An Equal Opportunity Provider and Employer

United States Department of Agriculture

August 23, 2019 

Dear Agreement Holder:

Pursuant to the Agriculture Improvement Act of 2018 (Farm Bill), the Upland Cotton 

Economic Adjustment Assistance Program (EAAP) has changed to the Upland Cotton 

Economic Adjustment Assistance for Textile Mills (EAATM) Program. The EAAP

Agreement has been updated to incorporate the program name change and clarify 

certain elements of the Agreement. A summary of the revisions includes: 

• Section A-1(c): Clarification of eligible expenditures – “...Expenditures that are 

not directly associated with manufacturing of upland cotton into eligible cotton 

products are beyond the scope of the EAATM and are not eligible expenditures 

for EAATM.” 

• Section A-3: Completion and Execution of the Agreement: “...Agreement 

Holders must stipulate in writing the intended use of all funds projected to be 

received under this program for the sole purpose of capital expenditures directly 

attributable to the purpose of manufacturing upland cotton into eligible cotton 

products.”

• Section A-9(a): Names and addresses updated.

• Section A-13 Appeals: Addresses updated.

• Section B-4: Additional clarification of net weight bales – “Net bale weights 

must either be vendor weights or certified reweights. The weight purchased and 

claimed for the purpose of CCC payment under EAATM must be the same.” 

• Section B-7(h): Additional requirement to this section – “Maintain a 

supplemental ledger based on item (g) for the purposes of audit. Ledger should 

include only eligible capital expenditures in excess of payments received for the 

sole purpose of manufacturing upland cotton into eligible cotton products in the 

United States. The expenditures should be recorded to include, but not limited 

to, description of expenditure, acquisition date, method of payment, date of 

payment and amount of payment.”

• Section B-8: Pre-approval of Expenditures Exceeding $100,000: “Any 

expenditure exceeding $100,000 to be utilized by the Agreement Holder for 

purposes of meeting the eligibility requirements of an allowable purpose under 

the program must receive pre-approval from the License and Storage Contract 

Branch, WCMD. Failure to receive pre-approval will result in the asset not being 

considered as a qualified expenditure. 

• Section B-9(a): Requirement of Eligible Purchases with CCC Funding to be 

Readily Put into Service: The Agreement Holder is required to install assets 

purchased with CCC funds, within 24 months after the date of a purchase 

agreement. If unforeseen difficulties prevent the Agreement Holder from

Marketing and 

Regulatory Programs

Agricultural Marketing

Service

Fair Trade Practices 

Program

Warehouse and 

Commodity 

Management

Division

P.O. Box 419205

Mail Stop 9148

Kansas City, Missouri

64141-6205
An Equal Opportunity Provider and Employer

meeting the 24-month installation time, the Agreement Holder must receive 

approval from the License and Storage Contract Branch, WCMD. 

• Section B-10: Prohibition of Direct or Indirect Transfer of CCC Funds in a Plant 

or Corporate Acquisition: In the event of a corporate acquisition of an Agreement 

Holder or its plant, the Agreement Holder is required to sign a written verification 

certifying that no CCC funds were transferred, either in cash or as an asset 

purchased exclusively to be transferred to the acquiring company. 

A decision has been made regarding the carryover of expenditures to successive

marketing years. The following provision has been added to the Agreement: 

• Section B-9(b): The Agreement Holder must make expenditures equal to, or 

greater than, any amounts paid by CCC within any marketing year. A marketing 

year being August 1 of each year and ending July 31 of the next year. 

Expenditure amounts that exceed the amount paid to Agreement Holder for any 

marketing year will not carry over to the following marketing year. The Agreement 

Holder will have 18 months following the end of the marketing year to expend the 

amounts received from CCC. Example: Funds paid for consuming cotton during 

the 2018 Marketing Year began August 1 of 2018 and ended July 31 of 2019. 

The funds received for that period from CCC must be spent within 18 months in 

the amount equal to or greater than the funds received. The cut-off date for 

expending those funds will be January 31, 2021. Agreement holder received 

$250,000 from CCC during the course of the 2018 Marketing Year. Agreement 

Holder listed two invoices on their supplemental ledger listing only eligible capital 

expenditures. Inv. 1 – Lift truck with bale clamp $55,000 and Inv. 2 – Carding and 

drawing equipment replacement - $1,060,000 for a total of $1,115,000. These 

monies were spent during the 18 months following the 2018 marketing year. 

$1,115,000 Expended minus 250,000 received from CCC = $865,000 – the 

$865,000 will not be carried forward. 

Effective date of the updated Agreement is August 1, 2019. Attached is a copy of 

the updated Agreement. Please complete, sign, and submit the Agreement to this office

by September 30, 2019. An executed copy will be returned to Agreement Holder upon 

signature by a CCC representative. 

Sincerely,

Carie Cameron, Chief

License and Storage Contract Branch

Warehouse and Commodity Management Division