II

Calendar No. 767

106TH CONGRESS

2D SESSION S. 3001

[Report No. 106–391]

To amend the United States Grain Standards Act to extend the authority

of the Secretary of Agriculture to collect fees, extend the authorization

of appropriations, and improve the administration of that Act, to amend

the United States Warehouse Act to authorize the issuance of electronic

warehouse receipts, and for other purposes.

IN THE SENATE OF THE UNITED STATES

AUGUST 25, 2000

Mr. LUGAR, from the Committee on Agriculture, Nutrition, and Forestry, reported under authority of the order of the Senate of July 26, 2000, the

following original bill; which was read twice and placed on the calendar

A BILL

To amend the United States Grain Standards Act to extend

the authority of the Secretary of Agriculture to collect

fees, extend the authorization of appropriations, and improve the administration of that Act, to amend the

United States Warehouse Act to authorize the issuance

of electronic warehouse receipts, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

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

3 ‘‘Grain Standards and Warehouse Improvement Act of

4 2000’’.

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

6 this Act is as follows:

Sec. 1. Short title; table of contents.

TITLE I—GRAIN STANDARDS

Sec. 101. Sampling for export grain.

Sec. 102. Geographic boundaries for official agencies.

Sec. 103. Authorization to collect fees.

Sec. 104. Testing of equipment.

Sec. 105. Limitation on administrative and supervisory costs.

Sec. 106. Licenses and authorizations.

Sec. 107. Grain additives.

Sec. 108. Authorization of appropriations.

Sec. 109. Advisory committee.

Sec. 110. Conforming amendments.

TITLE II—WAREHOUSES

Sec. 201. Storage of agricultural products in warehouses.

TITLE III—MISCELLANEOUS

Sec. 301. Energy generation, transmission, and distribution facilities efficiency

grants in rural communities with extremely high energy costs.

Sec. 302. Carry forward adjustment.

Sec. 303. Fees and penalties for mediation and arbitration of disputes involving

agricultural products moving in foreign commerce under multinational entities.

Sec. 304. Community facilities grant program for rural communities with extreme unemployment and severe economic depression.

Sec. 305. Eligibility for business and industry loans.

Sec. 306. State agricultural loan mediation programs.

Sec. 307. Adjustments to nutrition programs.

7 TITLE I—GRAIN STANDARDS

8 SEC. 101. SAMPLING FOR EXPORT GRAIN.

9 Section 5(a)(1) of the United States Grain Standards

10 Act (7 U.S.C. 77(a)(1)) is amended by striking ‘‘(on the
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1 basis’’ and all that follows through ‘‘from the United

2 States)’’.

3 SEC. 102. GEOGRAPHIC BOUNDARIES FOR OFFICIAL AGEN4 CIES.

5 (a) INSPECTION AUTHORITY.—Section 7(f)(2) of the

6 United States Grain Standards Act (7 U.S.C. 79(f)(2))

7 is amended by striking ‘‘conduct pilot programs to’’.

8 (b) WEIGHING AUTHORITY.—Section 7A(i) of the

9 United States Grain Standards Act (7 U.S.C. 79a(i)) is

10 amended in the last sentence by striking ‘‘conduct pilot

11 programs to’’.

12 SEC. 103. AUTHORIZATION TO COLLECT FEES.

13 (a) INSPECTION AND SUPERVISORY FEES.—Section

14 7(j)(4) of the United States Grain Standards Act (7

15 U.S.C. 79(j)(4)) is amended in the first sentence by strik16 ing ‘‘2000’’ and inserting ‘‘2005’’.

17 (b) WEIGHING AND SUPERVISORY FEES.—Section

18 7A(l)(3) of the United States Grain Standards Act (7

19 U.S.C. 79a(l)(3)) is amended in the first sentence by strik20 ing ‘‘2000’’ and inserting ‘‘2005’’.

21 SEC. 104. TESTING OF EQUIPMENT.

22 Section 7B(a) of the United States Grain Standards

23 Act (7 U.S.C. 79b(a)) is amended in the first sentence

24 by striking ‘‘but at least annually and’’.
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1 SEC. 105. LIMITATION ON ADMINISTRATIVE AND SUPER2 VISORY COSTS.

3 Section 7D of the United States Grain Standards Act

4 (7 U.S.C. 79d) is amended—

5 (1) by striking ‘‘2000’’ and inserting ‘‘2005’’;

6 and

7 (2) by striking ‘‘40 per centum’’ and inserting

8 ‘‘30 percent’’.

9 SEC. 106. LICENSES AND AUTHORIZATIONS.

10 Section 8(a)(3) of the United States Grain Standards

11 Act (7 U.S.C. 84(a)(3)) is amended by inserting ‘‘inspec12 tion, weighing,’’ after ‘‘laboratory testing,’’.

13 SEC. 107. GRAIN ADDITIVES.

14 Section 13(e)(1) of the United States Grain Stand15 ards Act (7 U.S.C. 87b(e)(1)) is amended by inserting ‘‘,

16 or prohibit disguising the quality of grain,’’ after ‘‘sound

17 and pure grain’’.

18 SEC. 108. AUTHORIZATION OF APPROPRIATIONS.

19 Section 19 of the United States Grain Standards Act

20 (7 U.S.C. 87h) is amended by striking ‘‘2000’’ and insert21 ing ‘‘2005’’.

22 SEC. 109. ADVISORY COMMITTEE.

23 Section 21(e) of the United States Grain Standards

24 Act (7 U.S.C. 87j(e)) is amended by striking ‘‘2000’’ and

25 inserting ‘‘2005’’.
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1 SEC. 110. CONFORMING AMENDMENTS.

2 (a) Section 8 of the United States Grain Standards

3 Act of 1976 (7 U.S.C. 79 note; Public Law 94–582) is

4 amended—

5 (1) by striking ‘‘(a)’’; and

6 (2) by striking subsection (b).

7 (b) Sections 23, 24, and 25 of the United States

8 Grain Standards Act of 1976 (7 U.S.C. 87e–1, 7 U.S.C.

9 76 note; Public Law 94–582) are repealed.

10 (c) Section 27 of the United States Grain Standards

11 Act of 1976 (7 U.S.C. 74 note; Public Law 94–582) is

12 amended by striking ‘‘; and thereafter’’ and all that fol13 lows and inserting a period.

14 TITLE II—WAREHOUSES

15 SEC. 201. STORAGE OF AGRICULTURAL PRODUCTS IN

16 WAREHOUSES.

17 The United States Warehouse Act (7 U.S.C. 241 et

18 seq.) is amended to read as follows:

19 ‘‘SECTION 1. SHORT TITLE.

20 ‘‘This Act may be cited as the ‘United States Ware21 house Act’.

22 ‘‘SEC. 2. DEFINITIONS.

23 ‘‘In this Act:

24 ‘‘(1) AGRICULTURAL PRODUCT.—The term ‘ag25 ricultural product’ means an agricultural commodity,
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1 as determined by the Secretary, including a proc2 essed product of an agricultural commodity.

3 ‘‘(2) APPROVAL.—The term ‘approval’ means

4 the consent provided by the Secretary for a person

5 to engage in an activity authorized by this Act.

6 ‘‘(3) DEPARTMENT.—The term ‘‘Department’’

7 means the Department of Agriculture.

8 ‘‘(4) ELECTRONIC DOCUMENT.—The term ‘elec9 tronic document’ means a document authorized

10 under this Act generated, sent, received, or stored by

11 electronic, optical, or similar means, including elec12 tronic data interchange, electronic mail, telegram,

13 telex, or telecopy.

14 ‘‘(5) ELECTRONIC RECEIPT.—The term ‘elec15 tronic receipt’ means a receipt that is authorized by

16 the Secretary to be issued or transmitted under this

17 Act in the form of an electronic document.

18 ‘‘(6) HOLDER.—

19 ‘‘(A) IN GENERAL.—The term ‘holder’

20 means a person, as defined by the Secretary,

21 that has possession in fact or by operation of

22 law of a receipt or any electronic document.

23 ‘‘(B) INCLUSION.—The term ‘holder’ in24 cludes a person that has possession of a receipt
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1 or electronic document as a creditor of another

2 person.

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

4 ‘‘(A) a person (as defined in section 1 of

5 title 1, United States Code);

6 ‘‘(B) a State; and

7 ‘‘(C) a political subdivision of a State.

8 ‘‘(8) RECEIPT.—The term ‘receipt’ means a

9 warehouse receipt issued in accordance with this

10 Act, including an electronic receipt.

11 ‘‘(9) SECRETARY.—The term ‘Secretary’ means

12 the Secretary of Agriculture.

13 ‘‘(10) WAREHOUSE.—The term ‘warehouse’

14 means a structure or other approved storage facility,

15 as determined by the Secretary, in which any agri16 cultural product may be stored or handled for the

17 purposes of interstate or foreign commerce.

18 ‘‘(11) WAREHOUSE OPERATOR.—The term

19 ‘warehouse operator’ means a person that is lawfully

20 engaged in the business of storing or handling agri21 cultural products.

22 ‘‘SEC. 3. POWERS OF SECRETARY.

23 ‘‘(a) IN GENERAL.—The Secretary shall have exclu24 sive power, jurisdiction, and authority, to the extent that

25 this Act applies, with respect to—
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1 ‘‘(1) each warehouse operator licensed under

2 this Act;

3 ‘‘(2) each person that has obtained an approval

4 to engage in an activity under this Act; and

5 ‘‘(3) each person claiming an interest in an ag6 ricultural product by means of an electronic docu7 ment or electronic receipt subject to this Act.

8 ‘‘(b) COVERED AGRICULTURAL PRODUCTS.—The

9 Secretary shall specify, after an opportunity for notice and

10 comment, those agricultural products for which a ware11 house license may be issued under this Act.

12 ‘‘(c) INVESTIGATIONS.—The Secretary may inves13 tigate the storing, warehousing, classifying according to

14 grade and otherwise, weighing, and certifying of agricul15 tural products.

16 ‘‘(d) INSPECTIONS.—The Secretary may inspect or

17 cause to be inspected any person or warehouse licensed

18 under this Act and any warehouse for which a license is

19 applied for under this Act.

20 ‘‘(e) SUITABILITY FOR STORAGE.—The Secretary

21 may determine whether a licensed warehouse, or a ware22 house for which a license is applied for under this Act,

23 is suitable for the proper storage of the agricultural prod24 uct or products stored or proposed for storage in the ware25 house.
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1 ‘‘(f) CLASSIFICATION.—The Secretary may classify a

2 licensed warehouse, or a warehouse for which a license is

3 applied for under this Act, in accordance with the owner4 ship, location, surroundings, capacity, conditions, and

5 other qualities of the warehouse and as to the kinds of

6 licenses issued or that may be issued for the warehouse

7 under this Act.

8 ‘‘(g) WAREHOUSE OPERATOR’S DUTIES.—Subject to

9 the other provisions of this Act, the Secretary may pre10 scribe the duties of a warehouse operator operating a

11 warehouse licensed under this Act with respect to the

12 warehouse operator’s care of and responsibility for agricul13 tural products stored or handled by the warehouse oper14 ator.

15 ‘‘(h) SYSTEMS FOR CONVEYANCE OF TITLE IN AGRI16 CULTURAL PRODUCTS.—The Secretary may approve 1 or

17 more systems under which title in agricultural products

18 may be conveyed and under which documents relating to

19 the shipment, payment, and financing of the sale of agri20 cultural products may be transferred, including convey21 ance of receipts and any other written or electronic docu22 ments in accordance with a process established by the Sec23 retary.
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1 ‘‘(i) EXAMINATION AND AUDITS.—The Secretary

2 may conduct an examination, audit, or similar activity

3 with respect to—

4 ‘‘(1) any person that is engaged in the business

5 of storing an agricultural product that is subject to

6 this Act;

7 ‘‘(2) any State agency that regulates the stor8 age of an agricultural product by such a person; or

9 ‘‘(3) any commodity exchange with regulatory

10 authority over the storage of agricultural products

11 that are subject to this Act.

12 ‘‘(j) LICENSES FOR OPERATION OF WAREHOUSES.—

13 The Secretary may issue to any warehouse operator a li14 cense for the operation of a warehouse in accordance with

15 this Act if—

16 ‘‘(1) the Secretary determines that the ware17 house is suitable for the proper storage of the agri18 cultural product or products stored or proposed for

19 storage in the warehouse; and

20 ‘‘(2) the warehouse operator agrees, as a condi21 tion of the license, to comply with this Act (includ22 ing regulations promulgated under this Act).

23 ‘‘(k) LICENSING OF OTHER PERSONS.—

24 ‘‘(1) IN GENERAL.—On presentation of satisfac25 tory proof of competency to carry out the activities
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1 described in this paragraph, the Secretary may issue

2 to any person a Federal license—

3 ‘‘(A) to inspect any agricultural product

4 stored or handled in a warehouse subject to this

5 Act;

6 ‘‘(B) to sample such an agricultural prod7 uct;

8 ‘‘(C) to classify such an agricultural prod9 uct according to condition, grade, or other class

10 and certify the condition, grade, or other class

11 of the agricultural product; or

12 ‘‘(D) to weigh such an agricultural product

13 and certify the weight of the agricultural prod14 uct.

15 ‘‘(2) CONDITION.—As a condition of a license

16 issued under paragraph (1), the licensee shall agree

17 to comply with this Act (including regulations pro18 mulgated under this Act).

19 ‘‘(l) EXAMINATION OF BOOKS, RECORDS, PAPERS,

20 AND ACCOUNTS.—The Secretary may examine, using des21 ignated officers, employees, or agents of the Department,

22 all books, records, papers, and accounts relating to activi23 ties subject to this Act of—

24 ‘‘(1) a warehouse operator operating a ware25 house licensed under this Act;
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1 ‘‘(2) a person operating a system for the elec2 tronic recording and transfer of receipts and other

3 documents authorized by the Secretary; or

4 ‘‘(3) any other person issuing receipts or elec5 tronic documents authorized by the Secretary under

6 this Act.

7 ‘‘(m) COOPERATION WITH STATES.—The Secretary

8 may—

9 ‘‘(1) cooperate with officers and employees of a

10 State who administer or enforce State laws relating

11 to warehouses, warehouse operators, weighers, grad12 ers, inspectors, samplers, or classifiers; and

13 ‘‘(2) enter into cooperative agreements with

14 States to perform activities authorized under this

15 Act.

16 ‘‘SEC. 4. IMPOSITION AND COLLECTION OF FEES.

17 ‘‘(a) IN GENERAL.—The Secretary shall charge, as18 sess, and cause to be collected fees to cover the costs of

19 administering this Act.

20 ‘‘(b) RATES.—The fees under this section shall be set

21 at a rate determined by the Secretary.

22 ‘‘(c) TREATMENT OF FEES.—All fees collected under

23 this section shall be credited to the account that incurs

24 the costs of administering this Act and shall be available
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1 to the Secretary without further appropriation and with2 out fiscal year limitation.

3 ‘‘(d) INTEREST.—Funds collected under this section

4 may be deposited in an interest bearing account with a

5 financial institution, and any interest earned on the ac6 count shall be credited under subsection (c).

7 ‘‘(e) EFFICIENCIES AND COST EFFECTIVENESS.—

8 ‘‘(1) IN GENERAL.—The Secretary shall seek to

9 minimize the fees established under this section by

10 improving efficiencies and reducing costs, including

11 the efficient use of personnel to the extent prac12 ticable and consistent with the effective implementa13 tion of this Act.

14 ‘‘(2) REPORT.—The Secretary shall publish an

15 annual report on the actions taken by the Secretary

16 to comply with paragraph (1).

17 ‘‘SEC. 5. QUALITY AND VALUE STANDARDS.

18 ‘‘If standards for the evaluation or determination of

19 the quality or value of an agricultural product are not es20 tablished under another Federal law, the Secretary may

21 establish standards for the evaluation or determination of

22 the quality or value of the agricultural product under this

23 Act.
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1 ‘‘SEC. 6. BONDING AND OTHER FINANCIAL ASSURANCE RE2 QUIREMENTS.

3 ‘‘(a) IN GENERAL.—As a condition of receiving a li4 cense or approval under this Act (including regulations

5 promulgated under this Act), the person applying for the

6 license or approval shall execute and file with the Sec7 retary a bond, or provide such other financial assurance

8 as the Secretary determines appropriate, to secure the per9 son’s performance of the activities so licensed or approved.

10 ‘‘(b) SERVICE OF PROCESS.—To qualify as a suitable

11 bond or other financial assurance under subsection (a),

12 the surety, sureties, or financial institution shall be subject

13 to service of process in suits on the bond or other financial

14 assurance in the State, district, or territory in which the

15 warehouse is located.

16 ‘‘(c) ADDITIONAL ASSURANCES.—If the Secretary de17 termines that a previously approved bond or other finan18 cial assurance is insufficient, the Secretary may suspend

19 or revoke the license or approval covered by the bond or

20 other financial assurance if the person that filed the bond

21 or other financial assurance does not provide such addi22 tional bond or other financial assurance as the Secretary

23 determines appropriate.

24 ‘‘(d) THIRD PARTY ACTIONS.—Any person injured by

25 the breach of any obligation arising under this Act for

26 which a bond or other financial assurance has been ob-
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1 tained as required by this section may sue with respect

2 to the bond or other financial assurance in a district court

3 of the United States to recover the damages that the per4 son sustained as a result of the breach.

5 ‘‘SEC. 7. MAINTENANCE OF RECORDS.

6 ‘‘To facilitate the administration of this Act, the fol7 lowing persons shall maintain such records and make such

8 reports, as the Secretary may by regulation require:

9 ‘‘(1) A warehouse operator that is licensed

10 under this Act.

11 ‘‘(2) A person operating a system for the elec12 tronic recording and transfer of receipts and other

13 documents that are authorized under this Act.

14 ‘‘(3) Any other person issuing receipts or elec15 tronic documents that are authorized under this Act.

16 ‘‘SEC. 8. FAIR TREATMENT IN STORAGE OF AGRICULTURAL

17 PRODUCTS.

18 ‘‘(a) IN GENERAL.—Subject to the capacity of a

19 warehouse, a warehouse operator shall deal, in a fair and

20 reasonable manner, with persons storing, or seeking to

21 store, an agricultural product in the warehouse if the agri22 cultural product—

23 ‘‘(1) is of the kind, type, and quality custom24 arily stored or handled in the area in which the

25 warehouse is located;
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1 ‘‘(2) is tendered to the warehouse operator in a

2 suitable condition for warehousing; and

3 ‘‘(3) is tendered in a manner that is consistent

4 with the ordinary and usual course of business.

5 ‘‘(b) ALLOCATION.—Nothing in this section prohibits

6 a warehouse operator from entering into an agreement

7 with a depositor of an agricultural product to allocate

8 available storage space.

9 ‘‘SEC. 9. COMMINGLING OF AGRICULTURAL PRODUCTS.

10 ‘‘(a) IN GENERAL.—A warehouse operator may com11 mingle agricultural products in a manner approved by the

12 Secretary.

13 ‘‘(b) LIABILITY.—A warehouse operator shall be sev14 erally liable to each depositor or holder for the care and

15 redelivery of the share of the depositor and holder of the

16 commingled agricultural product to the same extent and

17 under the same circumstances as if the agricultural prod18 ucts had been stored separately.

19 ‘‘SEC. 10. TRANSFER OF STORED AGRICULTURAL PROD20 UCTS.

21 ‘‘(a) IN GENERAL.—In accordance with regulations

22 promulgated under this Act, a warehouse operator may

23 transfer a stored agricultural product from one warehouse

24 to another warehouse for continued storage.
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1 ‘‘(b) CONTINUED DUTY.—The warehouse operator

2 from which agricultural products have been transferred

3 under subsection (a) shall deliver to the rightful owner of

4 such products, on request at the original warehouse, such

5 products in the quantity and of the kind, quality, and

6 grade called for by the receipt or other evidence of storage

7 of the owner.

8 ‘‘SEC. 11. ISSUANCE OF RECEIPTS AND OTHER DOCU9 MENTS.

10 ‘‘(a) IN GENERAL.—Subject to subsections (b) and

11 (c) and except as otherwise provided in this Act, at the

12 request of the depositor of an agricultural product stored

13 or handled in a warehouse licensed under this Act, the

14 warehouse operator shall issue a receipt to the depositor

15 as prescribed by the Secretary.

16 ‘‘(b) ACTUAL STORAGE REQUIRED.—A receipt may

17 not be issued under this section for an agricultural prod18 uct unless the agricultural product is actually stored in

19 the warehouse at the time of the issuance of the receipt.

20 ‘‘(c) CONTENTS.—Each receipt issued for an agricul21 tural product stored or handled in a warehouse licensed

22 under this Act shall contain such information, for each

23 agricultural product covered by the receipt, as the Sec24 retary may require by regulation.
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1 ‘‘(d) PROHIBITION ON ADDITIONAL RECEIPTS OR

2 OTHER DOCUMENTS.—

3 ‘‘(1) RECEIPTS.—While a receipt issued under

4 this Act is outstanding and uncanceled by the ware5 house operator, no other or further receipt may be

6 issued for the same agricultural product (or any por7 tion of the same agricultural product) represented

8 by the outstanding receipt, except as authorized by

9 the Secretary.

10 ‘‘(2) OTHER DOCUMENTS.—If a written or elec11 tronic document is recorded or transferred under

12 this section, no other similar document in any form

13 shall be issued by any person with respect to the

14 same agricultural product represented by the docu15 ment, except as authorized by the Secretary.

16 ‘‘(e) ELECTRONIC RECEIPTS AND ELECTRONIC DOC17 UMENTS.—Except as provided in subsection (f) and not18 withstanding any other provision of Federal or State law:

19 ‘‘(1) IN GENERAL.—The Secretary shall pro20 mulgate regulations to authorize the issuance of

21 electronic receipts, and the recording and transfer of

22 electronic receipts and other documents, in accord23 ance with this subsection.

24 ‘‘(2) SYSTEMS FOR ELECTRONIC RECORDING

25 AND TRANSFER.—Electronic receipts and electronic
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1 documents issued with respect to an agricultural

2 product may be recorded in, and transferred under,

3 a system or systems maintained in 1 or more loca4 tions.

5 ‘‘(3) TREATMENT OF HOLDER.—The person

6 designated as a holder of an electronic receipt or

7 other electronic document shall be considered, for

8 the purposes of Federal and State law, to be in pos9 session of the receipt or document.

10 ‘‘(4) SECURITY INTERESTS.—

11 ‘‘(A) PERFECTION OF INTEREST.—Any se12 curity interest lawfully asserted by a person

13 under any Federal or State law with respect to

14 an agricultural product that is the subject of an

15 electronic receipt, or an electronic document

16 filed under any system for electronic receipts or

17 other electronic documents issued or filed in ac18 cordance with this Act, may be perfected only

19 by recording the security interest in the system

20 in the manner specified by the regulations pro21 mulgated under paragraph (1).

22 ‘‘(B) EFFECT OF RECORDATION.—The rec23 ordation by a person of the person’s security in24 terest in any agricultural product included in

25 any system for electronic receipts or other elec-
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1 tronic documents issued or filed in accordance

2 with this Act shall, for the purposes of Federal

3 and State law, establish the security interest of

4 the person.

5 ‘‘(C) PRIORITY.—If more than 1 security

6 interest exists in an agricultural product cov7 ered by an electronic receipt, the priority of the

8 security interests shall be determined by the ap9 plicable Federal or State law.

10 ‘‘(D) ENCUMBRANCES.—

11 ‘‘(i) OPERATORS LICENSED UNDER

12 STATE LAW.—If a warehouse operator li13 censed under State law elects to issue an

14 electronic receipt authorized under this

15 subsection, a security interest, lien, or

16 other encumbrance may be recorded on the

17 electronic receipt under this subsection

18 only if the security interest, lien, or other

19 encumbrance is—

20 ‘‘(I) authorized by State law to

21 be included on a written warehouse

22 receipt; and

23 ‘‘(II) recorded in a manner pre24 scribed by the Secretary.
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1 ‘‘(ii) OTHER APPLICATIONS.—If a

2 warehouse operator licensed under this

3 Act, or a warehouse operator not licensed

4 under State law, elects to issue an elec5 tronic receipt authorized under this sub6 section, a security interest, lien, or other

7 encumbrance shall be recorded on the elec8 tronic receipt in a manner prescribed by

9 the Secretary.

10 ‘‘(5) EFFECT OF PURCHASE OF RECEIPT OR

11 DOCUMENT.—A person purchasing an electronic re12 ceipt or electronic document shall take possession of

13 the agricultural product free and clear of all liens,

14 except those liens recorded in the system or systems

15 established under the regulations promulgated under

16 paragraph (1).

17 ‘‘(6) ACCEPTANCE.—

18 ‘‘(A) IN GENERAL.—An electronic receipt

19 issued, and an electronic document transferred,

20 in accordance with the regulations promulgated

21 under paragraph (1) shall be accepted in any

22 business, market, or financial transaction,

23 whether governed by Federal or State law.

24 ‘‘(B) NO ELECTRONIC RECEIPT RE25 QUIRED.—A person shall not be required to
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1 issue a receipt or document with respect to an

2 agricultural product in electronic format.

3 ‘‘(7) LEGAL EFFECT.—Information created to

4 comply with this Act (including regulations promul5 gated under this Act) shall not be denied legal ef6 fect, validity, or enforceability on the ground that

7 the information is generated, sent, received, or

8 stored by electronic or similar means.

9 ‘‘(8) OPTION FOR STATE LICENSED WARE10 HOUSE OPERATORS.—Notwithstanding any other

11 provision of this Act, a State-licensed warehouse op12 erator not licensed under this Act may, at the option

13 of the warehouse operator, issue electronic receipts

14 and electronic documents in accordance with this

15 subsection.

16 ‘‘(9) APPLICATION.—This subsection shall not

17 apply to a warehouse operator that is licensed under

18 State law to store agricultural commodities in a

19 warehouse in the State if the warehouse operator

20 elects—

21 ‘‘(A) not to issue electronic receipts au22 thorized under this subsection; or

23 ‘‘(B) to issue electronic receipts authorized

24 under State law.
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1 ‘‘(f) ELECTRONIC RECEIPTS AND ELECTRONIC DOC2 UMENTS FOR COTTON.—

3 ‘‘(1) AUTHORITY.—

4 ‘‘(A) CENTRAL FILING.—Notwithstanding

5 any other provision of Federal or State law, the

6 Secretary, or the designated representative of

7 the Secretary, may provide that, in lieu of

8 issuing a receipt for cotton stored in a ware9 house licensed under this Act or in any other

10 warehouse, the information required to be in11 cluded in a receipt (i) under this Act in the case

12 of a warehouse licensed under this Act or (ii)

13 under any applicable State law in the case of a

14 warehouse not licensed under this Act, shall be

15 recorded instead in 1 or more central filing sys16 tems maintained in 1 or more locations in ac17 cordance with regulations promulgated by the

18 Secretary.

19 ‘‘(B) DELIVERY OF COTTON.—Any record

20 under subparagraph (A) shall include a state21 ment that the cotton shall be delivered to a

22 specified person or to the order of the person.

23 ‘‘(C) ELECTRONIC TRANSMISSION FACILI24 TIES BETWEEN WAREHOUSES AND SYSTEM.—
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1 ‘‘(i) NONAPPLICABILITY TO WARE2 HOUSES WITHOUT FACILITIES.—This sub3 section and section 4 shall not apply to a

4 warehouse that does not have facilities to

5 electronically transmit and receive informa6 tion to and from a central filing system

7 under this subsection.

8 ‘‘(ii) NO REQUIREMENT TO OBTAIN

9 FACILITIES.—Nothing in this subsection

10 requires a warehouse operator to obtain fa11 cilities described in clause (i).

12 ‘‘(2) RECORDATION AND ENFORCEMENT OF

13 LIENS IN CENTRAL FILING SYSTEM.—Notwith14 standing any other provision of Federal or State

15 law:

16 ‘‘(A) RECORDATION.—The record of the

17 possessory interests of persons in cotton in18 cluded in a central filing system under this

19 subsection—

20 ‘‘(i) shall be considered to be a receipt

21 for the purposes of this Act and State law;

22 and

23 ‘‘(ii) shall establish the possessory in24 terest of persons in the cotton.

25 ‘‘(B) ENFORCEMENT.—
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1 ‘‘(i) POSSESSION OF WAREHOUSE RE2 CEIPT.—Any person designated as a holder

3 of an electronic warehouse receipt author4 ized under this subsection or section 4

5 shall, for the purpose of perfecting the se6 curity interest of the person under Federal

7 or State law with respect to the cotton cov8 ered by the warehouse receipt, be consid9 ered to be in possession of the warehouse

10 receipt.

11 ‘‘(ii) PRIORITY OF SECURITY INTER12 ESTS.—If more than 1 security interest ex13 ists in the cotton represented by the elec14 tronic warehouse receipt, the priority of

15 the security interests shall be determined

16 by applicable Federal or State law.

17 ‘‘(iii) APPLICABILITY.—This sub18 section is applicable to electronic cotton

19 warehouse receipts and any other security

20 interests covering cotton stored in a cotton

21 warehouse, regardless of whether the ware22 house is licensed under this Act.

23 ‘‘(3) CONDITIONS FOR DELIVERY ON DEMAND

24 FOR COTTON STORED.—A warehouse operator oper25 ating a warehouse covered by this subsection, in the
26

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1 absence of a lawful excuse, shall, without unneces2 sary delay, deliver the cotton stored in the ware3 house on demand made by the person named in the

4 record in the central filing system as the holder of

5 the receipt representing the cotton, if the demand is

6 accompanied by—

7 ‘‘(A) an offer to satisfy the valid lien of a

8 warehouse operator, as determined by the Sec9 retary; and

10 ‘‘(B) an offer to provide an acknowledg11 ment in a central filing system under this sub12 section, if requested by the warehouse operator,

13 that the cotton has been delivered.

14 ‘‘SEC. 12. CONDITIONS FOR DELIVERY OF AGRICULTURAL

15 PRODUCTS.

16 ‘‘(a) PROMPT DELIVERY.—In the absence of a lawful

17 excuse, a warehouse operator shall, without unnecessary

18 delay, deliver the agricultural product stored or handled

19 in the warehouse on a demand made by—

20 ‘‘(1) the holder of the receipt for the agricul21 tural product; or

22 ‘‘(2) the person that deposited the product, if

23 no receipt has been issued.

24 ‘‘(b) PAYMENT TO ACCOMPANY DEMAND IF RE25 QUESTED.—
27

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1 ‘‘(1) IN GENERAL.—Demand for delivery shall

2 be accompanied by payment of the accrued charges

3 associated with the storage of the agricultural prod4 uct if requested by the warehouse operator.

5 ‘‘(2) SPECIAL RULE FOR COTTON.—In the case

6 of cotton stored in a warehouse, the warehouse oper7 ator shall provide a written request for payment of

8 the accrued charges associated with the storage of

9 the cotton to the holder of the receipt at the time

10 at which demand for the delivery of the cotton is

11 made.

12 ‘‘(c) SURRENDER OF RECEIPT.—When the holder of

13 a receipt requests delivery of an agricultural product cov14 ered by the receipt, the holder shall surrender the receipt

15 to the warehouse operator, in the manner prescribed by

16 the Secretary, to obtain the agricultural product.

17 ‘‘(d) CANCELLATION OF RECEIPT.—A warehouse op18 erator shall cancel each receipt returned to the warehouse

19 operator upon the delivery of the agricultural product for

20 which the receipt was issued.

21 ‘‘SEC. 13. SUSPENSION OR REVOCATION OF LICENSES.

22 ‘‘(a) IN GENERAL.—After providing notice and an

23 opportunity for a hearing in accordance with this section,

24 the Secretary may suspend or revoke any license issued,

25 or approval for an activity provided, under this Act—
28

•S 3001 PCS

1 ‘‘(1) for a material violation of, or failure to

2 comply, with any provision of this Act (including

3 regulations promulgated under this Act); or

4 ‘‘(2) on the ground that unreasonable or exorbi5 tant charges have been imposed for services ren6 dered.

7 ‘‘(b) TEMPORARY SUSPENSION.—The Secretary may

8 temporarily suspend a license or approval for an activity

9 under this Act prior to an opportunity for a hearing for

10 any violation of, or failure to comply with, any provision

11 of this Act (including regulations promulgated under this

12 Act).

13 ‘‘(c) AUTHORITY TO CONDUCT HEARINGS.—The

14 agency within the Department that is responsible for ad15 ministering regulations promulgated under this Act shall

16 have exclusive authority to conduct any hearing required

17 under this section.

18 ‘‘(d) JUDICIAL REVIEW.—

19 ‘‘(1) JURISDICTION.—A final administrative de20 termination issued subsequent to a hearing may be

21 reviewable only in a district court of the United

22 States.

23 ‘‘(2) PROCEDURE.—The review shall be con24 ducted in accordance with the standards set forth in

25 section 706(2) of title 5, United States Code.
29

•S 3001 PCS

1 ‘‘SEC. 14. PUBLIC INFORMATION.

2 ‘‘(a) IN GENERAL.—The Secretary may release to the

3 public—

4 ‘‘(1) the names, addresses, and locations of all

5 persons that have been licensed under this Act or

6 that have been approved to engage in an activity

7 under this Act;

8 ‘‘(2) the results of any investigation made, or

9 hearing conducted, under this Act; and

10 ‘‘(3) the names, addresses, and locations of all

11 persons with respect to which a license or approval

12 has been suspended or revoked under section 13, in13 cluding the reasons for the suspension or revocation.

14 ‘‘(b) CONFIDENTIALITY.—Except as otherwise pro15 vided by law, an officer, employee, or agent of the Depart16 ment shall not divulge confidential business information

17 obtained during a warehouse examination or other func18 tion performed as part of the duties of the officer, em19 ployee, or agent under this Act.

20 ‘‘SEC. 15. PENALTIES FOR NONCOMPLIANCE.

21 ‘‘If a person fails to comply with any requirement of

22 this Act (including regulations promulgated under this

23 Act), the Secretary may assess, on the record after an op24 portunity for a hearing, a civil penalty—
30

•S 3001 PCS

1 ‘‘(1) of not more than $25,000 per violation, if

2 an agricultural product is not involved in the viola3 tion; or

4 ‘‘(2) of not more than 100 percent of the value

5 of the agricultural product, if an agricultural prod6 uct is involved in the violation.

7 ‘‘SEC. 16. JURISDICTION AND ARBITRATION.

8 ‘‘(a) FEDERAL JURISDICTION.—A district court of

9 the United States shall have exclusive jurisdiction over any

10 action brought under this Act without regard to the

11 amount in controversy or the citizenship of the parties.

12 ‘‘(b) ARBITRATION.—Nothing in this Act prevents

13 the enforceability of an agreement to arbitrate that would

14 otherwise be enforceable under chapter 1 of title 9, United

15 States Code.

16 ‘‘SEC. 17. REGULATIONS.

17 ‘‘The Secretary shall promulgate such regulations as

18 the Secretary considers necessary to carry out this Act.

19 ‘‘SEC. 18. AUTHORIZATION OF APPROPRIATION.

20 ‘‘There are authorized to be appropriated such sums

21 as are necessary to carry out this Act.’’.
31

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1 TITLE III—MISCELLANEOUS

2 SEC. 301. ENERGY GENERATION, TRANSMISSION, AND DIS3 TRIBUTION FACILITIES EFFICIENCY GRANTS

4 IN RURAL COMMUNITIES WITH EXTREMELY

5 HIGH ENERGY COSTS.

6 Title I of the Rural Electrification Act of 1936 (7

7 U.S.C. 901 et seq.) is amended by adding at the end the

8 following:

9 ‘‘SEC. 19. ENERGY GENERATION, TRANSMISSION, AND DIS10 TRIBUTION FACILITIES EFFICIENCY GRANTS

11 IN RURAL COMMUNITIES WITH EXTREMELY

12 HIGH ENERGY COSTS.

13 ‘‘(a) IN GENERAL.—The Secretary, acting through

14 the Rural Utilities Service, may—

15 ‘‘(1) in coordination with State rural develop16 ment initiatives, make grants and loans to persons,

17 States, political subdivisions of States, and other en18 tities organized under the laws of States to develop,

19 upgrade, and improve the efficiency of energy gen20 eration, transmission, and distribution facilities in

21 communities in which the average residential ex22 penditure for home energy is at least 275 percent of

23 the national average residential expenditure for

24 home energy (as determined by the Energy Informa25 tion Agency using the most recent data available);
32

•S 3001 PCS

1 ‘‘(2) make direct payments to the Denali Com2 mission established by the Denali Commission Act of

3 1998 (42 U.S.C. 3121 note; Public Law 105–277)

4 to develop, upgrade, and improve the efficiency of

5 energy generation, transmission, and distribution fa6 cilities in communities described in paragraph (1);

7 and

8 ‘‘(3) make grants to State entities, in existence

9 as of the date of enactment of this section, to estab10 lish and support a revolving fund to provide a more

11 cost-effective means of purchasing fuel where the

12 fuel cannot be shipped by means of surface transpor13 tation.

14 ‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—

15 ‘‘(1) IN GENERAL.—There are authorized to be

16 appropriated to carry out this section $50,000,000

17 for fiscal year 2001 and such sums as are necessary

18 for each subsequent fiscal year.

19 ‘‘(2) LIMITATION ON PLANNING AND ADMINIS20 TRATIVE EXPENSES.—Not more than 4 percent of

21 the amounts made available under paragraph (1)

22 may be used for planning and administrative ex23 penses.’’.
33

•S 3001 PCS

1 SEC. 302. CARRY FORWARD ADJUSTMENT.

2 The amendments made by section 204(b)(10)(A) of

3 the Agricultural Risk Protection Act of 2000 shall apply

4 beginning with undermarketings of the 2001 crop of bur5 ley tobacco and with marketings of the 2002 crop of burley

6 tobacco.

7 SEC. 303. FEES AND PENALTIES FOR MEDIATION AND ARBI8 TRATION OF DISPUTES INVOLVING AGRICUL9 TURAL PRODUCTS MOVING IN FOREIGN COM10 MERCE UNDER MULTINATIONAL ENTITIES.

11 Section 203(e) of the Agricultural Marketing Act of

12 1946 (7 U.S.C. 1622(e)) is amended—

13 (1) by striking ‘‘(e) To’’ and inserting the fol14 lowing:

15 ‘‘(e) DEVELOPMENT OF NEW MARKETS.—

16 ‘‘(1) IN GENERAL.—To’’; and

17 (2) by adding at the end the following:

18 ‘‘(2) FEES AND PENALTIES.—

19 ‘‘(A) IN GENERAL.—In carrying out para20 graph (1), the Secretary may assess and collect

21 reasonable fees and late payment penalties to

22 mediate and arbitrate disputes arising between

23 parties in connection with transactions involving

24 agricultural products moving in foreign com25 merce under the jurisdiction of a multinational

26 entity.
34

•S 3001 PCS

1 ‘‘(B) DEPOSIT.—Fees and penalties col2 lected under subparagraph (A) shall be depos3 ited into the account that incurred the cost of

4 providing the mediation or arbitration service.

5 ‘‘(C) AVAILABILITY.—Fees and penalties

6 collected under subparagraph (A) shall be avail7 able to the Secretary without further Act of ap8 propriation and shall remain available until ex9 pended to pay the expenses of the Secretary for

10 providing mediation and arbitration services

11 under this paragraph.

12 ‘‘(D) NO REQUIREMENT FOR USE OF

13 SERVICES.—No person shall be required by the

14 Secretary to use the mediation and arbitration

15 services provided under this paragraph.’’.

16 SEC. 304. COMMUNITY FACILITIES GRANT PROGRAM FOR

17 RURAL COMMUNITIES WITH EXTREME UNEM18 PLOYMENT AND SEVERE ECONOMIC DEPRES19 SION.

20 (a) IN GENERAL.—Section 306(a) of the Consoli21 dated Farm and Rural Development Act (7 U.S.C.

22 1926(a)) is amended by adding at the end the following:

23 ‘‘(20) COMMUNITY FACILITIES GRANT PROGRAM

24 FOR RURAL COMMUNITIES WITH EXTREME UNEM25 PLOYMENT AND SEVERE ECONOMIC DEPRESSION.—
35

•S 3001 PCS

1 ‘‘(A) DEFINITION OF NOT EMPLOYED

2 RATE.—In this paragraph, the term ‘not em3 ployed rate’, with respect to a community,

4 means the percentage of individuals over the

5 age of 18 who reside within the community and

6 who are ready, willing, and able to be employed

7 but are unable to find employment, as deter8 mined by the department of labor of the State

9 in which the community is located.

10 ‘‘(B) GRANT AUTHORITY.—The Secretary

11 may make grants to associations, units of gen12 eral local government, nonprofit corporations,

13 and Indian tribes (as defined in section 4 of the

14 Indian Self-Determination and Education As15 sistance Act (25 U.S.C. 450b)) in a State to

16 provide the Federal share of the cost of devel17 oping specific essential community facilities in

18 rural communities with respect to which the not

19 employed rate is greater than the lesser of—

20 ‘‘(i) 500 percent of the average na21 tional unemployment rate on the date of

22 enactment of this paragraph, as deter23 mined by the Bureau of Labor Statistics;

24 or
36

•S 3001 PCS

1 ‘‘(ii) 200 percent of the average na2 tional unemployment rate during the Great

3 Depression, as determined by the Bureau

4 of Labor Statistics.

5 ‘‘(C) FEDERAL SHARE.—Paragraph

6 (19)(B) shall apply to a grant made under this

7 paragraph.

8 ‘‘(D) AUTHORIZATION OF APPROPRIA9 TIONS.—There are authorized to be appro10 priated to carry out this paragraph

11 $50,000,000 for fiscal year 2001 and such

12 sums as are necessary for each subsequent fis13 cal year, of which not more than 5 percent of

14 the amount made available for a fiscal year

15 shall be available for community planning and

16 implementation.’’.

17 (b) CONFORMING AMENDMENT.—Section

18 381E(d)(1)(B) of the Consolidated Farm and Rural De19 velopment Act (7 U.S.C. 2009d(d)(1)(B)) is amended by

20 striking ‘‘section 306(a)(19)’’ and inserting ‘‘paragraph

21 (19) or (20) of section 306(a)’’.
37

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1 SEC. 305. ELIGIBILITY FOR BUSINESS AND INDUSTRY

2 LOANS.

3 (a) IN GENERAL.—Section 310B of the Consolidated

4 Farm and Rural Development Act (7 U.S.C. 1932) is

5 amended—

6 (1) by striking ‘‘SEC. 310B. (a) The’’ and in7 serting the following:

8 ‘‘SEC. 310B. RURAL INDUSTRIALIZATION ASSISTANCE.

9 ‘‘(a) LOANS FOR PRIVATE BUSINESS ENTER10 PRISES.—

11 ‘‘(1) IN GENERAL.—The’’; and

12 (2) in subsection (a)—

13 (A) by striking ‘‘of (1) improving’’ and in14 serting the following: ‘‘of—

15 ‘‘(A) improving’’;

16 (B) by striking ‘‘control, (2) the conserva17 tion, development, and use of’’ and inserting

18 the following: ‘‘control;

19 ‘‘(B) conserving, developing, and using’’;

20 (C) by striking ‘‘areas, (3) reducing’’ and

21 inserting the following: ‘‘areas;

22 ‘‘(C) reducing’’;

23 (D) by striking ‘‘areas, and (4) to facili24 tate’’ and inserting the following: ‘‘areas; and’’;

25 ‘‘(D) facilitating’’;
38

•S 3001 PCS

1 (E) by striking ‘‘For the purposes of’’ and

2 inserting the following:

3 ‘‘(2) DEFINITION OF SOLAR ENERGY.—In’’;

4 (F) by striking ‘‘Such loans,’’ and insert5 ing the following:

6 ‘‘(3) APPLICABILITY OF CERTAIN LIMITA7 TIONS.—Loans under this subsection,’’;

8 (G) by striking ‘‘As used in’’ and inserting

9 the following:

10 ‘‘(4) DEFINITION OF AQUACULTURE.—In’’;

11 (H) by striking ‘‘No loan’’ and inserting

12 the following:

13 ‘‘(5) LOAN LIMITATION.—No loan’’; and

14 (I) by adding at the end the following:

15 ‘‘(6) ELIGIBILITY FOR BUSINESS AND INDUS16 TRY LOANS.—Notwithstanding section 381A(1), a

17 loan may be made under paragraph (1)(A) for a

18 project or facility in a city or town with a population

19 in excess of 50,000 inhabitants, and its immediately

20 adjacent urbanized area, if the Secretary determines

21 that—

22 ‘‘(A) the project or facility will be used for

23 the processing of an agricultural commodity;

24 ‘‘(B) the loan will be used for purchasing

25 supplies for, refurbishing, or equipping an exist-
39

•S 3001 PCS

1 ing project or facility, and not for new construc2 tion of a project or facility; and

3 ‘‘(C) the primary economic beneficiaries of

4 the project or facility will be producers of agri5 cultural commodities.’’.

6 (b) CONFORMING AMENDMENTS.—

7 (1) Section 307(a)(6)(B)(ii) of the Consolidated

8 Farm and Rural Development Act (7 U.S.C.

9 1927(a)(6)(B)(ii)) is amended by striking ‘‘clause

10 (1) of section 310B(a)’’ and inserting ‘‘section

11 310B(a)(1)(A)’’.

12 (2) Section 381E(d)(3)(B) of the Consolidated

13 Farm and Rural Development Act (7 U.S.C.

14 2009d(d)(3)(B)) is amended by striking ‘‘section

15 310B(a)(1)’’ and inserting ‘‘section 310B(a)(1)(A)’’.

16 (c) REGULATIONS.—Not later than 30 days after the

17 date of enactment of this Act, the Secretary of Agriculture

18 shall promulgate interim final regulations to implement

19 the amendments made by this section.

20 SEC. 306. STATE AGRICULTURAL LOAN MEDIATION PRO21 GRAMS.

22 Section 506 of the Agricultural Credit Act of 1987

23 (7 U.S.C. 5106) is amended by striking ‘‘2000’’ and in24 serting ‘‘2005’’.
40

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1 SEC. 307. ADJUSTMENTS TO NUTRITION PROGRAMS.

2 (a) COST-OF-LIVING ALLOWANCES FOR MEMBERS OF

3 UNIFORMED SERVICES.—Section 17(d)(2)(B)(ii) of the

4 Child Nutrition Act of 1966 (42 U.S.C. 1786(d)(2)(B)(ii))

5 is amended by striking ‘‘continental’’ and inserting ‘‘con6 tiguous States of the’’.

7 (b) DEMONSTRATION PROJECT.—Effective October

8 1, 2000, section 17(r)(1) of the Child Nutrition Act of

9 1966 (42 U.S.C. 1786(r)(1)) is amended by striking ‘‘at

10 least 20 local agencies’’ and inserting ‘‘not more than 20

11 local agencies’’.

12 (c) CHILD AND ADULT CARE FOOD PROGRAM.—Sec13 tion 17 of the Richard B. Russell National School Lunch

14 Act (42 U.S.C. 1766) is amended—

15 (1) by striking the section heading and all that

16 follows through ‘‘SEC. 17.’’ and inserting the fol17 lowing:

18 ‘‘SEC. 17. CHILD AND ADULT CARE FOOD PROGRAM.’’;

19 and

20 (2) in subsection (a)(6)(C)(ii), by striking

21 ‘‘and’’ at the end.

Calendar No. 767

106TH CONGRESS

2D SESSION S. 3001

[Report No. 106–391]

A BILL

To amend the United States Grain Standards Act

to extend the authority of the Secretary of Agriculture to collect fees, extend the authorization ofappropriations, and improve the administrationof that Act, to amend the United States Warehouse Act to authorize the issuance of electronicwarehouse receipts, and for other purposes.

AUGUST 25, 2000

Reported, read twice, and placed on the calendar