II

104TH CONGRESS

2D SESSION S. 1541

To extend, reform, and improve agricultural commodity, trade, conservation,

and other programs, and for other purposes.

IN THE SENATE OF THE UNITED STATES

JANUARY 26, 1996

Mr. LUGAR (for himself, Mr. DOLE, Mr. HELMS, Mr. COCHRAN, Mr. CRAIG,

Mr. GRASSLEY, Mr. PRESSLER, and Mr. COVERDELL) introduced the following bill; which was read for the first time

A BILL

To extend, reform, and improve agricultural commodity,

trade, conservation, and other programs, and for other

purposes.

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

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

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

5 ‘‘Agricultural Market Transition Act of 1996’’.

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

7 this title is as follows:

Sec. 1. Short title; table of contents.

Subtitle A—Agricultural Market Transition Program

Sec. 12. Definitions.
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Sec. 13. Production flexibility contracts.

Sec. 14. Nonrecourse marketing assistance loans and loan deficiency payments.

Sec. 15. Payment limitations.

Sec. 16. Peanut program.

Sec. 17. Sugar program.

Sec. 18. Administration.

Sec. 19. Elimination of permanent price support authority.

Sec. 20. Effect of amendments.

Subtitle B—Conservation

Sec. 31. Conservation.

Subtitle C—Agricultural Promotion and Export Programs

Sec. 41. Market promotion program.

Sec. 42. Export enhancement program.

Subtitle D—Miscellaneous

Sec. 51. Crop insurance.

Sec. 52. Collection and use of agricultural quarantine and inspection fees.

Sec. 53. Commodity Credit Corporation interest rate.

1 Subtitle A—Agricultural Market

2 Transition Program

3 SEC. 12. DEFINITIONS.

4 In this subtitle:

5 (1) CONSIDERED PLANTED.—The term ‘‘con6 sidered planted’’ means acreage that is considered

7 planted under title V of the Agricultural Act of 1949

8 (7 U.S.C. 1461 et seq.) (as in effect prior to the

9 amendment made by section 19(b)(2)).

10 (2) CONTRACT.—The term ‘‘contract’’ means a

11 production flexibility contract entered into under

12 section 13.

13 (3) CONTRACT ACREAGE.—The term ‘‘contract

14 acreage’’ means 1 or more crop acreage bases estab15 lished for contract commodities under title V of the
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1 Agricultural Act of 1949 (as in effect prior to the

2 amendment made by section 19(b)(2)) that would

3 have been in effect for the 1996 crop (but for the

4 amendment made by section 19(b)(2)).

5 (4) CONTRACT COMMODITY.—The term ‘‘con6 tract commodity’’ means wheat, corn, grain sor7 ghum, barley, oats, upland cotton, and rice.

8 (5) CONTRACT PAYMENT.—The term ‘‘contract

9 payment’’ means a payment made under section 13

10 pursuant to a contract.

11 (6) CORN.—The term ‘‘corn’’ means field corn.

12 (7) DEPARTMENT.—The term ‘‘Department’’

13 means the United States Department of Agriculture.

14 (8) FARM PROGRAM PAYMENT YIELD.—The

15 term ‘‘farm program payment yield’’ means the farm

16 program payment yield established for the 1995 crop

17 of a contract commodity under title V of the Agri18 cultural Act of 1949 (as in effect prior to the

19 amendment made by section 19(b)(2)).

20 (9) LOAN COMMODITY.—The term ‘‘loan com21 modity’’ means each contract commodity, extra long

22 staple cotton, and oilseeds.

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

24 crop of soybeans, sunflower seed, rapeseed, canola,
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1 safflower, flaxseed, mustard seed, or, if designated

2 by the Secretary, other oilseeds.

3 (11) PERSON.—The term ‘‘person’’ means an

4 individual, partnership, firm, joint-stock company,

5 corporation, association, trust, estate, or State

6 agency.

7 (12) PRODUCER.—

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

9 means a person who, as owner, landlord, ten10 ant, or sharecropper, shares in the risk of pro11 ducing a crop, and is entitled to share in the

12 crop available for marketing from the farm, or

13 would have shared had the crop been produced.

14 (B) HYBRID SEED.—The term ‘‘producer’’

15 includes a person growing hybrid seed under

16 contract. In determining the interest of a grow17 er of hybrid seed in a crop, the Secretary shall

18 not take into consideration the existence of a

19 hybrid seed contract.

20 (13) PROGRAM.—The term ‘‘program’’ means

21 the agricultural market transition program estab22 lished under this subtitle.

23 (14) SECRETARY.—The term ‘‘Secretary’’

24 means the Secretary of Agriculture.
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1 (15) STATE.—The term ‘‘State’’ means each of

2 the several States of the United States, the District

3 of Columbia, the Commonwealth of Puerto Rico, and

4 any other territory or possession of the United

5 States.

6 (16) UNITED STATES.—The term ‘‘United

7 States’’, when used in a geographical sense, means

8 all of the States.

9 SEC. 13. PRODUCTION FLEXIBILITY CONTRACTS.

10 (a) CONTRACTS AUTHORIZED.—

11 (1) OFFER AND TERMS.—Beginning as soon as

12 practicable after the date of the enactment of this

13 subtitle, the Secretary shall offer to enter into a con14 tract with an eligible owner or operator described in

15 paragraph (2) on a farm containing eligible farm16 land. Under the terms of a contract, the owner or

17 operator shall agree, in exchange for annual contract

18 payments, to comply with—

19 (A) the conservation plan for the farm pre20 pared in accordance with section 1212 of the

21 Food Security Act of 1985 (16 U.S.C. 3812);

22 (B) wetland protection requirements appli23 cable to the farm under subtitle C of title XII

24 of the Act (16 U.S.C. 3821 et seq.); and
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1 (C) the planting flexibility requirements of

2 subsection (j).

3 (2) ELIGIBLE OWNERS AND OPERATORS DE4 SCRIBED.—The following persons shall be considered

5 to be an owner or operator eligible to enter into a

6 contract:

7 (A) An owner of eligible farmland who as8 sumes all of the risk of producing a crop.

9 (B) An owner of eligible farmland who

10 shares in the risk of producing a crop.

11 (C) An operator of eligible farmland with

12 a share-rent lease of the eligible farmland, re13 gardless of the length of the lease, if the owner

14 enters into the same contract.

15 (D) An operator of eligible farmland who

16 cash rents the eligible farmland under a lease

17 expiring on or after September 30, 2002, in

18 which case the consent of the owner is not re19 quired.

20 (E) An operator of eligible farmland who

21 cash rents the eligible farmland under a lease

22 expiring before September 30, 2002, if the

23 owner consents to the contract.

24 (F) An owner of eligible farmland who

25 cash rents the eligible farmland and the lease
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1 term expires before September 30, 2002, but

2 only if the actual operator of the farm declines

3 to enter into a contract. In the case of an

4 owner covered by this subparagraph, contract

5 payments shall not begin under a contract until

6 the fiscal year following the fiscal year in which

7 the lease held by the nonparticipating operator

8 expires.

9 (G) An owner or operator described in a

10 preceding subparagraph regardless of whether

11 the owner or operator purchased catastrophic

12 risk protection for a fall-planted 1996 crop

13 under section 508(b) of the Federal Crop Insur14 ance Act (7 U.S.C. 1508(b)).

15 (3) TENANTS AND SHARECROPPERS.—In carry16 ing out this section, the Secretary shall provide ade17 quate safeguards to protect the interests of opera18 tors who are tenants and sharecroppers.

19 (b) ELEMENTS.—

20 (1) TIME FOR CONTRACTING.—

21 (A) DEADLINE.—Except as provided in

22 subparagraph (B), the Secretary may not enter

23 into a contract after April 15, 1996.

24 (B) CONSERVATION RESERVE LANDS.—
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1 (i) IN GENERAL.—At the beginning of

2 each fiscal year, the Secretary shall allow

3 an eligible owner or operator on a farm

4 covered by a conservation reserve contract

5 entered into under section 1231 of the

6 Food Security Act of 1985 (16 U.S.C.

7 3831) that terminates after the date speci8 fied in subparagraph (A) to enter into or

9 expand a production flexibility contract to

10 cover the contract acreage of the farm that

11 was subject to the former conservation re12 serve contract.

13 (ii) AMOUNT.—Contract payments

14 made for contract acreage under this sub15 paragraph shall be made at the rate and

16 amount applicable to the annual contract

17 payment level for the applicable crop.

18 (2) DURATION OF CONTRACT.—

19 (A) BEGINNING DATE.—A contract shall

20 begin with—

21 (i) the 1996 crop of a contract com22 modity; or

23 (ii) in the case of acreage that was

24 subject to a conservation reserve contract

25 described in paragraph (1)(B), the date
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1 the production flexibility contract was en2 tered into or expanded to cover the acre3 age.

4 (B) ENDING DATE.—A contract shall ex5 tend through the 2002 crop.

6 (3) ESTIMATION OF CONTRACT PAYMENTS.—At

7 the time the Secretary enters into a contract, the

8 Secretary shall provide an estimate of the minimum

9 contract payments anticipated to be made during at

10 least the first fiscal year for which contract pay11 ments will be made.

12 (c) ELIGIBLE FARMLAND DESCRIBED.—Land shall

13 be considered to be farmland eligible for coverage under

14 a contract only if the land has contract acreage attrib15 utable to the land and—

16 (1) for at least 1 of the 1991 through 1995

17 crops, at least a portion of the land was enrolled in

18 the acreage reduction program authorized for a crop

19 of a contract commodity under section 101B, 103B,

20 105B, or 107B of the Agricultural Act of 1949 (as

21 in effect prior to the amendment made by section

22 19(b)(2)) or was considered planted;

23 (2) was subject to a conservation reserve con24 tract under section 1231 of the Food Security Act

25 of 1985 (16 U.S.C. 3831) whose term expired, or
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1 was voluntarily terminated, on or after January 1,

2 1995; or

3 (3) is released from coverage under a conserva4 tion reserve contract by the Secretary during the pe5 riod beginning on January 1, 1995, and ending on

6 the date specified in subsection (b)(1)(A).

7 (d) TIME FOR PAYMENT.—

8 (1) IN GENERAL.—An annual contract payment

9 shall be made not later than September 30 of each

10 of fiscal years 1996 through 2002.

11 (2) ADVANCE PAYMENTS.—

12 (A) FISCAL YEAR 1996.—At the option of

13 the owner or operator, 50 percent of the con14 tract payment for fiscal year 1996 shall be

15 made not later than June 15, 1996.

16 (B) SUBSEQUENT FISCAL YEARS.—At the

17 option of the owner or operator for fiscal year

18 1997 and each subsequent fiscal year, 50 per19 cent of the annual contract payment shall be

20 made on December 15.

21 (e) AMOUNTS AVAILABLE FOR CONTRACT PAYMENTS

22 FOR EACH FISCAL YEAR.—

23 (1) IN GENERAL.—The Secretary shall, to the

24 maximum extent practicable, expend on a fiscal year
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1 basis the following amounts to satisfy the obligations

2 of the Secretary under all contracts:

3 (A) For fiscal year 1996, $5,570,000,000.

4 (B) For fiscal year 1997, $5,385,000,000.

5 (C) For fiscal year 1998, $5,800,000,000.

6 (D) For fiscal year 1999, $5,603,000,000.

7 (E) For fiscal year 2000, $5,130,000,000.

8 (F) For fiscal year 2001, $4,130,000,000.

9 (G) For fiscal year 2002, $4,008,000,000.

10 (2) ALLOCATION.—The amount made available

11 for a fiscal year under paragraph (1) shall be allo12 cated as follows:

13 (A) For wheat, 26.26 percent.

14 (B) For corn, 46.22 percent.

15 (C) For grain sorghum, 5.11 percent.

16 (D) For barley, 2.16 percent.

17 (E) For oats, 0.15 percent.

18 (F) For upland cotton, 11.63 percent.

19 (G) For rice, 8.47 percent.

20 (3) ADJUSTMENT.—The Secretary shall adjust

21 the amounts allocated for each contract commodity

22 under paragraph (2) for a particular fiscal year by—

23 (A) subtracting an amount equal to the

24 amount, if any, necessary to satisfy payment re25 quirements under sections 101B, 103B, 105B,
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1 and 107B of the Agricultural Act of 1949 (as

2 in effect prior to the amendment made by sec3 tion 19(b)(2)) for the 1994 and 1995 crops of

4 the commodity;

5 (B) adding an amount equal to the sum of

6 all repayments of deficiency payments received

7 under section 114(a)(2) of the Act (as so in ef8 fect) for the commodity;

9 (C) to the maximum extent practicable,

10 adding an amount equal to the sum of all con11 tract payments withheld by the Secretary, at

12 the request of an owner or operator subject to

13 a contract, as an offset against repayments of

14 deficiency payments otherwise required under

15 section 114(a)(2) of the Act (as so in effect) for

16 the commodity; and

17 (D) adding an amount equal to the sum of

18 all refunds of contract payments received dur19 ing the preceding fiscal year under subsection

20 (h) for the commodity.

21 (f) DETERMINATION OF CONTRACT PAYMENTS.—

22 (1) INDIVIDUAL PAYMENT QUANTITY OF CON23 TRACT COMMODITIES.—For each contract, the pay24 ment quantity of a contract commodity for each fis25 cal year shall be equal to the product of—
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1 (A) 85 percent of the contract acreage;

2 and

3 (B) the farm program payment yield.

4 (2) ANNUAL PAYMENT QUANTITY OF CONTRACT

5 COMMODITIES.—The payment quantity of each con6 tract commodity covered by all contracts for each

7 fiscal year shall equal the sum of the amounts cal8 culated under paragraph (1) for each individual con9 tract.

10 (3) ANNUAL PAYMENT RATE.—The payment

11 rate for a contract commodity for each fiscal year

12 shall be equal to—

13 (A) the amount made available under sub14 section (e) for the contract commodity for the

15 fiscal year; divided by

16 (B) the amount determined under para17 graph (2) for the fiscal year.

18 (4) ANNUAL PAYMENT AMOUNT.—The amount

19 to be paid under a contract in effect for each fiscal

20 year with respect to a contract commodity shall be

21 equal to the product of—

22 (A) the payment quantity determined

23 under paragraph (1) with respect to the con24 tract; and
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1 (B) the payment rate in effect under para2 graph (3).

3 (5) ASSIGNMENT OF CONTRACT PAYMENTS.—

4 The provisions of section 8(g) of the Soil Conserva5 tion and Domestic Allotment Act (16 U.S.C.

6 590h(g)) (relating to assignment of payments) shall

7 apply to contract payments under this subsection.

8 The owner or operator making the assignment, or

9 the assignee, shall provide the Secretary with notice,

10 in such manner as the Secretary may require in the

11 contract, of any assignment made under this para12 graph.

13 (6) SHARING OF CONTRACT PAYMENTS.—The

14 Secretary shall provide for the sharing of contract

15 payments among the owners and operators subject

16 to the contract on a fair and equitable basis.

17 (g) PAYMENT LIMITATION.—The total amount of

18 contract payments made to a person under a contract dur19 ing any fiscal year may not exceed the payment limitations

20 established under sections 1001 through 1001C of the

21 Food Security Act of 1985 (7 U.S.C. 1308 through 1308–

22 3).

23 (h) EFFECT OF VIOLATION.—

24 (1) TERMINATION OF CONTRACT.—Except as

25 provided in paragraph (2), if an owner or operator
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1 subject to a contract violates the conservation plan

2 for the farm containing eligible farmland under the

3 contract, wetland protection requirements applicable

4 to the farm, or the planting flexibility requirements

5 of subsection (j), the Secretary shall terminate the

6 contract with respect to the owner or operator on

7 each farm in which the owner or operator has an in8 terest. On the termination, the owner or operator

9 shall forfeit all rights to receive future contract pay10 ments on each farm in which the owner or operator

11 has an interest and shall refund to the Secretary all

12 contract payments received by the owner or operator

13 during the period of the violation, together with in14 terest on the contract payments as determined by

15 the Secretary.

16 (2) REFUND OR ADJUSTMENT.—If the Sec17 retary determines that a violation does not warrant

18 termination of the contract under paragraph (1), the

19 Secretary may require the owner or operator subject

20 to the contract—

21 (A) to refund to the Secretary that part of

22 the contract payments received by the owner or

23 operator during the period of the violation, to24 gether with interest on the contract payments

25 as determined by the Secretary; or
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1 (B) to accept a reduction in the amount of

2 future contract payments that is proportionate

3 to the severity of the violation, as determined

4 by the Secretary.

5 (3) FORECLOSURE.—An owner or operator sub6 ject to a contract may not be required to make re7 payments to the Secretary of amounts received

8 under the contract if the contract acreage has been

9 foreclosed on and the Secretary determines that for10 giving the repayments is appropriate in order to pro11 vide fair and equitable treatment. This paragraph

12 shall not void the responsibilities of such an owner

13 or operator under the contract if the owner or opera14 tor continues or resumes operation, or control, of the

15 contract acreage. On the resumption of operation or

16 control over the contract acreage by the owner or

17 operator, the provisions of the contract in effect on

18 the date of the foreclosure shall apply.

19 (4) REVIEW.—A determination of the Secretary

20 under this subsection shall be considered to be an

21 adverse decision for purposes of the availability of

22 administrative review of the determination.

23 (i) TRANSFER OF INTEREST IN LANDS SUBJECT TO

24 CONTRACT.—
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1 (1) EFFECT OF TRANSFER.—Except as pro2 vided in paragraph (2), the transfer by an owner or

3 operator subject to a contract of the right and inter4 est of the owner or operator in the contract acreage

5 shall result in the termination of the contract with

6 respect to the acreage, effective on the date of the

7 transfer, unless the transferee of the acreage agrees

8 with the Secretary to assume all obligations of the

9 contract. At the request of the transferee, the Sec10 retary may modify the contract if the modifications

11 are consistent with the objectives of this section as

12 determined by the Secretary.

13 (2) EXCEPTION.—If an owner or operator who

14 is entitled to a contract payment dies, becomes in15 competent, or is otherwise unable to receive the con16 tract payment, the Secretary shall make the pay17 ment, in accordance with regulations prescribed by

18 the Secretary.

19 (j) PLANTING FLEXIBILITY.—

20 (1) PERMITTED CROPS.—Subject to paragraph

21 (2), any commodity or crop may be planted on con22 tract acreage on a farm.

23 (2) LIMITATIONS.—

24 (A) HAYING AND GRAZING.—
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1 (i) TIME LIMITATIONS.—Haying and

2 grazing on land exceeding 15 percent of

3 the contract acreage on a farm as provided

4 in clause (iii) shall be permitted, except

5 during any consecutive 5-month period be6 tween April 1 and October 31 that is de7 termined by the State committee estab8 lished under section 8(b) of the Soil Con9 servation and Domestic Allotment Act (16

10 U.S.C. 590h(b)) for a State. In the case of

11 a natural disaster, the Secretary may per12 mit unlimited haying and grazing on the

13 contract acreage of a farm.

14 (ii) CONTRACT COMMODITIES.—A con15 tract commodity may be hayed or grazed

16 on contract acreage on a farm without lim17 itation.

18 (iii) HAYING AND GRAZING LIMITA19 TION ON PORTION OF CONTRACT ACRE20 AGE.—Unlimited haying and grazing shall

21 be permitted on not more than 15 percent

22 of the contract acreage on a farm.

23 (B) ALFALFA.—Alfalfa may be planted for

24 harvest without limitation on the contract acre25 age on a farm, except that each contract acre
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1 that is planted for harvest to alfalfa in excess

2 of 15 percent of the total contract acreage on

3 a farm shall be ineligible for contract payments.

4 (C) FRUITS AND VEGETABLES.—

5 (i) IN GENERAL.—The planting for

6 harvest of fruits and vegetables shall be

7 prohibited on contract acreage.

8 (ii) UNRESTRICTED VEGETABLES.—

9 Lentils, mung beans, and dry peas may be

10 planted without limitation on contract

11 acreage.

12 SEC. 14. NONRECOURSE MARKETING ASSISTANCE LOANS

13 AND LOAN DEFICIENCY PAYMENTS.

14 (a) AVAILABILITY OF NONRECOURSE LOANS.—

15 (1) AVAILABILITY.—For each of the 1996

16 through 2002 crops of each loan commodity, the

17 Secretary shall make available to producers on a

18 farm nonrecourse marketing assistance loans for

19 loan commodities produced on the farm. The loans

20 shall be made under terms and conditions that are

21 prescribed by the Secretary and at the loan rate es22 tablished under subsection (b) for the loan commod23 ity.
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1 (2) ELIGIBLE PRODUCTION.—The following

2 production shall be eligible for a marketing assist3 ance loan under this section:

4 (A) In the case of a marketing assistance

5 loan for a contract commodity, any production

6 by a producer who has entered into a produc7 tion flexibility contract.

8 (B) In the case of a marketing assistance

9 loan for extra long staple cotton and oilseeds,

10 any production.

11 (b) LOAN RATES.—

12 (1) WHEAT.—

13 (A) LOAN RATE.—Subject to subparagraph

14 (B), the loan rate for a marketing assistance

15 loan for wheat shall be—

16 (i) not less than 85 percent of the

17 simple average price received by producers

18 of wheat, as determined by the Secretary,

19 during the marketing years for the imme20 diately preceding 5 crops of wheat, exclud21 ing the year in which the average price was

22 the highest and the year in which the aver23 age price was the lowest in the period; but

24 (ii) not more than $2.58 per bushel.
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1 (B) STOCKS TO USE RATIO ADJUST2 MENT.—If the Secretary estimates for any mar3 keting year that the ratio of ending stocks of

4 wheat to total use for the marketing year will

5 be—

6 (i) equal to or greater than 30 per7 cent, the Secretary may reduce the loan

8 rate for wheat for the corresponding crop

9 by an amount not to exceed 10 percent in

10 any year;

11 (ii) less than 30 percent but not less

12 than 15 percent, the Secretary may reduce

13 the loan rate for wheat for the correspond14 ing crop by an amount not to exceed 5 per15 cent in any year; or

16 (iii) less than 15 percent, the Sec17 retary may not reduce the loan rate for

18 wheat for the corresponding crop.

19 (C) NO EFFECT ON FUTURE YEARS.—Any

20 reduction in the loan rate for wheat under sub21 paragraph (B) shall not be considered in deter22 mining the loan rate for wheat for subsequent

23 years.

24 (2) FEED GRAINS.—
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1 (A) LOAN RATE FOR CORN.—Subject to

2 subparagraph (B), the loan rate for a market3 ing assistance loan for corn shall be—

4 (i) not less than 85 percent of the

5 simple average price received by producers

6 of corn, as determined by the Secretary,

7 during the marketing years for the imme8 diately preceding 5 crops of corn, excluding

9 the year in which the average price was the

10 highest and the year in which the average

11 price was the lowest in the period; but

12 (ii) not more than $1.89 per bushel.

13 (B) STOCKS TO USE RATIO ADJUST14 MENT.—If the Secretary estimates for any mar15 keting year that the ratio of ending stocks of

16 corn to total use for the marketing year will

17 be—

18 (i) equal to or greater than 25 per19 cent, the Secretary may reduce the loan

20 rate for corn for the corresponding crop by

21 an amount not to exceed 10 percent in any

22 year;

23 (ii) less than 25 percent but not less

24 than 12.5 percent, the Secretary may re25 duce the loan rate for corn for the cor-
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1 responding crop by an amount not to ex2 ceed 5 percent in any year; or

3 (iii) less than 12.5 percent the Sec4 retary may not reduce the loan rate for

5 corn for the corresponding crop.

6 (C) NO EFFECT ON FUTURE YEARS.—Any

7 reduction in the loan rate for corn under sub8 paragraph (B) shall not be considered in deter9 mining the loan rate for corn for subsequent

10 years.

11 (D) OTHER FEED GRAINS.—The loan rate

12 for a marketing assistance loan for grain sor13 ghum, barley, and oats, respectively, shall be es14 tablished at such level as the Secretary deter15 mines is fair and reasonable in relation to the

16 rate that loans are made available for corn, tak17 ing into consideration the feeding value of the

18 commodity in relation to corn.

19 (3) UPLAND COTTON.—

20 (A) LOAN RATE.—Subject to subparagraph

21 (B), the loan rate for a marketing assistance

22 loan for upland cotton shall be established by

23 the Secretary at such loan rate, per pound, as

24 will reflect for the base quality of upland cot25 ton, as determined by the Secretary, at average
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1 locations in the United States a rate that is not

2 less than the smaller of—

3 (i) 85 percent of the average price

4 (weighted by market and month) of the

5 base quality of cotton as quoted in the des6 ignated United States spot markets during

7 3 years of the 5-year period ending July

8 31 in the year in which the loan rate is an9 nounced, excluding the year in which the

10 average price was the highest and the year

11 in which the average price was the lowest

12 in the period; or

13 (ii) 90 percent of the average, for the

14 15-week period beginning July 1 of the

15 year in which the loan rate is announced,

16 of the 5 lowest-priced growths of the

growths quoted for Middling 13 17 ⁄32-inch cot18 ton C.I.F. Northern Europe (adjusted

19 downward by the average difference during

20 the period April 15 through October 15 of

21 the year in which the loan is announced

22 between the average Northern European

23 price quotation of such quality of cotton

24 and the market quotations in the des25 ignated United States spot markets for the
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1 base quality of upland cotton), as deter2 mined by the Secretary.

3 (B) LIMITATIONS.—The loan rate for a

4 marketing assistance loan for upland cotton

5 shall not be less than $0.50 per pound or more

6 than $0.5192 per pound.

7 (4) EXTRA LONG STAPLE COTTON.—The loan

8 rate for a marketing assistance loan for extra long

9 staple cotton shall be—

10 (A) not less than 85 percent of the simple

11 average price received by producers of extra

12 long staple cotton, as determined by the Sec13 retary, during 3 years of the 5 previous market14 ing years, excluding the year in which the aver15 age price was the highest and the year in which

16 the average price was the lowest in the period;

17 but

18 (B) not more than $0.7965 per pound.

19 (5) RICE.—The loan rate for a marketing as20 sistance loan for rice shall be $6.50 per hundred21 weight.

22 (6) OILSEEDS.—

23 (A) SOYBEANS.—The loan rate for a mar24 keting assistance loan for soybeans shall be

25 $4.92 per bushel.
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1 (B) SUNFLOWER SEED, CANOLA,

2 RAPESEED, SAFFLOWER, MUSTARD SEED, AND

3 FLAXSEED.—The loan rates for a marketing as4 sistance loan for sunflower seed, canola,

5 rapeseed, safflower, mustard seed, and flaxseed,

6 individually, shall be $0.087 per pound.

7 (C) OTHER OILSEEDS.—The loan rates for

8 a marketing assistance loan for other oilseeds

9 shall be established at such level as the Sec10 retary determines is fair and reasonable in rela11 tion to the loan rate available for soybeans, ex12 cept in no event shall the rate for the oilseeds

13 (other than cottonseed) be less than the rate es14 tablished for soybeans on a per-pound basis for

15 the same crop.

16 (c) TERM OF LOAN.—In the case of each loan com17 modity (other than upland cotton or extra long staple cot18 ton), a marketing assistance loan under subsection (a)

19 shall have a term of 9 months beginning on the first day

20 of the first month after the month in which the loan is

21 made. A marketing assistance loan for upland cotton or

22 extra long staple cotton shall have a term of 10 months

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

24 month in which the loan is made. The Secretary may not
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1 extend the term of a marketing assistance loan for any

2 loan commodity.

3 (d) REPAYMENT.—

4 (1) REPAYMENT RATES FOR WHEAT AND FEED

5 GRAINS.—The Secretary shall permit a producer to

6 repay a marketing assistance loan under subsection

7 (a) for wheat, corn, grain sorghum, barley, and oats

8 at a level that the Secretary determines will—

9 (A) minimize potential loan forfeitures;

10 (B) minimize the accumulation of stocks of

11 the commodities by the Federal Government;

12 (C) minimize the cost incurred by the Fed13 eral Government in storing the commodities;

14 and

15 (D) allow the commodities produced in the

16 United States to be marketed freely and com17 petitively, both domestically and internationally.

18 (2) REPAYMENT RATES FOR UPLAND COTTON,

19 OILSEEDS AND RICE.—The Secretary shall permit

20 producers to repay a marketing assistance loan

21 under subsection (a) for upland cotton, oilseeds and

22 rice at a level that is the lesser of—

23 (A) the loan rate established for upland

24 cotton, oilseeds and rice, respectively, under

25 subsection (b); or
28

•S 1541 IS

1 (B) the prevailing world market price for

2 upland cotton, oilseeds and rice, respectively

3 (adjusted to United States quality and loca4 tion), as determined by the Secretary.

5 (3) REPAYMENT RATES FOR EXTRA LONG STA6 PLE COTTON.—Repayment of a marketing assistance

7 loan for extra long staple cotton shall be at the loan

8 rate established for the commodity under subsection

9 (b), plus interest (as determined by the Secretary).

10 (4) PREVAILING WORLD MARKET PRICE.—For

11 purposes of paragraph (2)(B) and subsection (f), the

12 Secretary shall prescribe by regulation—

13 (A) a formula to determine the prevailing

14 world market price for each loan commodity,

15 adjusted to United States quality and location;

16 and

17 (B) a mechanism by which the Secretary

18 shall announce periodically the prevailing world

19 market price for each loan commodity.

20 (5) ADJUSTMENT OF PREVAILING WORLD MAR21 KET PRICE FOR UPLAND COTTON.—

22 (A) IN GENERAL.—During the period end23 ing July 31, 2003, the prevailing world market

24 price for upland cotton (adjusted to United
29

•S 1541 IS

1 States quality and location) established under

2 paragraph (4) shall be further adjusted if—

3 (i) the adjusted prevailing world mar4 ket price is less than 115 percent of the

5 loan rate for upland cotton established

6 under subsection (b), as determined by the

7 Secretary; and

8 (ii) the Friday through Thursday av9 erage price quotation for the lowest-priced

10 United States growth as quoted for Middling (M) 13 11 ⁄32-inch cotton delivered C.I.F.

12 Northern Europe is greater than the Fri13 day through Thursday average price of the

14 5 lowest-priced growths of upland cotton,

as quoted for Middling (M) 13 15 ⁄32-inch cot16 ton, delivered C.I.F. Northern Europe (re17 ferred to in this subsection as the ‘‘North18 ern Europe price’’).

19 (B) FURTHER ADJUSTMENT.—Except as

20 provided in subparagraph (C), the adjusted pre21 vailing world market price for upland cotton

22 shall be further adjusted on the basis of some

23 or all of the following data, as available:

24 (i) The United States share of world

25 exports.
30

•S 1541 IS

1 (ii) The current level of cotton export

2 sales and cotton export shipments.

3 (iii) Other data determined by the

4 Secretary to be relevant in establishing an

5 accurate prevailing world market price for

6 upland cotton (adjusted to United States

7 quality and location).

8 (C) LIMITATION ON FURTHER ADJUST9 MENT.—The adjustment under subparagraph

10 (B) may not exceed the difference between—

11 (i) the Friday through Thursday aver12 age price for the lowest-priced United

13 States growth as quoted for Middling

13 14 ⁄32-inch cotton delivered C.I.F. Northern

15 Europe; and

16 (ii) the Northern Europe price.

17 (e) LOAN DEFICIENCY PAYMENTS.—

18 (1) AVAILABILITY.—Except as provided in

19 paragraph (4), the Secretary may make loan defi20 ciency payments available to producers who, al21 though eligible to obtain a marketing assistance loan

22 under subsection (a) with respect to a loan commod23 ity, agree to forgo obtaining the loan for the com24 modity in return for payments under this subsection.
31

•S 1541 IS

1 (2) COMPUTATION.—A loan deficiency payment

2 under this subsection shall be computed by multiply3 ing—

4 (A) the loan payment rate determined

5 under paragraph (3) for the loan commodity; by

6 (B) the quantity of the loan commodity

7 that the producers on a farm are eligible to

8 place under loan but for which the producers

9 forgo obtaining the loan in return for payments

10 under this subsection.

11 (3) LOAN PAYMENT RATE.—For purposes of

12 this subsection, the loan payment rate shall be the

13 amount by which—

14 (A) the loan rate established under sub15 section (b) for the loan commodity; exceeds

16 (B) the rate at which a loan for the com17 modity may be repaid under subsection (d).

18 (4) EXCEPTION FOR EXTRA LONG STAPLE COT19 TON.—This subsection shall not apply with respect

20 to extra long staple cotton.

21 (f) SPECIAL MARKETING LOAN PROVISIONS FOR UP22 LAND COTTON.—

23 (1) COTTON USER MARKETING CERTIFI24 CATES.—
32

•S 1541 IS

1 (A) ISSUANCE.—Subject to subparagraph

2 (D), during the period ending July 31, 2003,

3 the Secretary shall issue marketing certificates

4 or cash payments to domestic users and export5 ers for documented purchases by domestic users

6 and sales for export by exporters made in the

7 week following a consecutive 4-week period in

8 which—

9 (i) the Friday through Thursday aver10 age price quotation for the lowest-priced

11 United States growth, as quoted for Middling (M) 13 12 ⁄32-inch cotton, delivered

13 C.I.F. Northern Europe exceeds the

14 Northern Europe price by more than 1.25

15 cents per pound; and

16 (ii) the prevailing world market price

17 for upland cotton (adjusted to United

18 States quality and location) does not ex19 ceed 130 percent of the loan rate for up20 land cotton established under subsection

21 (b).

22 (B) VALUE OF CERTIFICATES OR PAY23 MENTS.—The value of the marketing certifi24 cates or cash payments shall be based on the

25 amount of the difference (reduced by 1.25 cents
33

•S 1541 IS

1 per pound) in the prices during the 4th week of

2 the consecutive 4-week period multiplied by the

3 quantity of upland cotton included in the docu4 mented sales.

5 (C) ADMINISTRATION OF MARKETING CER6 TIFICATES.—

7 (i) REDEMPTION, MARKETING, OR EX8 CHANGE.—The Secretary shall establish

9 procedures for redeeming marketing cer10 tificates for cash or marketing or exchange

11 of the certificates for agricultural commod12 ities owned by the Commodity Credit Cor13 poration in such manner, and at such price

14 levels, as the Secretary determines will best

15 effectuate the purposes of cotton user mar16 keting certificates. Any price restrictions

17 that would otherwise apply to the disposi18 tion of agricultural commodities by the

19 Commodity Credit Corporation shall not

20 apply to the redemption of certificates

21 under this paragraph.

22 (ii) DESIGNATION OF COMMODITIES

23 AND PRODUCTS.—To the extent prac24 ticable, the Secretary shall permit owners

25 of certificates to designate the commodities
34

•S 1541 IS

1 and products, including storage sites, the

2 owners would prefer to receive in exchange

3 for certificates. If any certificate is not

4 presented for redemption, marketing, or

5 exchange within a reasonable number of

6 days after the issuance of the certificate

7 (as determined by the Secretary), reason8 able costs of storage and other carrying

9 charges, as determined by the Secretary,

10 shall be deducted from the value of the

11 certificate for the period beginning after

12 the reasonable number of days and ending

13 with the date of the presentation of the

14 certificate to the Commodity Credit Cor15 poration.

16 (iii) TRANSFERS.—Marketing certifi17 cates issued to domestic users and export18 ers of upland cotton may be transferred to

19 other persons in accordance with regula20 tions issued by the Secretary.

21 (D) EXCEPTION.—The Secretary shall not

22 issue marketing certificates or cash payments

23 under subparagraph (A) if, for the immediately

24 preceding consecutive 10-week period, the Fri25 day through Thursday average price quotation
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•S 1541 IS

1 for the lowest priced United States growth, as

quoted for Middling (M) 13 2 ⁄32-inch cotton, deliv3 ered C.I.F. Northern Europe, adjusted for the

4 value of any certificate issued under this para5 graph, exceeds the Northern Europe price by

6 more than 1.25 cents per pound.

7 (E) LIMITATION ON EXPENDITURES.—

8 Total expenditures under this paragraph shall

9 not exceed $701,000,000 during fiscal years

10 1996 through 2002.

11 (2) SPECIAL IMPORT QUOTA.—

12 (A) ESTABLISHMENT.—The President

13 shall carry out an import quota program that

14 provides that, during the period ending July 31,

15 2003, whenever the Secretary determines and

16 announces that for any consecutive 10-week pe17 riod, the Friday through Thursday average

18 price quotation for the lowest-priced United

19 States growth, as quoted for Middling (M)

13 20 ⁄32-inch cotton, delivered C.I.F. Northern Eu21 rope, adjusted for the value of any certificates

22 issued under paragraph (1), exceeds the North23 ern Europe price by more than 1.25 cents per

24 pound, there shall immediately be in effect a

25 special import quota.
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•S 1541 IS

1 (B) QUANTITY.—The quota shall be equal

2 to 1 week’s consumption of upland cotton by

3 domestic mills at the seasonally adjusted aver4 age rate of the most recent 3 months for which

5 data are available.

6 (C) APPLICATION.—The quota shall apply

7 to upland cotton purchased not later than 90

8 days after the date of the Secretary’s announce9 ment under subparagraph (A) and entered into

10 the United States not later than 180 days after

11 the date.

12 (D) OVERLAP.—A special quota period

13 may be established that overlaps any existing

14 quota period if required by subparagraph (A),

15 except that a special quota period may not be

16 established under this paragraph if a quota pe17 riod has been established under subsection (g).

18 (E) PREFERENTIAL TARIFF TREAT19 MENT.—The quantity under a special import

20 quota shall be considered to be an in-quota

21 quantity for purposes of—

22 (i) section 213(d) of the Caribbean

23 Basin Economic Recovery Act (19 U.S.C.

24 2703(d));
37

•S 1541 IS

1 (ii) section 204 of the Andean Trade

2 Preference Act (19 U.S.C. 3203);

3 (iii) section 503(d) of the Trade Act

4 of 1974 (19 U.S.C. 2463(d)); and

5 (iv) General Note 3(a)(iv) to the Har6 monized Tariff Schedule.

7 (F) DEFINITION.—In this paragraph, the

8 term ‘‘special import quota’’ means a quantity

9 of imports that is not subject to the over-quota

10 tariff rate of a tariff-rate quota.

11 (g) LIMITED GLOBAL IMPORT QUOTA FOR UPLAND

12 COTTON.—

13 (1) IN GENERAL.—The President shall carry

14 out an import quota program that provides that

15 whenever the Secretary determines and announces

16 that the average price of the base quality of upland

17 cotton, as determined by the Secretary, in the des18 ignated spot markets for a month exceeded 130 per19 cent of the average price of such quality of cotton

20 in the markets for the preceding 36 months, not21 withstanding any other provision of law, there shall

22 immediately be in effect a limited global import

23 quota subject to the following conditions:

24 (A) QUANTITY.—The quantity of the quota

25 shall be equal to 21 days of domestic mill con-
38

•S 1541 IS

1 sumption of upland cotton at the seasonally ad2 justed average rate of the most recent 3 months

3 for which data are available.

4 (B) QUANTITY IF PRIOR QUOTA.—If a

5 quota has been established under this sub6 section during the preceding 12 months, the

7 quantity of the quota next established under

8 this subsection shall be the smaller of 21 days

9 of domestic mill consumption calculated under

10 subparagraph (A) or the quantity required to

11 increase the supply to 130 percent of the de12 mand.

13 (C) PREFERENTIAL TARIFF TREAT14 MENT.—The quantity under a limited global

15 import quota shall be considered to be an in16 quota quantity for purposes of—

17 (i) section 213(d) of the Caribbean

18 Basin Economic Recovery Act (19 U.S.C.

19 2703(d));

20 (ii) section 204 of the Andean Trade

21 Preference Act (19 U.S.C. 3203);

22 (iii) section 503(d) of the Trade Act

23 of 1974 (19 U.S.C. 2463(d)); and

24 (iv) General Note 3(a)(iv) to the Har25 monized Tariff Schedule.
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•S 1541 IS

1 (D) DEFINITIONS.—In this subsection:

2 (i) SUPPLY.—The term ‘‘supply’’

3 means, using the latest official data of the

4 Bureau of the Census, the Department of

5 Agriculture, and the Department of the

6 Treasury—

7 (I) the carry-over of upland cot8 ton at the beginning of the marketing

9 year (adjusted to 480-pound bales) in

10 which the quota is established;

11 (II) production of the current

12 crop; and

13 (III) imports to the latest date

14 available during the marketing year.

15 (ii) DEMAND.—The term ‘‘demand’’

16 means—

17 (I) the average seasonally ad18 justed annual rate of domestic mill

19 consumption in the most recent 3

20 months for which data are available;

21 and

22 (II) the larger of—

23 (aa) average exports of up24 land cotton during the preceding

25 6 marketing years; or
40

•S 1541 IS

1 (bb) cumulative exports of

2 upland cotton plus outstanding

3 export sales for the marketing

4 year in which the quota is estab5 lished.

6 (iii) LIMITED GLOBAL IMPORT

7 QUOTA.—The term ‘‘limited global import

8 quota’’ means a quantity of imports that is

9 not subject to the over-quota tariff rate of

10 a tariff-rate quota.

11 (E) QUOTA ENTRY PERIOD.—When a

12 quota is established under this subsection, cot13 ton may be entered under the quota during the

14 90-day period beginning on the date the quota

15 is established by the Secretary.

16 (2) NO OVERLAP.—Notwithstanding paragraph

17 (1), a quota period may not be established that over18 laps an existing quota period or a special quota pe19 riod established under subsection (f)(2).

20 (h) SOURCE OF LOANS.—

21 (1) IN GENERAL.—The Secretary shall provide

22 the loans authorized by this section and the Agricul23 tural Adjustment Act of 1938 (7 U.S.C. 1281 et

24 seq.) through the Commodity Credit Corporation

25 and other means available to the Secretary.
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•S 1541 IS

1 (2) PROCESSORS.—Whenever any loan or sur2 plus removal operation for any agricultural commod3 ity is carried out through purchases from or loans

4 or payments to processors, the Secretary shall, to

5 the extent practicable, obtain from the processors

6 such assurances as the Secretary considers adequate

7 that the producers of the commodity have received

8 or will receive maximum benefits from the loan or

9 surplus removal operation.

10 (i) ADJUSTMENTS OF LOANS.—

11 (1) IN GENERAL.—The Secretary may make

12 appropriate adjustments in the loan levels for any

13 commodity for differences in grade, type, quality, lo14 cation, and other factors.

15 (2) LOAN LEVEL.—The adjustments shall, to

16 the maximum extent practicable, be made in such

17 manner that the average loan level for the commod18 ity will, on the basis of the anticipated incidence of

19 the factors, be equal to the level of support deter20 mined as provided in this section or the Agricultural

21 Adjustment Act of 1938 (7 U.S.C. 1281 et seq.).

22 (j) PERSONAL LIABILITY OF PRODUCERS FOR DEFI23 CIENCIES.—

24 (1) IN GENERAL.—Except as provided in para25 graph (2), no producer shall be personally liable for
42

•S 1541 IS

1 any deficiency arising from the sale of the collateral

2 securing any nonrecourse loan made under this sec3 tion or the Agricultural Adjustment Act of 1938 (7

4 U.S.C. 1281 et seq.) unless the loan was obtained

5 through a fraudulent representation by the producer.

6 (2) LIMITATIONS.—Paragraph (1) shall not

7 prevent the Commodity Credit Corporation or the

8 Secretary from requiring a producer to assume li9 ability for—

10 (A) a deficiency in the grade, quality, or

11 quantity of a commodity stored on a farm or

12 delivered by the producer;

13 (B) a failure to properly care for and pre14 serve a commodity; or

15 (C) a failure or refusal to deliver a com16 modity in accordance with a program estab17 lished under this section or the Agricultural Ad18 justment Act of 1938.

19 (3) ACQUISITION OF COLLATERAL.—The Sec20 retary may include in a contract for a nonrecourse

21 loan made under this section or the Agricultural Ad22 justment Act of 1938 a provision that permits the

23 Commodity Credit Corporation, on and after the ma24 turity of the loan or any extension of the loan, to ac25 quire title to the unredeemed collateral without obli-
43

•S 1541 IS

1 gation to pay for any market value that the collat2 eral may have in excess of the loan indebtedness.

3 (4) SUGARCANE AND SUGAR BEETS.—A secu4 rity interest obtained by the Commodity Credit Cor5 poration as a result of the execution of a security

6 agreement by the processor of sugarcane or sugar

7 beets shall be superior to all statutory and common

8 law liens on raw cane sugar and refined beet sugar

9 in favor of the producers of sugarcane and sugar

10 beets and all prior recorded and unrecorded liens on

11 the crops of sugarcane and sugar beets from which

12 the sugar was derived.

13 (k) COMMODITY CREDIT CORPORATION SALES PRICE

14 RESTRICTIONS.—

15 (1) IN GENERAL.—The Commodity Credit Cor16 poration may sell any commodity owned or con17 trolled by the Corporation at any price that the Sec18 retary determines will maximize returns to the Cor19 poration.

20 (2) NONAPPLICATION OF SALES PRICE RE21 STRICTIONS.—Paragraph (1) shall not apply to—

22 (A) a sale for a new or byproduct use;

23 (B) a sale of peanuts or oilseeds for the ex24 traction of oil;
44

•S 1541 IS

1 (C) a sale for seed or feed if the sale will

2 not substantially impair any loan program;

3 (D) a sale of a commodity that has sub4 stantially deteriorated in quality or as to which

5 there is a danger of loss or waste through dete6 rioration or spoilage;

7 (E) a sale for the purpose of establishing

8 a claim arising out of a contract or against a

9 person who has committed fraud, misrepresen10 tation, or other wrongful act with respect to the

11 commodity;

12 (F) a sale for export, as determined by the

13 Corporation; and

14 (G) a sale for other than a primary use.

15 (3) PRESIDENTIAL DISASTER AREAS.—

16 (A) IN GENERAL.—Notwithstanding para17 graph (1), on such terms and conditions as the

18 Secretary may consider in the public interest,

19 the Corporation may make available any com20 modity or product owned or controlled by the

21 Corporation for use in relieving distress—

22 (i) in any area in the United States

23 (including the Virgin Islands) declared by

24 the President to be an acute distress area

25 because of unemployment or other eco-
45

•S 1541 IS

1 nomic cause, if the President finds that the

2 use will not displace or interfere with nor3 mal marketing of agricultural commodities;

4 and

5 (ii) in connection with any major dis6 aster determined by the President to war7 rant assistance by the Federal Government

8 under the Robert T. Stafford Disaster Re9 lief and Emergency Assistance Act (42

10 U.S.C. 5121 et seq.).

11 (B) COSTS.—Except on a reimbursable

12 basis, the Corporation shall not bear any costs

13 in connection with making a commodity avail14 able under subparagraph (A) beyond the cost of

15 the commodity to the Corporation incurred in—

16 (i) the storage of the commodity; and

17 (ii) the handling and transportation

18 costs in making delivery of the commodity

19 to designated agencies at 1 or more central

20 locations in each State or other area.

21 (4) EFFICIENT OPERATIONS.—Paragraph (1)

22 shall not apply to the sale of a commodity the dis23 position of which is desirable in the interest of the

24 effective and efficient conduct of the operations of

25 the Corporation because of the small quantity of the
46

•S 1541 IS

1 commodity involved, or because of the age, location,

2 or questionable continued storability of the commod3 ity.

4 SEC. 15. PAYMENT LIMITATIONS.

5 (a) IN GENERAL.—Section 1001 of the Food Security

6 Act of 1985 (7 U.S.C. 1308) is amended by striking para7 graphs (1) through (4) and inserting the following:

8 ‘‘(1) LIMITATION ON PAYMENTS UNDER PRO9 DUCTION FLEXIBILITY CONTRACTS.—The total

10 amount of contract payments made under section 13

11 of the Agricultural Market Transition Act to a per12 son under 1 or more production flexibility contracts

13 during any fiscal year may not exceed $40,000.

14 ‘‘(2) LIMITATION ON MARKETING LOAN GAINS

15 AND LOAN DEFICIENCY PAYMENTS.—

16 ‘‘(A) LIMITATION.—The total amount of

17 payments specified in subparagraph (B) that a

18 person shall be entitled to receive under section

19 14 of the Agricultural Market Transition Act

20 for contract commodities and oilseeds during

21 any crop year may not exceed $75,000.

22 ‘‘(B) DESCRIPTION OF PAYMENTS.—The

23 payments referred to in subparagraph (A) are

24 the following:
47

•S 1541 IS

1 ‘‘(i) Any gain realized by a producer

2 from repaying a marketing assistance loan

3 for a crop of any loan commodity at a

4 lower level than the original loan rate es5 tablished for the commodity under section

6 14(b) of the Act.

7 ‘‘(ii) Any loan deficiency payment re8 ceived for a loan commodity under section

9 14(e) of the Act.’’.

10 (b) CONFORMING AMENDMENTS.—

11 (1) Section 1001 of the Food Security Act of

12 1985 (7 U.S.C. 1308) (as amended by subsection

13 (a)) is amended—

14 (A) by redesignating paragraphs (5), (6),

15 and (7) as paragraphs (3), (4), and (5), respec16 tively; and

17 (B) in the second sentence of paragraph

18 (3)(A) (as so redesignated), by striking ‘‘para19 graphs (6) and (7)’’ and inserting ‘‘paragraphs

20 (4) and (5)’’.

21 (2) Section 1305(d) of the Agricultural Rec22 onciliation Act of 1987 (Public Law 100–203; 7

23 U.S.C. 1308 note) is amended by striking ‘‘para24 graphs (5) through (7) of section 1001, as amended
48

•S 1541 IS

1 by this subtitle,’’ and inserting ‘‘paragraphs (3)

2 through (5) of section 1001,’’.

3 (3) Section 1001A of the Food Security Act of

4 1985 (7 U.S.C. 1308–1(a)(1)) is amended—

5 (A) in the first sentence of subsection

6 (a)(1)—

7 (i) by striking ‘‘section 1001(5)(B)(i)’’

8 and inserting ‘‘section 1001(3)(B)(i)’’;

9 (ii) by striking ‘‘under the Agricul10 tural Act of 1949 (7 U.S.C. 1421 et

11 seq.)’’; and

12 (iii) by striking ‘‘section

13 1001(5)(B)(i)(II)’’ and inserting ‘‘section

14 1001(3)(B)(i)(II)’’; and

15 (B) in subsection (b)—

16 (i) in paragraph (1)—

17 (I) by striking ‘‘under the Agri18 cultural Act of 1949’’; and

19 (II) by striking ‘‘section

20 1001(5)(B)(i)’’ and inserting ‘‘section

21 1001(3)(B)(i)’’; and

22 (ii) in paragraph (2)(B), by striking

23 ‘‘section 1001(5)(B)(i)(II)’’ and inserting

24 ‘‘section 1001(3)(B)(i)(II)’’.
49

•S 1541 IS

1 (4) Section 1001C(a) of the Food Security Act

2 of 1985 (7 U.S.C. 1308–3(a)) is amended—

3 (A) by striking ‘‘For each of the 1991

4 through 1997 crops, any’’ and inserting ‘‘Any’’;

5 (B) by striking ‘‘price support program

6 loans, payments, or benefits made available

7 under the Agricultural Act of 1949 (7 U.S.C.

8 1421 et seq.),’’ and inserting ‘‘loans or pay9 ments made available under the Agricultural

10 Market Transition Act’’; and

11 (C) by striking ‘‘during the 1989 through

12 1997 crop years’’.

13 SEC. 16. PEANUT PROGRAM.

14 (a) QUOTA PEANUTS.—

15 (1) AVAILABILITY OF LOANS.—The Secretary

16 shall make nonrecourse loans available to producers

17 of quota peanuts.

18 (2) LOAN RATE.—The national average quota

19 loan rate for quota peanuts shall be $610 per ton.

20 (3) INSPECTION, HANDLING, OR STORAGE.—

21 The loan amount may not be reduced by the Sec22 retary by any deductions for inspection, handling, or

23 storage.

24 (4) LOCATION AND OTHER FACTORS.—The Sec25 retary may make adjustments in the loan rate for
50

•S 1541 IS

1 quota peanuts for location of peanuts and such other

2 factors as are authorized by section 411 of the Agri3 cultural Adjustment Act of 1938.

4 (b) ADDITIONAL PEANUTS.—

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

6 nonrecourse loans available to producers of addi7 tional peanuts at such rates as the Secretary finds

8 appropriate, taking into consideration the demand

9 for peanut oil and peanut meal, expected prices of

10 other vegetable oils and protein meals, and the de11 mand for peanuts in foreign markets.

12 (2) ANNOUNCEMENT.—The Secretary shall an13 nounce the loan rate for additional peanuts of each

14 crop not later than February 15 preceding the mar15 keting year for the crop for which the loan rate is

16 being determined.

17 (c) AREA MARKETING ASSOCIATIONS.—

18 (1) WAREHOUSE STORAGE LOANS.—

19 (A) IN GENERAL.—In carrying out sub20 sections (a) and (b), the Secretary shall make

21 warehouse storage loans available in each of the

22 producing areas (described in section 1446.95

23 of title 7 of the Code of Federal Regulations

24 (January 1, 1989)) to a designated area mar25 keting association of peanut producers that is
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•S 1541 IS

1 selected and approved by the Secretary and

2 that is operated primarily for the purpose of

3 conducting the loan activities. The Secretary

4 may not make warehouse storage loans avail5 able to any cooperative that is engaged in oper6 ations or activities concerning peanuts other

7 than those operations and activities specified in

8 this section and section 358e of the Agricultural

9 Adjustment Act of 1938 (7 U.S.C. 1359a).

10 (B) ADMINISTRATIVE AND SUPERVISORY

11 ACTIVITIES.—An area marketing association

12 shall be used in administrative and supervisory

13 activities relating to loans and marketing activi14 ties under this section and section 358e of the

15 Agricultural Adjustment Act of 1938 (7 U.S.C.

16 1359a).

17 (C) ASSOCIATION COSTS.—Loans made to

18 the association under this paragraph shall in19 clude such costs as the area marketing associa20 tion reasonably may incur in carrying out the

21 responsibilities, operations, and activities of the

22 association under this section and section 358e

23 of the Agricultural Adjustment Act of 1938 (7

24 U.S.C. 1359a).
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•S 1541 IS

1 (2) POOLS FOR QUOTA AND ADDITIONAL PEA2 NUTS.—

3 (A) IN GENERAL.—The Secretary shall re4 quire that each area marketing association es5 tablish pools and maintain complete and accu6 rate records by area and segregation for quota

7 peanuts handled under loan and for additional

8 peanuts placed under loan, except that separate

9 pools shall be established for Valencia peanuts

10 produced in New Mexico. Bright hull and dark

11 hull Valencia peanuts shall be considered as

12 separate types for the purpose of establishing

13 the pools.

14 (B) NET GAINS.—Net gains on peanuts in

15 each pool, unless otherwise approved by the

16 Secretary, shall be distributed only to producers

17 who placed peanuts in the pool and shall be dis18 tributed in proportion to the value of the pea19 nuts placed in the pool by each producer. Net

20 gains for peanuts in each pool shall consist of

21 the following:

22 (i) QUOTA PEANUTS.—For quota pea23 nuts, the net gains over and above the loan

24 indebtedness and other costs or losses in25 curred on peanuts placed in the pool.
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•S 1541 IS

1 (ii) ADDITIONAL PEANUTS.—For ad2 ditional peanuts, the net gains over and

3 above the loan indebtedness and other

4 costs or losses incurred on peanuts placed

5 in the pool for additional peanuts.

6 (d) LOSSES.—Losses in quota area pools shall be cov7 ered using the following sources in the following order of

8 priority:

9 (1) TRANSFERS FROM ADDITIONAL LOAN

10 POOLS.—The proceeds due any producer from any

11 pool shall be reduced by the amount of any loss that

12 is incurred with respect to peanuts transferred from

13 an additional loan pool to a quota loan pool by the

14 producer under section 358–1(b)(8) of the Agricul15 tural Adjustment Act of 1938 (7 U.S.C. 1358–

16 1(b)(8)).

17 (2) OTHER PRODUCERS IN SAME POOL.—Fur18 ther losses in an area quota pool shall be offset by

19 reducing the gain of any producer in the pool by the

20 amount of pool gains attributed to the same pro21 ducer from the sale of additional peanuts for domes22 tic and export edible use.

23 (3) USE OF MARKETING ASSESSMENTS.—The

24 Secretary shall use funds collected under subsection

25 (g) (except funds attributable to handlers) to offset
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•S 1541 IS

1 further losses in area quota pools. The Secretary

2 shall transfer to the Treasury those funds collected

3 under subsection (g) and available for use under this

4 subsection that the Secretary determines are not re5 quired to cover losses in area quota pools.

6 (4) CROSS COMPLIANCE.—Further losses in

7 area quota pools, other than losses incurred as a re8 sult of transfers from additional loan pools to quota

9 loan pools under section 358–1(b)(8) of the Agricul10 tural Adjustment Act of 1938 (7 U.S.C. 1358–

11 1(b)(8)), shall be offset by any gains or profits from

12 quota pools in other production areas (other than

13 separate type pools established under subsection

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

15 Mexico) in such manner as the Secretary shall by

16 regulation prescribe.

17 (5) INCREASED ASSESSMENTS.—If use of the

18 authorities provided in the preceding paragraphs is

19 not sufficient to cover losses in an area quota pool,

20 the Secretary shall increase the marketing assess21 ment established under subsection (g) by such an

22 amount as the Secretary considers necessary to

23 cover the losses. The increased assessment shall

24 apply only to quota peanuts in the production area

25 covered by the pool. Amounts collected under sub-
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•S 1541 IS

1 section (g) as a result of the increased assessment

2 shall be retained by the Secretary to cover losses in

3 that pool.

4 (e) DISAPPROVAL OF QUOTAS.—Notwithstanding

5 any other provision of law, no loan for quota peanuts may

6 be made available by the Secretary for any crop of peanuts

7 with respect to which poundage quotas have been dis8 approved by producers, as provided for in section 358–

9 1(d) of the Agricultural Adjustment Act of 1938 (7 U.S.C.

10 1358–1(d)).

11 (f) QUALITY IMPROVEMENT.—

12 (1) IN GENERAL.—With respect to peanuts

13 under loan, the Secretary shall—

14 (A) promote the crushing of peanuts at a

15 greater risk of deterioration before peanuts of a

16 lesser risk of deterioration;

17 (B) ensure that all Commodity Credit Cor18 poration inventories of peanuts sold for domes19 tic edible use must be shown to have been offi20 cially inspected by licensed Department inspec21 tors both as farmer stock and shelled or cleaned

22 in-shell peanuts;

23 (C) continue to endeavor to operate the

24 peanut program so as to improve the quality of

25 domestic peanuts and ensure the coordination
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•S 1541 IS

1 of activities under the Peanut Administrative

2 Committee established under Marketing Agree3 ment No. 146, regulating the quality of domes4 tically produced peanuts (under the Agricul5 tural Adjustment Act (7 U.S.C. 601 et seq.),

6 reenacted with amendments by the Agricultural

7 Marketing Agreement Act of 1937); and

8 (D) ensure that any changes made in the

9 peanut program as a result of this subsection

10 requiring additional production or handling at

11 the farm level shall be reflected as an upward

12 adjustment in the Department loan schedule.

13 (2) EXPORTS AND OTHER PEANUTS.—The Sec14 retary shall require that all peanuts in the domestic

15 and export markets fully comply with all quality

16 standards under Marketing Agreement No. 146.

17 (g) MARKETING ASSESSMENT.—

18 (1) IN GENERAL.—The Secretary shall provide

19 for a nonrefundable marketing assessment. The as20 sessment shall be made on a per pound basis in an

21 amount equal to 1.1 percent for each of the 1994

22 and 1995 crops, 1.15 percent for the 1996 crop, and

23 1.2 percent for each of the 1997 through 2002

24 crops, of the national average quota or additional

25 peanut loan rate for the applicable crop.
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1 (2) FIRST PURCHASERS.—

2 (A) IN GENERAL.—Except as provided

3 under paragraphs (3) and (4), the first pur4 chaser of peanuts shall—

5 (i) collect from the producer a mar6 keting assessment equal to the quantity of

7 peanuts acquired multiplied by—

8 (I) in the case of each of the

9 1994 and 1995 crops, .55 percent of

10 the applicable national average loan

11 rate;

12 (II) in the case of the 1996 crop,

13 .6 percent of the applicable national

14 average loan rate; and

15 (III) in the case of each of the

16 1997 through 2002 crops, .65 percent

17 of the applicable national average loan

18 rate;

19 (ii) pay, in addition to the amount col20 lected under clause (i), a marketing assess21 ment in an amount equal to the quantity

22 of peanuts acquired multiplied by .55 per23 cent of the applicable national average loan

24 rate; and
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•S 1541 IS

1 (iii) remit the amounts required under

2 clauses (i) and (ii) to the Commodity Cred3 it Corporation in a manner specified by the

4 Secretary.

5 (B) DEFINITION OF FIRST PURCHASER.—

6 In this subsection, the term ‘‘first purchaser’’

7 means a person acquiring peanuts from a pro8 ducer except that in the case of peanuts for9 feited by a producer to the Commodity Credit

10 Corporation, the term means the person acquir11 ing the peanuts from the Commodity Credit

12 Corporation.

13 (3) OTHER PRIVATE MARKETINGS.—In the case

14 of a private marketing by a producer directly to a

15 consumer through a retail or wholesale outlet or in

16 the case of a marketing by the producer outside of

17 the continental United States, the producer shall be

18 responsible for the full amount of the assessment

19 and shall remit the assessment by such time as is

20 specified by the Secretary.

21 (4) LOAN PEANUTS.—In the case of peanuts

22 that are pledged as collateral for a loan made under

this section, 1 23 ⁄2 of the assessment shall be deducted

24 from the proceeds of the loan. The remainder of the

25 assessment shall be paid by the first purchaser of
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•S 1541 IS

1 the peanuts. For purposes of computing net gains on

2 peanuts under this section, the reduction in loan

3 proceeds shall be treated as having been paid to the

4 producer.

5 (5) PENALTIES.—If any person fails to collect

6 or remit the reduction required by this subsection or

7 fails to comply with the requirements for record8 keeping or otherwise as are required by the Sec9 retary to carry out this subsection, the person shall

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

11 an amount determined by multiplying—

12 (A) the quantity of peanuts involved in the

13 violation; by

14 (B) the national average quota peanut rate

15 for the applicable crop year.

16 (6) ENFORCEMENT.—The Secretary may en17 force this subsection in the courts of the United

18 States.

19 (h) CROPS.—Subsections (a) through (f) shall be ef20 fective only for the 1996 through 2002 crops of peanuts.

21 (i) MARKETING QUOTAS.—

22 (1) IN GENERAL.—Part VI of subtitle B of title

23 III of the Agricultural Adjustment Act of 1938 is

24 amended—

25 (A) in section 358–1 (7 U.S.C. 1358–1)—
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1 (i) in the section heading, by striking

2 ‘‘1991 THROUGH 1997 CROPS OF’’;

3 (ii) in subsections (a)(1), (b)(1)(B),

4 (b)(2)(A), (b)(2)(C), and (b)(3)(A), by

5 striking ‘‘of the 1991 through 1997 mar6 keting years’’ each place it appears and in7 serting ‘‘marketing year’’;

8 (iii) in subsection (a)(3), by striking

9 ‘‘1990’’ and inserting ‘‘1990, for the 1991

10 through 1995 marketing years, and 1995,

11 for the 1996 through 2002 marketing

12 years’’;

13 (iv) in subsection (b)(1)(A)—

14 (I) by striking ‘‘each of the 1991

15 through 1997 marketing years’’ and

16 inserting ‘‘each marketing year’’; and

17 (II) in clause (i), by inserting be18 fore the semicolon the following: ‘‘, in

19 the case of the 1991 through 1995

20 marketing years, and the 1995 mar21 keting year, in the case of the 1996

22 through 2002 marketing years’’; and

23 (v) in subsection (f), by striking

24 ‘‘1997’’ and inserting ‘‘2002’’;

25 (B) in section 358b (7 U.S.C. 1358b)—
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•S 1541 IS

1 (i) in the section heading, by striking

2 ‘‘1991 THROUGH 1995 CROPS OF’’; and

3 (ii) in subsection (c), by striking

4 ‘‘1995’’ and inserting ‘‘2002’’;

5 (C) in section 358c(d) (7 U.S.C.

6 1358c(d)), by striking ‘‘1995’’ and inserting

7 ‘‘2002’’; and

8 (D) in section 358e (7 U.S.C. 1359a)—

9 (i) in the section heading, by striking

10 ‘‘FOR 1991 THROUGH 1997 CROPS OF

11 PEANUTS’’; and

12 (ii) in subsection (i), by striking

13 ‘‘1997’’ and inserting ‘‘2002’’.

14 (2) ELIMINATION OF QUOTA FLOOR.—Section

15 358–1(a)(1) of the Act (7 U.S.C. 1358–1(a)(1)) is

16 amended by striking the second sentence.

17 (3) TEMPORARY QUOTA ALLOCATION.—Section

18 358–1 of the Act (7 U.S.C. 1358–1) is amended—

19 (A) in subsection (a)(1), by striking ‘‘do20 mestic edible, seed,’’ and inserting ‘‘domestic

21 edible use’’;

22 (B) in subsection (b)(2)—

23 (i) in subparagraph (A), by striking

24 ‘‘subparagraph (B) and subject to’’; and
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•S 1541 IS

1 (ii) by striking subparagraph (B) and

2 inserting the following:

3 ‘‘(B) TEMPORARY QUOTA ALLOCATION.—

4 ‘‘(i) ALLOCATION RELATED TO SEED

5 PEANUTS.—Temporary allocation of quota

6 pounds for the marketing year only in

7 which the crop is planted shall be made to

8 producers for each of the 1996 through

9 2002 marketing years as provided in this

10 subparagraph.

11 ‘‘(ii) QUANTITY.—The temporary

12 quota allocation shall be equal to the

13 pounds of seed peanuts planted on the

14 farm, as may be adjusted under regula15 tions prescribed by the Secretary.

16 ‘‘(iii) ADDITIONAL QUOTA.—The tem17 porary allocation of quota pounds under

18 this paragraph shall be in addition to the

19 farm poundage quota otherwise established

20 under this subsection and shall be credited,

21 for the applicable marketing year only, in

22 total to the producer of the peanuts on the

23 farm in a manner prescribed by the Sec24 retary.
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1 ‘‘(iv) EFFECT OF OTHER REQUIRE2 MENTS.—Nothing in this section alters or

3 changes the requirements regarding the

4 use of quota and additional peanuts estab5 lished by section 358e(b).’’; and

6 (C) in subsection (e)(3), strike ‘‘and seed

7 and use on a farm’’.

8 (4) UNDERMARKETINGS.—Part VI of subtitle B

9 of title III of the Act is amended—

10 (A) in section 358–1(b) (7 U.S.C. 1358–

11 1(b))—

12 (i) in paragraph (1)(B), by striking

13 ‘‘including—’’ and clauses (i) and (ii) and

14 inserting ‘‘including any increases resulting

15 from the allocation of quotas voluntarily

16 released for 1 year under paragraph (7).’’;

17 (ii) in paragraph (3)(B), by striking

18 ‘‘include—’’ and clauses (i) and (ii) and in19 serting ‘‘include any increase resulting

20 from the allocation of quotas voluntarily

21 released for 1 year under paragraph (7).’’;

22 and

23 (iii) by striking paragraphs (8) and

24 (9); and
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•S 1541 IS

1 (B) in section 358b(a) (7 U.S.C.

2 1358b(a))—

3 (i) in paragraph (1), by striking ‘‘(in4 cluding any applicable under marketings)’’

5 both places it appears;

6 (ii) in paragraph (1)(A), by striking

7 ‘‘of undermarketings and’’;

8 (iii) in paragraph (2), by striking

9 ‘‘(including any applicable under market10 ings)’’; and

11 (iv) in paragraph (3), by striking

12 ‘‘(including any applicable

13 undermarketings)’’.

14 (5) DISASTER TRANSFERS.—Section 358–1(b)

15 of the Act (7 U.S.C. 1358–1(b)), as amended by

16 paragraph (4)(A)(iii), is further amended by adding

17 at the end the following:

18 ‘‘(8) DISASTER TRANSFERS.—

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

20 subparagraph (B), additional peanuts produced

21 on a farm from which the quota poundage was

22 not harvested and marketed because of drought,

23 flood, or any other natural disaster, or any

24 other condition beyond the control of the pro25 ducer, may be transferred to the quota loan
65

•S 1541 IS

1 pool for pricing purposes on such basis as the

2 Secretary shall by regulation provide.

3 ‘‘(B) LIMITATION.—The poundage of pea4 nuts transferred under subparagraph (A) shall

5 not exceed the difference between—

6 ‘‘(i) the total quantity of peanuts

7 meeting quality requirements for domestic

8 edible use, as determined by the Secretary,

9 marketed from the farm; and

10 ‘‘(ii) the total farm poundage quota,

11 excluding quota pounds transferred to the

12 farm in the fall.

13 ‘‘(C) SUPPORT RATE.—Peanuts trans14 ferred under this paragraph shall be supported

15 at not more than 70 percent of the quota sup16 port rate for the marketing years in which the

17 transfers occur. The transfers for a farm shall

18 not exceed 25 percent of the total farm quota

19 pounds, excluding pounds transferred in the

20 fall.’’.

21 SEC. 17. SUGAR PROGRAM.

22 (a) SUGARCANE.—The Secretary shall make loans

23 available to processors of domestically grown sugarcane at

24 a rate equal to 18 cents per pound for raw cane sugar.
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1 (b) SUGAR BEETS.—The Secretary shall make loans

2 available to processors of domestically grown sugar beets

3 at a rate equal to 22.9 cents per pound for refined beet

4 sugar.

5 (c) TERM OF LOANS.—

6 (1) IN GENERAL.—Loans under this section

7 during any fiscal year shall be made available not

8 earlier than the beginning of the fiscal year and

9 shall mature at the earlier of—

10 (A) the end of 9 months; or

11 (B) the end of the fiscal year.

12 (2) SUPPLEMENTAL LOANS.—In the case of

13 loans made under this section in the last 3 months

14 of a fiscal year, the processor may repledge the

15 sugar as collateral for a second loan in the subse16 quent fiscal year, except that the second loan shall—

17 (A) be made at the loan rate in effect at

18 the time the second loan is made; and

19 (B) mature in 9 months less the quantity

20 of time that the first loan was in effect.

21 (d) LOAN TYPE; PROCESSOR ASSURANCES.—

22 (1) RECOURSE LOANS.—Subject to paragraph

23 (2), the Secretary shall carry out this section

24 through the use of recourse loans.
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1 (2) NONRECOURSE LOANS.—During any fiscal

2 year in which the tariff rate quota for imports of

3 sugar into the United States is established at, or is

4 increased to, a level in excess of 1,500,000 short

5 tons raw value, the Secretary shall carry out this

6 section by making available nonrecourse loans. Any

7 recourse loan previously made available by the Sec8 retary under this section during the fiscal year shall

9 be changed by the Secretary into a nonrecourse loan.

10 (3) PROCESSOR ASSURANCES.—If the Secretary

11 is required under paragraph (2) to make

12 nonrecourse loans available during a fiscal year or to

13 change recourse loans into nonrecourse loans, the

14 Secretary shall obtain from each processor that re15 ceives a loan under this section such assurances as

16 the Secretary considers adequate to ensure that the

17 processor will provide payments to producers that

18 are proportional to the value of the loan received by

19 the processor for sugar beets and sugarcane deliv20 ered by producers served by the processor. The Sec21 retary may establish appropriate minimum payments

22 for purposes of this paragraph.

23 (e) MARKETING ASSESSMENT.—

24 (1) SUGARCANE.—Effective for marketings of

25 raw cane sugar during the 1996 through 2003 fiscal
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1 years, the first processor of sugarcane shall remit to

2 the Commodity Credit Corporation a nonrefundable

3 marketing assessment in an amount equal to—

4 (A) in the case of marketings during fiscal

5 year 1996, 1.1 percent of the loan rate estab6 lished under subsection (a) per pound of raw

7 cane sugar, processed by the processor from do8 mestically produced sugarcane or sugarcane

9 molasses, that has been marketed (including the

10 transfer or delivery of the sugar to a refinery

11 for further processing or marketing); and

12 (B) in the case of marketings during each

13 of fiscal years 1997 through 2003, 1.375 per14 cent of the loan rate established under sub15 section (a) per pound of raw cane sugar, proc16 essed by the processor from domestically pro17 duced sugarcane or sugarcane molasses, that

18 has been marketed (including the transfer or

19 delivery of the sugar to a refinery for further

20 processing or marketing).

21 (2) SUGAR BEETS.—Effective for marketings of

22 beet sugar during the 1996 through 2003 fiscal

23 years, the first processor of sugar beets shall remit

24 to the Commodity Credit Corporation a nonrefund25 able marketing assessment in an amount equal to—
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•S 1541 IS

1 (A) in the case of marketings during fiscal

2 year 1996, 1.1794 percent of the loan rate es3 tablished under subsection (a) per pound of

4 beet sugar, processed by the processor from do5 mestically produced sugar beets or sugar beet

6 molasses, that has been marketed; and

7 (B) in the case of marketings during each

8 of fiscal years 1997 through 2003, 1.47425

9 percent of the loan rate established under sub10 section (a) per pound of beet sugar, processed

11 by the processor from domestically produced

12 sugar beets or sugar beet molasses, that has

13 been marketed.

14 (3) COLLECTION.—

15 (A) TIMING.—A marketing assessment re16 quired under this subsection shall be collected

17 on a monthly basis and shall be remitted to the

18 Commodity Credit Corporation not later than

19 30 days after the end of each month. Any cane

20 sugar or beet sugar processed during a fiscal

21 year that has not been marketed by September

22 30 of the year shall be subject to assessment on

23 that date. The sugar shall not be subject to a

24 second assessment at the time that it is mar25 keted.
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•S 1541 IS

1 (B) MANNER.—Subject to subparagraph

2 (A), marketing assessments shall be collected

3 under this subsection in the manner prescribed

4 by the Secretary and shall be nonrefundable.

5 (4) PENALTIES.—If any person fails to remit

6 the assessment required by this subsection or fails to

7 comply with such requirements for recordkeeping or

8 otherwise as are required by the Secretary to carry

9 out this subsection, the person shall be liable to the

10 Secretary for a civil penalty up to an amount deter11 mined by multiplying—

12 (A) the quantity of cane sugar or beet

13 sugar involved in the violation; by

14 (B) the loan rate for the applicable crop of

15 sugarcane or sugar beets.

16 (5) ENFORCEMENT.—The Secretary may en17 force this subsection in a court of the United States.

18 (f) FORFEITURE PENALTY.—

19 (1) IN GENERAL.—A penalty shall be assessed

20 on the forfeiture of any sugar pledged as collateral

21 for a nonrecourse loan under this section.

22 (2) CANE SUGAR.—The penalty for cane sugar

23 shall be 1 cent per pound.

24 (3) BEET SUGAR.—The penalty for beet sugar

25 shall bear the same relation to the penalty for cane
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1 sugar as the marketing assessment for sugar beets

2 bears to the marketing assessment for sugarcane.

3 (4) EFFECT OF FORFEITURE.—Any payments

4 owed producers by a processor that forfeits of any

5 sugar pledged as collateral for a nonrecourse loan

6 shall be reduced in proportion to the loan forfeiture

7 penalty incurred by the processor.

8 (g) INFORMATION REPORTING.—

9 (1) DUTY OF PROCESSORS AND REFINERS TO

10 REPORT.—A sugarcane processor, cane sugar re11 finer, and sugar beet processor shall furnish the Sec12 retary, on a monthly basis, such information as the

13 Secretary may require to administer sugar pro14 grams, including the quantity of purchases of sugar15 cane, sugar beets, and sugar, and production, impor16 tation, distribution, and stock levels of sugar.

17 (2) PENALTY.—Any person willfully failing or

18 refusing to furnish the information, or furnishing

19 willfully any false information, shall be subject to a

20 civil penalty of not more than $10,000 for each such

21 violation.

22 (3) MONTHLY REPORTS.—Taking into consider23 ation the information received under paragraph (1),

24 the Secretary shall publish on a monthly basis com-
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•S 1541 IS

1 posite data on production, imports, distribution, and

2 stock levels of sugar.

3 (h) MARKETING ALLOTMENTS.—Part VII of subtitle

4 B of title III of the Agricultural Adjustment Act of 1938

5 (7 U.S.C. 1359aa et seq.) is repealed.

6 (i) CROPS.—This section (other than subsection (h))

7 shall be effective only for the 1996 through 2002 crops

8 of sugar beets and sugarcane.

9 SEC. 18. ADMINISTRATION.

10 (a) COMMODITY CREDIT CORPORATION.—

11 (1) USE OF CORPORATION.—The Secretary

12 shall carry out this subtitle through the Commodity

13 Credit Corporation.

14 (2) SALARIES AND EXPENSES.—No funds of

15 the Corporation shall be used for any salary or ex16 pense of any officer or employee of the Department

17 of Agriculture.

18 (b) DETERMINATIONS BY SECRETARY.—A deter19 mination made by the Secretary under this subtitle or the

20 Agricultural Adjustment Act of 1938 (7 U.S.C. 1281 et

21 seq.) shall be final and conclusive.

22 (c) REGULATIONS.—The Secretary may issue such

23 regulations as the Secretary determines necessary to carry

24 out this subtitle.
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1 SEC. 19. ELIMINATION OF PERMANENT PRICE SUPPORT

2 AUTHORITY.

3 (a) AGRICULTURAL ADJUSTMENT ACT OF 1938.—

4 The Agricultural Adjustment Act of 1938 is amended—

5 (1) in title III—

6 (A) in subtitle B—

7 (i) by striking parts II through V (7

8 U.S.C. 1326–1351); and

9 (ii) in part VI—

10 (I) by moving subsection (c) of

11 section 358d (7 U.S.C. 1358d(c)) to

12 appear after section 301(b)(17) (7

13 U.S.C. 1301(b)(17)) and redesignat14 ing the subsection as paragraph (18);

15 and

16 (II) by striking sections 358,

17 358a, and 358d (7 U.S.C. 1358,

18 1358a, and 1359); and

19 (B) by striking subtitle D (7 U.S.C.

20 1379a–1379j); and

21 (2) by striking title IV (7 U.S.C. 1401–1407).

22 (b) AGRICULTURAL ACT OF 1949.—

23 (1) TRANSFER OF CERTAIN SECTIONS.—The

24 Agricultural Act of 1949 is amended—

25 (A) by transferring sections 106, 106A,

26 and 106B (7 U.S.C. 1445, 1445–1, 1445–2) to
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1 appear after section 314A of the Agricultural

2 Adjustment Act of 1938 (7 U.S.C. 1314–1) and

3 redesignating the transferred sections as sec4 tions 315, 315A, and 315B, respectively;

5 (B) by transferring sections 111, 201(c),

6 and 204 (7 U.S.C. 1445f, 1446(c), 1446e) to

7 appear after section 304 of the Agricultural Ad8 justment Act of 1938 (7 U.S.C. 1304) and re9 designating the transferred sections as sections

10 305, 306, and 307, respectively; and

11 (C) by transferring sections 404 and 416

12 (7 U.S.C. 1424 and 1431) to appear after sec13 tion 390 of the Agricultural Adjustment Act of

14 1938 (7 U.S.C. 1390) and redesignating the

15 transferred sections as sections 390A and

16 390B, respectively.

17 (2) REPEAL.—The Agricultural Act of 1949 (7

18 U.S.C. 1421 et seq.) (as amended by paragraph (1))

19 is repealed.

20 (c) CONFORMING AMENDMENTS.—

21 (1) Section 306 of the Agricultural Adjustment

22 Act of 1938 (as transferred and redesignated by

23 subsection (b)(1)(B)) is amended by striking ‘‘204’’

24 and inserting ‘‘307’’.
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1 (2) Section 361 of the Agricultural Adjustment

2 Act of 1938 (7 U.S.C. 1361) is amended by striking

3 ‘‘, corn, wheat, cotton, peanuts, and rice, estab4 lished’’.

5 SEC. 20. EFFECT OF AMENDMENTS.

6 (a) EFFECT ON PRIOR CROPS.—Except as otherwise

7 specifically provided and notwithstanding any other provi8 sion of law, this subtitle and the amendments made by

9 this subtitle shall not affect the authority of the Secretary

10 to carry out a price support or production adjustment pro11 gram for any of the 1991 through 1995 crops of an agri12 cultural commodity established under a provision of law

13 in effect immediately before the date of the enactment of

14 this Act.

15 (b) LIABILITY.—A provision of this subtitle or an

16 amendment made by this subtitle shall not affect the li17 ability of any person under any provision of law as in ef18 fect before the date of the enactment of this Act.

19 Subtitle B—Conservation

20 SEC. 31. CONSERVATION.

21 (a) FUNDING.—Subtitle E of title XII of the Food

22 Security Act of 1985 (16 U.S.C. 3841 et seq.) is amended

23 to read as follows:
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1 ‘‘Subtitle E—Funding

2 ‘‘SEC. 1241. FUNDING.

3 ‘‘(a) MANDATORY EXPENSES.—For each of fiscal

4 years 1996 through 2002, the Secretary shall use the

5 funds of the Commodity Credit Corporation to carry out

6 the programs authorized by—

7 ‘‘(1) subchapter B of chapter 1 of subtitle D

8 (including contracts extended by the Secretary pur9 suant to section 1437 of the Food, Agriculture, Con10 servation, and Trade Act of 1990 (Public Law 101–

11 624; 16 U.S.C. 3831 note));

12 ‘‘(2) subchapter C of chapter 1 of subtitle D;

13 and

14 ‘‘(3) chapter 4 of subtitle D.

15 ‘‘(b) LIVESTOCK ENVIRONMENTAL ASSISTANCE PRO16 GRAM.—For each of fiscal years 1996 through 2002,

17 $100,000,000 of the funds of the Commodity Credit Cor18 poration shall be available for providing technical assist19 ance, cost-sharing payments, and incentive payments for

20 practices relating to livestock production under the live21 stock environmental assistance program under chapter 4

22 of subtitle D.’’.

23 (b) LIVESTOCK ENVIRONMENTAL ASSISTANCE PRO24 GRAM.—To carry out the programs funded under the

25 amendment made by subsection (a), subtitle D of title XII
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1 of the Food Security Act of 1985 (16 U.S.C. 3830 et seq.)

2 is amended by adding at the end the following:

3 ‘‘CHAPTER 4—LIVESTOCK

4 ENVIRONMENTAL ASSISTANCE PROGRAM

5 ‘‘SEC. 1240. DEFINITIONS.

6 ‘‘In this chapter:

7 ‘‘(1) LAND MANAGEMENT PRACTICE.—The

8 term ‘land management practice’ means a site-spe9 cific nutrient or manure management, irrigation

10 management, tillage or residue management, grazing

11 management, or other land management practice

12 that the Secretary determines is needed to protect,

13 in the most cost effective manner, water, soil, or re14 lated resources from degradation due to livestock

15 production.

16 ‘‘(2) LARGE CONFINED LIVESTOCK OPER17 ATION.—The term ‘large confined livestock oper18 ation’ means an operation that—

19 ‘‘(A) is a confined animal feeding oper20 ation; and

21 ‘‘(B) has more than—

22 ‘‘(i) 700 mature dairy cattle;

23 ‘‘(ii) 10,000 beef cattle;
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1 ‘‘(iii) 30,000 laying hens or broilers

2 (if the facility has continuous overflow wa3 tering);

4 ‘‘(iv) 100,000 laying hens or broilers

5 (if the facility has a liquid manure sys6 tem);

7 ‘‘(v) 55,000 turkeys;

8 ‘‘(vi) 15,000 swine; or

9 ‘‘(vii) 10,000 sheep or lambs.

10 ‘‘(3) LIVESTOCK.—The term ‘livestock’ means

11 dairy cows, beef cattle, laying hens, broilers, turkeys,

12 swine, sheep, lambs, and such other animals as de13 termined by the Secretary.

14 ‘‘(4) OPERATOR.—The term ‘operator’ means a

15 person who is engaged in livestock production (as

16 defined by the Secretary).

17 ‘‘(5) STRUCTURAL PRACTICE.—The term ‘struc18 tural practice’ means the establishment of an animal

19 waste management facility, terrace, grassed water20 way, contour grass strip, filterstrip, or other struc21 tural practice that the Secretary determines is need22 ed to protect, in the most cost effective manner,

23 water, soil, or related resources from degradation

24 due to livestock production.
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1 ‘‘SEC. 1240A. ESTABLISHMENT AND ADMINISTRATION OF

2 LIVESTOCK ENVIRONMENTAL ASSISTANCE

3 PROGRAM.

4 ‘‘(a) ESTABLISHMENT.—

5 ‘‘(1) IN GENERAL.—During the 1996 through

6 2002 fiscal years, the Secretary shall provide tech7 nical assistance, cost-sharing payments, and incen8 tive payments to operators who enter into contracts

9 with the Secretary, through a livestock environ10 mental assistance program.

11 ‘‘(2) ELIGIBLE PRACTICES.—

12 ‘‘(A) STRUCTURAL PRACTICES.—An opera13 tor who implements a structural practice shall

14 be eligible for technical assistance or cost-shar15 ing payments, or both.

16 ‘‘(B) LAND MANAGEMENT PRACTICES.—An

17 operator who performs a land management

18 practice shall be eligible for technical assistance

19 or incentive payments, or both.

20 ‘‘(3) ELIGIBLE LAND.—Assistance under this

21 chapter may be provided with respect to land that

22 is used for livestock production and on which a seri23 ous threat to water, soil, or related resources exists,

24 as determined by the Secretary, by reason of the soil

25 types, terrain, climatic, soil, topographic, flood, or
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1 saline characteristics, or other factors or natural

2 hazards.

3 ‘‘(4) SELECTION CRITERIA.—In providing tech4 nical assistance, cost-sharing payments, and incen5 tive payments to operators in a region, watershed, or

6 conservation priority area in which an agricultural

7 operation is located, the Secretary shall consider—

8 ‘‘(A) the significance of the water, soil, and

9 related natural resource problems; and

10 ‘‘(B) the maximization of environmental

11 benefits per dollar expended.

12 ‘‘(b) APPLICATION AND TERM.—

13 ‘‘(1) IN GENERAL.—A contract between an op14 erator and the Secretary under this chapter may—

15 ‘‘(A) apply to 1 or more structural prac16 tices or 1 or more land management practices,

17 or both; and

18 ‘‘(B) have a term of not less than 5, nor

19 more than 10, years, as determined appropriate

20 by the Secretary, depending on the practice or

21 practices that are the basis of the contract.

22 ‘‘(2) DUTIES OF OPERATORS AND SEC23 RETARY.—To receive cost-sharing or incentive pay24 ments, or technical assistance, participating opera25 tors shall comply with all terms and conditions of
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1 the contract and a plan, as established by the Sec2 retary.

3 ‘‘(c) STRUCTURAL PRACTICES.—

4 ‘‘(1) COMPETITIVE OFFER.—The Secretary

5 shall administer a competitive offer system for oper6 ators proposing to receive cost-sharing payments in

7 exchange for the implementation of 1 or more struc8 tural practices by the operator. The competitive

9 offer system shall consist of—

10 ‘‘(A) the submission of a competitive offer

11 by the operator in such manner as the Sec12 retary may prescribe; and

13 ‘‘(B) evaluation of the offer in light of the

14 selection criteria established under subsection

15 (a)(4) and the projected cost of the proposal, as

16 determined by the Secretary.

17 ‘‘(2) CONCURRENCE OF OWNER.—If the opera18 tor making an offer to implement a structural prac19 tice is a tenant of the land involved in agricultural

20 production, for the offer to be acceptable, the opera21 tor shall obtain the concurrence of the owner of the

22 land with respect to the offer.

23 ‘‘(d) LAND MANAGEMENT PRACTICES.—The Sec24 retary shall establish an application and evaluation proc25 ess for awarding technical assistance or incentive pay-
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1 ments, or both, to an operator in exchange for the per2 formance of 1 or more land management practices by the

3 operator.

4 ‘‘(e) COST-SHARING, INCENTIVE PAYMENTS, AND

5 TECHNICAL ASSISTANCE.—

6 ‘‘(1) COST-SHARING PAYMENTS.—

7 ‘‘(A) IN GENERAL.—The Federal share of

8 cost-sharing payments to an operator proposing

9 to implement 1 or more structural practices

10 shall not be greater than 75 percent of the pro11 jected cost of each practice, as determined by

12 the Secretary, taking into consideration any

13 payment received by the operator from a State

14 or local government.

15 ‘‘(B) LIMITATION.—An operator of a large

16 confined livestock operation shall not be eligible

17 for cost-sharing payments to construct an ani18 mal waste management facility.

19 ‘‘(C) OTHER PAYMENTS.—An operator

20 shall not be eligible for cost-sharing payments

21 for structural practices on eligible land under

22 this chapter if the operator receives cost-shar23 ing payments or other benefits for the same

24 land under chapter 1, 2, or 3.
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1 ‘‘(2) INCENTIVE PAYMENTS.—The Secretary

2 shall make incentive payments in an amount and at

3 a rate determined by the Secretary to be necessary

4 to encourage an operator to perform 1 or more land

5 management practices.

6 ‘‘(3) TECHNICAL ASSISTANCE.—

7 ‘‘(A) FUNDING.—The Secretary shall allo8 cate funding under this chapter for the provi9 sion of technical assistance according to the

10 purpose and projected cost for which the tech11 nical assistance is provided for a fiscal year.

12 The allocated amount may vary according to

13 the type of expertise required, quantity of time

14 involved, and other factors as determined ap15 propriate by the Secretary. Funding shall not

16 exceed the projected cost to the Secretary of the

17 technical assistance provided for a fiscal year.

18 ‘‘(B) OTHER AUTHORITIES.—The receipt

19 of technical assistance under this chapter shall

20 not affect the eligibility of the operator to re21 ceive technical assistance under other authori22 ties of law available to the Secretary.

23 ‘‘(f) LIMITATION ON PAYMENTS.—
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1 ‘‘(1) IN GENERAL.—The total amount of cost2 sharing and incentive payments paid to a person

3 under this chapter may not exceed—

4 ‘‘(A) $10,000 for any fiscal year; or

5 ‘‘(B) $50,000 for any multiyear contract.

6 ‘‘(2) REGULATIONS.—The Secretary shall issue

7 regulations that are consistent with section 1001 for

8 the purpose of—

9 ‘‘(A) defining the term ‘person’ as used in

10 paragraph (1); and

11 ‘‘(B) prescribing such rules as the Sec12 retary determines necessary to ensure a fair

13 and reasonable application of the limitations es14 tablished under this subsection.

15 ‘‘(g) REGULATIONS.—Not later than 180 days after

16 the effective date of this subsection, the Secretary shall

17 issue regulations to implement the livestock environmental

18 assistance program established under this chapter.’’.

19 (c) CONFORMING AMENDMENTS.—

20 (1) COMMODITY CREDIT CORPORATION CHAR21 TER ACT.—Section 5(g) of the Commodity Credit

22 Corporation Charter Act (15 U.S.C. 714c(g)) is

23 amended to read as follows:

24 ‘‘(g) Carry out conservation functions and pro25 grams.’’.
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1 (2) WETLANDS RESERVE PROGRAM.—

2 (A) IN GENERAL.—Section 1237 of the

3 Food Security Act of 1985 (16 U.S.C. 3837) is

4 amended—

5 (i) in subsection (b)(2)—

6 (I) by striking ‘‘not less’’ and in7 serting ‘‘not more’’; and

8 (II) by striking ‘‘2000’’ and in9 serting ‘‘2002’’; and

10 (ii) in subsection (c), by striking

11 ‘‘2000’’ and inserting ‘‘2002’’.

12 (B) LENGTH OF EASEMENT.—Section

13 1237A(e) of the Food Security Act of 1985 (16

14 U.S.C. 3837a(e)) is amended by striking para15 graph (2) and inserting the following:

16 ‘‘(2) shall be for 15 years, but in no case shall

17 be a permanent easement.’’.

18 (3) CONSERVATION RESERVE PROGRAM.—

19 (A) IN GENERAL.—Section 1231(d) of the

20 Food Security Act of 1985 (16 U.S.C. 3831(d))

21 is amended by striking ‘‘total of’’ and all that

22 follows through the period at the end of the

23 subsection and inserting ‘‘total of 36,400,000

24 acres.’’.
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1 (B) OPTIONAL CONTRACT TERMINATION

2 BY PRODUCERS.—Section 1235 of the Food Se3 curity Act of 1985 (16 U.S.C. 3835) is amend4 ed by adding at the end the following:

5 ‘‘(e) TERMINATION BY OWNER OR OPERATOR.—

6 ‘‘(1) NOTICE OF TERMINATION.—An owner or

7 operator of land subject to a contract entered into

8 under this subchapter may terminate the contract by

9 submitting to the Secretary written notice of the in10 tention of the owner or operator to terminate the

11 contract.

12 ‘‘(2) EFFECTIVE DATE.—The contract termi13 nation shall take effect 60 days after the date on

14 which the owner or operator submits the written no15 tice under paragraph (1).

16 ‘‘(3) PRORATED RENTAL PAYMENT.—If a con17 tract entered into under this subchapter is termi18 nated under this subsection before the end of the fis19 cal year for which a rental payment is due, the Sec20 retary shall provide a prorated rental payment cover21 ing the portion of the fiscal year during which the

22 contract was in effect.

23 ‘‘(4) RENEWED ENROLLMENT.—The termi24 nation of a contract entered into under this sub25 chapter shall not affect the ability of the owner or
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1 operator who requested the termination to submit a

2 subsequent bid to enroll the land that was subject to

3 the contract into the conservation reserve.

4 ‘‘(5) CONSERVATION REQUIREMENTS.—If land

5 that was subject to a contract is returned to produc6 tion of an agricultural commodity, the conservation

7 requirements under subtitles B and C shall apply to

8 the use of the land to the extent that the require9 ments are similar to those requirements imposed on

10 other similar lands in the area, except that the re11 quirements may not be more onerous than the re12 quirements imposed on other lands.

13 ‘‘(6) REPAYMENT OF COST SHARE.—A person

14 who terminates a contract entered into under this

15 subchapter within less than 3 years after entering

16 into the contract shall reimburse the Secretary for

17 any cost share assistance provided under the con18 tract.’’.

19 (C) LIMITATION.—Notwithstanding any

20 other provision of law, no new acres shall be en21 rolled in the conservation reserve program es22 tablished under subchapter B of chapter 1 of

23 subtitle D of title XII of the Food Security Act

24 of 1985 (16 U.S.C. 3831 et seq.) in calendar

25 year 1997.
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1 Subtitle C—Agricultural Promotion

2 and Export Programs

3 SEC. 41. MARKET PROMOTION PROGRAM.

4 Effective October 1, 1995, section 211(c)(1) of the

5 Agricultural Trade Act of 1978 (7 U.S.C. 5641(c)(1)) is

6 amended—

7 (1) by striking ‘‘and’’ after ‘‘1991 through

8 1993,’’; and

9 (2) by striking ‘‘through 1997,’’ and inserting

10 ‘‘through 1995, and not more than $100,000,000

11 for each of fiscal years 1996 through 2002,’’.

12 SEC. 42. EXPORT ENHANCEMENT PROGRAM.

13 Effective October 1, 1995, section 301(e)(1) of the

14 Agricultural Trade Act of 1978 (7 U.S.C. 5651(e)(1)) is

15 amended to read as follows:

16 ‘‘(1) IN GENERAL.—The Commodity Credit

17 Corporation shall make available to carry out the

18 program established under this section not more

19 than—

20 ‘‘(A) $350,000,000 for fiscal year 1996;

21 ‘‘(B) $350,000,000 for fiscal year 1997;

22 ‘‘(C) $500,000,000 for fiscal year 1998;

23 ‘‘(D) $550,000,000 for fiscal year 1999;

24 ‘‘(E) $579,000,000 for fiscal year 2000;
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1 ‘‘(F) $478,000,000 for fiscal year 2001;

2 and

3 ‘‘(G) $478,000,000 for fiscal year 2002.’’.

4 Subtitle D—Miscellaneous

5 SEC. 51. CROP INSURANCE.

6 (a) CATASTROPHIC RISK PROTECTION.—Section

7 508(b) of the Federal Crop Insurance Act (7 U.S.C.

8 1508(b)) is amended—

9 (1) in paragraph (4), by adding at the end the

10 following:

11 ‘‘(C) DELIVERY OF COVERAGE.—

12 ‘‘(i) IN GENERAL.—In full consulta13 tion with approved insurance providers, the

14 Secretary may continue to offer cata15 strophic risk protection in a State (or a

16 portion of a State) through local offices of

17 the Department if the Secretary deter18 mines that there is an insufficient number

19 of approved insurance providers operating

20 in the State or portion to adequately pro21 vide catastrophic risk protection coverage

22 to producers.

23 ‘‘(ii) COVERAGE BY APPROVED INSUR24 ANCE PROVIDERS.—To the extent that cat25 astrophic risk protection coverage by ap-
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1 proved insurance providers is sufficiently

2 available in a State as determined by the

3 Secretary, only approved insurance provid4 ers may provide the coverage in the State.

5 ‘‘(iii) CURRENT POLICIES.—Subject to

6 clause (ii), all catastrophic risk protection

7 policies written by local offices of the De8 partment shall be transferred (including all

9 fees collected for the crop year in which

10 the approved insurance provider will as11 sume the policies) to the approved insur12 ance provider for performance of all sales,

13 service, and loss adjustment functions.’’;

14 and

15 (2) in paragraph (7), by striking subparagraph

16 (A) and inserting the following:

17 ‘‘(A) IN GENERAL.—Effective for the

18 spring-planted 1996 and subsequent crops, to

19 be eligible for any payment or loan under the

20 Agricultural Market Transition Act, the con21 servation reserve program, or any benefit de22 scribed in section 371 of the Consolidated Farm

23 and Rural Development Act (7 U.S.C. 2008f),

24 a person shall—
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1 ‘‘(i) obtain at least the catastrophic

2 level of insurance for each crop of eco3 nomic significance in which the person has

4 an interest; or

5 ‘‘(ii) provide a written waiver to the

6 Secretary that waives any eligibility for

7 emergency crop loss assistance in connec8 tion with the crop.’’.

9 (b) COVERAGE OF SEED CROPS.—Section

10 519(a)(2)(B) of the Act (7 U.S.C. 1519(a)(2)(B)) is

11 amended by inserting ‘‘seed crops,’’ after ‘‘turfgrass sod,’’.

12 SEC. 52. COLLECTION AND USE OF AGRICULTURAL QUAR13 ANTINE AND INSPECTION FEES.

14 Subsection (a) of section 2509 of the Food, Agri15 culture, Conservation, and Trade Act of 1990 (21 U.S.C.

16 136a) is amended to read as follows:

17 ‘‘(a) QUARANTINE AND INSPECTION FEES.—

18 ‘‘(1) FEES AUTHORIZED.—The Secretary of Ag19 riculture may prescribe and collect fees sufficient—

20 ‘‘(A) to cover the cost of providing agricul21 tural quarantine and inspection services in con22 nection with the arrival at a port in the cus23 toms territory of the United States, or the

24 preclearance or preinspection at a site outside

25 the customs territory of the United States, of
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1 an international passenger, commercial vessel,

2 commercial aircraft, commercial truck, or rail3 road car;

4 ‘‘(B) to cover the cost of administering this

5 subsection; and

6 ‘‘(C) through fiscal year 2002, to maintain

7 a reasonable balance in the Agricultural Quar8 antine Inspection User Fee Account established

9 under paragraph (5).

10 ‘‘(2) LIMITATION.—In setting the fees under

11 paragraph (1), the Secretary shall ensure that the

12 amount of the fees are commensurate with the costs

13 of agricultural quarantine and inspection services

14 with respect to the class of persons or entities pay15 ing the fees. The costs of the services with respect

16 to passengers as a class includes the costs of related

17 inspections of the aircraft or other vehicle.

18 ‘‘(3) STATUS OF FEES.—Fees collected under

19 this subsection by any person on behalf of the Sec20 retary are held in trust for the United States and

21 shall be remitted to the Secretary in such manner

22 and at such times as the Secretary may prescribe.

23 ‘‘(4) LATE PAYMENT PENALTIES.—If a person

24 subject to a fee under this subsection fails to pay the

25 fee when due, the Secretary shall assess a late pay-
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1 ment penalty, and the overdue fees shall accrue in2 terest, as required by section 3717 of title 31,

3 United States Code.

4 ‘‘(5) AGRICULTURAL QUARANTINE INSPECTION

5 USER FEE ACCOUNT.—

6 ‘‘(A) ESTABLISHMENT.—There is estab7 lished in the Treasury of the United States a

8 no-year fund, to be known as the ‘Agricultural

9 Quarantine Inspection User Fee Account’,

10 which shall contain all of the fees collected

11 under this subsection and late payment pen12 alties and interest charges collected under para13 graph (4) through fiscal year 2002.

14 ‘‘(B) USE OF ACCOUNT.—For each of the

15 fiscal years 1996 through 2002, funds in the

16 Agricultural Quarantine Inspection User Fee

17 Account shall be available, in such amounts as

18 are provided in advance in appropriations Acts,

19 to cover the costs associated with the provision

20 of agricultural quarantine and inspection serv21 ices and the administration of this subsection.

22 Amounts made available under this subpara23 graph shall be available until expended.

24 ‘‘(C) EXCESS FEES.—Fees and other

25 amounts collected under this subsection in any
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1 of the fiscal years 1996 through 2002 in excess

2 of $100,000,000 shall be available for the pur3 poses specified in subparagraph (B) until ex4 pended, without further appropriation.

5 ‘‘(6) USE OF AMOUNTS COLLECTED AFTER FIS6 CAL YEAR 2002.—After September 30, 2002, the un7 obligated balance in the Agricultural Quarantine In8 spection User Fee Account and fees and other

9 amounts collected under this subsection shall be

10 credited to the Department of Agriculture accounts

11 that incur the costs associated with the provision of

12 agricultural quarantine and inspection services and

13 the administration of this subsection. The fees and

14 other amounts shall remain available to the Sec15 retary until expended without fiscal year limitation.

16 ‘‘(7) STAFF YEARS.—The number of full-time

17 equivalent positions in the Department of Agri18 culture attributable to the provision of agricultural

19 quarantine and inspection services and the adminis20 tration of this subsection shall not be counted to21 ward the limitation on the total number of full-time

22 equivalent positions in all agencies specified in sec23 tion 5(b) of the Federal Workforce Restructuring

24 Act of 1994 (Public Law 103–226; 5 U.S.C. 3101
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1 note) or other limitation on the total number of full2 time equivalent positions.’’.

3 SEC. 53. COMMODITY CREDIT CORPORATION INTEREST

4 RATE.

5 Notwithstanding any other provision of law, the

6 monthly Commodity Credit Corporation interest rate ap7 plicable to loans provided for agricultural commodities by

8 the Corporation shall be 100 basis points greater than the

9 rate determined under the applicable interest rate formula

10 in effect on October 1, 1995.

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