreover, Congress has received several concerns and questions about CBP’s proposed interpretation, including questions of the number and value 

of importations that would be impacted by the change. CBP informed Congress that it does not keep records indicating which importers are basing transaction value on the price paid by the buyer 

in the first or earlier sale. Therefore, there is no information available to assess which sectors are using this provision, the extent of 

its use, and probable impact on the United States. 

The Conferees through section (a) require Customs to collect 

adequate information regarding the impact of such proposal by requiring that importers declare whether the transaction value of the 

imported merchandise is determined on the basis of the price paid 

in the first or earlier sale occurring prior to introduction of the 

merchandise into the United States. The term ‘‘first or earlier sale’’

as used in subsection (a)(2) is intended to refer to the current CBP 

interpretation expressed in the January 24, 2008 Federal Register 

Notice. 

Subsection (b) requires CBP to provide the collected information to the United States International Trade Commission (‘‘ITC’’) 


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on a monthly basis. The Conferees intend for CBP and ITC to mutually agree on the format in which CBP will submit the data for 

ITC use. Subsection (c) requires the ITC to submit a report to the 

House Ways and Means Committee and the Senate Finance Committee within ninety days of receipt of CBP’s last monthly report. 

In subsection (d), the Conferees express a sense of Congress 

that CBP should not before January 1, 2011, implement a change 

of interpretation of the expression ‘‘sold for exportation to the 

United States’’ for purposes of applying the transaction value of the 

imported merchandise in a series of sales. It is the sense of Congress that after January 1, 2011, CBP may propose to change or 

change its interpretation only if CBP: (1) consults with and provides notice to the appropriate committees not less than 180 days 

prior to proposing a change and not less than 90 days prior to publishing a change; (2) consults with, provides notice to, and takes 

into consideration views expressed by the Commercial Operations 

Advisory Committee not less than 120 days prior to proposing a 

change and not less than 60 days prior to publishing a change; and 

(3) receives the explicit approval of the Secretary of Treasury prior 

to publishing a change. The term ‘‘publishing’’, as used in subsection (d), includes any notice CBP may provide to the regulated 

community through a public notice. 

Through subsection (d)(3), the Conferees express a sense of 

Congress that CBP should take into consideration the ITC report 

as referenced in subsection (b) before publishing any change to the 

expression ‘‘sold for exportation to the United States.’’

V. TAX COMPLEXITY ANALYSIS 

Section 4022(b) of the Internal Revenue Service Restructuring 

and Reform Act of 1998 (the ‘‘IRS Reform Act’’) requires the Joint 

Committee on Taxation (in consultation with the Internal Revenue 

Service and the Department of the Treasury) to provide a tax complexity analysis. The complexity analysis is required for all legislation reported by the Senate Committee on Finance, the House 

Committee on Ways and Means, or any committee of conference if 

the legislation includes a provision that directly or indirectly 

amends the Internal Revenue Code (the ‘‘Code’’) and has widespread applicability to individuals or small businesses. 

The staff of the Joint Committee on Taxation has determined 

that a complexity analysis is not required under section 4022(b) of 

the IRS Reform Act because the bill contains no provisions that 

have ‘‘widespread applicability’’ to individuals or small businesses. 

COMPLIANCE WITH RULE XXI, CL.9 (HOUSE) AND WITH 

RULE XLIV (SENATE) 

The following list is submitted in compliance with clause 9 of 

rule XXI of the Rules of the House of Representatives and rule 

XLIV of the Standing Rules of the Senate, which require publication of a list of congressionally directed spending items (Senate), 

congressional earmarks (House), limited tax benefits, and limited 

tariff benefits included in the conference report, or in the joint 

statement of managers accompanying the conference report, including the name of each Senator, House Member, Delegate, or ResiVerDate Aug 31 2005 23:09 May 18, 2008 Jkt 042321 PO 00000 Frm 01101 Fmt 6601 Sfmt 6602 E:\HR\OC\HR627.XXX HR627

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dent Commissioners who submitted a request to the Committee of 

jurisdiction for each item so identified. Congressionally directed 

spending items (as defined in the Senate rule) and congressional 

earmarks (as defined in the House rule) in this division of the conference report or joint statement of managers contains any limited 

tax benefits or limited tariff benefits as defined in the applicable 

House and Senate rules. 

Member Program description Funding level 

Baucus .............. National Sheep and Goat Industry Improvement Center ................... $1 million. 

Baucus .............. Appropriate Technology Transfer to Rural Areas ............................... Authorized for appropriation. 

Baucus .............. Camelina Pilot Program ..................................................................... $9 million. 

Biden ................ Chesapeake Bay Watershed Conservation Program .......................... $382 million. 

Cardin ............... Chesapeake Bay Watershed Conservation Program .......................... $382 million. 

Casey ................ Chesapeake Bay Watershed Conservation Program .......................... $382 million. 

Chambliss ......... Cost Share Assistance for Wildlife Corridors ..................................... Up to $100 million. 

Cochran ............ Natural Products Research Laboratory .............................................. Authorized for appropriation. 

Conrad .............. Grants to Broadcasting Systems ....................................................... Authorized for appropriation. 

Harkin ............... Congressional Hunger Center ............................................................. Authorized for appropriation. 

Harkin ............... Appropriate Technology Transfer to Rural Areas ............................... Authorized for appropriation.

Harkin ............... Policy Research Centers ..................................................................... Authorized for appropriation. 

Hinojosa ............ Housing Assistance Council ............................................................... Authorized for appropriation. 

Inouye ............... Insular Pacific Sun Grant Sub-Center ............................................... Authorized for appropriation. 

Inouye ............... Education Grants to Alaska Native Serving Institutions and Native 

Hawaiian Serving Institutions.

Authorized for appropriation. 

Kohl ................... Housing Assistance Council ............................................................... Authorized for appropriation. 

Nelson ............... Drought Mitigation Center/University of Nebraska ............................ Authorized for appropriation. 

Reid .................. Desert Terminal Lakes/Nevada ........................................................... $175 million FY 08–12. 

Roberts ............. Consortium for Agricultural Soils Mitigation of Greenhouse Gases/ 

Kansas State University.

Authorized for appropriation. 

Stevens ............. Education Grants to Alaska Native Serving Institutions and Native 

Hawaiian Serving Institutions.

Authorized for appropriation. 

Stevens ............. Water Systems for Rural and Native Villages in Alaska ................... Authorized for appropriation. 

From the Committee on Agriculture, for consideration of 

the House bill (except title XII) and the Senate amendment (except secs. 12001, 12201–12601, and 12701–12808), 

and modifications committed to conference: 

COLLIN C. PETERSON, 

TIM HOLDEN, 

MIKE MCINTYRE, 

BOB ETHERIDGE, 

LEONARD L. BOSWELL, 

JOE BACA, 

DENNIS L. CARDOZA, 

DAVID SCOTT, 

BOB GOODLATTE, 

ROBIN HAYES, 

MARILYN MUSGRAVE, 

RANDY NEUGEBAUER, 

From the Committee on Education and Labor, for consideration of secs. 4303 and 4304 of the House bill, and secs. 

4901–4905, 4911, and 4912 of the Senate amendment, and 

modifications committed to conference: 

GEORGE MILLER, 

CAROLYN MCCARTHY, 

TODD R. PLATTS, 

From the Committee on Energy and Commerce, for consideration of secs. 6012, 6023, 6024, 6028, 6029, 9004, 9005, 


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and 9017 of the House bill, and secs. 6006, 6012, 6110–

6112, 6202, 6302, 7044, 7049, 7307, 7507, 9001, 11060, 

11072, 11087, and 11101–11103 of the Senate amendment, 

and modifications committed to conference: 

JOHN D. DINGELL, 

FRANK PALLONE, 

From the Committee on Financial Services, for consideration of sec. 11310 of the House bill, and secs. 6501–6505, 

11068, and 13107 of the Senate amendment, and modifications committed to conference: 

PAUL E. KANJORSKI, 

MAXINE WATERS, 

From the Committee on Foreign Affairs, for consideration 

of secs. 3001–3008, 3010–3014, and 3016 of the House bill, 

and secs. 3001–3022, 3101–3107, and 3201–3204 of the 

Senate amendment, and modifications committed to conference: 

HOWARD L. BERMAN, 

BRAD SHERMAN, 

ILEANA ROS-LEHTINEN, 

From the Committee on Judiciary, for consideration of 

secs. 11102, 11312, and 11314 of the House bill, and secs. 

5402, 10103, 10201, 10203, 10205, 11017, 11069, 11076, 

13102, and 13104 of the Senate amendment, and modifications committed to conference: 

JOHN CONYERS, 

BOBBY SCOTT, 

From the Committee on Natural Resources, for consideration of secs. 2313, 2331, 2341, 2405, 2607, 2607A, 2611, 

5401, 6020, 7033, 7311, 8101, 8112, 8121–8127, 8204, 

8205, 11063, and 11075 of the Senate amendment, and 

modifications committed to conference: 

NICK RAHALL, 

MADELEINE Z. BORDALLO, 

CATHY MCMORRIS RODGERS, 

From the Committee on Oversight and Government Reform, for consideration of secs. 1501 and 7109 of the House 

bill, and secs. 7020, 7313, 7314, 7316, 7502, 8126, 8205, 

and 10201 of the Senate amendment, and modifications 

committed to conference: 

EDOLPHUS TOWNS, 

From the Committee on Science and Technology, for consideration of secs. 4403, 9003, 9006, 9010, 9015, 9019, and 

9020 of the House bill, and secs. 7039, 7051, 7315, 7501, 

and 9001 of the Senate amendment, and modifications 

committed to conference: 

BART GORDON, 

MICHAEL T. MCCAUL, 

From the Committee on Small Business, for consideration 

of subtitle D of title XI of the Senate amendment, and 

modifications committed to conference: 

NYDIA M. VELA ́ ZQUEZ, 

HEATH SHULER, 


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From the Committee on Transportation and Infrastructure, for consideration of secs. 2203, 2301, 6019, and 6020 

of the House bill, and secs. 2604, 6029, 6030, and 11087 

of the Senate amendment, and modifications committed to 

conference: 

JAMES L. OBERSTAR, ELEANOR H. NORTON, SAM GRAVES, From the Committee on Ways and Means, for consideration of sec. 1303 and title XII of the House bill, and secs. 

12001–12601, and 12701–12808 of the Senate amendment, 

and modifications committed to conference: 

CHARLES B. RANGEL, 

EARL POMEROY, 

For consideration of House bill (except title XII) and the 

Senate amendment (except secs. 12001, 12201–12601, and 

12701–12808), and modifications committed to conference: 

ROSA L. DELAURO, ADAM H. PUTNAM, 

Managers on the Part of the House. 

TOM HARKIN, 

PATRICK LEAHY, 

KENT CONRAD, 

MAX BAUCUS, 

BLANCHE L. LINCOLN, 

DEBBIE STABENOW, 

SAXBY CHAMBLISS, 

THAD COCHRAN, 

PAT ROBERTS

(for purposes of title XV 

only), 

CHUCK GRASSLEY. 

Managers on the Part of the Senate. 

Æ 


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