II 

Calendar No. 415 

112TH CONGRESS 

2D SESSION S. 3240 

To reauthorize agricultural programs through 2017, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MAY 24, 2012 

Ms. STABENOW, from the Committee on Agriculture, Nutrition, and Forestry, 

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

the calendar 

A BILL 

To reauthorize agricultural programs through 2017, 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) IN GENERAL.—This Act may be cited as the ‘‘Ag5 riculture Reform, Food, and Jobs Act of 2012’’. 

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

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Definition of Secretary. 

TITLE I—COMMODITY PROGRAMS 


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Subtitle A—Repeals and Reforms 

Sec. 1101. Repeal of direct payments. 

Sec. 1102. Repeal of counter-cyclical payments. 

Sec. 1103. Repeal of average crop revenue election program. 

Sec. 1104. Definitions. 

Sec. 1105. Agriculture risk coverage. 

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

Sec. 1107. Period of effectiveness. 

Subtitle B—Marketing Assistance Loans and Loan Deficiency Payments 

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

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

Sec. 1203. Term of loans. 

Sec. 1204. Repayment of loans. 

Sec. 1205. Loan deficiency payments. 

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

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

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

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

cotton. 

Sec. 1210. Adjustments of loans. 

Subtitle C—Sugar 

Sec. 1301. Sugar program. 

Subtitle D—Dairy 

PART I—DAIRY PRODUCTION MARGIN PROTECTION AND DAIRY MARKET

STABILIZATION PROGRAMS

Sec. 1401. Definitions. 

Sec. 1402. Calculation of average feed cost and actual dairy production margins. 

SUBPART A—DAIRY PRODUCTION MARGIN PROTECTION PROGRAM

Sec. 1411. Establishment of dairy production margin protection program. 

Sec. 1412. Participation of dairy operations in production margin protection 

program. 

Sec. 1413. Production history of participating dairy operations. 

Sec. 1414. Basic production margin protection. 

Sec. 1415. Supplemental production margin protection. 

Sec. 1416. Effect of failure to pay administration fees or premiums. 

SUBPART B—DAIRY MARKET STABILIZATION PROGRAM

Sec. 1431. Establishment of dairy market stabilization program. 

Sec. 1432. Threshold for implementation and reduction in dairy payments. 

Sec. 1433. Milk marketings information. 

Sec. 1434. Calculation and collection of reduced dairy operation payments. 

Sec. 1435. Remitting funds to the Secretary and use of funds. 

Sec. 1436. Suspension of reduced payment requirement. 

Sec. 1437. Enforcement. 

Sec. 1438. Audit requirements. 


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Sec. 1439. Study; report. 

SUBPART C—DURATION

Sec. 1451. Duration. 

PART II—DAIRY MARKET TRANSPARENCY

Sec. 1461. Dairy product mandatory reporting. 

Sec. 1462. Federal milk marketing order information. 

PART III—REPEAL OR REAUTHORIZATION OF OTHER DAIRY-RELATED

PROVISIONS

Sec. 1471. Repeal of dairy product price support and milk income loss contract 

programs. 

Sec. 1472. Repeal of dairy export incentive program. 

Sec. 1473. Extension of dairy forward pricing program. 

Sec. 1474. Extension of dairy indemnity program. 

Sec. 1475. Extension of dairy promotion and research program. 

Sec. 1476. Extension of Federal Milk Marketing Order Review Commission. 

PART IV—EFFECTIVE DATE

Sec. 1481. Effective date. 

Subtitle E—Supplemental Agricultural Disaster Assistance Programs 

Sec. 1501. Supplemental agricultural disaster assistance programs. 

Subtitle F—Administration 

Sec. 1601. Administration generally. 

Sec. 1602. Suspension of permanent price support authority. 

Sec. 1603. Payment limitations. 

Sec. 1604. Payments limited to active farmers. 

Sec. 1605. Adjusted gross income limitation. 

Sec. 1606. Geographically disadvantaged farmers and ranchers. 

Sec. 1607. Personal liability of producers for deficiencies. 

Sec. 1608. Prevention of deceased individuals receiving payments under farm 

commodity programs. 

Sec. 1609. Appeals. 

Sec. 1610. Technical corrections. 

Sec. 1611. Assignment of payments. 

Sec. 1612. Tracking of benefits. 

Sec. 1613. Signature authority. 

Sec. 1614. Implementation. 

TITLE II—CONSERVATION 

Subtitle A—Conservation Reserve Program 

Sec. 2001. Extension and enrollment requirements of conservation reserve program. 

Sec. 2002. Farmable wetland program. 

Sec. 2003. Duties of owners and operators. 

Sec. 2004. Duties of the Secretary. 

Sec. 2005. Payments. 

Sec. 2006. Contract requirements. 


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Sec. 2007. Conversion of land subject to contract to other conserving uses. 

Sec. 2008. Effective date. 

Subtitle B—Conservation Stewardship Program 

Sec. 2101. Conservation stewardship program. 

Subtitle C—Environmental Quality Incentives Program 

Sec. 2201. Purposes. 

Sec. 2202. Definitions. 

Sec. 2203. Establishment and administration. 

Sec. 2204. Evaluation of applications. 

Sec. 2205. Duties of producers. 

Sec. 2206. Limitation on payments. 

Sec. 2207. Conservation innovation grants and payments. 

Sec. 2208. Effective date. 

Subtitle D—Agricultural Conservation Easement Program 

Sec. 2301. Agricultural Conservation Easement Program. 

Subtitle E—Regional Conservation Partnership Program 

Sec. 2401. Regional Conservation Partnership Program. 

Subtitle F—Other Conservation Programs 

Sec. 2501. Conservation of private grazing land. 

Sec. 2502. Grassroots source water protection program. 

Sec. 2503. Voluntary public access and habitat incentive program. 

Sec. 2504. Agriculture conservation experienced services program. 

Sec. 2505. Small watershed rehabilitation program. 

Sec. 2506. Terminal lakes assistance. 

Subtitle G—Funding and Administration 

Sec. 2601. Funding. 

Sec. 2602. Technical assistance. 

Sec. 2603. Regional equity. 

Sec. 2604. Reservation of funds to provide assistance to certain farmers or 

ranchers for conservation access. 

Sec. 2605. Annual report on program enrollments and assistance. 

Sec. 2606. Administrative requirements for conservation programs. 

Sec. 2607. Rulemaking authority. 

Sec. 2608. Standards for State technical committees. 

Subtitle H—Repeal of Superseded Program Authorities and Transitional 

Provisions 

Sec. 2701. Comprehensive conservation enhancement program. 

Sec. 2702. Emergency forestry conservation reserve program. 

Sec. 2703. Wetlands reserve program. 

Sec. 2704. Farmland protection program and farm viability program. 

Sec. 2705. Grassland reserve program. 

Sec. 2706. Agricultural water enhancement program. 

Sec. 2707. Wildlife habitat incentive program. 

Sec. 2708. Great Lakes basin program. 


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Sec. 2709. Chesapeake Bay watershed program. 

Sec. 2710. Cooperative conservation partnership initiative. 

Sec. 2711. Environmental easement program. 

Sec. 2712. Technical amendments. 

TITLE III—TRADE 

Subtitle A—Food for Peace Act 

Sec. 3001. Set-aside for support for organizations through which nonemergency 

assistance is provided. 

Sec. 3002. Food aid quality. 

Sec. 3003. Minimum levels of assistance. 

Sec. 3004. Reauthorization of Food Aid Consultative Group. 

Sec. 3005. Oversight, monitoring, and evaluation of Food for Peace Act programs. 

Sec. 3006. Assistance for stockpiling and rapid transportation, delivery, and 

distribution of shelf-stable prepackaged foods. 

Sec. 3007. Limitation on total volume of commodities monetized. 

Sec. 3008. Flexibility. 

Sec. 3009. Procurement, transportation, testing, and storage of agricultural 

commodities for prepositioning in the United States and foreign countries. 

Sec. 3010. Deadline for agreements to finance sales or to provide other assistance. 

Sec. 3011. Minimum level of nonemergency food assistance. 

Sec. 3012. Coordination of foreign assistance programs report. 

Sec. 3013. Micronutrient fortification programs. 

Sec. 3014. John Ogonowski and Doug Bereuter Farmer-to-Farmer Program. 

Subtitle B—Agricultural Trade Act of 1978 

Sec. 3101. Export credit guarantee programs. 

Sec. 3102. Funding for market access program. 

Sec. 3103. Foreign market development cooperator program. 

Subtitle C—Other Agricultural Trade Laws 

Sec. 3201. Food for Progress Act of 1985. 

Sec. 3202. Bill Emerson Humanitarian Trust. 

Sec. 3203. Promotion of agricultural exports to emerging markets. 

Sec. 3204. McGovern-Dole International Food for Education and Child Nutrition Program. 

Sec. 3205. Technical assistance for specialty crops. 

Sec. 3206. Global Crop Diversity Trust. 

Sec. 3207. Local and regional food aid procurement projects. 

Sec. 3208. Donald Payne Horn of Africa food resilience program. 

Sec. 3209. Agricultural trade enhancement study. 

TITLE IV—NUTRITION 

Subtitle A—Supplemental Nutrition Assistance Program 

Sec. 4001. Food distribution program on Indian reservations. 

Sec. 4002. Standard utility allowances based on the receipt of energy assistance 

payments. 

Sec. 4003. Eligibility disqualifications. 


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Sec. 4004. Ending supplemental nutrition assistance program benefits for lottery or gambling winners. 

Sec. 4005. Retail food stores. 

Sec. 4006. Improving security of food assistance. 

Sec. 4007. Technology modernization for retail food stores. 

Sec. 4008. Use of benefits for purchase of community-supported agriculture 

share. 

Sec. 4009. Restaurant meals program. 

Sec. 4010. Quality control error rate determination. 

Sec. 4011. Authorization of appropriations. 

Sec. 4012. Assistance for community food projects. 

Sec. 4013. Emergency food assistance. 

Sec. 4014. Nutrition education. 

Sec. 4015. Retail food store and recipient trafficking. 

Sec. 4016. Technical and conforming amendments. 

Subtitle B—Commodity Distribution Programs 

Sec. 4101. Commodity distribution program. 

Sec. 4102. Commodity supplemental food program. 

Sec. 4103. Distribution of surplus commodities to special nutrition projects. 

Sec. 4104. Technical and conforming amendments. 

Subtitle C—Miscellaneous 

Sec. 4201. Purchase of fresh fruits and vegetables for distribution to schools 

and service institutions. 

Sec. 4202. Seniors farmers’ market nutrition program. 

Sec. 4203. Nutrition information and awareness pilot program. 

Sec. 4204. Whole grain products. 

Sec. 4205. Hunger-free communities. 

Sec. 4206. Healthy Food Financing Initiative. 

Sec. 4207. Purchase of commodities by Commodity Credit Corporation. 

TITLE V—CREDIT 

Subtitle A—Farmer Loans, Servicing, and Other Assistance Under the 

Consolidated Farm and Rural Development Act 

Sec. 5001. Farmer loans, servicing, and other assistance under the Consolidated Farm and Rural Development Act. 

Subtitle B—Miscellaneous 

Sec. 5101. State agricultural mediation programs. 

Sec. 5102. Loans to purchasers of highly fractionated land. 

Sec. 5103. Removal of duplicative appraisals. 

TITLE VI—RURAL DEVELOPMENT 

Subtitle A—Reorganization of the Consolidated Farm and Rural Development 

Act 

Sec. 6001. Reorganization of the Consolidated Farm and Rural Development 

Act. 

Sec. 6002. Conforming amendments. 

Subtitle B—Rural Electrification 


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Sec. 6101. Definition of rural area. 

Sec. 6102. Guarantees for bonds and notes issued for electrification or telephone purposes. 

Sec. 6103. Expansion of 911 access. 

Sec. 6104. Access to broadband telecommunications services in rural areas. 

Subtitle C—Miscellaneous 

Sec. 6201. Distance learning and telemedicine. 

Sec. 6202. Rural energy savings program. 

TITLE VII—RESEARCH, EXTENSION, AND RELATED MATTERS 

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

Act of 1977 

Sec. 7101. National Agricultural Research, Extension, Education, and Economics Advisory Board. 

Sec. 7102. Specialty crop committee. 

Sec. 7103. Veterinary services grant program. 

Sec. 7104. Grants and fellowships for food and agriculture sciences education. 

Sec. 7105. Agricultural and food policy research centers. 

Sec. 7106. Education grants to Alaska Native serving institutions and Native 

Hawaiian serving institutions. 

Sec. 7107. Nutrition education program. 

Sec. 7108. Continuing animal health and disease research programs. 

Sec. 7109. Grants to upgrade agricultural and food sciences facilities at 1890 

land-grant colleges, including Tuskegee University. 

Sec. 7110. Grants to upgrade agricultural and food sciences facilities and 

equipment at insular area land-grant institutions. 

Sec. 7111. Hispanic-serving institutions. 

Sec. 7112. Competitive grants for international agricultural science and education programs. 

Sec. 7113. University research. 

Sec. 7114. Extension service. 

Sec. 7115. Supplemental and alternative crops. 

Sec. 7116. Capacity building grants for NLGCA institutions. 

Sec. 7117. Aquaculture assistance programs. 

Sec. 7118. Rangeland research programs. 

Sec. 7119. Special authorization for biosecurity planning and response. 

Sec. 7120. Distance education and resident instruction grants program for insular area institutions of higher education. 

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

Sec. 7201. Best utilization of biological applications. 

Sec. 7202. Integrated management systems. 

Sec. 7203. Sustainable agriculture technology development and transfer program. 

Sec. 7204. National training program. 

Sec. 7205. National Genetics Resources Program. 

Sec. 7206. National Agricultural Weather Information System. 

Sec. 7207. High-priority research and extension initiatives. 

Sec. 7208. Organic agriculture research and extension initiative. 

Sec. 7209. Farm business management. 

Sec. 7210. Regional centers of excellence. 

Sec. 7211. Assistive technology program for farmers with disabilities. 


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Sec. 7212. National rural information center clearinghouse. 

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

1998 

Sec. 7301. Relevance and merit of agricultural research, extension, and education funded by the Department. 

Sec. 7302. Integrated research, education, and extension competitive grants 

program. 

Sec. 7303. Support for research regarding diseases of wheat, triticale, and barley caused by Fusarium graminearum or by Tilletia indica. 

Sec. 7304. Grants for youth organizations. 

Sec. 7305. Specialty crop research initiative. 

Sec. 7306. Food animal residue avoidance database program. 

Sec. 7307. Office of pest management policy. 

Sec. 7308. Authorization of regional integrated pest management centers. 

Subtitle D—Other Laws 

Sec. 7401. Critical Agricultural Materials Act. 

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

Sec. 7403. Research Facilities Act. 

Sec. 7404. Competitive, Special, and Facilities Research Grant Act. 

Sec. 7405. Enhanced use lease authority pilot program under Department of 

Agriculture Reorganization Act of 1994. 

Sec. 7406. Renewable Resources Extension Act of 1978. 

Sec. 7407. National Aquaculture Act of 1980. 

Sec. 7408. Beginning farmer and rancher development program under Farm 

Security and Rural Investment Act of 2002. 

Subtitle E—Food, Conservation, and Energy Act of 2008 

PART I—AGRICULTURAL SECURITY

Sec. 7501. Agricultural biosecurity communication center. 

Sec. 7502. Assistance to build local capacity in agricultural biosecurity planning, preparation, and response. 

Sec. 7503. Research and development of agricultural countermeasures. 

Sec. 7504. Agricultural biosecurity grant program. 

PART II—MISCELLANEOUS

Sec. 7511. Grazinglands research laboratory. 

Sec. 7512. Budget submission and funding. 

Sec. 7513. Natural products research program. 

Sec. 7514. Sun grant program. 

Subtitle F—Miscellaneous 

Sec. 7601. Foundation for Food and Agriculture Research. 

TITLE VIII—FORESTRY 

Subtitle A—Repeal of Certain Forestry Programs 

Sec. 8001. Forest land enhancement program. 

Sec. 8002. Watershed forestry assistance program. 

Sec. 8003. Expired cooperative national forest products marketing program. 


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Sec. 8004. Hispanic-serving institution agricultural land national resources 

leadership program. 

Sec. 8005. Tribal watershed forestry assistance program. 

Subtitle B—Reauthorization of Cooperative Forestry Assistance Act of 1978 

Programs 

Sec. 8101. State-wide assessment and strategies for forest resources. 

Sec. 8102. Forest stewardship program. 

Sec. 8103. Forest Legacy Program. 

Sec. 8104. Community forest and open space conservation program. 

Sec. 8105. Urban and community forestry assistance. 

Subtitle C—Reauthorization of Other Forestry-related Laws 

Sec. 8201. Rural revitalization technologies. 

Sec. 8202. Office of International Forestry. 

Sec. 8203. Insect infestations and related diseases. 

Sec. 8204. Stewardship end result contracting projects. 

Sec. 8205. Healthy forests reserve program. 

Subtitle D—Miscellaneous Provisions 

Sec. 8301. McIntire-Stennis Cooperative Forestry Act. 

Sec. 8302. Revision of strategic plan for forest inventory and analysis. 

TITLE IX—ENERGY 

Sec. 9001. Definition of renewable chemical. 

Sec. 9002. Biobased markets program. 

Sec. 9003. Biorefinery, renewable chemical, and biobased product manufacturing assistance. 

Sec. 9004. Repeal of repowering assistance program and transfer of remaining 

funds. 

Sec. 9005. Bioenergy program for advanced biofuels. 

Sec. 9006. Biodiesel fuel education program. 

Sec. 9007. Rural Energy for America Program. 

Sec. 9008. Biomass research and development. 

Sec. 9009. Feedstock flexibility program for bioenergy producers. 

Sec. 9010. Biomass Crop Assistance Program. 

Sec. 9011. Repeal of forest biomass for energy. 

Sec. 9012. Community wood energy program. 

Sec. 9013. Repeal of renewable fertilizer study. 

TITLE X—HORTICULTURE 

Sec. 10001. Specialty crops market news allocation. 

Sec. 10002. Repeal of grant program to improve movement of specialty crops. 

Sec. 10003. Farmers market and local food promotion program. 

Sec. 10004. Study on local food production and program evaluation. 

Sec. 10005. Organic agriculture. 

Sec. 10006. Food safety education initiatives. 

Sec. 10007. Coordinated plant management program. 

Sec. 10008. Specialty crop block grants. 

Sec. 10009. Recordkeeping, investigations, and enforcement. 

Sec. 10010. Report on honey. 

Sec. 10011. Effective date. 


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TITLE XI—CROP INSURANCE 

Sec. 11001. Supplemental coverage option. 

Sec. 11002. Premium amounts for catastrophic risk protection. 

Sec. 11003. Permanent enterprise unit. 

Sec. 11004. Enterprise units for irrigated and nonirrigated crops. 

Sec. 11005. Data collection. 

Sec. 11006. Adjustment in actual production history to establish insurable 

yields. 

Sec. 11007. Submission and review of policies. 

Sec. 11008. Board review and approval. 

Sec. 11009. Consultation. 

Sec. 11010. Budget limitations on renegotiation of the standard reinsurance 

agreement. 

Sec. 11011. Stacked income protection plan for producers of upland cotton. 

Sec. 11012. Peanut revenue crop insurance. 

Sec. 11013. Authority to correct errors. 

Sec. 11014. Implementation. 

Sec. 11015. Approval of costs for research and development. 

Sec. 11016. Whole farm risk management insurance. 

Sec. 11017. Crop insurance for livestock. 

Sec. 11018. Margin coverage for catfish. 

Sec. 11019. Research and development. 

Sec. 11020. Pilot programs. 

Sec. 11021. Index-based weather insurance pilot program. 

Sec. 11022. Enhancing producer self-help through farm financial 

benchmarking. 

Sec. 11023. Beginning farmer and rancher provisions. 

Sec. 11024. Agricultural management assistance, risk management education, 

and organic certification cost share assistance. 

Sec. 11025. Crop production on native sod. 

Sec. 11026. Technical amendments. 

TITLE XII—MISCELLANEOUS 

Subtitle A—Socially Disadvantaged Producers and Limited Resource 

Producers 

Sec. 12001. Outreach and assistance for socially disadvantaged farmers and 

ranchers and veteran farmers and ranchers. 

Sec. 12002. Office of Advocacy and Outreach. 

Subtitle B—Livestock 

Sec. 12101. Wildlife reservoir zoonotic disease initiative. 

Sec. 12102. Trichinae certification program. 

Sec. 12103. National Aquatic Animal Health Plan. 

Sec. 12104. Sheep production and marketing grant program. 

Sec. 12105. Feral swine eradication pilot program. 

Subtitle C—Other Miscellaneous Provisions 

Sec. 12201. Military veterans agricultural liaison. 

Sec. 12202. Information gathering. 

Sec. 12203. Grants to improve supply, stability, safety, and training of agricultural labor force. 

Sec. 12204. Noninsured crop assistance program. 


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Sec. 12205. Regional economic and infrastructure development. 

Sec. 12206. Canada geese removal. 

1 SEC. 2. DEFINITION OF SECRETARY. 

2 In this Act, the term ‘‘Secretary’’ means the Sec3 retary of Agriculture. 

4 TITLE I—COMMODITY 

5 PROGRAMS 

6 Subtitle A—Repeals and Reforms 

7 SEC. 1101. REPEAL OF DIRECT PAYMENTS. 

8 (a) REPEAL.—Sections 1103 and 1303 of the Food, 

9 Conservation, and Energy Act of 2008 (7 U.S.C. 8713, 

10 8753) are repealed. 

11 (b) CONTINUED APPLICATION FOR 2012 CROP

12 YEAR.—Sections 1103 and 1303 of the Food, Conserva13 tion, and Energy Act of 2008 (7 U.S.C. 8713, 8753), as 

14 in effect on the day before the date of enactment of this 

15 Act, shall continue to apply through the 2012 crop year 

16 with respect to all covered commodities (as defined in sec17 tion 1001 of that Act (7 U.S.C. 8702)) (except pulse 

18 crops) and peanuts on a farm. 

19 SEC. 1102. REPEAL OF COUNTER-CYCLICAL PAYMENTS. 

20 (a) REPEAL.—Sections 1104 and 1304 of the Food, 

21 Conservation, and Energy Act of 2008 (7 U.S.C. 8714, 

22 8754) are repealed. 

23 (b) CONTINUED APPLICATION FOR 2012 CROP

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1 tion, and Energy Act of 2008 (7 U.S.C. 8714, 8754), as 

2 in effect on the day before the date of enactment of this 

3 Act, shall continue to apply through the 2012 crop year 

4 with respect to all covered commodities (as defined in sec5 tion 1001 of that Act (7 U.S.C. 8702)) and peanuts on 

6 a farm. 

7 SEC. 1103. REPEAL OF AVERAGE CROP REVENUE ELECTION 

8 PROGRAM. 

9 (a) REPEAL.—Section 1105 of the Food, Conserva10 tion, and Energy Act of 2008 (7 U.S.C. 8715) is repealed. 

11 (b) CONTINUED APPLICATION FOR 2012 CROP

12 YEAR.—Section 1105 of the Food, Conservation, and En13 ergy Act of 2008 (7 U.S.C. 8715), as in effect on the day 

14 before the date of enactment of this Act, shall continue 

15 to apply through the 2012 crop year with respect to all 

16 covered commodities (as defined in section 1001 of that 

17 Act (7 U.S.C. 8702)) and peanuts on a farm for which 

18 the irrevocable election under section 1105 of that Act is 

19 made before the date of enactment of this Act. 

20 SEC. 1104. DEFINITIONS. 

21 In this subtitle, subtitle B, and subtitle F: 

22 (1) ACTUAL CROP REVENUE.—The term ‘‘ac23 tual crop revenue’’, with respect to a covered com24 modity for a crop year, means the amount deter25 mined by the Secretary under section 1105(c)(3). 


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1 (2) AGRICULTURE RISK COVERAGE GUAR2 ANTEE.—The term ‘‘agriculture risk coverage guar3 antee’’, with respect to a covered commodity for a 

4 crop year, means the amount determined by the Sec5 retary under section 1105(c)(4). 

6 (3) AGRICULTURE RISK COVERAGE PAYMENT.— 

7 The term ‘‘agriculture risk coverage payment’’ 

8 means a payment under section 1105(c). 

9 (4) AVERAGE INDIVIDUAL YIELD.—The term 

10 ‘‘average individual yield’’ means the yield reported 

11 by a producer for purposes of subtitle A of the Fed12 eral Crop Insurance Act (7 U.S.C. 1501 et seq.), to 

13 the maximum extent practicable. 

14 (5) COUNTY COVERAGE.—For the purposes of 

15 agriculture risk coverage under section 1105, the 

16 term ‘‘county coverage’’ means coverage determined 

17 using the total quantity of all acreage in a county 

18 of the covered commodity that is planted or pre19 vented from being planted for harvest by a producer 

20 with the yield determined by the average county 

21 yield described in subsection (c) of that section. 

22 (6) COVERED COMMODITY.— 

23 (A) IN GENERAL.—The term ‘‘covered 

24 commodity’’ means wheat, corn, grain sorghum, 

25 barley, oats, long grain rice, medium grain rice, 


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1 pulse crops, soybeans, other oilseeds, and pea2 nuts. 

3 (B) POPCORN.—The Secretary— 

4 (i) shall study the feasibility of includ5 ing popcorn as a covered commodity by 

6 2014; and 

7 (ii) if the Secretary determines it to 

8 be feasible, shall designate popcorn as a 

9 covered commodity. 

10 (7) ELIGIBLE ACRES.— 

11 (A) IN GENERAL.—Except as provided in 

12 subparagraphs (B) through (E), the term ‘‘eli13 gible acres’’ means all acres planted or pre14 vented from being planted to all covered com15 modities on a farm in any crop year. 

16 (B) MAXIMUM.—Except as provided in 

17 (C), the total quantity of eligible acres on a 

18 farm determined under subparagraph (A) shall 

19 not exceed the average total acres planted or 

20 prevented from being planted to covered com21 modities and upland cotton on the farm for the 

22 2009 through 2012 crop years, as determined 

23 by the Secretary. 

24 (C) ADJUSTMENT.—The Secretary shall 

25 provide for an adjustment, as appropriate, in 


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1 the eligible acres for covered commodities for a 

2 farm if any of the following circumstances oc3 curs: 

4 (i) If a conservation reserve contract 

5 for a farm in a county entered into under 

6 section 1231 of the Food Security Act of 

7 1985 (16 U.S.C. 3831) expires or is volun8 tarily terminated or cropland is released 

9 from coverage under a conservation reserve 

10 contract, the Secretary shall provide for an 

11 adjustment, as appropriate, in the eligible 

12 acres for the farm to a total quantity that 

13 is the higher of— 

14 (I) the total base acreage for the 

15 farm, less any upland cotton base 

16 acreage, that was suspended during 

17 the conservation reserve contract; or 

18 (II) the product obtained by mul19 tiplying— 

20 (aa) the average proportion 

21 that— 

22 (AA) the total number 

23 of acres planted to covered 

24 commodities and upland cot25 ton in the county for crop 


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1 years 2009 through 2012; 

2 bears to 

3 (BB) the total number 

4 of all acres of covered com5 modities, grassland, and up6 land cotton acres in the 

7 county for the same crop 

8 years; by 

9 (bb) the total acres for 

10 which coverage has expired, vol11 untarily terminated, or been re12 leased under the conservation re13 serve contract. 

14 (ii) The producer has eligible oilseed 

15 acreage as the result of the Secretary des16 ignating additional oilseeds, which shall be 

17 determined in the same manner as eligible 

18 oilseed acreage under section 

19 1101(a)(1)(D) of the Food, Conservation, 

20 and Energy Act of 2008 (7 U.S.C. 

21 8711(a)(1)(D)). 

22 (iii) The producer has any acreage not 

23 cropped during the 2009 through 2012 

24 crop years, but placed into an established 

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1 riching land or conserving moisture for 

2 subsequent crop years, including summer 

3 fallow, as determined by the Secretary. 

4 (D) EXCLUSION.—The term ‘‘eligible 

5 acres’’ does not include any crop subsequently 

6 planted during the same crop year on the same 

7 land for which the first crop is eligible for pay8 ments under this subtitle, unless the crop was 

9 planted in an area approved for double crop10 ping, as determined by the Secretary. 

11 (8) EXTRA LONG STAPLE COTTON.—The term 

12 ‘‘extra long staple cotton’’ means cotton that— 

13 (A) is produced from pure strain varieties 

14 of the Barbadense species or any hybrid of the 

15 species, or other similar types of extra long sta16 ple cotton, designated by the Secretary, having 

17 characteristics needed for various end uses for 

18 which United States upland cotton is not suit19 able and grown in irrigated cotton-growing re20 gions of the United States designated by the 

21 Secretary or other areas designated by the Sec22 retary as suitable for the production of the vari23 eties or types; and 


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1 (B) is ginned on a roller-type gin or, if au2 thorized by the Secretary, ginned on another 

3 type gin for experimental purposes. 

4 (9) INDIVIDUAL COVERAGE.—For purposes of 

5 agriculture risk coverage under section 1105, the 

6 term ‘‘individual coverage’’ means coverage deter7 mined using the total quantity of all acreage in a 

8 county of the covered commodity that is planted or 

9 prevented from being planted for harvest by a pro10 ducer with the yield determined by the average indi11 vidual yield of the producer described in subsection 

12 (c) of that section. 

13 (10) MEDIUM GRAIN RICE.—The term ‘‘medium 

14 grain rice’’ includes short grain rice. 

15 (11) MIDSEASON PRICE.—The term ‘‘midseason 

16 price’’ means the applicable national average market 

17 price received by producers for the first 5 months of 

18 the applicable marketing year, as determined by the 

19 Secretary. 

20 (12) OTHER OILSEED.—The term ‘‘other oil21 seed’’ means a crop of sunflower seed, rapeseed, 

22 canola, safflower, flaxseed, mustard seed, crambe, 

23 sesame seed, or any oilseed designated by the Sec24 retary. 

25 (13) PRODUCER.— 


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

2 means an owner, operator, landlord, tenant, or 

3 sharecropper that shares in the risk of pro4 ducing a crop and is entitled to share in the 

5 crop available for marketing from the farm, or 

6 would have shared had the crop been produced. 

7 (B) HYBRID SEED.—In determining 

8 whether a grower of hybrid seed is a producer, 

9 the Secretary shall— 

10 (i) not take into consideration the ex11 istence of a hybrid seed contract; and 

12 (ii) ensure that program requirements 

13 do not adversely affect the ability of the 

14 grower to receive a payment under this 

15 title. 

16 (14) PULSE CROP.—The term ‘‘pulse crop’’ 

17 means dry peas, lentils, small chickpeas, and large 

18 chickpeas. 

19 (15) STATE.—The term ‘‘State’’ means— 

20 (A) a State; 

21 (B) the District of Columbia; 

22 (C) the Commonwealth of Puerto Rico; 

23 and 

24 (D) any other territory or possession of the 

25 United States. 


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1 (16) TRANSITIONAL YIELD.—The term ‘‘transi2 tional yield’’ has the meaning given the term in sec3 tion 502(b) of the Federal Crop Insurance Act (7 

4 U.S.C. 1502(b)). 

5 (17) UNITED STATES.—The term ‘‘United 

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

7 all of the States. 

8 (18) UNITED STATES PREMIUM FACTOR.—The 

9 term ‘‘United States Premium Factor’’ means the 

10 percentage by which the difference in the United 

11 States loan schedule premiums for Strict Middling 

(SM) 11 12 ⁄8-inch upland cotton and for Middling (M) 

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

14 applicable premiums for comparable international 

15 qualities. 

16 SEC. 1105. AGRICULTURE RISK COVERAGE. 

17 (a) PAYMENTS REQUIRED.—If the Secretary deter18 mines that payments are required under subsection (c), 

19 the Secretary shall make payments for each covered com20 modity available to producers in accordance with this sec21 tion. 

22 (b) COVERAGE ELECTION.— 

23 (1) IN GENERAL.—For the period of crop years 

24 2013 through 2017, the producers shall make a 1- 

25 time, irrevocable election to receive— 


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1 (A) individual coverage under this section, 

2 as determined by the Secretary; or 

3 (B) in the case of a county with sufficient 

4 data (as determined by the Secretary), county 

5 coverage under this section. 

6 (2) EFFECT OF ELECTION.—The election made 

7 under paragraph (1) shall be binding on the pro8 ducers making the election, regardless of covered 

9 commodities planted, and applicable to all acres 

10 under the operational control of the producers, in a 

11 manner that— 

12 (A) acres brought under the operational 

13 control of the producers after the election are 

14 included; and 

15 (B) acres no longer under the operational 

16 control of the producers after the election are 

17 no longer subject to the election of the pro18 ducers but become subject to the election of the 

19 subsequent producers. 

20 (3) DUTIES OF THE SECRETARY.—The Sec21 retary shall ensure that producers are precluded 

22 from taking any action, including reconstitution, 

23 transfer, or other similar action, that would have the 

24 effect of altering or reversing the election made 

25 under paragraph (1). 


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1 (c) AGRICULTURE RISK COVERAGE.— 

2 (1) PAYMENTS.—The Secretary shall make ag3 riculture risk coverage payments available under this 

4 subsection for each of the 2013 through 2017 crop 

5 years if the Secretary determines that— 

6 (A) the actual crop revenue for the crop 

7 year for the covered commodity; is less than 

8 (B) the agriculture risk coverage guarantee 

9 for the crop year for the covered commodity. 

10 (2) TIME FOR PAYMENTS.—If the Secretary de11 termines under this subsection that agriculture risk 

12 coverage payments are required to be made for the 

13 covered commodity, the agriculture risk coverage 

14 payments shall be made as soon as practicable there15 after. 

16 (3) ACTUAL CROP REVENUE.—The amount of 

17 the actual crop revenue for a crop year of a covered 

18 commodity shall be equal to the product obtained by 

19 multiplying— 

20 (A)(i) in the case of individual coverage, 

21 the actual average individual yield for the cov22 ered commodity, as determined by the Sec23 retary; or 

24 (ii) in the case of county coverage, the ac25 tual average yield for the county for the covered 


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1 commodity, as determined by the Secretary; 

2 and 

3 (B) the higher of— 

4 (i) the midseason price; or 

5 (ii) if applicable, the national mar6 keting assistance loan rate for the covered 

7 commodity under subtitle B. 

8 (4) AGRICULTURE RISK COVERAGE GUAR9 ANTEE.— 

10 (A) IN GENERAL.—The agriculture risk 

11 coverage guarantee for a crop year for a cov12 ered commodity shall equal 89 percent of the 

13 benchmark revenue. 

14 (B) BENCHMARK REVENUE.— 

15 (i) IN GENERAL.—The benchmark 

16 revenue shall be the product obtained by 

17 multiplying— 

18 (I)(aa) in the case of individual 

19 coverage, subject to clause (ii), the av20 erage individual yield, as determined 

21 by the Secretary, for the most recent 

22 5 crop years, excluding each of the 

23 crop years with the highest and lowest 

24 yields; or 


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1 (bb) in the case of county cov2 erage, the average county yield, as de3 termined by the Secretary, for the 

4 most recent 5 crop years, excluding 

5 each of the crop years with the high6 est and lowest yields; and 

7 (II) subject to clause (iii), the av8 erage national marketing year average 

9 price for the most recent 5 crop years, 

10 excluding each of the crop years with 

11 the highest and lowest prices. 

12 (ii) USE OF TRANSITIONAL YIELDS.— 

13 If the yield determined under clause 

14 (i)(I)(aa)— 

15 (I) for the 2012 crop year or any 

16 prior crop year, is less than 60 per17 cent of the applicable transitional 

18 yield, the Secretary shall use 60 per19 cent of the applicable transitional 

20 yield for that crop year; and 

21 (II) for the 2013 crop year and 

22 any subsequent crop year, is less than 

23 70 percent of the applicable transi24 tional yield, the Secretary shall use 70 


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1 percent of the applicable transitional 

2 yield for that crop year. 

3 (iii) SPECIAL RULE FOR RICE AND

4 PEANUTS.—If the national marketing year 

5 average price under clause (i)(II) for any 

6 of the applicable crop years is lower than 

7 the price for the covered commodity listed 

8 below, the Secretary shall use the following 

9 price for that crop year: 

10 (I) For long grain rice, $13.00 

11 per hundredweight. 

12 (II) For medium grain rice, 

13 $13.00 per hundredweight. 

14 (III) For peanuts, $530.00 per 

15 ton. 

16 (5) PAYMENT RATE.—The payment rate for 

17 each covered commodity shall be equal to the lesser 

18 of— 

19 (A) the amount that— 

20 (i) the agriculture risk coverage guar21 antee for the covered commodity; exceeds 

22 (ii) the actual crop revenue for the 

23 crop year of the covered commodity; or 

24 (B) 10 percent of the benchmark revenue 

25 for the crop year of the covered commodity. 


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1 (6) PAYMENT AMOUNT.—If agriculture risk 

2 coverage payments under this subsection are re3 quired to be paid for any of the 2013 through 2017 

4 crop years of a covered commodity, the amount of 

5 the agriculture risk coverage payment for the crop 

6 year shall be equal to the product obtained by multi7 plying— 

8 (A) the payment rate under paragraph (5); 

9 and 

10 (B)(i) in the case of individual coverage 

11 the sum of— 

12 (I) 65 percent of the planted eligible 

13 acres of the covered commodity; and 

14 (II) 45 percent of the eligible acres 

15 that were prevented from being planted to 

16 the covered commodity; or 

17 (ii) in the case of county coverage— 

18 (I) 80 percent of the planted eligible 

19 acres of the covered commodity; and 

20 (II) 45 percent of the eligible acres 

21 that were prevented from being planted to 

22 the covered commodity. 

23 (7) DUTIES OF THE SECRETARY.—In carrying 

24 out the program under this subsection, the Secretary 

25 shall— 


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1 (A) to the maximum extent practicable, 

2 use all available information and analysis to 

3 check for anomalies in the determination of 

4 payments under the program; 

5 (B) to the maximum extent practicable, 

6 calculate a separate actual crop revenue and ag7 riculture risk coverage guarantee for irrigated 

8 and nonirrigated covered commodities; 

9 (C) differentiate by type or class the na10 tional average price of— 

11 (i) sunflower seeds; 

12 (ii) barley, using malting barley val13 ues; and 

14 (iii) wheat; and 

15 (D) assign a yield for each acre planted or 

16 prevented from being planted for the crop year 

17 for the covered commodity on the basis of the 

18 yield history of representative farms in the 

19 State, region, or crop reporting district, as de20 termined by the Secretary, if the Secretary can21 not establish the yield as determined under 

22 paragraph (3)(A)(ii) or (4)(B)(i) or if the yield 

23 determined under paragraph (3)(A)(ii) or (4) is 

24 an unrepresentative average yield for the cov25 ered commodity as determined by the Secretary. 


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1 SEC. 1106. PRODUCER AGREEMENT REQUIRED AS CONDI2 TION OF PROVISION OF PAYMENTS. 

3 (a) COMPLIANCE WITH CERTAIN REQUIREMENTS.— 

4 (1) REQUIREMENTS.—Before the producers on 

5 a farm may receive agriculture risk coverage pay6 ments, the producers shall agree, during the crop 

7 year for which the payments are made and in ex8 change for the payments— 

9 (A) to comply with applicable conservation 

10 requirements under subtitle B of title XII of 

11 the Food Security Act of 1985 (16 U.S.C. 3811 

12 et seq.); 

13 (B) to comply with applicable wetland pro14 tection requirements under subtitle C of title 

15 XII of that Act (16 U.S.C. 3821 et seq.); 

16 (C) to use the land on the farm for an ag17 ricultural or conserving use in a quantity equal 

18 to the attributable eligible acres of the farm, 

19 and not for a nonagricultural commercial, in20 dustrial, or residential use, as determined by 

21 the Secretary; and 

22 (D) to effectively control noxious weeds 

23 and otherwise maintain the land in accordance 

24 with sound agricultural practices, as determined 

25 by the Secretary, if the agricultural or con26 serving use involves the noncultivation of any 


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1 portion of the land referred to in subparagraph 

2 (C). 

3 (2) COMPLIANCE.—The Secretary may issue 

4 such rules as the Secretary considers necessary to 

5 ensure producer compliance with the requirements of 

6 paragraph (1). 

7 (3) MODIFICATION.—At the request of the 

8 transferee or owner, the Secretary may modify the 

9 requirements of this subsection if the modifications 

10 are consistent with the objectives of this subsection, 

11 as determined by the Secretary. 

12 (b) TRANSFER OR CHANGE OF INTEREST IN

13 FARM.— 

14 (1) TERMINATION.— 

15 (A) IN GENERAL.—Except as provided in 

16 paragraph (2), a transfer of (or change in) the 

17 interest of the producers on a farm for which 

18 agriculture risk coverage payments are made 

19 shall result in the termination of the agriculture 

20 risk coverage payments, unless the transferee or 

21 owner of the acreage agrees to assume all obli22 gations under subsection (a). 

23 (B) EFFECTIVE DATE.—The termination 

24 shall take effect on the date determined by the 

25 Secretary. 


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1 (2) EXCEPTION.—If a producer entitled to an 

2 agriculture risk coverage payment dies, becomes in3 competent, or is otherwise unable to receive the pay4 ment, the Secretary shall make the payment, in ac5 cordance with rules issued by the Secretary. 

6 (c) REPORTS.— 

7 (1) ACREAGE REPORTS.—As a condition on the 

8 receipt of any benefits under this subtitle or subtitle 

9 B, the Secretary shall require producers on a farm 

10 to submit to the Secretary annual acreage reports 

11 with respect to all cropland on the farm. 

12 (2) PRODUCTION REPORTS.—As a condition on 

13 the receipt of any benefits under section 1105, the 

14 Secretary shall require producers on a farm to sub15 mit to the Secretary annual production reports with 

16 respect to all covered commodities produced on the 

17 farm. 

18 (3) PENALTIES.—No penalty with respect to 

19 benefits under this subtitle or subtitle B shall be as20 sessed against the producers on a farm for an inac21 curate acreage or production report unless the pro22 ducers on the farm knowingly and willfully falsified 

23 the acreage or production report. 

24 (4) DATA REPORTING.—To the maximum ex25 tent practicable, the Secretary shall use data reVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00030 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 ported by the producer pursuant to requirements 

2 under the Federal Crop Insurance Act (7 U.S.C. 

3 1501 et seq.) to meet the obligations described in 

4 paragraphs (1) and (2), without additional submis5 sions to the Department. 

6 (d) TENANTS AND SHARECROPPERS.—In carrying 

7 out this subtitle, the Secretary shall provide adequate safe8 guards to protect the interests of tenants and share9 croppers. 

10 SEC. 1107. PERIOD OF EFFECTIVENESS. 

11 This subtitle shall be effective beginning with the 

12 2013 crop year of each covered commodity through the 

13 2017 crop year. 

14 Subtitle B—Marketing Assistance 

15 Loans and Loan Deficiency Pay16 ments 

17 SEC. 1201. AVAILABILITY OF NONRECOURSE MARKETING 

18 ASSISTANCE LOANS FOR LOAN COMMOD19 ITIES. 

20 (a) DEFINITION OF LOAN COMMODITY.—In this sub21 title, the term ‘‘loan commodity’’ means wheat, corn, grain 

22 sorghum, barley, oats, upland cotton, extra long staple 

23 cotton, long grain rice, medium grain rice, peanuts, soy24 beans, other oilseeds, graded wool, nongraded wool, moVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00031 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 hair, honey, dry peas, lentils, small chickpeas, and large 

2 chickpeas. 

3 (b) NONRECOURSE LOANS AVAILABLE.— 

4 (1) IN GENERAL.—For each of the 2013 

5 through 2017 crops of each loan commodity, the 

6 Secretary shall make available to producers on a 

7 farm nonrecourse marketing assistance loans for 

8 loan commodities produced on the farm. 

9 (2) TERMS AND CONDITIONS.—The marketing 

10 assistance loans shall be made under terms and con11 ditions that are prescribed by the Secretary and at 

12 the loan rate established under section 1202 for the 

13 loan commodity. 

14 (c) ELIGIBLE PRODUCTION.—The producers on a 

15 farm shall be eligible for a marketing assistance loan 

16 under subsection (b) for any quantity of a loan commodity 

17 produced on the farm. 

18 (d) COMPLIANCE WITH CONSERVATION AND WET19 LANDS REQUIREMENTS.— 

20 (1) REQUIREMENTS.—Before the producers on 

21 a farm may receive a marketing assistance loan or 

22 any other payment or benefit under this subtitle, the 

23 producers shall agree, for the crop year for which 

24 the payments are made and in exchange for the pay25 ments— 


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1 (A) to comply with applicable conservation 

2 requirements under subtitle B of title XII of 

3 the Food Security Act of 1985 (16 U.S.C. 3811 

4 et seq.); 

5 (B) to comply with applicable wetland pro6 tection requirements under subtitle C of title 

7 XII of that Act (16 U.S.C. 3821 et seq.); 

8 (C) to use the land on the farm for an ag9 ricultural or conserving use in a quantity equal 

10 to the attributable eligible acres of the farm, 

11 and not for a nonagricultural commercial, in12 dustrial, or residential use, as determined by 

13 the Secretary; and 

14 (D) to effectively control noxious weeds 

15 and otherwise maintain the land in accordance 

16 with sound agricultural practices, as determined 

17 by the Secretary, if the agricultural or con18 serving use involves the noncultivation of any 

19 portion of the land referred to in subparagraph 

20 (C). 

21 (2) COMPLIANCE.—The Secretary may issue 

22 such rules as the Secretary considers necessary to 

23 ensure producer compliance with paragraph (1). 

24 (3) MODIFICATION.—At the request of a trans25 feree or owner, the Secretary may modify the reVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00033 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 quirements of this subsection if the modifications 

2 are consistent with the purposes of this subsection, 

3 as determined by the Secretary. 

4 (e) SPECIAL RULES FOR PEANUTS.— 

5 (1) IN GENERAL.—This subsection shall apply 

6 only to producers of peanuts. 

7 (2) OPTIONS FOR OBTAINING LOAN.—A mar8 keting assistance loan under this section, and loan 

9 deficiency payments under section 1205, may be ob10 tained at the option of the producers on a farm 

11 through— 

12 (A) a designated marketing association or 

13 marketing cooperative of producers that is ap14 proved by the Secretary; or 

15 (B) the Farm Service Agency. 

16 (3) STORAGE OF LOAN PEANUTS.—As a condi17 tion on the approval by the Secretary of an indi18 vidual or entity to provide storage for peanuts for 

19 which a marketing assistance loan is made under 

20 this section, the individual or entity shall agree— 

21 (A) to provide the storage on a nondiscrim22 inatory basis; and 

23 (B) to comply with such additional require24 ments as the Secretary considers appropriate to 

25 accomplish the purposes of this section and proVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00034 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 mote fairness in the administration of the bene2 fits of this section. 

3 (4) STORAGE, HANDLING, AND ASSOCIATED

4 COSTS.— 

5 (A) IN GENERAL.—To ensure proper stor6 age of peanuts for which a loan is made under 

7 this section, the Secretary shall pay handling 

8 and other associated costs (other than storage 

9 costs) incurred at the time at which the peanuts 

10 are placed under loan, as determined by the 

11 Secretary. 

12 (B) REDEMPTION AND FORFEITURE.—The 

13 Secretary shall— 

14 (i) require the repayment of handling 

15 and other associated costs paid under sub16 paragraph (A) for all peanuts pledged as 

17 collateral for a loan that is redeemed under 

18 this section; and 

19 (ii) pay storage, handling, and other 

20 associated costs for all peanuts pledged as 

21 collateral that are forfeited under this sec22 tion. 

23 (5) MARKETING.—A marketing association or 

24 cooperative may market peanuts for which a loan is 

25 made under this section in any manner that conVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00035 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 forms to consumer needs, including the separation of 

2 peanuts by type and quality. 

3 (6) REIMBURSABLE AGREEMENTS AND PAY4 MENT OF ADMINISTRATIVE EXPENSES.—The Sec5 retary may implement any reimbursable agreements 

6 or provide for the payment of administrative ex7 penses under this subsection only in a manner that 

8 is consistent with those activities in regard to other 

9 loan commodities. 

10 SEC. 1202. LOAN RATES FOR NONRECOURSE MARKETING 

11 ASSISTANCE LOANS. 

12 (a) IN GENERAL.—For purposes of each of the 2013 

13 through 2017 crop years, the loan rate for a marketing 

14 assistance loan under section 1201 for a loan commodity 

15 shall be equal to the following: 

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

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

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

19 bushel. 

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

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

22 (6) In the case of base quality of upland cotton, 

23 for the 2013 and each subsequent crop year, the 

24 simple average of the adjusted prevailing world price 

25 for the 2 immediately preceding marketing years, as 


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1 determined by the Secretary and announced October 

2 1 preceding the next domestic plantings, but in no 

3 case less than $0.47 per pound or more than $0.52 

4 per pound. 

5 (7) In the case of extra long staple cotton, 

6 $0.7977 per pound. 

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

8 hundredweight. 

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

10 hundredweight. 

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

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

13 hundredweight for each of the following kinds of oil14 seeds: 

15 (A) Sunflower seed. 

16 (B) Rapeseed. 

17 (C) Canola. 

18 (D) Safflower. 

19 (E) Flaxseed. 

20 (F) Mustard seed. 

21 (G) Crambe. 

22 (H) Sesame seed. 

23 (I) Other oilseeds designated by the Sec24 retary. 


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1 (12) In the case of dry peas, $5.40 per hun2 dredweight. 

3 (13) In the case of lentils, $11.28 per hundred4 weight. 

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

6 hundredweight. 

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

8 hundredweight. 

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

10 pound. 

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

12 pound. 

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

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

15 (20) In the case of peanuts, $355 per ton. 

16 (b) SINGLE COUNTY LOAN RATE FOR OTHER OIL17 SEEDS.—The Secretary shall establish a single loan rate 

18 in each county for each kind of other oilseeds described 

19 in subsection (a)(11). 

20 SEC. 1203. TERM OF LOANS. 

21 (a) TERM OF LOAN.—In the case of each loan com22 modity, a marketing assistance loan under section 1201 

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

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

25 made. 


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1 (b) EXTENSIONS PROHIBITED.—The Secretary may 

2 not extend the term of a marketing assistance loan for 

3 any loan commodity. 

4 SEC. 1204. REPAYMENT OF LOANS. 

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

6 producers on a farm to repay a marketing assistance loan 

7 under section 1201 for a loan commodity (other than up8 land cotton, long grain rice, medium grain rice, extra long 

9 staple cotton, peanuts and confectionery and each other 

10 kind of sunflower seed (other than oil sunflower seed)) at 

11 a rate that is the lesser of— 

12 (1) the loan rate established for the commodity 

13 under section 1202, plus interest (determined in ac14 cordance with section 163 of the Federal Agriculture 

15 Improvement and Reform Act of 1996 (7 U.S.C. 

16 7283)); 

17 (2) a rate (as determined by the Secretary) 

18 that— 

19 (A) is calculated based on average market 

20 prices for the loan commodity during the pre21 ceding 30-day period; and 

22 (B) will minimize discrepancies in mar23 keting loan benefits across State boundaries 

24 and across county boundaries; or 


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

2 alternative methods for calculating a repayment rate 

3 for a loan commodity that the Secretary determines 

4 will— 

5 (A) minimize potential loan forfeitures; 

6 (B) minimize the accumulation of stocks of 

7 the commodity by the Federal Government; 

8 (C) minimize the cost incurred by the Fed9 eral Government in storing the commodity; 

10 (D) allow the commodity produced in the 

11 United States to be marketed freely and com12 petitively, both domestically and internationally; 

13 and 

14 (E) minimize discrepancies in marketing 

15 loan benefits across State boundaries and 

16 across county boundaries. 

17 (b) REPAYMENT RATES FOR UPLAND COTTON, LONG

18 GRAIN RICE, AND MEDIUM GRAIN RICE.—The Secretary 

19 shall permit producers to repay a marketing assistance 

20 loan under section 1201 for upland cotton, long grain rice, 

21 and medium grain rice at a rate that is the lesser of— 

22 (1) the loan rate established for the commodity 

23 under section 1202, plus interest (determined in ac24 cordance with section 163 of the Federal Agriculture 


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1 Improvement and Reform Act of 1996 (7 U.S.C. 

2 7283)); or 

3 (2) the prevailing world market price for the 

4 commodity, as determined and adjusted by the Sec5 retary in accordance with this section. 

6 (c) REPAYMENT RATES FOR EXTRA LONG STAPLE

7 COTTON.—Repayment of a marketing assistance loan for 

8 extra long staple cotton shall be at the loan rate estab9 lished for the commodity under section 1202, plus interest 

10 (determined in accordance with section 163 of the Federal 

11 Agriculture Improvement and Reform Act of 1996 (7 

12 U.S.C. 7283)). 

13 (d) PREVAILING WORLD MARKET PRICE.—For pur14 poses of this section and section 1207, the Secretary shall 

15 prescribe by regulation— 

16 (1) a formula to determine the prevailing world 

17 market price for each of upland cotton, long grain 

18 rice, and medium grain rice; and 

19 (2) a mechanism by which the Secretary shall 

20 announce periodically those prevailing world market 

21 prices. 

22 (e) ADJUSTMENT OF PREVAILING WORLD MARKET

23 PRICE FOR UPLAND COTTON, LONG GRAIN RICE, AND

24 MEDIUM GRAIN RICE.— 


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1 (1) RICE.—The prevailing world market price 

2 for long grain rice and medium grain rice deter3 mined under subsection (d) shall be adjusted to 

4 United States quality and location. 

5 (2) COTTON.—The prevailing world market 

6 price for upland cotton determined under subsection 

7 (d)— 

8 (A) shall be adjusted to United States 

9 quality and location, with the adjustment to in10 clude— 

11 (i) a reduction equal to any United 

12 States Premium Factor for upland cotton 

13 of a quality higher than Middling (M) 

13 14 ⁄32-inch; and 

15 (ii) the average costs to market the 

16 commodity, including average transpor17 tation costs, as determined by the Sec18 retary; and 

19 (B) may be further adjusted, during the 

20 period beginning on the date of enactment of 

21 this Act and ending on July 31, 2018, if the 

22 Secretary determines the adjustment is nec23 essary— 

24 (i) to minimize potential loan forfeit25 ures; 


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1 (ii) to minimize the accumulation of 

2 stocks of upland cotton by the Federal 

3 Government; 

4 (iii) to ensure that upland cotton pro5 duced in the United States can be mar6 keted freely and competitively, both domes7 tically and internationally; and 

8 (iv) to ensure an appropriate transi9 tion between current-crop and forward10 crop price quotations, except that the Sec11 retary may use forward-crop price 

12 quotations prior to July 31 of a marketing 

13 year only if— 

14 (I) there are insufficient current15 crop price quotations; and 

16 (II) the forward-crop price 

17 quotation is the lowest such quotation 

18 available. 

19 (3) GUIDELINES FOR ADDITIONAL ADJUST20 MENTS.—In making adjustments under this sub21 section, the Secretary shall establish a mechanism 

22 for determining and announcing the adjustments in 

23 order to avoid undue disruption in the United States 

24 market. 


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1 (f) REPAYMENT RATES FOR CONFECTIONERY AND

2 OTHER KINDS OF SUNFLOWER SEEDS.—The Secretary 

3 shall permit the producers on a farm to repay a marketing 

4 assistance loan under section 1201 for confectionery and 

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

6 seed) at a rate that is the lesser of— 

7 (1) the loan rate established for the commodity 

8 under section 1202, plus interest (determined in ac9 cordance with section 163 of the Federal Agriculture 

10 Improvement and Reform Act of 1996 (7 U.S.C. 

11 7283)); or 

12 (2) the repayment rate established for oil sun13 flower seed. 

14 (g) PAYMENT OF COTTON STORAGE COSTS.—Effec15 tive for each of the 2013 through 2017 crop years, the 

16 Secretary shall make cotton storage payments available in 

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

18 provided storage payments for the 2006 crop of cotton, 

19 except that the rates shall be reduced by 20 percent. 

20 (h) REPAYMENT RATE FOR PEANUTS.—The Sec21 retary shall permit producers on a farm to repay a mar22 keting assistance loan for peanuts under subsection (a) at 

23 a rate that is the lesser of— 

24 (1) the loan rate established for peanuts under 

25 subsection (b), plus interest (determined in accordVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00044 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 ance with section 163 of the Federal Agriculture Im2 provement and Reform Act of 1996 (7 U.S.C. 

3 7283)); or 

4 (2) a rate that the Secretary determines will— 

5 (A) minimize potential loan forfeitures; 

6 (B) minimize the accumulation of stocks of 

7 peanuts by the Federal Government; 

8 (C) minimize the cost incurred by the Fed9 eral Government in storing peanuts; and 

10 (D) allow peanuts produced in the United 

11 States to be marketed freely and competitively, 

12 both domestically and internationally. 

13 (i) AUTHORITY TO TEMPORARILY ADJUST REPAY14 MENT RATES.— 

15 (1) ADJUSTMENT AUTHORITY.—In the event of 

16 a severe disruption to marketing, transportation, or 

17 related infrastructure, the Secretary may modify the 

18 repayment rate otherwise applicable under this sec19 tion for marketing assistance loans under section 

20 1201 for a loan commodity. 

21 (2) DURATION.—Any adjustment made under 

22 paragraph (1) in the repayment rate for marketing 

23 assistance loans for a loan commodity shall be in ef24 fect on a short-term and temporary basis, as deter25 mined by the Secretary. 


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1 SEC. 1205. LOAN DEFICIENCY PAYMENTS. 

2 (a) AVAILABILITY OF LOAN DEFICIENCY PAY3 MENTS.— 

4 (1) IN GENERAL.—Except as provided in sub5 section (d), the Secretary may make loan deficiency 

6 payments available to producers on a farm that, al7 though eligible to obtain a marketing assistance loan 

8 under section 1201 with respect to a loan com9 modity, agree to forgo obtaining the loan for the 

10 commodity in return for loan deficiency payments 

11 under this section. 

12 (2) UNSHORN PELTS, HAY, AND SILAGE.— 

13 (A) MARKETING ASSISTANCE LOANS.— 

14 Subject to subparagraph (B), nongraded wool 

15 in the form of unshorn pelts and hay and silage 

16 derived from a loan commodity are not eligible 

17 for a marketing assistance loan under section 

18 1201. 

19 (B) LOAN DEFICIENCY PAYMENT.—Effec20 tive for the 2013 through 2017 crop years, the 

21 Secretary may make loan deficiency payments 

22 available under this section to producers on a 

23 farm that produce unshorn pelts or hay and si24 lage derived from a loan commodity. 

25 (b) COMPUTATION.—A loan deficiency payment for a 

26 loan commodity or commodity referred to in subsection 


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1 (a)(2) shall be equal to the product obtained by multi2 plying— 

3 (1) the payment rate determined under sub4 section (c) for the commodity; by 

5 (2) the quantity of the commodity produced by 

6 the eligible producers, excluding any quantity for 

7 which the producers obtain a marketing assistance 

8 loan under section 1201. 

9 (c) PAYMENT RATE.— 

10 (1) IN GENERAL.—In the case of a loan com11 modity, the payment rate shall be the amount by 

12 which— 

13 (A) the loan rate established under section 

14 1202 for the loan commodity; exceeds 

15 (B) the rate at which a marketing assist16 ance loan for the loan commodity may be repaid 

17 under section 1204. 

18 (2) UNSHORN PELTS.—In the case of unshorn 

19 pelts, the payment rate shall be the amount by 

20 which— 

21 (A) the loan rate established under section 

22 1202 for ungraded wool; exceeds 

23 (B) the rate at which a marketing assist24 ance loan for ungraded wool may be repaid 

25 under section 1204. 


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1 (3) HAY AND SILAGE.—In the case of hay or si2 lage derived from a loan commodity, the payment 

3 rate shall be the amount by which— 

4 (A) the loan rate established under section 

5 1202 for the loan commodity from which the 

6 hay or silage is derived; exceeds 

7 (B) the rate at which a marketing assist8 ance loan for the loan commodity may be repaid 

9 under section 1204. 

10 (d) EXCEPTION FOR EXTRA LONG STAPLE COT11 TON.—This section shall not apply with respect to extra 

12 long staple cotton. 

13 (e) EFFECTIVE DATE FOR PAYMENT RATE DETER14 MINATION.—The Secretary shall determine the amount of 

15 the loan deficiency payment to be made under this section 

16 to the producers on a farm with respect to a quantity of 

17 a loan commodity or commodity referred to in subsection 

18 (a)(2) using the payment rate in effect under subsection 

19 (c) as of the date the producers request the payment. 

20 SEC. 1206. PAYMENTS IN LIEU OF LOAN DEFICIENCY PAY21 MENTS FOR GRAZED ACREAGE. 

22 (a) ELIGIBLE PRODUCERS.— 

23 (1) IN GENERAL.—Effective for the 2013 

24 through 2017 crop years, in the case of a producer 

25 that would be eligible for a loan deficiency payment 


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1 under section 1205 for wheat, barley, or oats, but 

2 that elects to use acreage planted to the wheat, bar3 ley, or oats for the grazing of livestock, the Sec4 retary shall make a payment to the producer under 

5 this section if the producer enters into an agreement 

6 with the Secretary to forgo any other harvesting of 

7 the wheat, barley, or oats on that acreage. 

8 (2) GRAZING OF TRITICALE ACREAGE.—Effec9 tive for the 2013 through 2017 crop years, with re10 spect to a producer on a farm that uses acreage 

11 planted to triticale for the grazing of livestock, the 

12 Secretary shall make a payment to the producer 

13 under this section if the producer enters into an 

14 agreement with the Secretary to forgo any other 

15 harvesting of triticale on that acreage. 

16 (b) PAYMENT AMOUNT.— 

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

18 made under this section to a producer on a farm de19 scribed in subsection (a)(1) shall be equal to the 

20 amount determined by multiplying— 

21 (A) the loan deficiency payment rate deter22 mined under section 1205(c) in effect, as of the 

23 date of the agreement, for the county in which 

24 the farm is located; by 


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1 (B) the payment quantity determined by 

2 multiplying— 

3 (i) the quantity of the grazed acreage 

4 on the farm with respect to which the pro5 ducer elects to forgo harvesting of wheat, 

6 barley, or oats; and 

7 (ii)(I) the yield in effect for the cal8 culation of agriculture risk coverage pay9 ments under subtitle A with respect to that 

10 loan commodity on the farm; or 

11 (II) in the case of a farm without a 

12 payment yield for that loan commodity, an 

13 appropriate yield established by the Sec14 retary. 

15 (2) GRAZING OF TRITICALE ACREAGE.—The 

16 amount of a payment made under this section to a 

17 producer on a farm described in subsection (a)(2) 

18 shall be equal to the amount determined by multi19 plying— 

20 (A) the loan deficiency payment rate deter21 mined under section 1205(c) in effect for 

22 wheat, as of the date of the agreement, for the 

23 county in which the farm is located; by 

24 (B) the payment quantity determined by 

25 multiplying— 


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1 (i) the quantity of the grazed acreage 

2 on the farm with respect to which the pro3 ducer elects to forgo harvesting of triticale; 

4 and 

5 (ii)(I) the yield in effect for the cal6 culation of agriculture risk coverage pay7 ments under subtitle A with respect to 

8 wheat on the farm; or 

9 (II) in the case of a farm without a 

10 payment yield for wheat, an appropriate 

11 yield established by the Secretary in a 

12 manner consistent with section 1102 of the 

13 Food, Conservation, and Energy Act of 

14 2008 (7 U.S.C. 8712). 

15 (c) TIME, MANNER, AND AVAILABILITY OF PAY16 MENT.— 

17 (1) TIME AND MANNER.—A payment under this 

18 section shall be made at the same time and in the 

19 same manner as loan deficiency payments are made 

20 under section 1205. 

21 (2) AVAILABILITY.— 

22 (A) IN GENERAL.—The Secretary shall es23 tablish an availability period for the payments 

24 authorized by this section. 


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1 (B) CERTAIN COMMODITIES.—In the case 

2 of wheat, barley, and oats, the availability pe3 riod shall be consistent with the availability pe4 riod for the commodity established by the Sec5 retary for marketing assistance loans author6 ized by this subtitle. 

7 (d) PROHIBITION ON CROP INSURANCE INDEMNITY

8 OR NONINSURED CROP ASSISTANCE.—A 2013 through 

9 2017 crop of wheat, barley, oats, or triticale planted on 

10 acreage that a producer elects, in the agreement required 

11 by subsection (a), to use for the grazing of livestock in 

12 lieu of any other harvesting of the crop shall not be eligible 

13 for an indemnity under a policy or plan of insurance au14 thorized under the Federal Crop Insurance Act (7 U.S.C. 

15 1501 et seq.) or noninsured crop assistance under section 

16 196 of the Federal Agriculture Improvement and Reform 

17 Act of 1996 (7 U.S.C. 7333). 

18 SEC. 1207. SPECIAL MARKETING LOAN PROVISIONS FOR 

19 UPLAND COTTON. 

20 (a) SPECIAL IMPORT QUOTA.— 

21 (1) DEFINITION OF SPECIAL IMPORT QUOTA.— 

22 In this subsection, the term ‘‘special import quota’’ 

23 means a quantity of imports that is not subject to 

24 the over-quota tariff rate of a tariff-rate quota. 

25 (2) ESTABLISHMENT.— 


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1 (A) IN GENERAL.—The President shall 

2 carry out an import quota program during the 

3 period beginning on August 1, 2013, and end4 ing on July 31, 2018, as provided in this sub5 section. 

6 (B) PROGRAM REQUIREMENTS.—Whenever 

7 the Secretary determines and announces that 

8 for any consecutive 4-week period, the Friday 

9 through Thursday average price quotation for 

10 the lowest-priced United States growth, as 

quoted for Middling (M) 13 11 ⁄32-inch cotton, deliv12 ered to a definable and significant international 

13 market, as determined by the Secretary, ex14 ceeds the prevailing world market price, there 

15 shall immediately be in effect a special import 

16 quota. 

17 (3) QUANTITY.—The quota shall be equal to 

18 the consumption during a 1-week period of cotton by 

19 domestic mills at the seasonally adjusted average 

20 rate of the most recent 3 months for which official 

21 data of the Department of Agriculture or other data 

22 are available. 

23 (4) APPLICATION.—The quota shall apply to 

24 upland cotton purchased not later than 90 days 

25 after the date of the Secretary’s announcement 


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1 under paragraph (2) and entered into the United 

2 States not later than 180 days after that date. 

3 (5) OVERLAP.—A special quota period may be 

4 established that overlaps any existing quota period if 

5 required by paragraph (2), except that a special 

6 quota period may not be established under this sub7 section if a quota period has been established under 

8 subsection (b). 

9 (6) PREFERENTIAL TARIFF TREATMENT.—The 

10 quantity under a special import quota shall be con11 sidered to be an in-quota quantity for purposes of— 

12 (A) section 213(d) of the Caribbean Basin 

13 Economic Recovery Act (19 U.S.C. 2703(d)); 

14 (B) section 204 of the Andean Trade Pref15 erence Act (19 U.S.C. 3203); 

16 (C) section 503(d) of the Trade Act of 

17 1974 (19 U.S.C. 2463(d)); and 

18 (D) General Note 3(a)(iv) to the Har19 monized Tariff Schedule. 

20 (7) LIMITATION.—The quantity of cotton en21 tered into the United States during any marketing 

22 year under the special import quota established 

23 under this subsection may not exceed the equivalent 

24 of 10 week’s consumption of upland cotton by do25 mestic mills at the seasonally adjusted average rate 


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1 of the 3 months immediately preceding the first spe2 cial import quota established in any marketing year. 

3 (b) LIMITED GLOBAL IMPORT QUOTA FOR UPLAND

4 COTTON.— 

5 (1) DEFINITIONS.—In this subsection: 

6 (A) DEMAND.—The term ‘‘demand’’ 

7 means— 

8 (i) the average seasonally adjusted an9 nual rate of domestic mill consumption of 

10 cotton during the most recent 3 months 

11 for which official data of the Department 

12 of Agriculture (as determined by the Sec13 retary) are available; and 

14 (ii) the larger of— 

15 (I) average exports of upland cot16 ton during the preceding 6 marketing 

17 years; or 

18 (II) cumulative exports of upland 

19 cotton plus outstanding export sales 

20 for the marketing year in which the 

21 quota is established. 

22 (B) LIMITED GLOBAL IMPORT QUOTA.— 

23 The term ‘‘limited global import quota’’ means 

24 a quantity of imports that is not subject to the 

25 over-quota tariff rate of a tariff-rate quota. 


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1 (C) SUPPLY.—The term ‘‘supply’’ means, 

2 using the latest official data of the Department 

3 of Agriculture— 

4 (i) the carryover of upland cotton at 

5 the beginning of the marketing year (ad6 justed to 480-pound bales) in which the 

7 quota is established; 

8 (ii) production of the current crop; 

9 and 

10 (iii) imports to the latest date avail11 able during the marketing year. 

12 (2) PROGRAM.—The President shall carry out 

13 an import quota program that provides that when14 ever the Secretary determines and announces that 

15 the average price of the base quality of upland cot16 ton, as determined by the Secretary, in the des17 ignated spot markets for a month exceeded 130 per18 cent of the average price of the quality of cotton in 

19 the markets for the preceding 36 months, notwith20 standing any other provision of law, there shall im21 mediately be in effect a limited global import quota 

22 subject to the following conditions: 

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

24 shall be equal to 21 days of domestic mill con25 sumption of upland cotton at the seasonally adVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00056 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 justed average rate of the most recent 3 months 

2 for which official data of the Department of Ag3 riculture are available or as estimated by the 

4 Secretary. 

5 (B) QUANTITY IF PRIOR QUOTA.—If a 

6 quota has been established under this sub7 section during the preceding 12 months, the 

8 quantity of the quota next established under 

9 this subsection shall be the smaller of 21 days 

10 of domestic mill consumption calculated under 

11 subparagraph (A) or the quantity required to 

12 increase the supply to 130 percent of the de13 mand. 

14 (C) PREFERENTIAL TARIFF TREAT15 MENT.—The quantity under a limited global 

16 import quota shall be considered to be an in17 quota quantity for purposes of— 

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

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

20 2703(d)); 

21 (ii) section 204 of the Andean Trade 

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

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

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


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1 (iv) General Note 3(a)(iv) to the Har2 monized Tariff Schedule. 

3 (D) QUOTA ENTRY PERIOD.—When a 

4 quota is established under this subsection, cot5 ton may be entered under the quota during the 

6 90-day period beginning on the date the quota 

7 is established by the Secretary. 

8 (3) NO OVERLAP.—Notwithstanding paragraph 

9 (2), a quota period may not be established that over10 laps an existing quota period or a special quota pe11 riod established under subsection (a). 

12 (c) ECONOMIC ADJUSTMENT ASSISTANCE TO USERS

13 OF UPLAND COTTON.— 

14 (1) IN GENERAL.—Subject to paragraph (2), 

15 the Secretary shall, on a monthly basis, make eco16 nomic adjustment assistance available to domestic 

17 users of upland cotton in the form of payments for 

18 all documented use of that upland cotton during the 

19 previous monthly period regardless of the origin of 

20 the upland cotton. 

21 (2) VALUE OF ASSISTANCE.—Effective begin22 ning on August 1, 2012, the value of the assistance 

23 provided under paragraph (1) shall be 3 cents per 

24 pound. 


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1 (3) ALLOWABLE PURPOSES.—Economic adjust2 ment assistance under this subsection shall be made 

3 available only to domestic users of upland cotton 

4 that certify that the assistance shall be used only to 

5 acquire, construct, install, modernize, develop, con6 vert, or expand land, plant, buildings, equipment, fa7 cilities, or machinery. 

8 (4) REVIEW OR AUDIT.—The Secretary may 

9 conduct such review or audit of the records of a do10 mestic user under this subsection as the Secretary 

11 determines necessary to carry out this subsection. 

12 (5) IMPROPER USE OF ASSISTANCE.—If the 

13 Secretary determines, after a review or audit of the 

14 records of the domestic user, that economic adjust15 ment assistance under this subsection was not used 

16 for the purposes specified in paragraph (3), the do17 mestic user shall be— 

18 (A) liable for the repayment of the assist19 ance to the Secretary, plus interest, as deter20 mined by the Secretary; and 

21 (B) ineligible to receive assistance under 

22 this subsection for a period of 1 year following 

23 the determination of the Secretary. 


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1 SEC. 1208. SPECIAL COMPETITIVE PROVISIONS FOR EXTRA 

2 LONG STAPLE COTTON. 

3 (a) COMPETITIVENESS PROGRAM.—Notwithstanding 

4 any other provision of law, during the period beginning 

5 on the date of enactment of this Act through July 31, 

6 2018, the Secretary shall carry out a program— 

7 (1) to maintain and expand the domestic use of 

8 extra long staple cotton produced in the United 

9 States; 

10 (2) to increase exports of extra long staple cot11 ton produced in the United States; and 

12 (3) to ensure that extra long staple cotton pro13 duced in the United States remains competitive in 

14 world markets. 

15 (b) PAYMENTS UNDER PROGRAM; TRIGGER.—Under 

16 the program, the Secretary shall make payments available 

17 under this section whenever— 

18 (1) for a consecutive 4-week period, the world 

19 market price for the lowest priced competing growth 

20 of extra long staple cotton (adjusted to United 

21 States quality and location and for other factors af22 fecting the competitiveness of such cotton), as deter23 mined by the Secretary, is below the prevailing 

24 United States price for a competing growth of extra 

25 long staple cotton; and 


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1 (2) the lowest priced competing growth of extra 

2 long staple cotton (adjusted to United States quality 

3 and location and for other factors affecting the com4 petitiveness of such cotton), as determined by the 

5 Secretary, is less than 134 percent of the loan rate 

6 for extra long staple cotton. 

7 (c) ELIGIBLE RECIPIENTS.—The Secretary shall 

8 make payments available under this section to domestic 

9 users of extra long staple cotton produced in the United 

10 States and exporters of extra long staple cotton produced 

11 in the United States that enter into an agreement with 

12 the Commodity Credit Corporation to participate in the 

13 program under this section. 

14 (d) PAYMENT AMOUNT.—Payments under this sec15 tion shall be based on the amount of the difference in the 

16 prices referred to in subsection (b)(1) during the fourth 

17 week of the consecutive 4-week period multiplied by the 

18 amount of documented purchases by domestic users and 

19 sales for export by exporters made in the week following 

20 such a consecutive 4-week period. 

21 SEC. 1209. AVAILABILITY OF RECOURSE LOANS FOR HIGH 

22 MOISTURE FEED GRAINS AND SEED COTTON. 

23 (a) HIGH MOISTURE FEED GRAINS.— 

24 (1) DEFINITION OF HIGH MOISTURE STATE.— 

25 In this subsection, the term ‘‘high moisture state’’ 


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1 means corn or grain sorghum having a moisture con2 tent in excess of Commodity Credit Corporation 

3 standards for marketing assistance loans made by 

4 the Secretary under section 1201. 

5 (2) RECOURSE LOANS AVAILABLE.—For each of 

6 the 2013 through 2017 crops of corn and grain sor7 ghum, the Secretary shall make available recourse 

8 loans, as determined by the Secretary, to producers 

9 on a farm that— 

10 (A) normally harvest all or a portion of 

11 their crop of corn or grain sorghum in a high 

12 moisture state; 

13 (B) present— 

14 (i) certified scale tickets from an in15 spected, certified commercial scale, includ16 ing a licensed warehouse, feedlot, feed mill, 

17 distillery, or other similar entity approved 

18 by the Secretary, pursuant to regulations 

19 issued by the Secretary; or 

20 (ii) field or other physical measure21 ments of the standing or stored crop in re22 gions of the United States, as determined 

23 by the Secretary, that do not have certified 

24 commercial scales from which certified 


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1 scale tickets may be obtained within rea2 sonable proximity of harvest operation; 

3 (C) certify that the producers on the farm 

4 were the owners of the feed grain at the time 

5 of delivery to, and that the quantity to be 

6 placed under loan under this subsection was in 

7 fact harvested on the farm and delivered to, a 

8 feedlot, feed mill, or commercial or on-farm 

9 high-moisture storage facility, or to a facility 

10 maintained by the users of corn and grain sor11 ghum in a high moisture state; and 

12 (D) comply with deadlines established by 

13 the Secretary for harvesting the corn or grain 

14 sorghum and submit applications for loans 

15 under this subsection within deadlines estab16 lished by the Secretary. 

17 (3) ELIGIBILITY OF ACQUIRED FEED GRAINS.— 

18 A loan under this subsection shall be made on a 

19 quantity of corn or grain sorghum of the same crop 

20 acquired by the producer equivalent to a quantity 

21 determined by multiplying— 

22 (A) the acreage of the corn or grain sor23 ghum in a high moisture state harvested on the 

24 farm of the producer; by 


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1 (B) the lower of the actual average yield 

2 used to make payments under subtitle A or the 

3 actual yield on a field, as determined by the 

4 Secretary, that is similar to the field from 

5 which the corn or grain sorghum was obtained. 

6 (b) RECOURSE LOANS AVAILABLE FOR SEED COT7 TON.—For each of the 2013 through 2017 crops of upland 

8 cotton and extra long staple cotton, the Secretary shall 

9 make available recourse seed cotton loans, as determined 

10 by the Secretary, on any production. 

11 (c) REPAYMENT RATES.—Repayment of a recourse 

12 loan made under this section shall be at the loan rate es13 tablished for the commodity by the Secretary, plus interest 

14 (determined in accordance with section 163 of the Federal 

15 Agriculture Improvement and Reform Act of 1996 (7 

16 U.S.C. 7283)). 

17 SEC. 1210. ADJUSTMENTS OF LOANS. 

18 (a) ADJUSTMENT AUTHORITY.—Subject to sub19 section (e), the Secretary may make appropriate adjust20 ments in the loan rates for any loan commodity (other 

21 than cotton) for differences in grade, type, quality, loca22 tion, and other factors. 

23 (b) MANNER OF ADJUSTMENT.—The adjustments 

24 under subsection (a) shall, to the maximum extent prac25 ticable, be made in such a manner that the average loan 


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1 level for the commodity will, on the basis of the anticipated 

2 incidence of the factors, be equal to the level of support 

3 determined in accordance with this subtitle and subtitles 

4 C through E. 

5 (c) ADJUSTMENT ON COUNTY BASIS.— 

6 (1) IN GENERAL.—The Secretary may establish 

7 loan rates for a crop for producers in individual 

8 counties in a manner that results in the lowest loan 

9 rate being 95 percent of the national average loan 

10 rate, if those loan rates do not result in an increase 

11 in outlays. 

12 (2) PROHIBITION.—Adjustments under this 

13 subsection shall not result in an increase in the na14 tional average loan rate for any year. 

15 (d) ADJUSTMENT IN LOAN RATE FOR COTTON.— 

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

17 appropriate adjustments in the loan rate for cotton 

18 for differences in quality factors. 

19 (2) REVISIONS TO QUALITY ADJUSTMENTS FOR

20 UPLAND COTTON.— 

21 (A) IN GENERAL.—Not later than 180 

22 days after the date of enactment of this Act, 

23 the Secretary shall implement revisions in the 

24 administration of the marketing assistance loan 

25 program for upland cotton to more accurately 


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1 and efficiently reflect market values for upland 

2 cotton. 

3 (B) MANDATORY REVISIONS.—Revisions 

4 under subparagraph (A) shall include— 

5 (i) the elimination of warehouse loca6 tion differentials; 

7 (ii) the establishment of differentials 

8 for the various quality factors and staple 

9 lengths of cotton based on a 3-year, 

10 weighted moving average of the weighted 

11 designated spot market regions, as deter12 mined by regional production; 

13 (iii) the elimination of any artificial 

14 split in the premium or discount between 

15 upland cotton with a 32 or 33 staple 

16 length due to micronaire; and 

17 (iv) a mechanism to ensure that no 

18 premium or discount is established that ex19 ceeds the premium or discount associated 

20 with a leaf grade that is 1 better than the 

21 applicable color grade. 

22 (C) DISCRETIONARY REVISIONS.—Revi23 sions under subparagraph (A) may include— 

24 (i) the use of non-spot market price 

25 data, in addition to spot market price data, 


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1 that would enhance the accuracy of the 

2 price information used in determining 

3 quality adjustments under this subsection; 

4 (ii) adjustments in the premiums or 

5 discounts associated with upland cotton 

6 with a staple length of 33 or above due to 

7 micronaire with the goal of eliminating any 

8 unnecessary artificial splits in the calcula9 tions of the premiums or discounts; and 

10 (iii) such other adjustments as the 

11 Secretary determines appropriate, after 

12 consultations conducted in accordance with 

13 paragraph (3). 

14 (3) CONSULTATION WITH PRIVATE SECTOR.— 

15 (A) PRIOR TO REVISION.—In making ad16 justments to the loan rate for cotton (including 

17 any review of the adjustments) as provided in 

18 this subsection, the Secretary shall consult with 

19 representatives of the United States cotton in20 dustry. 

21 (B) INAPPLICABILITY OF FEDERAL ADVI22 SORY COMMITTEE ACT.—The Federal Advisory 

23 Committee Act (5 U.S.C. App.) shall not apply 

24 to consultations under this subsection. 


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1 (4) REVIEW OF ADJUSTMENTS.—The Secretary 

2 may review the operation of the upland cotton qual3 ity adjustments implemented pursuant to this sub4 section and may make further revisions to the ad5 ministration of the loan program for upland cotton, 

6 by— 

7 (A) revoking or revising any actions taken 

8 under paragraph (2)(B); or 

9 (B) revoking or revising any actions taken 

10 or authorized to be taken under paragraph 

11 (2)(C). 

12 (e) RICE.—The Secretary shall not make adjust13 ments in the loan rates for long grain rice and medium 

14 grain rice, except for differences in grade and quality (in15 cluding milling yields). 

16 Subtitle C—Sugar 

17 SEC. 1301. SUGAR PROGRAM. 

18 (a) CONTINUATION OF CURRENT PROGRAM AND

19 LOAN RATES.— 

20 (1) SUGARCANE.—Section 156(a)(5) of the 

21 Federal Agriculture Improvement and Reform Act of 

22 1996 (7 U.S.C. 7272(a)(5)) is amended by striking 

23 ‘‘the 2012 crop year’’ and inserting ‘‘each of the 

24 2012 through 2017 crop years’’. 


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1 (2) SUGAR BEETS.—Section 156(b)(2) of the 

2 Federal Agriculture Improvement and Reform Act of 

3 1996 (7 U.S.C. 7272(b)(2)) is amended by striking 

4 ‘‘2012’’ and inserting ‘‘2017’’. 

5 (3) EFFECTIVE PERIOD.—Section 156(i) of the 

6 Federal Agriculture Improvement and Reform Act of 

7 1996 (7 U.S.C. 7272(i)) is amended by striking 

8 ‘‘2012’’ and inserting ‘‘2017’’. 

9 (b) FLEXIBLE MARKETING ALLOTMENTS FOR

10 SUGAR.— 

11 (1) SUGAR ESTIMATES.—Section 359b(a)(1) of 

12 the Agricultural Adjustment Act of 1938 (7 U.S.C. 

13 1359bb(a)(1)) is amended by striking ‘‘2012’’ and 

14 inserting ‘‘2017’’. 

15 (2) EFFECTIVE PERIOD.—Section 359l(a) of 

16 the Agricultural Adjustment Act of 1938 (7 U.S.C. 

17 1359ll(a)) is amended by striking ‘‘2012’’ and in18 serting ‘‘2017’’. 

19 Subtitle D—Dairy 

20 PART I—DAIRY PRODUCTION MARGIN PROTEC21 TION AND DAIRY MARKET STABILIZATION 

22 PROGRAMS 

23 SEC. 1401. DEFINITIONS. 

24 In this part: 


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1 (1) ACTUAL DAIRY PRODUCTION MARGIN.—The 

2 term ‘‘actual dairy production margin’’ means the 

3 difference between the all-milk price and the average 

4 feed cost, as calculated under section 1402. 

5 (2) ALL-MILK PRICE.—The term ‘‘all-milk 

6 price’’ means the average price received, per hun7 dredweight of milk, by dairy operations for all milk 

8 sold to plants and dealers in the United States, as 

9 determined by the Secretary. 

10 (3) ANNUAL PRODUCTION HISTORY.—The term 

11 ‘‘annual production history’’ means the production 

12 history determined for a participating dairy oper13 ation under section 1413(b) whenever the partici14 pating dairy operation purchases supplemental pro15 duction margin protection. 

16 (4) AVERAGE FEED COST.—The term ‘‘average 

17 feed cost’’ means the average cost of feed used by 

18 a dairy operation to produce a hundredweight of 

19 milk, determined under section 1402 using the sum 

20 of the following: 

21 (A) The product determined by multiplying 

22 1.0728 by the price of corn per bushel. 

23 (B) The product determined by multiplying 

24 0.00735 by the price of soybean meal per ton. 


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1 (C) The product determined by multiplying 

2 0.0137 by the price of alfalfa hay per ton. 

3 (5) BASIC PRODUCTION HISTORY.—The term 

4 ‘‘basic production history’’ means the production 

5 history determined for a participating dairy oper6 ation under section 1413(a) for provision of basic 

7 production margin protection. 

8 (6) CONSECUTIVE 2-MONTH PERIOD.—The term 

9 ‘‘consecutive 2-month period’’ refers to the 2-month 

10 period consisting of the months of January and Feb11 ruary, March and April, May and June, July and 

12 August, September and October, or November and 

13 December, respectively. 

14 (7) DAIRY OPERATION.— 

15 (A) IN GENERAL.—The term ‘‘dairy oper16 ation’’ means, as determined by the Secretary, 

17 1 or more dairy producers that produce and 

18 market milk as a single dairy operation in 

19 which each dairy producer— 

20 (i) shares in the pooling of resources 

21 and a common ownership structure; 

22 (ii) is at risk in the production of milk 

23 on the dairy operation; and 


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1 (iii) contributes land, labor, manage2 ment, equipment, or capital to the dairy 

3 operation. 

4 (B) ADDITIONAL OWNERSHIP STRUC5 TURES.—The Secretary shall determine addi6 tional ownership structures to be covered by the 

7 definition of dairy operation. 

8 (8) HANDLER.— 

9 (A) IN GENERAL.—The term ‘‘handler’’ 

10 means the initial individual or entity making 

11 payment to a dairy operation for milk produced 

12 in the United States and marketed for commer13 cial use. 

14 (B) PRODUCER-HANDLER.—The term in15 cludes a ‘‘producer-handler’’ when the producer 

16 satisfies the definition in subparagraph (A). 

17 (9) PARTICIPATING DAIRY OPERATION.—The 

18 term ‘‘participating dairy operation’’ means a dairy 

19 operation that— 

20 (A) signs up under section 1412 to partici21 pate in the production margin protection pro22 gram under subpart A; and 

23 (B) as a result, also participates in the sta24 bilization program under subpart B. 


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1 (10) PRODUCTION MARGIN PROTECTION PRO2 GRAM.—The term ‘‘production margin protection 

3 program’’ means the dairy production margin pro4 tection program required by subpart A. 

5 (11) SECRETARY.—The term ‘‘Secretary’’ 

6 means the Secretary of Agriculture. 

7 (12) STABILIZATION PROGRAM.—The term 

8 ‘‘stabilization program’’ means the dairy market sta9 bilization program required by subpart B for all par10 ticipating dairy operations. 

11 (13) STABILIZATION PROGRAM BASE.—The 

12 term ‘‘stabilization program base’’, with respect to a 

13 participating dairy operation, means the stabilization 

14 program base calculated for the participating dairy 

15 operation under section 1431(b). 

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

17 States’’, in a geographical sense, means the 50 

18 States, the District of Columbia, American Samoa, 

19 Guam, the Commonwealth of the Northern Mariana 

20 Islands, the Commonwealth of Puerto Rico, the Vir21 gin Islands of the United States, and any other ter22 ritory or possession of the United States. 


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1 SEC. 1402. CALCULATION OF AVERAGE FEED COST AND AC2 TUAL DAIRY PRODUCTION MARGINS. 

3 (a) CALCULATION OF AVERAGE FEED COST.—The 

4 Secretary shall calculate the national average feed cost for 

5 each month using the following data: 

6 (1) The price of corn for a month shall be the 

7 price received during that month by farmers in the 

8 United States for corn, as reported in the monthly 

9 Agricultural Prices report by the Secretary. 

10 (2) The price of soybean meal for a month shall 

11 be the central Illinois price for soybean meal, as re12 ported in the Market News–Monthly Soybean Meal 

13 Price Report by the Secretary. 

14 (3) The price of alfalfa hay for a month shall 

15 be the price received during that month by farmers 

16 in the United States for alfalfa hay, as reported in 

17 the monthly Agricultural Prices report by the Sec18 retary. 

19 (b) CALCULATION OF ACTUAL DAIRY PRODUCTION

20 MARGINS.— 

21 (1) PRODUCTION MARGIN PROTECTION PRO22 GRAM.—For use in the production margin protection 

23 program under subpart A, the Secretary shall cal24 culate the actual dairy production margin for each 

25 consecutive 2-month period by subtracting— 


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1 (A) the average feed cost for that consecu2 tive 2-month period, determined in accordance 

3 with subsection (a); from 

4 (B) the all-milk price for that consecutive 

5 2-month period. 

6 (2) STABILIZATION PROGRAM.—For use in the 

7 stabilization program under subpart B, the Sec8 retary shall calculate each month the actual dairy 

9 production margin for the preceding month by sub10 tracting— 

11 (A) the average feed cost for that pre12 ceding month, determined in accordance with 

13 subsection (a); from 

14 (B) the all-milk price for that preceding 

15 month. 

16 (3) TIME FOR CALCULATIONS.—The calcula17 tions required by paragraphs (1) and (2) shall be 

18 made as soon as practicable using the full month 

19 price of the applicable reference month. 

20 Subpart A—Dairy Production Margin Protection 

21 Program 

22 SEC. 1411. ESTABLISHMENT OF DAIRY PRODUCTION MAR23 GIN PROTECTION PROGRAM. 

24 Effective not later than 120 days after the effective 

25 date of this subtitle, the Secretary shall establish and adVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00075 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 minister a dairy production margin protection program 

2 under which participating dairy operations are paid— 

3 (1) basic production margin protection program 

4 payments under section 1414 when actual dairy pro5 duction margins are less than the threshold levels 

6 for such payments; and 

7 (2) supplemental production margin protection 

8 program payments under section 1415 if purchased 

9 by a participating dairy operation. 

10 SEC. 1412. PARTICIPATION OF DAIRY OPERATIONS IN PRO11 DUCTION MARGIN PROTECTION PROGRAM. 

12 (a) ELIGIBILITY.—All dairy operations in the United 

13 States shall be eligible to participate in the production 

14 margin protection program, except that a participating 

15 dairy operation shall be required to register with the Sec16 retary before the participating dairy operation may re17 ceive— 

18 (1) basic production margin protection program 

19 payments under section 1414; and 

20 (2) if the participating dairy operation pur21 chases supplemental production margin protection 

22 under section 1415, supplemental production margin 

23 protection program payments under such section. 

24 (b) REGISTRATION PROCESS.— 


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1 (1) IN GENERAL.—The Secretary shall specify 

2 the manner and form by which a participating dairy 

3 operation may register to participate in the produc4 tion margin protection program. 

5 (2) TREATMENT OF MULTIPRODUCER DAIRY

6 OPERATIONS.—If a participating dairy operation is 

7 operated by more than 1 dairy producer, all of the 

8 dairy producers of the participating dairy operation 

9 shall be treated as a single dairy operation for pur10 poses of— 

11 (A) registration to receive basic production 

12 margin protection and election to purchase sup13 plemental production margin protection; 

14 (B) payment of the participation fee under 

15 subsection (d) and producer premiums under 

16 section 1415; and 

17 (C) participation in the stabilization pro18 gram under subtitle B. 

19 (3) TREATMENT OF PRODUCERS WITH MUL20 TIPLE DAIRY OPERATIONS.—If a dairy producer op21 erates 2 or more dairy operations, each dairy oper22 ation of the producer shall separately register to re23 ceive basic production margin protection and pur24 chase supplemental production margin protection 


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1 and only those dairy operations so registered shall 

2 be covered by the stabilization program. 

3 (c) TIME FOR REGISTRATION.— 

4 (1) EXISTING DAIRY OPERATIONS.—During the 

5 15-month period beginning on the date of the initi6 ation of the registration period for the production 

7 margin protection program, a dairy operation that is 

8 actively engaged as of such date may register with 

9 the Secretary— 

10 (A) to receive basic production margin pro11 tection; and 

12 (B) if the dairy operation elects, to pur13 chase supplemental production margin protec14 tion. 

15 (2) NEW ENTRANTS.—A dairy producer that 

16 has no existing interest in a dairy operation as of 

17 the date of the initiation of the registration period 

18 for the production margin protection program, but 

19 that, after such date, establishes a new dairy oper20 ation, may register with the Secretary during the 1- 

21 year period beginning on the date on which the dairy 

22 operation first markets milk commercially— 

23 (A) to receive basic production margin pro24 tection; and 


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1 (B) if the dairy operation elects, to pur2 chase supplemental production margin protec3 tion. 

4 (d) TRANSITION FROM MILC TO PRODUCTION MAR5 GIN PROTECTION.— 

6 (1) DEFINITION OF TRANSITION PERIOD.—In 

7 this subsection, the term ‘‘transition period’’ means 

8 the period during which the milk income loss pro9 gram established under section 1506 of the Food, 

10 Conservation, and Energy Act of 2008 (7 U.S.C. 

11 8773) and the production margin protection pro12 gram under this subtitle are both in existence. 

13 (2) NOTICE OF AVAILABILITY.—Not later than 

14 30 days after the date of enactment of this Act, the 

15 Secretary shall publish a notice in the Federal Reg16 ister to inform dairy operations of the availability of 

17 basic production margin protection and supple18 mental production margin protection, including the 

19 terms of the protection and information about the 

20 option of dairy operations during the transition pe21 riod to make an election described in paragraph (3). 

22 (3) ELECTION.—Except as provided in para23 graph (4), a dairy operation may elect to participate 

24 in either the milk income loss program established 

25 under section 1506 of the Food, Conservation, and 


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1 Energy Act of 2008 (7 U.S.C. 8773) or the produc2 tion margin protection program under this subtitle 

3 for the duration of the transition period. 

4 (4) TRANSFER TO PRODUCTION MARGIN PRO5 TECTION.—A dairy operation that elects to partici6 pate in the milk income loss program established 

7 under section 1506 of the Food, Conservation, and 

8 Energy Act of 2008 (7 U.S.C. 8773) during the 

9 transition period may, at any time, make a perma10 nent transfer to the production margin protection 

11 program. 

12 (e) ADMINISTRATION FEE.— 

13 (1) ADMINISTRATION FEE REQUIRED.—Except 

14 as provided in paragraph (5), a participating dairy 

15 operation shall— 

16 (A) pay an administration fee under this 

17 subsection to register to participate in the pro18 duction margin protection program; and 

19 (B) pay the administration fee annually 

20 thereafter to continue to participate in the pro21 duction margin protection program. 

22 (2) FEE AMOUNT.—The administration fee for 

23 a participating dairy operation for a calendar year 

24 shall be based on the pounds of milk (in millions) 


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1 marketed by the participating dairy operation in the 

2 previous calendar year, as follows: 

Pounds Marketed (in millions) Administration Fee 

less than 1 $100 

1 to 5 $250 

more than 5 to 10 $350 

more than 10 to 40 $1,000 

more than 40 $2,500 

3 (3) DEPOSIT OF FEES.—All administration fees 

4 collected under this subsection shall be credited to 

5 the fund or account used to cover the costs incurred 

6 to administer the production margin protection pro7 gram and the stabilization program and shall be 

8 available to the Secretary, without further appro9 priation and until expended, for use or transfer as 

10 provided in paragraph (4). 

11 (4) USE OF FEES.—The Secretary shall use ad12 ministration fees collected under this subsection— 

13 (A) to cover administrative costs of the 

14 production margin protection program and sta15 bilization program; and 

16 (B) to cover costs of the Department of 

17 Agriculture relating to reporting of dairy mar18 ket news, carrying out the amendments made 

19 by section 1476, and carrying out section 273 

20 of the Agricultural Marketing Act of 1946 (7 


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1 U.S.C. 1637b)), to the extent funds remain 

2 available after operation of subparagraph (A). 

3 (5) WAIVER.—The Secretary shall waive or re4 duce the administration fee required under para5 graph (1) in the case of a limited-resource dairy op6 eration, as defined by the Secretary. 

7 (f) DUTIES OF THE SECRETARY.—The Secretary 

8 shall ensure that producers are precluded from taking any 

9 action, including reconstitution, transfer, or other similar 

10 action, that would have the effect of altering or reversing 

11 any election made under this subtitle. 

12 (g) DENIAL OF PROGRAM BENEFITS.—A person or 

13 legal entity shall be ineligible to receive payments under 

14 this subtitle for a calendar year, and the succeeding crop 

15 year, if the Secretary determines that the person or legal 

16 entity— 

17 (1) failed to comply with this subtitle and 

18 adopted or participated in adopting a scheme or de19 vice to evade the application of basic production 

20 margin protection, supplemental production margin 

21 protection, or the market stabilization program; or 

22 (2) intentionally concealed the relevant interest 

23 of a person or legal entity in any farm or legal entity 

24 applicable to the implementation and administration 

25 of this subtitle. 


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1 (h) EXTENDED INELIGIBILITY.—If the Secretary de2 termines that a person or legal entity, for the benefit of 

3 the person or legal entity or the benefit of any other per4 son or legal entity, has knowingly engaged in, or aided 

5 in the creation of a fraudulent document, failed to disclose 

6 material information relevant to the administration of this 

7 subtitle, or committed other equally serious actions in vio8 lation of the purposes of this subtitle (including regula9 tions issued by the Secretary), the Secretary may for a 

10 period not to exceed 5 calendar years deny the issuance 

11 of payments under this subtitle to the person or legal enti12 ty. 

13 (i) PRO RATA DENIAL.— 

14 (1) IN GENERAL.—Payments otherwise owed to 

15 a person or legal entity described in subsection (g) 

16 or (h) shall be denied in a pro rata manner based 

17 on the ownership interest of the person or legal enti18 ty in a farm. 

19 (2) CASH RENT TENANT.—Payments otherwise 

20 payable to a person or legal entity shall be denied 

21 in a pro rata manner if the person or legal entity 

22 on a farm owned or under the control of a person 

23 or legal entity with respect to which a determination 

24 has been made under subsection (g) or (h). 


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1 (j) JOINT AND SEVERAL LIABILITY.—Any legal enti2 ty (including s partnership and joint venture) and any 

3 member of any legal entity determined to have knowingly 

4 participated in a scheme or device to evade, or that has 

5 the purpose of evading, this section shall be jointly and 

6 severally liable for any amounts that are payable to the 

7 Secretary as the result of the scheme or device (including 

8 amounts necessary to recover those amounts). 

9 (k) RELEASE.—The Secretary may partially or fully 

10 release from liability any person or legal entity that co11 operates with the Secretary in enforcing this section or 

12 in instances in which the Secretary determines that any 

13 reconstitution is bona fide and substantive. 

14 (l) LIMITATION.—A dairy operation may only partici15 pate in the production margin protection program or the 

16 livestock gross margin for dairy program under the Fed17 eral Crop Insurance Act (7 U.S.C. 1501 et seq.), but not 

18 both. 

19 SEC. 1413. PRODUCTION HISTORY OF PARTICIPATING 

20 DAIRY OPERATIONS. 

21 (a) PRODUCTION HISTORY FOR BASIC PRODUCTION

22 MARGIN PROTECTION.— 

23 (1) DETERMINATION REQUIRED.—For purposes 

24 of providing basic production margin protection, the 


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1 Secretary shall determine the basic production his2 tory of a participating dairy operation. 

3 (2) CALCULATION.—Except as provided in 

4 paragraph (3), the basic production history of a par5 ticipating dairy operation for basic production mar6 gin protection is equal to the highest annual milk 

7 marketings of the participating dairy operation dur8 ing any 1 of the 3 calendar years immediately pre9 ceding the calendar year in which the participating 

10 dairy operation first signed up to participate in the 

11 production margin protection program. 

12 (3) ELECTION BY NEW DAIRY OPERATIONS.—In 

13 the case of a participating dairy operation that has 

14 been in operation for less than a year, the partici15 pating dairy operation shall elect 1 of the following 

16 methods for the Secretary to determine the basic 

17 production history of the participating dairy oper18 ation: 

19 (A) The volume of the actual milk mar20 ketings for the months the participating dairy 

21 operation has been in operation extrapolated to 

22 a yearly amount. 

23 (B) An estimate of the actual milk mar24 ketings of the participating dairy operation 

25 based on the herd size of the participating dairy 


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1 operation relative to the national rolling herd 

2 average data published by the Secretary. 

3 (4) NO CHANGE IN PRODUCTION HISTORY FOR

4 BASIC PRODUCTION MARGIN PROTECTION.—Once 

5 the basic production history of a participating dairy 

6 operation is determined under paragraph (2) or (3), 

7 the basic production history shall not be subse8 quently changed for purposes of determining the 

9 amount of any basic production margin protection 

10 payments for the participating dairy operation made 

11 under section 1414. 

12 (b) ANNUAL PRODUCTION HISTORY FOR SUPPLE13 MENTAL PRODUCTION MARGIN PROTECTION.— 

14 (1) DETERMINATION REQUIRED.—For purposes 

15 of providing supplemental production margin protec16 tion for a participating dairy operation that pur17 chases supplemental production margin protection 

18 for a year under section 1415, the Secretary shall 

19 determine the annual production history of the par20 ticipating dairy operation under paragraph (2). 

21 (2) CALCULATION.—The annual production his22 tory of a participating dairy operation for a year is 

23 equal to the actual milk marketings of the partici24 pating dairy operation during the preceding calendar 

25 year. 


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1 (3) NEW DAIRY OPERATIONS.—Subsection 

2 (a)(3) shall apply with respect to determining the 

3 annual production history of a participating dairy 

4 operation that has been in operation for less than a 

5 year. 

6 (c) REQUIRED INFORMATION.—A participating dairy 

7 operation shall provide all information that the Secretary 

8 may require in order to establish— 

9 (1) the basic production history of the partici10 pating dairy operation under subsection (a); and 

11 (2) the production history of the participating 

12 dairy operation whenever the participating dairy op13 eration purchases supplemental production margin 

14 protection under section 1415. 

15 (d) TRANSFER OF PRODUCTION HISTORIES.— 

16 (1) TRANSFER BY SALE OR LEASE.—In promul17 gating the rules to initiate the production margin 

18 protection program, the Secretary shall specify the 

19 conditions under which and the manner by which the 

20 production history of a participating dairy operation 

21 may be transferred by sale or lease. 

22 (2) COVERAGE LEVEL.— 

23 (A) BASIC PRODUCTION MARGIN PROTEC24 TION.—A purchaser or lessee to whom the Sec25 retary transfers a basic production history 


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1 under this subsection shall not obtain a dif2 ferent level of basic production margin protec3 tion than the basic production margin protec4 tion coverage held by the seller or lessor from 

5 whom the transfer was obtained. 

6 (B) SUPPLEMENTAL PRODUCTION MARGIN

7 PROTECTION.—A purchaser or lessee to whom 

8 the Secretary transfers an annual production 

9 history under this subsection shall not obtain a 

10 different level of supplemental production mar11 gin protection coverage than the supplemental 

12 production margin protection coverage in effect 

13 for the seller or lessor from whom the transfer 

14 was obtained for the calendar year in which the 

15 transfer was made. 

16 (e) MOVEMENT AND TRANSFER OF PRODUCTION

17 HISTORY.— 

18 (1) MOVEMENT AND TRANSFER AUTHOR19 IZED.—Subject to paragraph (2), if a participating 

20 dairy operation moves from 1 location to another lo21 cation, the participating dairy operation may trans22 fer the basic production history and annual produc23 tion history associated with the participating dairy 

24 operation. 


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1 (2) NOTIFICATION REQUIREMENT.—A partici2 pating dairy operation shall notify the Secretary of 

3 any move of a participating dairy operation under 

4 paragraph (1). 

5 (3) SUBSEQUENT OCCUPATION OF VACATED LO6 CATION.—A party subsequently occupying a partici7 pating dairy operation location vacated as described 

8 in paragraph (1) shall have no interest in the basic 

9 production history or annual production history pre10 viously associated with the participating dairy oper11 ation at such location. 

12 SEC. 1414. BASIC PRODUCTION MARGIN PROTECTION. 

13 (a) PAYMENT THRESHOLD.—The Secretary shall 

14 make a payment to participating dairy operations in ac15 cordance with subsection (b) whenever the average actual 

16 dairy production margin for a consecutive 2-month period 

17 is less than $4.00 per hundredweight of milk. 

18 (b) BASIC PRODUCTION MARGIN PROTECTION PAY19 MENT.—The basic production margin protection payment 

20 for a participating dairy operation for a consecutive 2- 

21 month period shall be equal to the product obtained by 

22 multiplying— 

23 (1) the difference between the average actual 

24 dairy production margin for the consecutive 2-month 


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1 period and $4.00, except that, if the difference is 

2 more than $4.00, the Secretary shall use $4.00; by 

3 (2) the lesser of— 

4 (A) 80 percent of the production history of 

5 the participating dairy operation, divided by 6; 

6 or 

7 (B) the actual quantity of milk marketed 

8 by the participating dairy operation during the 

9 consecutive 2-month period. 

10 SEC. 1415. SUPPLEMENTAL PRODUCTION MARGIN PROTEC11 TION. 

12 (a) ELECTION OF SUPPLEMENTAL PRODUCTION

13 MARGIN PROTECTION.—A participating dairy operation 

14 may annually purchase supplemental production margin 

15 protection to protect, during the calendar year for which 

16 purchased, a higher level of the income of a participating 

17 dairy operation than the income level guaranteed by basic 

18 production margin protection under section 1414. 

19 (b) SELECTION OF PAYMENT THRESHOLD.—A par20 ticipating dairy operation purchasing supplemental pro21 duction margin protection for a year shall elect a coverage 

22 level that is higher, in any increment of $0.50, than the 

23 payment threshold for basic production margin protection 

24 specified in section 1414(a), but not to exceed $8.00. 


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1 (c) COVERAGE PERCENTAGE.—A participating dairy 

2 operation purchasing supplemental production margin 

3 protection for a year shall elect a percentage of coverage 

4 equal to not more than 90 percent, nor less than 25 per5 cent, of the annual production history of the participating 

6 dairy operation. 

7 (d) PREMIUMS FOR SUPPLEMENTAL PRODUCTION

8 MARGIN PROTECTION.— 

9 (1) PREMIUMS REQUIRED.—A participating 

10 dairy operation that purchases supplemental produc11 tion margin protection shall pay an annual premium 

12 equal to the product obtained by multiplying— 

13 (A) the coverage percentage elected by the 

14 participating dairy operation under subsection 

15 (c); 

16 (B) the annual production history of the 

17 participating dairy operation; and 

18 (C) the premium per hundredweight of 

19 milk, as specified in the applicable table under 

20 paragraph (2) or (3). 

21 (2) PREMIUM PER HUNDREDWEIGHT FOR FIRST

22 4 MILLION POUNDS OF PRODUCTION.—For the first 

23 4,000,000 pounds of milk marketings included in 

24 the annual production history of a participating 

25 dairy operation, the premium per hundredweight 


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1 corresponding to each coverage level specified in the 

2 following table is as follows: 

Coverage Level Premium per Cwt. 

$4.50 $0.01 

$5.00 $0.02 

$5.50 $0.035 

$6.00 $0.045 

$6.50 $0.09 

$7.00 $0.40 

$7.50 $0.60 

$8.00 $0.95 

3 (3) PREMIUM PER HUNDREDWEIGHT FOR PRO4 DUCTION IN EXCESS OF 4 MILLION POUNDS.—For 

5 milk marketings in excess of 4,000,000 pounds in6 cluded in the annual production history of a partici7 pating dairy operation, the premium per hundred8 weight corresponding to each coverage level is as fol9 lows: 

Coverage Level Premium per Cwt. 

$4.50 $0.02 

$5.00 $0.04 

$5.50 $0.10 

$6.00 $0.15 

$6.50 $0.29 

$7.00 $0.62 

$7.50 $0.83 

$8.00 $1.06 

10 (4) TIME FOR PAYMENT.—In promulgating the 

11 rules to initiate the production margin protection 

12 program, the Secretary shall provide more than 1 

13 method by which a participating dairy operation that 

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1 tion for a calendar year may pay the premium under 

2 this subsection for that year in any manner that 

3 maximizes participating dairy operation payment 

4 flexibility and program integrity. 

5 (e) PREMIUM OBLIGATIONS.— 

6 (1) PRO-RATION OF PREMIUM FOR NEW DAIRY

7 OPERATIONS.—A participating dairy operation de8 scribed in section 1412(c)(2) that purchases supple9 mental production margin protection for a calendar 

10 year after the start of the calendar year shall pay 

11 a pro-rated premium for that calendar year based on 

12 the portion of the calendar year for which the par13 ticipating dairy operation purchases the coverage. 

14 (2) LEGAL OBLIGATION.—A participating dairy 

15 operation that purchases supplemental production 

16 margin protection for a calendar year shall be legally 

17 obligated to pay the applicable premium for that cal18 endar year, except that the Secretary may waive 

19 that obligation, under terms and conditions deter20 mined by the Secretary, for 1 or more producers in 

21 any participating dairy operation in the case of 

22 death, retirement, permanent dissolution of a par23 ticipating dairy operation, or other circumstances as 

24 the Secretary considers appropriate to ensure the in25 tegrity of the program. 


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1 (f) SUPPLEMENTAL PAYMENT THRESHOLD.—A par2 ticipating dairy operation with supplemental production 

3 margin protection shall receive a supplemental production 

4 margin protection payment whenever the average actual 

5 dairy production margin for a consecutive 2-month period 

6 is less than the coverage level threshold selected by the 

7 participating dairy operation under subsection (b). 

8 (g) SUPPLEMENTAL PRODUCTION MARGIN PROTEC9 TION PAYMENTS.— 

10 (1) IN GENERAL.—The supplemental produc11 tion margin protection payment for a participating 

12 dairy operation is in addition to the basic production 

13 margin protection payment. 

14 (2) AMOUNT OF PAYMENT.—The supplemental 

15 production margin protection payment for the par16 ticipating dairy operation shall be determined as fol17 lows: 

18 (A) The Secretary shall calculate the dif19 ference between the coverage level threshold se20 lected by the participating dairy operation 

21 under subsection (b) and the greater of— 

22 (i) the average actual dairy production 

23 margin for the consecutive 2-month period; 

24 or 

25 (ii) $4.00. 


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1 (B) The amount determined under sub2 paragraph (A) shall be multiplied by the per3 centage selected by the participating dairy oper4 ation under subsection (c) and by the lesser of 

5 the following: 

6 (i) The annual production history of 

7 the participating dairy operation, divided 

8 by 6. 

9 (ii) The actual amount of milk mar10 keted by the participating dairy operation 

11 during the consecutive 2-month period. 

12 SEC. 1416. EFFECT OF FAILURE TO PAY ADMINISTRATION 

13 FEES OR PREMIUMS. 

14 (a) LOSS OF BENEFITS.—A participating dairy oper15 ation that fails to pay the required administration fee 

16 under section 1412 or is in arrears on premium payments 

17 for supplemental production margin protection under sec18 tion 1415— 

19 (1) remains legally obligated to pay the admin20 istration fee or premiums, as the case may be; and 

21 (2) may not receive basic production margin 

22 protection payments or supplemental production 

23 margin protection payments until the fees or pre24 miums are fully paid. 


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1 (b) ENFORCEMENT.—The Secretary may take such 

2 action as necessary to collect administration fees and pre3 mium payments for supplemental production margin pro4 tection. 

5 Subpart B—Dairy Market Stabilization Program 

6 SEC. 1431. ESTABLISHMENT OF DAIRY MARKET STABILIZA7 TION PROGRAM. 

8 (a) PROGRAM REQUIRED; PURPOSE.—Effective not 

9 later than 120 days after the effective date of this subtitle, 

10 the Secretary shall establish and administer a dairy mar11 ket stabilization program applicable to participating dairy 

12 operations for the purpose of assisting in balancing the 

13 supply of milk with demand when participating dairy oper14 ations are experiencing low or negative operating margins. 

15 (b) ELECTION OF STABILIZATION PROGRAM BASE

16 CALCULATION METHOD.— 

17 (1) ELECTION.—When a dairy operation signs 

18 up under section 1412 to participate in the produc19 tion margin protection program, the dairy operation 

20 shall inform the Secretary of the method by which 

21 the stabilization program base for the participating 

22 dairy operation will be calculated under paragraph 

23 (3). 

24 (2) CHANGE IN CALCULATION METHOD.—A 

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1 bilization program base calculation method to be 

2 used for a calendar year by notifying the Secretary 

3 of the change not later than a date determined by 

4 the Secretary. 

5 (3) CALCULATION METHODS.—A participating 

6 dairy operation may elect either of the following 

7 methods for calculation of the stabilization program 

8 base for the participating dairy operation: 

9 (A) The volume of the average monthly 

10 milk marketings of the participating dairy oper11 ation for the 3 months immediately preceding 

12 the announcement by the Secretary that the 

13 stabilization program will become effective. 

14 (B) The volume of the monthly milk mar15 ketings of the participating dairy operation for 

16 the same month in the preceding year as the 

17 month for which the Secretary has announced 

18 the stabilization program will become effective. 

19 SEC. 1432. THRESHOLD FOR IMPLEMENTATION AND RE20 DUCTION IN DAIRY PAYMENTS. 

21 (a) WHEN STABILIZATION PROGRAM REQUIRED.— 

22 Except as provided in subsection (b), the Secretary shall 

23 announce that the stabilization program is in effect and 

24 order reduced payments by handlers to participating dairy 

25 operations that exceed the applicable percentage of the 


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1 participating dairy operation’s stabilization program base 

2 whenever— 

3 (1) the actual dairy production margin has been 

4 $6.00 or less per hundredweight of milk for each of 

5 the immediately preceding 2 months; or 

6 (2) the actual dairy production margin has been 

7 $4.00 or less per hundredweight of milk for the im8 mediately preceding month. 

9 (b) EXCEPTION.—If any of the conditions described 

10 in section 1436(b) have been met during the 2-month pe11 riod immediately preceding the month in which the an12 nouncement under subsection (a) would otherwise be made 

13 by the Secretary in the absence of this exception, the Sec14 retary shall— 

15 (1) suspend the stabilization program; 

16 (2) refrain from making the announcement 

17 under subsection (a) to implement order the sta18 bilization payment; or 

19 (3) order reduced payments. 

20 (c) EFFECTIVE DATE FOR IMPLEMENTATION OF

21 PAYMENT REDUCTIONS.—Reductions in dairy payments 

22 shall commence beginning on the first day of the month 

23 immediately following the date of the announcement by 

24 the Secretary under subsection (a). 


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1 SEC. 1433. MILK MARKETINGS INFORMATION. 

2 (a) COLLECTION OF MILK MARKETING DATA.—The 

3 Secretary shall establish, by regulation, a process to collect 

4 from participating dairy operations and handlers such in5 formation that the Secretary considers necessary for each 

6 month during which the stabilization program is in effect. 

7 (b) REDUCE REGULATORY BURDEN.—When imple8 menting the process under subsection (a), the Secretary 

9 shall minimize the regulatory burden on participating 

10 dairy operations and handlers. 

11 SEC. 1434. CALCULATION AND COLLECTION OF REDUCED 

12 DAIRY OPERATION PAYMENTS. 

13 (a) REDUCED PARTICIPATING DAIRY OPERATION

14 PAYMENTS REQUIRED.—During any month in which pay15 ment reductions are in effect under the stabilization pro16 gram, each handler shall reduce payments to each partici17 pating dairy operation from whom the handler receives 

18 milk. 

19 (b) REDUCTIONS BASED ON ACTUAL DAIRY PRO20 DUCTION MARGIN.— 

21 (1) REDUCTION REQUIREMENT 1.—If the Sec22 retary determines that the average actual dairy pro23 duction margin has been less than $6.00 but greater 

24 than $5.00 per hundredweight of milk for 2 consecu25 tive months, the handler shall make payments to a 


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1 participating dairy operation for a month based on 

2 the greater of the following: 

3 (A) 98 percent of the stabilization program 

4 base of the participating dairy operation. 

5 (B) 94 percent of the marketings of milk 

6 for the month by the participating dairy oper7 ation. 

8 (2) REDUCTION REQUIREMENT 2.—If the Sec9 retary determines that the average actual dairy pro10 duction margin has been less than $5.00 but greater 

11 than $4.00 for 2 consecutive months, the handler 

12 shall make payments to a participating dairy oper13 ation for a month based on the greater of the fol14 lowing: 

15 (A) 97 percent of the stabilization program 

16 base of the participating dairy operation. 

17 (B) 93 percent of the marketings of milk 

18 for the month by the participating dairy oper19 ation. 

20 (3) REDUCTION REQUIREMENT 3.—If the Sec21 retary determines that the average actual dairy pro22 duction margin has been $4.00 or less for any 1 

23 month, the handler shall make payments to a par24 ticipating dairy operation for a month based on the 

25 greater of the following: 


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1 (A) 96 percent of the stabilization program 

2 base of the participating dairy operation. 

3 (B) 92 percent of the marketings of milk 

4 for the month by the participating dairy oper5 ation. 

6 (c) CONTINUATION OF REDUCTIONS.—The largest 

7 level of payment reduction required under paragraph (1), 

8 (2), or (3) of subsection (b) shall be continued for each 

9 month until the Secretary suspends the stabilization pro10 gram and terminates payment reductions in accordance 

11 with section 1436. 

12 (d) PAYMENT REDUCTION EXCEPTION.—Notwith13 standing any preceding subsection of this section, a han14 dler shall make no payment reductions for a participating 

15 dairy operation for a month if the participating dairy oper16 ation’s milk marketings for the month are equal to or less 

17 than the percentage of the stabilization program base ap18 plicable to the participating dairy operation under para19 graph (1), (2), or (3) of subsection (b). 

20 SEC. 1435. REMITTING FUNDS TO THE SECRETARY AND USE 

21 OF FUNDS. 

22 (a) REMITTING FUNDS.—As soon as practicable after 

23 the end of each month during which payment reductions 

24 are in effect under the stabilization program, each handler 

25 shall remit to the Secretary an amount equal to the 


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1 amount by which payments to participating dairy oper2 ations are reduced by the handler under section 1434. 

3 (b) DEPOSIT OF REMITTED FUNDS.—All funds re4 ceived under subsection (a) shall be available to the Sec5 retary, without further appropriation and until expended, 

6 for use or transfer as provided in subsection (c). 

7 (c) USE OF FUNDS.— 

8 (1) AVAILABILITY FOR CERTAIN COMMODITY

9 DONATIONS.—Not later than 90 days after the 

10 funds described in subsection (a) are due as deter11 mined by the Secretary, the Secretary shall obligate 

12 the funds for the purpose of— 

13 (A) purchasing dairy products for donation 

14 to food banks and other programs that the Sec15 retary determines appropriate; and 

16 (B) expanding consumption and building 

17 demand for dairy products. 

18 (2) NO DUPLICATION OF EFFORT.—The Sec19 retary shall ensure that expenditures under para20 graph (1) are compatible with, and do not duplicate, 

21 programs supported by the dairy research and pro22 motion activities conducted under the Dairy Produc23 tion Stabilization Act of 1983 (7 U.S.C. 4501 et 

24 seq.). 


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1 (3) ACCOUNTING.—The Secretary shall keep an 

2 accurate account of all funds expended under para3 graph (1). 

4 (d) ANNUAL REPORT.—Not later than December 31 

5 of each year that the stabilization program is in effect, 

6 the Secretary shall submit to the Committee on Agri7 culture of the House of Representatives and the Com8 mittee on Agriculture, Nutrition, and Forestry of the Sen9 ate a report that provides an accurate accounting of— 

10 (1) the funds received by the Secretary during 

11 the preceding fiscal year under subsection (a); 

12 (2) all expenditures made by the Secretary 

13 under subsection (b) during the preceding fiscal 

14 year; and 

15 (3) the impact of the stabilization program on 

16 dairy markets. 

17 (e) ENFORCEMENT.—If a participating dairy oper18 ation or handler fails to remit or collect the amounts by 

19 which payments to participating dairy operations are re20 duced under section 1434, the participating dairy oper21 ation or handler responsible for the failure shall be liable 

22 to the Secretary for the amount that should have been 

23 remitted or collected, plus interest. In addition to the en24 forcement authorities available under section 1437, the 


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1 Secretary may enforce this subsection in the courts of the 

2 United States. 

3 SEC. 1436. SUSPENSION OF REDUCED PAYMENT REQUIRE4 MENT. 

5 (a) DETERMINATION OF PRICES.—For purposes of 

6 this section: 

7 (1) The price in the United States for cheddar 

8 cheese and nonfat dry milk shall be determined by 

9 the Secretary. 

10 (2) The world price of cheddar cheese and skim 

11 milk powder shall be determined by the Secretary. 

12 (b) SUSPENSION THRESHOLDS.—The stabilization 

13 program shall be suspended or the Secretary shall refrain 

14 from making the announcement under section 1432(a) if 

15 the Secretary determines that— 

16 (1) the actual dairy production margin is great17 er than $6.00 per hundredweight of milk for 2 con18 secutive months; 

19 (2) the actual dairy production margin is equal 

20 to or less than $6.00 (but greater than $5.00) for 

21 2 consecutive months, and during the same 2 con22 secutive months— 

23 (A) the price in the United States for 

24 cheddar cheese is equal to or greater than the 

25 world price of cheddar cheese; or 


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1 (B) the price in the United States for non2 fat dry milk is equal to or greater than the 

3 world price of skim milk powder; 

4 (3) the actual dairy production margin is equal 

5 to or less than $5.00 (but greater than $4.00) for 

6 2 consecutive months, and during the same 2 con7 secutive months— 

8 (A) the price in the United States for 

9 cheddar cheese is more than 5 percent above 

10 the world price of cheddar cheese; or 

11 (B) the price in the United States for non12 fat dry milk is more than 5 percent above the 

13 world price of skim milk powder; or 

14 (4) the actual dairy production margin is equal 

15 to or less than $4.00 for 2 consecutive months, and 

16 during the same 2 consecutive months— 

17 (A) the price in the United States for 

18 cheddar cheese is more than 7 percent above 

19 the world price of cheddar cheese; or 

20 (B) the price in the United States for non21 fat dry milk is more than 7 percent above the 

22 world price of skim milk powder. 

23 (c) IMPLEMENTATION BY HANDLERS.—Effective on 

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1 bilization program, the handler shall cease reducing pay2 ments to participating dairy operations under the sta3 bilization program. 

4 (d) CONDITION ON RESUMPTION OF STABILIZATION

5 PROGRAM.—Upon the announcement by the Secretary 

6 under subsection (b) that the stabilization program has 

7 been suspended, the stabilization program may not be im8 plemented again until, at the earliest— 

9 (1) 2 months have passed, beginning on the 

10 first day of the month immediately following the an11 nouncement by the Secretary; and 

12 (2) the conditions of section 1432(a) are again 

13 met. 

14 SEC. 1437. ENFORCEMENT. 

15 (a) UNLAWFUL ACT.—It shall be unlawful and a vio16 lation of the this subpart for any person subject to the 

17 stabilization program to willfully fail or refuse to provide, 

18 or delay the timely reporting of, accurate information and 

19 remittance of funds to the Secretary in accordance with 

20 this subpart. 

21 (b) ORDER.—After providing notice and opportunity 

22 for a hearing to an affected person, the Secretary may 

23 issue an order against any person to cease and desist from 

24 continuing any violation of this subpart. 


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1 (c) APPEAL.—An order of the Secretary under sub2 section (b) shall be final and conclusive unless an affected 

3 person files an appeal of the order of the Secretary in 

4 United States district court not later than 30 days after 

5 the date of the issuance of the order. A finding of the 

6 Secretary in the order shall be set aside only if the finding 

7 is not supported by substantial evidence. 

8 (d) NONCOMPLIANCE WITH ORDER.—If a person 

9 subject to this subpart fails to obey an order issued under 

10 subsection (b) after the order has become final and 

11 unappealable, or after the appropriate United States dis12 trict court has entered a final judgment in favor of the 

13 Secretary, the United States may apply to the appropriate 

14 United States district court for enforcement of the order. 

15 If the court determines that the order was lawfully made 

16 and duly served and that the person violated the order, 

17 the court shall enforce the order. 

18 SEC. 1438. AUDIT REQUIREMENTS. 

19 (a) AUDITS OF DAIRY OPERATION AND HANDLER

20 COMPLIANCE.— 

21 (1) AUDITS AUTHORIZED.—If determined by 

22 the Secretary to be necessary to ensure compliance 

23 by participating dairy operations and handlers with 

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1 duct periodic audits of participating dairy operations 

2 and handlers. 

3 (2) SAMPLE OF DAIRY OPERATIONS.—Any 

4 audit conducted under this subsection shall include, 

5 at a minimum, investigation of a statistically valid 

6 and random sample of participating dairy oper7 ations. 

8 (b) SUBMISSION OF RESULTS.—The Secretary shall 

9 submit the results of any audit conducted under sub10 section (a) to the Committee on Agriculture of the House 

11 of Representatives and the Committee on Agriculture, Nu12 trition, and Forestry of the Senate and include such rec13 ommendations as the Secretary considers appropriate re14 garding the stabilization program. 

15 SEC. 1439. STUDY; REPORT. 

16 (a) IN GENERAL.—The Secretary shall direct the Of17 fice of the Chief Economist to conduct a study of the im18 pacts of the program established under section 1431(a). 

19 (b) CONSIDERATIONS.—The study conducted under 

20 subsection (a) shall consider— 

21 (1) the economic impact of the program 

22 throughout the dairy product value chain, including 

23 the impact on producers, processors, domestic cus24 tomers, export customers, actual market growth and 


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1 potential market growth, farms of different sizes, 

2 and different regions and States; and 

3 (2) the impact of the program on the competi4 tiveness of the United States dairy industry in inter5 national markets. 

6 (c) REPORT.—Not later than December 1, 2016, the 

7 Office of the Chief Economist shall submit to the Com8 mittee on Agriculture of the House of Representatives and 

9 the Committee on Agriculture, Nutrition, and Forestry of 

10 the Senate a report that describes the results of the study 

11 conducted under subsection (a). 

12 Subpart C—Duration 

13 SEC. 1451. DURATION. 

14 The production margin protection program and the 

15 stabilization program shall end on December 31, 2017. 

16 PART II—DAIRY MARKET TRANSPARENCY 

17 SEC. 1461. DAIRY PRODUCT MANDATORY REPORTING. 

18 (a) DEFINITIONS.—Section 272(1)(A) of the Agricul19 tural Marketing Act of 1946 (7 U.S.C. 1637a(1)(A)) is 

20 amended by inserting ‘‘, or any other products that may 

21 significantly aid price discovery in the dairy markets, as 

22 determined by the Secretary’’ after ‘‘of 1937’’. 

23 (b) MANDATORY REPORTING FOR DAIRY PROD24 UCTS.—Section 273(b) of the Agricultural Marketing Act 

25 of 1946 (7 U.S.C. 1637b(b)) is amended— 


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1 (1) by striking paragraph (1) and inserting the 

2 following new paragraph: 

3 ‘‘(1) IN GENERAL.—In establishing the pro4 gram, the Secretary shall only— 

5 ‘‘(A)(i) subject to the conditions described 

6 in paragraph (2), require each manufacturer to 

7 report to the Secretary, no less frequently than 

8 once per month, information concerning the 

9 price, quantity, and moisture content of dairy 

10 products sold by the manufacturer and any 

11 other product characteristics that may signifi12 cantly aid price discovery in the dairy markets, 

13 as determined by the Secretary; and 

14 ‘‘(ii) modify the format used to provide the 

15 information on the day before the date of enact16 ment of this subtitle to ensure that the infor17 mation can be readily understood by market 

18 participants; and 

19 ‘‘(B) require each manufacturer and other 

20 person storing dairy products (including dairy 

21 products in cold storage) to report to the Sec22 retary, no less frequently than once per month, 

23 information on the quantity of dairy products 

24 stored.’’; and 


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1 (2) in paragraph (2), by inserting ‘‘or those 

2 that may significantly aid price discovery in the 

3 dairy markets’’ after ‘‘Federal milk marketing 

4 order’’ each place it appears in subparagraphs (A), 

5 (B), and (C). 

6 SEC. 1462. FEDERAL MILK MARKETING ORDER INFORMA7 TION. 

8 (a) INFORMATION CLEARINGHOUSE.— 

9 (1) IN GENERAL.—The Secretary shall, on be10 half of each milk marketing order issued under the 

11 Agricultural Adjustment Act (7 U.S.C. 601 et seq.), 

12 reenacted with amendments by the Agricultural 

13 Marketing Agreement Act of 1937, establish an in14 formation clearinghouse for the purposes of edu15 cating the public about the Federal milk marketing 

16 order system and any marketing order referenda, in17 cluding proposal information and timelines that shall 

18 be kept current and updated as information becomes 

19 available. 

20 (2) REQUIREMENTS.—Information under para21 graph (1) shall include— 

22 (A) information on procedures by which 

23 cooperatives vote; 


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1 (B) if applicable, information on the man2 ner by which producers may cast an individual 

3 ballot; 

4 (C) in applicable, instructions on the man5 ner in which to vote online; 

6 (D) due dates for each specific referendum; 

7 (E) the text of each referendum question 

8 under consideration; 

9 (F) a description in plain language of the 

10 question; 

11 (G) any relevant background information 

12 to the question; and 

13 (H) any other information that increases 

14 Federal milk marketing order transparency. 

15 (b) NOTIFICATION LIST FOR UPCOMING REF16 ERENDUM.—Each Federal milk marketing order shall— 

17 (1) make available the information described in 

18 subsection (b) through an Internet site; and 

19 (2) publicize the information in major agri20 culture and dairy-specific publications on upcoming 

21 referenda. 


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1 PART III—REPEAL OR REAUTHORIZATION OF 

2 OTHER DAIRY-RELATED PROVISIONS 

3 SEC. 1471. REPEAL OF DAIRY PRODUCT PRICE SUPPORT 

4 AND MILK INCOME LOSS CONTRACT PRO5 GRAMS. 

6 (a) REPEAL OF DAIRY PRODUCT PRICE SUPPORT

7 PROGRAM.—Section 1501 of the Food, Conservation, and 

8 Energy Act of 2008 (7 U.S.C. 8771) is repealed. 

9 (b) REPEAL OF MILK INCOME LOSS CONTRACT PRO10 GRAM.— 

11 (1) PAYMENTS UNDER MILK INCOME LOSS CON12 TRACT PROGRAM.—Section 1506(c)(3) of the Food, 

13 Conservation, and Energy Act of 2008 (7 U.S.C. 

14 8773(c)(3)) is amended— 

15 (A) in subparagraph (A), by inserting 

16 ‘‘and’’ after the semicolon; 

17 (B) in subparagraph (B), by striking ‘‘Au18 gust 31, 2012, 45 percent; and’’ and inserting 

19 ‘‘June 30, 2013, 45 percent.’’; and 

20 (C) by striking subparagraph (C). 

21 (2) EXTENSION.—Section 1506(h)(1) of the 

22 Food, Conservation, and Energy Act of 2008 (7 

23 U.S.C. 8773(h)(1)) is amended by striking ‘‘Sep24 tember 30, 2012’’ and inserting ‘‘June 30, 2013’’. 


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1 (3) REPEAL.—Effective July 1, 2013, section 

2 1506 of the Food, Conservation, and Energy Act of 

3 2008 (7 U.S.C. 8773) is repealed. 

4 SEC. 1472. REPEAL OF DAIRY EXPORT INCENTIVE PRO5 GRAM. 

6 (a) REPEAL.—Section 153 of the Food Security Act 

7 of 1985 (15 U.S.C. 713a–14) is repealed. 

8 (b) CONFORMING AMENDMENTS.—Section 902(2) of 

9 the Trade Sanctions Reform and Export Enhancement 

10 Act of 2000 (22 U.S.C. 7201(2)) is amended— 

11 (1) by striking subparagraph (D); and 

12 (2) by redesignating subparagraphs (E) and 

13 (F) as subparagraphs (D) and (E), respectively. 

14 SEC. 1473. EXTENSION OF DAIRY FORWARD PRICING PRO15 GRAM. 

16 Section 1502(e) of the Food, Conservation, and En17 ergy Act of 2008 (7 U.S.C. 8772(e)) is amended— 

18 (1) in paragraph (1), by striking ‘‘2012’’ and 

19 inserting ‘‘2017’’; and 

20 (2) in paragraph (2), by striking ‘‘2015’’ and 

21 inserting ‘‘2020’’. 

22 SEC. 1474. EXTENSION OF DAIRY INDEMNITY PROGRAM. 

23 Section 3 of Public Law 90–484 (7 U.S.C. 450l) is 

24 amended by striking ‘‘2012’’ and inserting ‘‘2017’’. 


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1 SEC. 1475. EXTENSION OF DAIRY PROMOTION AND RE2 SEARCH PROGRAM. 

3 Section 113(e)(2) of the Dairy Production Stabiliza4 tion Act of 1983 (7 U.S.C. 4504(e)(2)) is amended by 

5 striking ‘‘2012’’ and inserting ‘‘2017’’. 

6 SEC. 1476. EXTENSION OF FEDERAL MILK MARKETING 

7 ORDER REVIEW COMMISSION. 

8 Section 1509(a) of the Food, Conservation, and En9 ergy Act of 2008 (Public Law 110–246; 122 Stat. 1726) 

10 is amended by inserting ‘‘or other funds’’ after ‘‘Subject 

11 to the availability of appropriations’’. 

12 PART IV—EFFECTIVE DATE 

13 SEC. 1481. EFFECTIVE DATE. 

14 Except as otherwise provided in this subtitle, this 

15 subtitle and the amendments made by this subtitle take 

16 effect on October 1, 2012. 

17 Subtitle E—Supplemental Agricul18 tural Disaster Assistance Pro19 grams 

20 SEC. 1501. SUPPLEMENTAL AGRICULTURAL DISASTER AS21 SISTANCE PROGRAMS. 

22 (a) DEFINITIONS.—In this section: 

23 (1) ELIGIBLE PRODUCER ON A FARM.— 

24 (A) IN GENERAL.—The term ‘‘eligible pro25 ducer on a farm’’ means an individual or entity 

26 described in subparagraph (B) that, as deterVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00115 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 mined by the Secretary, assumes the production 

2 and market risks associated with the agricul3 tural production of crops or livestock. 

4 (B) DESCRIPTION.—An individual or enti5 ty referred to in subparagraph (A) is— 

6 (i) a citizen of the United States; 

7 (ii) a resident alien; 

8 (iii) a partnership of citizens of the 

9 United States; or 

10 (iv) a corporation, limited liability cor11 poration, or other farm organizational 

12 structure organized under State law. 

13 (2) FARM.— 

14 (A) IN GENERAL.—The term ‘‘farm’’ 

15 means, in relation to an eligible producer on a 

16 farm, the total of all crop acreage in all coun17 ties that is planted or intended to be planted 

18 for harvest, for sale, or on-farm livestock feed19 ing (including native grassland intended for 

20 haying) by the eligible producer. 

21 (B) AQUACULTURE.—In the case of aqua22 culture, the term ‘‘farm’’ means, in relation to 

23 an eligible producer on a farm, all fish being 

24 produced in all counties that are intended to be 

25 harvested for sale by the eligible producer. 


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1 (C) HONEY.—In the case of honey, the 

2 term ‘‘farm’’ means, in relation to an eligible 

3 producer on a farm, all bees and beehives in all 

4 counties that are intended to be harvested for 

5 a honey crop for sale by the eligible producer. 

6 (3) FARM-RAISED FISH.—The term ‘‘farm7 raised fish’’ means any aquatic species that is propa8 gated and reared in a controlled environment. 

9 (4) LIVESTOCK.—The term ‘‘livestock’’ in10 cludes— 

11 (A) cattle (including dairy cattle); 

12 (B) bison; 

13 (C) poultry; 

14 (D) sheep; 

15 (E) swine; 

16 (F) horses; and 

17 (G) other livestock, as determined by the 

18 Secretary. 

19 (b) LIVESTOCK INDEMNITY PAYMENTS.— 

20 (1) PAYMENTS.—For each of fiscal years 2012 

21 through 2017, the Secretary shall use such sums as 

22 are necessary of the funds of the Commodity Credit 

23 Corporation to make livestock indemnity payments 

24 to eligible producers on farms that have incurred 


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1 livestock death losses in excess of the normal mor2 tality, as determined by the Secretary, due to— 

3 (A) attacks by animals reintroduced into 

4 the wild by the Federal Government or pro5 tected by Federal law, including wolves; or 

6 (B) adverse weather, as determined by the 

7 Secretary, during the calendar year, including 

8 losses due to hurricanes, floods, blizzards, dis9 ease, wildfires, extreme heat, and extreme cold. 

10 (2) PAYMENT RATES.—Indemnity payments to 

11 an eligible producer on a farm under paragraph (1) 

12 shall be made at a rate of 65 percent of the market 

13 value of the applicable livestock on the day before 

14 the date of death of the livestock, as determined by 

15 the Secretary. 

16 (3) SPECIAL RULE FOR PAYMENTS MADE DUE

17 TO DISEASE.—The Secretary shall ensure that pay18 ments made to an eligible producer under paragraph 

19 (1) are not made for the same livestock losses for 

20 which compensation is provided pursuant to section 

21 10407(d) of the Animal Health Protection Act (7 

22 U.S.C. 8306(d)). 

23 (c) LIVESTOCK FORAGE DISASTER PROGRAM.— 

24 (1) DEFINITIONS.—In this subsection: 

25 (A) COVERED LIVESTOCK.— 


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1 (i) IN GENERAL.—Except as provided 

2 in clause (ii), the term ‘‘covered livestock’’ 

3 means livestock of an eligible livestock pro4 ducer that, during the 60 days prior to the 

5 beginning date of a qualifying drought or 

6 fire condition, as determined by the Sec7 retary, the eligible livestock producer— 

8 (I) owned; 

9 (II) leased; 

10 (III) purchased; 

11 (IV) entered into a contract to 

12 purchase; 

13 (V) is a contract grower; or 

14 (VI) sold or otherwise disposed of 

15 due to qualifying drought conditions 

16 during— 

17 (aa) the current production 

18 year; or 

19 (bb) subject to paragraph 

20 (3)(B)(ii), 1 or both of the 2 pro21 duction years immediately pre22 ceding the current production 

23 year. 

24 (ii) EXCLUSION.—The term ‘‘covered 

25 livestock’’ does not include livestock that 


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1 were or would have been in a feedlot, on 

2 the beginning date of the qualifying 

3 drought or fire condition, as a part of the 

4 normal business operation of the eligible 

5 livestock producer, as determined by the 

6 Secretary. 

7 (B) DROUGHT MONITOR.—The term 

8 ‘‘drought monitor’’ means a system for 

9 classifying drought severity according to a 

10 range of abnormally dry to exceptional drought, 

11 as defined by the Secretary. 

12 (C) ELIGIBLE LIVESTOCK PRODUCER.— 

13 (i) IN GENERAL.—The term ‘‘eligible 

14 livestock producer’’ means an eligible pro15 ducer on a farm that— 

16 (I) is an owner, cash or share 

17 lessee, or contract grower of covered 

18 livestock that provides the pastureland 

19 or grazing land, including cash-leased 

20 pastureland or grazing land, for the 

21 livestock; 

22 (II) provides the pastureland or 

23 grazing land for covered livestock, in24 cluding cash-leased pastureland or 


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1 grazing land that is physically located 

2 in a county affected by drought; 

3 (III) certifies grazing loss; and 

4 (IV) meets all other eligibility re5 quirements established under this sub6 section. 

7 (ii) EXCLUSION.—The term ‘‘eligible 

8 livestock producer’’ does not include an 

9 owner, cash or share lessee, or contract 

10 grower of livestock that rents or leases 

11 pastureland or grazing land owned by an12 other person on a rate-of-gain basis. 

13 (D) NORMAL CARRYING CAPACITY.—The 

14 term ‘‘normal carrying capacity’’, with respect 

15 to each type of grazing land or pastureland in 

16 a county, means the normal carrying capacity, 

17 as determined under paragraph (3)(D)(i), that 

18 would be expected from the grazing land or 

19 pastureland for livestock during the normal 

20 grazing period, in the absence of a drought or 

21 fire that diminishes the production of the graz22 ing land or pastureland. 

23 (E) NORMAL GRAZING PERIOD.—The term 

24 ‘‘normal grazing period’’, with respect to a 

25 county, means the normal grazing period during 


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1 the calendar year for the county, as determined 

2 under paragraph (3)(D)(i). 

3 (2) PROGRAM.—For each of fiscal years 2012 

4 through 2017, the Secretary shall use such sums as 

5 are necessary of the funds of the Commodity Credit 

6 Corporation to provide compensation for losses to el7 igible livestock producers due to grazing losses for 

8 covered livestock due to— 

9 (A) a drought condition, as described in 

10 paragraph (3); or 

11 (B) fire, as described in paragraph (4). 

12 (3) ASSISTANCE FOR LOSSES DUE TO DROUGHT

13 CONDITIONS.— 

14 (A) ELIGIBLE LOSSES.— 

15 (i) IN GENERAL.—An eligible livestock 

16 producer may receive assistance under this 

17 subsection only for grazing losses for cov18 ered livestock that occur on land that— 

19 (I) is native or improved 

20 pastureland with permanent vegeta21 tive cover; or 

22 (II) is planted to a crop planted 

23 specifically for the purpose of pro24 viding grazing for covered livestock. 


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1 (ii) EXCLUSIONS.—An eligible live2 stock producer may not receive assistance 

3 under this subsection for grazing losses 

4 that occur on land used for haying or graz5 ing under the conservation reserve pro6 gram established under subchapter B of 

7 chapter 1 of subtitle D of title XII of the 

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

9 3831 et seq.), unless the land is grassland 

10 eligible for the conservation reserve pro11 gram under section 1231(d)(2) of the Food 

12 Security Act of 1985 (16 U.S.C. 3831), as 

13 amended by section 2001 of this Act. 

14 (B) MONTHLY PAYMENT RATE.— 

15 (i) IN GENERAL.—Except as provided 

16 in clause (ii), the payment rate for assist17 ance under this paragraph for 1 month 

18 shall, in the case of drought, be equal to 

19 60 percent of the lesser of— 

20 (I) the monthly feed cost for all 

21 covered livestock owned or leased by 

22 the eligible livestock producer, as de23 termined under subparagraph (C); or 

24 (II) the monthly feed cost cal25 culated by using the normal carrying 


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1 capacity of the eligible grazing land of 

2 the eligible livestock producer. 

3 (ii) PARTIAL COMPENSATION.—In the 

4 case of an eligible livestock producer that 

5 sold or otherwise disposed of covered live6 stock due to drought conditions in 1 or 

7 both of the 2 production years immediately 

8 preceding the current production year, as 

9 determined by the Secretary, the payment 

10 rate shall be 80 percent of the payment 

11 rate otherwise calculated in accordance 

12 with clause (i). 

13 (C) MONTHLY FEED COST.— 

14 (i) IN GENERAL.—The monthly feed 

15 cost shall equal the product obtained by 

16 multiplying— 

17 (I) 30 days; 

18 (II) a payment quantity that is 

19 equal to the feed grain equivalent, as 

20 determined under clause (ii); and 

21 (III) a payment rate that is equal 

22 to the corn price per pound, as deter23 mined under clause (iii). 


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1 (ii) FEED GRAIN EQUIVALENT.—For 

2 purposes of clause (i)(II), the feed grain 

3 equivalent shall equal— 

4 (I) in the case of an adult beef 

5 cow, 15.7 pounds of corn per day; or 

6 (II) in the case of any other type 

7 of weight of livestock, an amount de8 termined by the Secretary that rep9 resents the average number of pounds 

10 of corn per day necessary to feed the 

11 livestock. 

12 (iii) CORN PRICE PER POUND.—For 

13 purposes of clause (i)(III), the corn price 

14 per pound shall equal the quotient ob15 tained by dividing— 

16 (I) the higher of— 

17 (aa) the national average 

18 corn price per bushel for the 12- 

19 month period immediately pre20 ceding March 1 of the year for 

21 which the disaster assistance is 

22 calculated; or 

23 (bb) the national average 

24 corn price per bushel for the 24- 


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1 month period immediately pre2 ceding that March 1; by 

3 (II) 56. 

4 (D) NORMAL GRAZING PERIOD AND

5 DROUGHT MONITOR INTENSITY.— 

6 (i) FSA COUNTY COMMITTEE DETER7 MINATIONS.— 

8 (I) IN GENERAL.—The Secretary 

9 shall determine the normal carrying 

10 capacity and normal grazing period 

11 for each type of grazing land or 

12 pastureland in the county served by 

13 the applicable committee. 

14 (II) CHANGES.—No change to 

15 the normal carrying capacity or nor16 mal grazing period established for a 

17 county under subclause (I) shall be 

18 made unless the change is requested 

19 by the appropriate State and county 

20 Farm Service Agency committees. 

21 (ii) DROUGHT INTENSITY.— 

22 (I) D2.—An eligible livestock 

23 producer that owns or leases grazing 

24 land or pastureland that is physically 

25 located in a county that is rated by 


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1 the U.S. Drought Monitor as having a 

2 D2 (severe drought) intensity in any 

3 area of the county for at least 8 con4 secutive weeks during the normal 

5 grazing period for the county, as de6 termined by the Secretary, shall be el7 igible to receive assistance under this 

8 paragraph in an amount equal to 1 

9 monthly payment using the monthly 

10 payment rate determined under sub11 paragraph (B). 

12 (II) D3.—An eligible livestock 

13 producer that owns or leases grazing 

14 land or pastureland that is physically 

15 located in a county that is rated by 

16 the U.S. Drought Monitor as having 

17 at least a D3 (extreme drought) in18 tensity in any area of the county at 

19 any time during the normal grazing 

20 period for the county, as determined 

21 by the Secretary, shall be eligible to 

22 receive assistance under this para23 graph— 

24 (aa) in an amount equal to 

25 2 monthly payments using the 


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1 monthly payment rate deter2 mined under subparagraph (B); 

3 or 

4 (bb) if the county is rated as 

5 having a D3 (extreme drought) 

6 intensity in any area of the coun7 ty for at least 4 weeks during the 

8 normal grazing period for the 

9 county, or is rated as having a 

10 D4 (exceptional drought) inten11 sity in any area of the county at 

12 any time during the normal graz13 ing period, in an amount equal to 

14 3 monthly payments using the 

15 monthly payment rate deter16 mined under subparagraph (B). 

17 (4) ASSISTANCE FOR LOSSES DUE TO FIRE ON

18 PUBLIC MANAGED LAND.— 

19 (A) IN GENERAL.—An eligible livestock 

20 producer may receive assistance under this 

21 paragraph only if— 

22 (i) the grazing losses occur on range23 land that is managed by a Federal agency; 

24 and 


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1 (ii) the eligible livestock producer is 

2 prohibited by the Federal agency from 

3 grazing the normal permitted livestock on 

4 the managed rangeland due to a fire. 

5 (B) PAYMENT RATE.—The payment rate 

6 for assistance under this paragraph shall be 

7 equal to 50 percent of the monthly feed cost for 

8 the total number of livestock covered by the 

9 Federal lease of the eligible livestock producer, 

10 as determined under paragraph (3)(C). 

11 (C) PAYMENT DURATION.— 

12 (i) IN GENERAL.—Subject to clause 

13 (ii), an eligible livestock producer shall be 

14 eligible to receive assistance under this 

15 paragraph for the period— 

16 (I) beginning on the date on 

17 which the Federal agency excludes the 

18 eligible livestock producer from using 

19 the managed rangeland for grazing; 

20 and 

21 (II) ending on the last day of the 

22 Federal lease of the eligible livestock 

23 producer. 

24 (ii) LIMITATION.—An eligible livestock 

25 producer may only receive assistance under 


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1 this paragraph for losses that occur on not 

2 more than 180 days per year. 

3 (5) NO DUPLICATIVE PAYMENTS.— 

4 (A) IN GENERAL.—An eligible livestock 

5 producer may elect to receive assistance for 

6 grazing or pasture feed losses due to drought 

7 conditions under paragraph (3) or fire under 

8 paragraph (4), but not both for the same loss, 

9 as determined by the Secretary. 

10 (B) RELATIONSHIP TO OTHER ASSIST11 ANCE.—An eligible livestock producer that re12 ceives assistance under this subsection may not 

13 also receive assistance for losses to crops on the 

14 same land with the same intended use. 

15 (d) EMERGENCY ASSISTANCE FOR LIVESTOCK, 

16 HONEY BEES, AND FARM-RAISED FISH.— 

17 (1) IN GENERAL.—For each of fiscal years 

18 2012 through 2017, the Secretary shall use not 

19 more than $10,000,000 of the funds of the Com20 modity Credit Corporation to provide emergency re21 lief to eligible producers of livestock, honey bees, and 

22 farm-raised fish to aid in the reduction of losses due 

23 to disease, adverse weather, or other conditions, such 

24 as blizzards and wildfires, as determined by the SecVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00130 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 retary, that are not covered under subsection (b) or 

2 (c). 

3 (2) USE OF FUNDS.—Funds made available 

4 under this subsection shall be used to reduce losses 

5 caused by feed or water shortages, disease, or other 

6 factors as determined by the Secretary. 

7 (3) AVAILABILITY OF FUNDS.—Any funds made 

8 available under this subsection shall remain available 

9 until expended. 

10 (e) TREE ASSISTANCE PROGRAM.— 

11 (1) DEFINITIONS.—In this subsection: 

12 (A) ELIGIBLE ORCHARDIST.—The term 

13 ‘‘eligible orchardist’’ means a person that pro14 duces annual crops from trees for commercial 

15 purposes. 

16 (B) NATURAL DISASTER.—The term ‘‘nat17 ural disaster’’ means plant disease, insect infes18 tation, drought, fire, freeze, flood, earthquake, 

19 lightning, or other occurrence, as determined by 

20 the Secretary. 

21 (C) NURSERY TREE GROWER.—The term 

22 ‘‘nursery tree grower’’ means a person who pro23 duces nursery, ornamental, fruit, nut, or Christ24 mas trees for commercial sale, as determined by 

25 the Secretary. 


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1 (D) TREE.—The term ‘‘tree’’ includes a 

2 tree, bush, and vine. 

3 (2) ELIGIBILITY.— 

4 (A) LOSS.—Subject to subparagraph (B), 

5 for each of fiscal years 2012 through 2017, the 

6 Secretary shall use such sums as are necessary 

7 of the funds of the Commodity Credit Corpora8 tion to provide assistance— 

9 (i) under paragraph (3) to eligible or10 chardists and nursery tree growers that 

11 planted trees for commercial purposes but 

12 lost the trees as a result of a natural dis13 aster, as determined by the Secretary; and 

14 (ii) under paragraph (3)(B) to eligible 

15 orchardists and nursery tree growers that 

16 have a production history for commercial 

17 purposes on planted or existing trees but 

18 lost the trees as a result of a natural dis19 aster, as determined by the Secretary. 

20 (B) LIMITATION.—An eligible orchardist 

21 or nursery tree grower shall qualify for assist22 ance under subparagraph (A) only if the tree 

23 mortality of the eligible orchardist or nursery 

24 tree grower, as a result of damaging weather or 


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1 related condition, exceeds 15 percent (adjusted 

2 for normal mortality). 

3 (3) ASSISTANCE.—Subject to paragraph (4), 

4 the assistance provided by the Secretary to eligible 

5 orchardists and nursery tree growers for losses de6 scribed in paragraph (2) shall consist of— 

7 (A)(i) reimbursement of 65 percent of the 

8 cost of replanting trees lost due to a natural 

9 disaster, as determined by the Secretary, in ex10 cess of 15 percent mortality (adjusted for nor11 mal mortality); or 

12 (ii) at the option of the Secretary, suffi13 cient seedlings to reestablish a stand; and 

14 (B) reimbursement of 50 percent of the 

15 cost of pruning, removal, and other costs in16 curred by an eligible orchardist or nursery tree 

17 grower to salvage existing trees or, in the case 

18 of tree mortality, to prepare the land to replant 

19 trees as a result of damage or tree mortality 

20 due to a natural disaster, as determined by the 

21 Secretary, in excess of 15 percent damage or 

22 mortality (adjusted for normal tree damage and 

23 mortality). 

24 (4) LIMITATIONS ON ASSISTANCE.— 


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1 (A) DEFINITIONS OF LEGAL ENTITY AND

2 PERSON.—In this paragraph, the terms ‘‘legal 

3 entity’’ and ‘‘person’’ have the meaning given 

4 those terms in section 1001(a) of the Food Se5 curity Act of 1985 (7 U.S.C. 1308(a)). 

6 (B) AMOUNT.—The total amount of pay7 ments received, directly or indirectly, by a per8 son or legal entity (excluding a joint venture or 

9 general partnership) under this subsection may 

10 not exceed $100,000 for any crop year, or an 

11 equivalent value in tree seedlings. 

12 (C) ACRES.—The total quantity of acres 

13 planted to trees or tree seedlings for which a 

14 person or legal entity shall be entitled to receive 

15 payments under this subsection may not exceed 

16 500 acres. 

17 (f) PAYMENT LIMITATIONS.— 

18 (1) DEFINITIONS OF LEGAL ENTITY AND PER19 SON.—In this subsection, the terms ‘‘legal entity’’ 

20 and ‘‘person’’ have the meaning given those terms in 

21 section 1001(a) of the Food Security Act of 1985 (7 

22 U.S.C. 1308(a)). 

23 (2) AMOUNT.—The total amount of disaster as24 sistance payments received, directly or indirectly, by 

25 a person or legal entity (excluding a joint venture or 


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1 general partnership) under this section (excluding 

2 payments received under subsection (e)) may not ex3 ceed $100,000 for any crop year. 

4 (3) DIRECT ATTRIBUTION.—Subsections (d) 

5 and (e) of section 1001 of the Food Security Act of 

6 1985 (7 U.S.C. 1308) or any successor provisions 

7 relating to direct attribution shall apply with respect 

8 to assistance provided under this section. 

9 Subtitle F—Administration 

10 SEC. 1601. ADMINISTRATION GENERALLY. 

11 (a) USE OF COMMODITY CREDIT CORPORATION.— 

12 The Secretary shall use the funds, facilities, and authori13 ties of the Commodity Credit Corporation to carry out this 

14 title. 

15 (b) DETERMINATIONS BY SECRETARY.—A deter16 mination made by the Secretary under this title shall be 

17 final and conclusive. 

18 (c) REGULATIONS.— 

19 (1) IN GENERAL.—Except as otherwise pro20 vided in this subsection, not later than 90 days after 

21 the date of enactment of this Act, the Secretary and 

22 the Commodity Credit Corporation, as appropriate, 

23 shall promulgate such regulations as are necessary 

24 to implement this title and the amendments made by 

25 this title. 


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1 (2) PROCEDURE.—The promulgation of the reg2 ulations and administration of this title and the 

3 amendments made by this title and sections 11001 

4 and 11011 of this Act shall be made without regard 

5 to— 

6 (A) the notice and comment provisions of 

7 section 553 of title 5, United States Code; 

8 (B) chapter 35 of title 44, United States 

9 Code (commonly known as the ‘‘Paperwork Re10 duction Act’’); and 

11 (C) the Statement of Policy of the Sec12 retary of Agriculture effective July 24, 1971 

13 (36 Fed. Reg. 13804), relating to notices of 

14 proposed rulemaking and public participation in 

15 rulemaking. 

16 (3) CONGRESSIONAL REVIEW OF AGENCY RULE17 MAKING.—In carrying out this subsection, the Sec18 retary shall use the authority provided under section 

19 808 of title 5, United States Code. 

20 (d) ADJUSTMENT AUTHORITY RELATED TO TRADE

21 AGREEMENTS COMPLIANCE.— 

22 (1) REQUIRED DETERMINATION; ADJUST23 MENT.—If the Secretary determines that expendi24 tures under this title that are subject to the total al25 lowable domestic support levels under the Uruguay 


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1 Round Agreements (as defined in section 2 of the 

2 Uruguay Round Agreements Act (19 U.S.C. 3501)) 

3 will exceed the allowable levels for any applicable re4 porting period, the Secretary shall, to the maximum 

5 extent practicable, make adjustments in the amount 

6 of the expenditures during that period to ensure that 

7 the expenditures do not exceed the allowable levels. 

8 (2) CONGRESSIONAL NOTIFICATION.—Before 

9 making any adjustment under paragraph (1), the 

10 Secretary shall submit to the Committee on Agri11 culture of the House of Representatives and the 

12 Committee on Agriculture, Nutrition, and Forestry 

13 of the Senate a report describing the determination 

14 made under that paragraph and the extent of the 

15 adjustment to be made. 

16 SEC. 1602. SUSPENSION OF PERMANENT PRICE SUPPORT 

17 AUTHORITY. 

18 (a) AGRICULTURAL ADJUSTMENT ACT OF 1938.— 

19 The following provisions of the Agricultural Adjustment 

20 Act of 1938 shall not be applicable to the 2013 through 

21 2017 crops of covered commodities (as defined in section 

22 1104), cotton, and sugar and shall not be applicable to 

23 milk during the period beginning on the date of enactment 

24 of this Act through December 31, 2017: 


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1 (1) Parts II through V of subtitle B of title III 

2 (7 U.S.C. 1326 et seq.). 

3 (2) In the case of upland cotton, section 377 (7 

4 U.S.C. 1377). 

5 (3) Subtitle D of title III (7 U.S.C. 1379a et 

6 seq.). 

7 (4) Title IV (7 U.S.C. 1401 et seq.). 

8 (b) AGRICULTURAL ACT OF 1949.—The following 

9 provisions of the Agricultural Act of 1949 shall not be ap10 plicable to the 2013 through 2017 crops of covered com11 modities (as defined in section 1104), cotton, and sugar 

12 and shall not be applicable to milk during the period be13 ginning on the date of enactment of this Act and through 

14 December 31, 2017: 

15 (1) Section 101 (7 U.S.C. 1441). 

16 (2) Section 103(a) (7 U.S.C. 1444(a)). 

17 (3) Section 105 (7 U.S.C. 1444b). 

18 (4) Section 107 (7 U.S.C. 1445a). 

19 (5) Section 110 (7 U.S.C. 1445e). 

20 (6) Section 112 (7 U.S.C. 1445g). 

21 (7) Section 115 (7 U.S.C. 1445k). 

22 (8) Section 201 (7 U.S.C. 1446). 

23 (9) Title III (7 U.S.C. 1447 et seq.). 


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1 (10) Title IV (7 U.S.C. 1421 et seq.), other 

2 than sections 404, 412, and 416 (7 U.S.C. 1424, 

3 1429, and 1431). 

4 (11) Title V (7 U.S.C. 1461 et seq.). 

5 (12) Title VI (7 U.S.C. 1471 et seq.). 

6 (c) SUSPENSION OF CERTAIN QUOTA PROVISIONS.— 

7 The joint resolution entitled ‘‘A joint resolution relating 

8 to corn and wheat marketing quotas under the Agricul9 tural Adjustment Act of 1938, as amended’’, approved 

10 May 26, 1941 (7 U.S.C. 1330 and 1340), shall not be 

11 applicable to the crops of wheat planted for harvest in the 

12 calendar years 2013 through 2017. 

13 SEC. 1603. PAYMENT LIMITATIONS. 

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

15 Act of 1985 (7 U.S.C. 1308) is amended by striking sub16 sections (b) and (c) and inserting the following: 

17 ‘‘(b) LIMITATION ON PAYMENTS FOR PEANUTS AND

18 OTHER COVERED COMMODITIES.—The total amount of 

19 payments received, directly or indirectly, by a person or 

20 legal entity (except a joint venture or general partnership) 

21 for any crop year under subtitle A of the Agriculture Re22 form, Food, and Jobs Act of 2012 for— 

23 ‘‘(1) peanuts may not exceed $50,000; and 

24 ‘‘(2) 1 or more other covered commodities may 

25 not exceed $50,000.’’. 


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1 (b) CONFORMING AMENDMENTS.— 

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

3 1985 (7 U.S.C. 1308) is amended— 

4 (A) in subsection (a)(1), by striking ‘‘sec5 tion 1001 of the Food, Conservation, and En6 ergy Act of 2008’’ and inserting ‘‘section 1104 

7 of the Agriculture Reform, Food, and Jobs Act 

8 of 2012’’; 

9 (B) in subsection (d), by inserting ‘‘or title 

10 I of the Agriculture Reform, Food, and Jobs 

11 Act of 2012’’ before the period at the end; 

12 (C) in subsection (e)— 

13 (i) in paragraph (1), by striking ‘‘sub14 sections (b) and (c) and a program de15 scribed in paragraphs (1)(C)’’ and insert16 ing ‘‘subsection (b) and a program de17 scribed in paragraph (1)(B)’’; and 

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

19 ‘‘subsections (b) and (c)’’ each place it ap20 pears and inserting ‘‘subsection (b)’’; 

21 (D) in subsection (f)— 

22 (i) by striking ‘‘or title XII’’ each 

23 place it appears in paragraphs (5)(A) and 

24 (6)(A) and inserting ‘‘, title I of the AgriVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00140 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 culture Reform, Food, and Jobs Act of 

2 2012, or title XII’’; 

3 (ii) in paragraph (2), by striking 

4 ‘‘Subsections (b) and (c)’’ and inserting 

5 ‘‘Subsection (b)’’; 

6 (iii) in paragraph (4)(B), by striking 

7 ‘‘subsection (b) or (c)’’ and inserting ‘‘sub8 section (b)’’; 

9 (iv) in paragraph (5)— 

10 (I) in subparagraph (A), by strik11 ing ‘‘subsection (d)’’ and inserting 

12 ‘‘subsection (c)’’; and 

13 (II) in subparagraph (B), by 

14 striking ‘‘subsection (b), (c), or (d)’’ 

15 and inserting ‘‘subsection (b) or (c)’’; 

16 and 

17 (v) in paragraph (6)— 

18 (I) in subparagraph (A), by strik19 ing ‘‘subsection (d), except as pro20 vided in subsection (g)’’ and inserting 

21 ‘‘subsection (c), except as provided in 

22 subsection (f)’’; and 

23 (II) in subparagraph (B), by 

24 striking ‘‘subsections (b), (c), and 


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1 (d)’’ and inserting ‘‘subsections (b) 

2 and (c)’’; 

3 (E) in subsection (g)— 

4 (i) in paragraph (1)— 

5 (I) bv striking ‘‘subsection 

6 (f)(6)(A)’’ and inserting ‘‘subsection 

7 (e)(6)(A)’’ and 

8 (II) by striking ‘‘subsection (b) 

9 or (c)’’ and inserting ‘‘subsection (b)’’; 

10 and 

11 (ii) in paragraph (2)(A), by striking 

12 ‘‘subsections (b) and (c)’’ and inserting 

13 ‘‘subsection (b)’’; and 

14 (F) by redesignating subsections (d) 

15 through (h) as subsections (c) through (g), re16 spectively. 

17 (2) Section 1001A of the Food Security Act of 

18 1985 (7 U.S.C. 1308–1) is amended— 

19 (A) in subsection (a), by striking ‘‘sub20 sections (b) and (c)’’ and inserting ‘‘subsection 

21 (b)’’; and 

22 (B) in subsection (b)(1), by striking ‘‘sub23 section (b) or (c)’’ and inserting ‘‘subsection 

24 (b)’’. 


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1 (3) Section 1001B(a) of the Food Security Act 

2 of 1985 (7 U.S.C. 1308–2(a)) is amended in the 

3 matter preceding paragraph (1) by striking ‘‘sub4 sections (b) and (c)’’ and inserting ‘‘subsection (b)’’. 

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

6 of 1985 (7 U.S.C. 1308–3(a)) is amended by insert7 ing ‘‘title I of the Agriculture Reform, Food, and 

8 Jobs Act of 2012,’’ after ‘‘2008,’’. 

9 (c) APPLICATION.—The amendments made by this 

10 section shall apply beginning with the 2013 crop year. 

11 SEC. 1604. PAYMENTS LIMITED TO ACTIVE FARMERS. 

12 Section 1001A of the Food Security Act of 1985 (7 

13 U.S.C. 1308–1) is amended— 

14 (1) in subsection (b)(2)— 

15 (A) by striking ‘‘or active personal man16 agement’’ each place it appears in subpara17 graphs (A)(i)(II) and (B)(ii); and 

18 (B) in subparagraph (C), by striking ‘‘, as 

19 applied to the legal entity, are met by the legal 

20 entity, the partners or members making a sig21 nificant contribution of personal labor or active 

22 personal management’’ and inserting ‘‘are met 

23 by partners or members making a significant 

24 contribution of personal labor, those partners or 

25 members’’; and 


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1 (2) in subsection (c)— 

2 (A) in paragraph (1)— 

3 (i) by striking subparagraph (A) and 

4 inserting the following: 

5 ‘‘(A) the landowner share-rents the land at 

6 a rate that is usual and customary;’’; 

7 (ii) in subparagraph (B), by striking 

8 the period at the end and inserting ‘‘; 

9 and’’; and 

10 (iii) by adding at the end the fol11 lowing: 

12 ‘‘(C) the share of the payments received by 

13 the landowner is commensurate with the share 

14 of the crop or income received as rent.’’; 

15 (B) in paragraph (2)(A), by striking ‘‘ac16 tive personal management or’’; 

17 (C) in paragraph (5)— 

18 (i) by striking ‘‘(5)’’ and all that fol19 lows through ‘‘(A) IN GENERAL.—A per20 son’’ and inserting the following: 

21 ‘‘(5) CUSTOM FARMING SERVICES.—A person’’; 

22 (ii) by inserting ‘‘under usual and 

23 customary terms’’ after ‘‘services’’; and 

24 (iii) by striking subparagraph (B); 

25 and 


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1 (D) by adding at the end the following: 

2 ‘‘(7) FARM MANAGERS.—A person who other3 wise meets the requirements of this subsection other 

4 than (b)(2)(A)(i)(II) shall be considered to be ac5 tively engaged in farming, as determined by the Sec6 retary, with respect to the farming operation, includ7 ing a farming operation that is a sole proprietorship, 

8 a legal entity such as a joint venture or general 

9 partnership, or a legal entity such as a corporation 

10 or limited partnership, if the person— 

11 ‘‘(A) makes a significant contribution of 

12 management to the farming operation necessary 

13 for the farming operation, taking into ac14 count— 

15 ‘‘(i) the size and complexity of the 

16 farming operation; and 

17 ‘‘(ii) the management requirements 

18 normally and customarily required by simi19 lar farming operations; 

20 ‘‘(B) is the only person in the farming op21 eration qualifying as actively engaged in farm22 ing; 

23 ‘‘(C) does not use the management con24 tribution under this paragraph to qualify as acVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00145 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 tively engaged in more than 1 farming oper2 ation; and 

3 ‘‘(D) manages a farm operation that does 

4 not substantially share equipment, labor, or 

5 management with persons or legal entities that 

6 with the person collectively receive, directly or 

7 indirectly, an amount equal to more than the 

8 applicable limits under section 1001(b).’’. 

9 SEC. 1605. ADJUSTED GROSS INCOME LIMITATION. 

10 (a) IN GENERAL.—Section 1001D(b)) of the Food 

11 Security Act of 1985 (7 U.S.C. 1308–3a(b)) is amended 

12 by striking paragraph (1) and inserting the following: 

13 ‘‘(1) COMMODITY PROGRAMS.— 

14 ‘‘(A) LIMITATION.—Notwithstanding any 

15 other provision of law, a person or legal entity 

16 shall not be eligible to receive any benefit de17 scribed in subparagraph (B) during a crop, fis18 cal or program year, as appropriate, if the aver19 age adjusted gross income (or comparable 

20 measure over the 3 taxable years preceding the 

21 most immediately preceding complete taxable 

22 year, as determined by the Secretary) of the 

23 person or legal entity exceeds $750,000. 

24 ‘‘(B) COVERED BENEFITS.—Subparagraph 

25 (A) applies with respect to the following: 


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1 ‘‘(i) A payment under section 1105 of 

2 the Agriculture Reform, Food, and Jobs 

3 Act of 2012. 

4 ‘‘(ii) A marketing loan gain or loan 

5 deficiency payment under subtitle B of title 

6 I of the Agriculture Reform, Food, and 

7 Jobs Act of 2012. 

8 ‘‘(iii) A payment under subtitle E of 

9 the Agriculture Reform, Food, and Jobs 

10 Act of 2012.’’. 

11 ‘‘(iv) A payment under section 196 of 

12 the Federal Agriculture Improvement and 

13 Reform Act of 1996 (7 U.S.C. 7333).’’. 

14 (b) APPLICATION.—The amendments made by this 

15 section shall apply beginning with the 2013 crop year. 

16 SEC. 1606. GEOGRAPHICALLY DISADVANTAGED FARMERS 

17 AND RANCHERS. 

18 Section 1621(d) of the Food, Conservation, and En19 ergy Act of 2008 (7 U.S.C. 8792(d)) is amended by strik20 ing ‘‘2012’’ and inserting ‘‘2017’’. 

21 SEC. 1607. PERSONAL LIABILITY OF PRODUCERS FOR DEFI22 CIENCIES. 

23 Section 164 of the Federal Agriculture Improvement 

24 and Reform Act of 1996 (7 U.S.C. 7284) is amended by 

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1 ergy Act of 2008’’ each place it appears and inserting 

2 ‘‘title I of the Food, Conservation, and Energy Act of 

3 2008 (7 U.S.C. 8702 et seq.), and title I of the Agriculture 

4 Reform, Food, and Jobs Act of 2012’’. 

5 SEC. 1608. PREVENTION OF DECEASED INDIVIDUALS RE6 CEIVING PAYMENTS UNDER FARM COM7 MODITY PROGRAMS. 

8 (a) RECONCILIATION.—At least twice each year, the 

9 Secretary shall reconcile social security numbers of all in10 dividuals who receive payments under this title, whether 

11 directly or indirectly, with the Commissioner of Social Se12 curity to determine if the individuals are alive. 

13 (b) PRECLUSION.—The Secretary shall preclude the 

14 issuance of payments to, and on behalf of, deceased indi15 viduals that were not eligible for payments. 

16 SEC. 1609. APPEALS. 

17 (a) DIRECTION, CONTROL, AND SUPPORT.—Section 

18 272 of the Department of Agriculture Reorganization Act 

19 of 1994 (7 U.S.C. 6992) is amended by striking sub20 section (c) and inserting the following: 

21 ‘‘(c) DIRECTION, CONTROL, AND SUPPORT.— 

22 ‘‘(1) DIRECTION AND CONTROL.— 

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

24 paragraph (2), the Director shall be free from 

25 the direction and control of any person other 


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1 than the Secretary or the Deputy Secretary of 

2 Agriculture. 

3 ‘‘(B) ADMINISTRATIVE SUPPORT.—The Di4 vision shall not receive administrative support 

5 (except on a reimbursable basis) from any agen6 cy other than the Office of the Secretary. 

7 ‘‘(C) PROHIBITION ON DELEGATION.—The 

8 Secretary may not delegate to any other officer 

9 or employee of the Department, other than the 

10 Deputy Secretary of Agriculture or the Direc11 tor, the authority of the Secretary with respect 

12 to the Division. 

13 ‘‘(2) EXCEPTION.—The Assistant Secretary for 

14 Administration is authorized to investigate, enforce, 

15 and implement the provisions in law, Executive 

16 order, or regulations that relate in general to com17 petitive and excepted service positions and employ18 ment within the Division, including the position of 

19 Director, and such authority may be further dele20 gated to subordinate officials.’’. 

21 (b) DETERMINATION OF APPEALABILITY OF AGENCY

22 DECISIONS.—Section 272 of the Department of Agri23 culture Reorganization Act of 1994 (7 U.S.C. 6992) is 

24 amended by striking subsection (d) and inserting the fol25 lowing: 


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1 ‘‘(d) DETERMINATION OF APPEALABILITY OF AGEN2 CY DECISIONS.— 

3 ‘‘(1) DEFINITION OF A MATTER OF GENERAL

4 APPLICABILITY.—In this subsection, the term ‘a 

5 matter of general applicability’ means a matter that 

6 challenges the merits or authority of a rule, proce7 dure, local or national program practice, or deter8 mination of an agency that applies, or can apply, to 

9 more than 1 interested party as opposed to the par10 ticular application of the rule, procedure, or practice 

11 to a specific set of facts or the facts themselves as 

12 the facts apply to 1 particular interested party. 

13 ‘‘(2) MATTERS NOT SUBJECT TO APPEAL.—The 

14 Division may not hear appeals— 

15 ‘‘(A) unless the determination of the agen16 cy is adverse to the appellant; 

17 ‘‘(B) that involve matters of general appli18 cability; and 

19 ‘‘(C) that involve requests for equitable re20 lief unless the equitable relief has been denied 

21 by the agency. 

22 ‘‘(3) EQUITABLE RELIEF.— 

23 ‘‘(A) IN GENERAL.—An appeal requesting 

24 equitable relief may not be granted by the Di25 rector to an appellant unless, using the rules 


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1 and practices that the agency applies to itself, 

2 the agency could in fact have granted the relief 

3 because the appellant acted in good faith, but 

4 failed to fully comply with the requirement of 

5 the rule or practice of the agency. 

6 ‘‘(B) REMAND.—If it cannot be deter7 mined whether the agency would have granted 

8 equitable relief because the appellant acted in 

9 good faith, but failed to comply with the rule or 

10 practice of the agency, the matter shall be re11 manded to the agency for further consideration. 

12 ‘‘(4) DETERMINATION OF APPEALABILITY.—If 

13 an officer, employee, or committee of an agency de14 termines that a decision is not appealable and a par15 ticipant appeals the decision to the Director, the Di16 rector shall determine whether the decision is ad17 verse to the individual participant and appealable or 

18 is a matter of general applicability and not subject 

19 to appeal. 

20 ‘‘(5) APPEALABILITY OF DETERMINATION.— 

21 The determination of the Director as to whether a 

22 decision is appealable is final.’’. 

23 (c) EQUITABLE RELIEF.—Section 278 of the Depart24 ment of Agriculture Reorganization Act of 1994 (7 U.S.C. 

25 6998) is amended by striking subsection (d). 


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1 (d) CONFORMING AMENDMENT.—Section 296(b) of 

2 the Department of Agriculture Reorganization Act of 

3 1994 (7 U.S.C. 7014(b)) is amended— 

4 (1) in paragraph (6)(C), by striking ‘‘or’’ at the 

5 end; 

6 (2) in paragraph (7), by striking the period at 

7 the end and inserting ‘‘; or’’; and 

8 (3) by adding at the end the following: 

9 ‘‘(8) the authority of the Secretary to carry out 

10 amendments to sections 272 and 278 made by the 

11 Agriculture Reform, Food, and Jobs Act of 2012.’’. 

12 SEC. 1610. TECHNICAL CORRECTIONS. 

13 (a) Section 359f(c)(1)(B) of the Agricultural Adjust14 ment Act of 1938 (7 U.S.C. 1359ff(c)(1)(B)) is amended 

15 by adding a period at the end. 

16 (b)(1) Section 1603(g) of the Food, Conservation, 

17 and Energy Act of 2008 (Public Law 110–246; 122 Stat. 

18 1739) is amended in paragraphs (2) through (6) and the 

19 amendments made by those paragraphs by striking 

20 ‘‘1703(a)’’ each place it appears and inserting ‘‘1603(a)’’. 

21 (2) This subsection and the amendments made by 

22 this subsection take effect as if included in the Food, Con23 servation, and Energy Act of 2008 (Public Law 110–246; 

24 122 Stat. 1651). 


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1 SEC. 1611. ASSIGNMENT OF PAYMENTS. 

2 (a) IN GENERAL.—The provisions of section 8(g) of 

3 the Soil Conservation and Domestic Allotment Act (16 

4 U.S.C. 590h(g)), relating to assignment of payments, shall 

5 apply to payments made under this title. 

6 (b) NOTICE.—The producer making the assignment, 

7 or the assignee, shall provide the Secretary with notice, 

8 in such manner as the Secretary may require, of any as9 signment made under this section. 

10 SEC. 1612. TRACKING OF BENEFITS. 

11 As soon as practicable after the date of enactment 

12 of this Act, the Secretary may track the benefits provided, 

13 directly or indirectly, to individuals and entities under ti14 tles I and II and the amendments made by those titles. 

15 SEC. 1613. SIGNATURE AUTHORITY. 

16 (a) IN GENERAL.—In carrying out this title and title 

17 II and amendments made by those titles, if the Secretary 

18 approves a document, the Secretary shall not subsequently 

19 determine the document is inadequate or invalid because 

20 of the lack of authority of any person signing the docu21 ment on behalf of the applicant or any other individual, 

22 entity, general partnership, or joint venture, or the docu23 ments relied upon were determined inadequate or invalid, 

24 unless the person signing the program document know25 ingly and willfully falsified the evidence of signature au26 thority or a signature. 


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1 (b) AFFIRMATION.— 

2 (1) IN GENERAL.—Nothing in this section pro3 hibits the Secretary from asking a proper party to 

4 affirm any document that otherwise would be consid5 ered approved under subsection (a). 

6 (2) NO RETROACTIVE EFFECT.—A denial of 

7 benefits based on a lack of affirmation under para8 graph (1) shall not be retroactive with respect to 

9 third-party producers who were not the subject of 

10 the erroneous representation of authority, if the 

11 third-party producers— 

12 (A) relied on the prior approval by the Sec13 retary of the documents in good faith; and 

14 (B) substantively complied with all pro15 gram requirements. 

16 SEC. 1614. IMPLEMENTATION. 

17 (a) STREAMLINING.—In implementing this title, the 

18 Secretary shall, to the maximum extent practicable— 

19 (1) seek to reduce administrative burdens and 

20 costs to producers by streamlining and reducing pa21 perwork, forms, and other administrative require22 ments; 

23 (2) improve coordination, information sharing, 

24 and administrative work with the Risk Management 


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1 Agency and the Natural Resources Conservation 

2 Service; and 

3 (3) take advantage of new technologies to en4 hance efficiency and effectiveness of program deliv5 ery to producers. 

6 (b) IMPLEMENTATION.—The Secretary shall make 

7 available to the Farm Service Agency to carry out this 

8 title $100,000,000. 

9 TITLE II—CONSERVATION 

10 Subtitle A—Conservation Reserve 

11 Program 

12 SEC. 2001. EXTENSION AND ENROLLMENT REQUIREMENTS 

13 OF CONSERVATION RESERVE PROGRAM. 

14 (a) EXTENSION.—Section 1231(a) of the Food Secu15 rity Act of 1985 (16 U.S.C. 3831(a)) is amended by strik16 ing ‘‘2012’’ and inserting ‘‘2017’’. 

17 (b) ELIGIBLE LAND.—Section 1231(b) of the Food 

18 Security Act of 1985 (16 U.S.C. 3831(b)) is amended— 

19 (1) in paragraph (1)(B), by striking ‘‘the date 

20 of enactment of the Food, Conservation, and Energy 

21 Act of 2008’’ and inserting ‘‘the date of enactment 

22 of the Agriculture Reform, Food, and Jobs Act of 

23 2012’’; 

24 (2) by striking paragraph (2) and redesignating 

25 paragraph (3) as paragraph (2); 


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1 (3) by inserting before paragraph (4) the fol2 lowing: 

3 ‘‘(3) grassland that— 

4 ‘‘(A) contains forbs or shrubland (includ5 ing improved rangeland and pastureland) for 

6 which grazing is the predominant use; 

7 ‘‘(B) is located in an area historically 

8 dominated by grassland; and 

9 ‘‘(C) could provide habitat for animal and 

10 plant populations of significant ecological value 

11 if the land is retained in its current use or re12 stored to a natural condition;’’; 

13 (4) in paragraph (4)(C), by striking 

14 ‘‘filterstrips devoted to trees or shrubs’’ and insert15 ing ‘‘filterstrips and riparian buffers devoted to 

16 trees, shrubs, or grasses’’; and 

17 (5) by striking paragraph (5) and inserting the 

18 following: 

19 ‘‘(5) the portion of land in a field not enrolled 

20 in the conservation reserve in a case in which— 

21 ‘‘(A) more than 50 percent of the land in 

22 the field is enrolled as a buffer or filterstrip or 

23 more than 75 percent of the land in the field 

24 is enrolled in a practice other than as a buffer 

25 or filterstrip; and 


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1 ‘‘(B) the remainder of the field is— 

2 ‘‘(i) infeasible to farm; and 

3 ‘‘(ii) enrolled at regular rental rates.’’. 

4 (c) PLANTING STATUS OF CERTAIN LAND.—Section 

5 1231(c) of the Food Security Act of 1985 (16 U.S.C. 

6 3831(c)) is amended by striking ‘‘if’’ and all that follows 

7 through the period at the end and inserting ‘‘if, during 

8 the crop year, the land was devoted to a conserving use.’’. 

9 (d) ENROLLMENT.—Section 1231 of the Food Secu10 rity Act of 1985 (16 U.S.C. 3831) is amended by striking 

11 subsection (d) and inserting the following: 

12 ‘‘(d) ENROLLMENT.— 

13 ‘‘(1) MAXIMUM ACREAGE ENROLLED.—The 

14 Secretary may maintain in the conservation reserve 

15 at any 1 time during— 

16 ‘‘(A) fiscal year 2012, no more than 

17 32,000,000 acres; 

18 ‘‘(B) fiscal year 2013, no more than 

19 30,000,000 acres; 

20 ‘‘(C) fiscal year 2014, no more than 

21 27,500,000 acres; 

22 ‘‘(D) fiscal year 2015, no more than 

23 26,500,000 acres; 

24 ‘‘(E) fiscal year 2016, no more than 

25 25,500,000 acres; and 


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1 ‘‘(F) fiscal year 2017, no more than 

2 25,000,000 acres. 

3 ‘‘(2) GRASSLAND.— 

4 ‘‘(A) LIMITATION.—For purposes of apply5 ing the limitations in paragraph (1), no more 

6 than 1,500,000 acres of the land described in 

7 subsection (b)(3) may be enrolled in the pro8 gram at any 1 time during the 2013 through 

9 2017 fiscal years. 

10 ‘‘(B) PRIORITY.—In enrolling acres under 

11 subparagraph (A), the Secretary may give pri12 ority to land with expiring conservation reserve 

13 program contracts. 

14 ‘‘(C) METHOD OF ENROLLMENT.—In en15 rolling acres under subparagraph (A), the Sec16 retary shall make the program available to own17 ers or operators of eligible land at least once 

18 during each fiscal year.’’. 

19 (e) DURATION OF CONTRACT.—Section 1231(e) of 

20 the Food Security Act of 1985 (16 U.S.C. 3831(e)) is 

21 amended by striking paragraphs (2) and (3) and inserting 

22 the following: 

23 ‘‘(2) SPECIAL RULE FOR CERTAIN LAND.—In 

24 the case of land devoted to hardwood trees, 

25 shelterbelts, windbreaks, or wildlife corridors under 


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1 a contract entered into under this subchapter, the 

2 owner or operator of the land may, within the limita3 tions prescribed under this section, specify the dura4 tion of the contract.’’. 

5 (f) CONSERVATION PRIORITY AREAS.—Section 

6 1231(f) of the Food Security Act of 1985 (16 U.S.C. 

7 3831(f)) is amended— 

8 (1) in paragraph (1), by striking ‘‘watershed 

9 areas of the Chesapeake Bay Region, the Great 

10 Lakes Region, the Long Island Sound Region, and 

11 other’’; 

12 (2) in paragraph (2), by striking ‘‘WATER13 SHEDS.—Watersheds’’ and inserting ‘‘AREAS.— 

14 Areas’’; and 

15 (3) in paragraph (3), by striking ‘‘a watershed’s 

16 designation—’’ and all that follows through the pe17 riod at the end and inserting ‘‘an area’s designation 

18 if the Secretary finds that the area no longer con19 tains actual and significant adverse water quality or 

20 habitat impacts related to agricultural production 

21 activities.’’. 

22 SEC. 2002. FARMABLE WETLAND PROGRAM. 

23 (a) EXTENSION.—Section 1231B(a)(1) of the Food 

24 Security Act of 1985 (16 U.S.C. 3831b(a)(1)) is amend25 ed— 


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1 (1) by striking ‘‘2012’’ and inserting ‘‘2017’’; 

2 and 

3 (2) by striking ‘‘a program’’ and inserting ‘‘a 

4 farmable wetland program’’. 

5 (b) ELIGIBLE ACREAGE.—Section 1231B(b)(1)(B) of 

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

7 3831b(b)(1)(B)) is amended by striking ‘‘flow from a row 

8 crop agriculture drainage system’’ and inserting ‘‘surface 

9 and subsurface flow from row crop agricultural produc10 tion’’. 

11 (c) CLERICAL AMENDMENTS.—Section 1231B of the 

12 Food Security Act of 1985 (16 U.S.C. 3831b) is amend13 ed— 

14 (1) by striking the heading and inserting the 

15 following: 

16 ‘‘SEC. 1231B. FARMABLE WETLAND PROGRAM.’’; 

17 and 

18 (2) in subsection (f)(2), by striking ‘‘section 

19 1234(c)(2)(B)’’ and inserting ‘‘section 

20 1234(c)(2)(A)(ii)’’. 

21 SEC. 2003. DUTIES OF OWNERS AND OPERATORS. 

22 (a) LIMITATION ON HARVESTING, GRAZING OR COM23 MERCIAL USE OF FORAGE.—Section 1232(a)(8) of the 

24 Food Security Act of 1985 (16 U.S.C. 3832(a)(8)) is 

25 amended by striking ‘‘except that’’ and all that follows 


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1 through the semicolon at the end of the paragraph and 

2 inserting ‘‘except as provided in section 1233(b);’’. 

3 (b) CONSERVATION PLAN REQUIREMENTS.—Section 

4 1232 of the Food Security Act of 1985 (16 U.S.C. 3832) 

5 is amended by striking subsection (b) and inserting the 

6 following: 

7 ‘‘(b) CONSERVATION PLANS.—The plan referred to 

8 in subsection (a)(1) shall set forth— 

9 ‘‘(1) the conservation measures and practices to 

10 be carried out by the owner or operator during the 

11 term of the contract; and 

12 ‘‘(2) the commercial use, if any, to be permitted 

13 on the land during the term.’’. 

14 (c) RENTAL PAYMENT REDUCTION.—Section 1232 

15 of the Food Security Act of 1985 (16 U.S.C. 3832) is 

16 amended by striking subsection (d). 

17 SEC. 2004. DUTIES OF THE SECRETARY. 

18 Section 1233 of the Food Security Act of 1985 (16 

19 U.S.C. 3833) is amended to read as follows: 

20 ‘‘SEC. 1233. DUTIES OF THE SECRETARY. 

21 ‘‘(a) COST-SHARE AND RENTAL PAYMENTS.—In re22 turn for a contract entered into by an owner or operator, 

23 the Secretary shall— 

24 ‘‘(1) share the cost of carrying out the con25 servation measures and practices set forth in the 


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1 contract for which the Secretary determines that 

2 cost sharing is appropriate and in the public inter3 est; and 

4 ‘‘(2) for a period of years not in excess of the 

5 term of the contract, pay an annual rental payment 

6 in an amount necessary to compensate for— 

7 ‘‘(A) the conversion of highly erodible crop8 land or other eligible land normally devoted to 

9 the production of an agricultural commodity on 

10 a farm or ranch to a less intensive use; 

11 ‘‘(B) the retirement of any cropland base 

12 and allotment history that the owner or oper13 ator agrees to retire permanently; and 

14 ‘‘(C) the development and management of 

15 grassland for multiple natural resource con16 servation benefits, including soil, water, air, and 

17 wildlife. 

18 ‘‘(b) SPECIFIED ACTIVITIES PERMITTED.—The Sec19 retary shall permit certain activities or commercial uses 

20 of land that is subject to the contract if those activities 

21 or uses are consistent with a plan approved by the Sec22 retary and include— 

23 ‘‘(1) harvesting, grazing, or other commercial 

24 use of the forage in response to drought, flooding, 


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1 or other emergency without any reduction in the 

2 rental rate; 

3 ‘‘(2) grazing by livestock of a beginning farmer 

4 or rancher without any reduction in the rental rate, 

5 if the grazing is— 

6 ‘‘(A) consistent with the conservation of 

7 soil, water quality, and wildlife habitat (includ8 ing habitat during the primary nesting season 

9 for critical birds in the area); and 

10 ‘‘(B) described in subparagraph (B) or (C) 

11 of paragraph (3); 

12 ‘‘(3) consistent with the conservation of soil, 

13 water quality, and wildlife habitat (including habitat 

14 during the primary nesting season for critical birds 

15 in the area) and in exchange for a reduction of not 

16 less than 25 percent in the annual rental rate for 

17 the acres covered by the authorized activity— 

18 ‘‘(A) managed harvesting and other com19 mercial use (including the managed harvesting 

20 of biomass), except that in permitting those ac21 tivities the Secretary, in coordination with the 

22 State technical committee— 

23 ‘‘(i) shall develop appropriate vegeta24 tion management requirements; and 


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1 ‘‘(ii) shall identify periods during 

2 which the activities may be conducted, 

3 such that the frequency is at least once 

4 every 5 years but not more than once every 

5 3 years; 

6 ‘‘(B) prescribed grazing for the control of 

7 invasive species, which may be conducted annu8 ally; 

9 ‘‘(C) routine grazing, except that in per10 mitting routine grazing, the Secretary, in co11 ordination with the State technical committee— 

12 ‘‘(i) shall develop appropriate vegeta13 tion management requirements and stock14 ing rates for the land that are suitable for 

15 continued routine grazing; and 

16 ‘‘(ii) shall identify the periods during 

17 which routine grazing may be conducted, 

18 such that the frequency is not more than 

19 once every 2 years, taking into consider20 ation regional differences such as— 

21 ‘‘(I) climate, soil type, and nat22 ural resources; 

23 ‘‘(II) the number of years that 

24 should be required between routine 

25 grazing activities; and 


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1 ‘‘(III) how often during a year in 

2 which routine grazing is permitted 

3 that routine grazing should be allowed 

4 to occur; and 

5 ‘‘(D) the installation of wind turbines and 

6 associated access, except that in permitting the 

7 installation of wind turbines, the Secretary shall 

8 determine the number and location of wind tur9 bines that may be installed, taking into ac10 count— 

11 ‘‘(i) the location, size, and other phys12 ical characteristics of the land; 

13 ‘‘(ii) the extent to which the land con14 tains threatened or endangered wildlife and 

15 wildlife habitat; and 

16 ‘‘(iii) the purposes of the conservation 

17 reserve program under this subchapter; 

18 and 

19 ‘‘(4) the intermittent and seasonal use of vege20 tative buffer practices incidental to agricultural pro21 duction on land adjacent to the buffer such that the 

22 permitted use does not destroy the permanent vege23 tative cover. 

24 ‘‘(c) AUTHORIZED ACTIVITIES ON GRASSLAND.— 

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1 scribed in section 1231(b)(3), the Secretary shall permit 

2 the following activities: 

3 ‘‘(1) Common grazing practices, including 

4 maintenance and necessary cultural practices, on the 

5 land in a manner that is consistent with maintaining 

6 the viability of grassland, forb, and shrub species ap7 propriate to that locality. 

8 ‘‘(2) Haying, mowing, or harvesting for seed 

9 production, subject to appropriate restrictions dur10 ing the primary nesting season for critical birds in 

11 the area. 

12 ‘‘(3) Fire presuppression, rehabilitation, and 

13 construction of fire breaks. 

14 ‘‘(4) Grazing-related activities, such as fencing 

15 and livestock watering. 

16 ‘‘(d) RESOURCE CONSERVING USE.— 

17 ‘‘(1) IN GENERAL.—Beginning on the date that 

18 is 1 year before the date of termination of a contract 

19 under the program, the Secretary shall allow an 

20 owner or operator to make conservation and land 

21 improvements that facilitate maintaining protection 

22 of highly erodible land after expiration of the con23 tract. 

24 ‘‘(2) CONSERVATION PLAN.—The Secretary 

25 shall require an owner or operator carrying out the 


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1 activities described in paragraph (1) to develop and 

2 implement a conservation plan. 

3 ‘‘(3) REENROLLMENT PROHIBITED.—Land al4 tered under paragraph (1) may not be reenrolled in 

5 the conservation reserve program for 5 years. 

6 ‘‘(4) PAYMENT.—The Secretary shall provide 

7 an annual payment that is reduced in an amount 

8 commensurate with any income or other compensa9 tion received as a result of the activities carried out 

10 under paragraph (1).’’. 

11 SEC. 2005. PAYMENTS. 

12 (a) TREES, WINDBREAKS, SHELTERBELTS, AND

13 WILDLIFE CORRIDORS.—Section 1234(b)(3)(A) of the 

14 Food Security Act of 1985 (16 U.S.C. 3834(b)(3)(A)) is 

15 amended— 

16 (1) in clause (i), by inserting ‘‘and’’ after the 

17 semicolon; 

18 (2) by striking clause (ii); and 

19 (3) by redesignating clause (iii) as clause (ii). 

20 (b) INCENTIVES.—Section 1234(b)(3)(B) of the Food 

21 Security Act of 1985 (16 U.S.C. 3834(b)(3)(B)) is amend22 ed— 

23 (1) in clause (i), by inserting ‘‘, practices to im24 prove the condition of resources on the land,’’ after 

25 ‘‘operator)’’; and 


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

2 ‘‘(iii) INCENTIVES.—In making rental 

3 payments to an owner or operator of land 

4 described in subparagraph (A), the Sec5 retary may provide incentive payments suf6 ficient to encourage proper thinning and 

7 practices to improve the condition of re8 sources on the land.’’. 

9 (c) ANNUAL RENTAL PAYMENTS.—Section 1234(c) 

10 of the Food Security Act of 1985 (16 U.S.C. 3834(c)) is 

11 amended— 

12 (1) in paragraph (1), by inserting ‘‘and other 

13 eligible land’’ after ‘‘highly erodible cropland’’ both 

14 places it appears; 

15 (2) by striking paragraph (2) and inserting the 

16 following: 

17 ‘‘(2) METHODS OF DETERMINATION.— 

18 ‘‘(A) IN GENERAL.—The amounts payable 

19 to owners or operators in the form of rental 

20 payments under contracts entered into under 

21 this subchapter may be determined through— 

22 ‘‘(i) the submission of bids for such 

23 contracts by owners and operators in such 

24 manner as the Secretary may prescribe; or 


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1 ‘‘(ii) such other means as the Sec2 retary determines are appropriate. 

3 ‘‘(B) GRASSLAND.—In the case of eligible 

4 land described in section 1231(b)(3), the Sec5 retary shall make annual payments in an 

6 amount that is not more than 75 percent of the 

7 grazing value of the land covered by the con8 tract.’’; and 

9 (3) in paragraph (5)(A)— 

10 (A) by striking ‘‘The Secretary’’ and in11 serting the following: 

12 ‘‘(i) SURVEY.—The Secretary’’; and 

13 (B) by adding at the end the following: 

14 ‘‘(ii) USE.—The Secretary may use 

15 the survey of dryland cash rental rates de16 scribed in clause (i) as a factor in deter17 mining rental rates under this section as 

18 the Secretary determines appropriate.’’. 

19 (d) PAYMENT SCHEDULE.—Section 1234 of the Food 

20 Security Act of 1985 (16 U.S.C. 3834) is amended by 

21 striking subsection (d) and inserting the following: 

22 ‘‘(d) PAYMENT SCHEDULE.— 

23 ‘‘(1) IN GENERAL.—Except as otherwise pro24 vided in this section, payments under this sub25 chapter shall be made in cash in such amount and 


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1 on such time schedule as is agreed on and specified 

2 in the contract. 

3 ‘‘(2) SOURCE.—Payments under this sub4 chapter shall be made using the funds of the Com5 modity Credit Corporation. 

6 ‘‘(3) ADVANCE PAYMENT.—Payments under 

7 this subchapter may be made in advance of deter8 mination of performance.’’. 

9 (e) PAYMENT LIMITATION.—Section 1234(f) of the 

10 Food Security Act of 1985 (16 U.S.C. 3834(f)) is amend11 ed— 

12 (1) in paragraph (1), by striking ‘‘, including 

13 rental payments made in the form of in-kind com14 modities,’’; 

15 (2) by striking paragraph (3); and 

16 (3) by redesignating paragraph (4) as para17 graph (2). 

18 SEC. 2006. CONTRACT REQUIREMENTS. 

19 Section 1235(f) of the Food Security Act of 1985 (16 

20 U.S.C. 3835(f)) is amended— 

21 (1) in paragraph (1)— 

22 (A) in the matter preceding subparagraph 

23 (A), by striking ‘‘DUTIES’’ and all that follows 

24 through ‘‘a beginning farmer’’ and inserting 

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1 ER.—In the case of a contract modification ap2 proved in order to facilitate the transfer of land 

3 subject to a contract from a retired farmer or 

4 rancher to a beginning farmer’’; 

5 (B) in subparagraph (D), by striking ‘‘the 

6 farmer or rancher’’ and inserting ‘‘the covered 

7 farmer or rancher’’; and 

8 (C) in subparagraph (E), by striking ‘‘sec9 tion 1001A(b)(3)(B)’’ and inserting ‘‘section 

10 1001’’; and 

11 (2) in paragraph (2), by striking ‘‘requirement 

12 of section 1231(h)(4)(B)’’ and inserting ‘‘option pro13 vided under section 1234(c)(2)(A)(ii)’’. 

14 SEC. 2007. CONVERSION OF LAND SUBJECT TO CONTRACT 

15 TO OTHER CONSERVING USES. 

16 Section 1235A of the Food Security Act of 1985 (16 

17 U.S.C. 3835a) is repealed. 

18 SEC. 2008. EFFECTIVE DATE. 

19 (a) IN GENERAL.—The amendments made by this 

20 title shall take effect on October 1, 2012, except, the 

21 amendment made by section 2001(d), which shall take ef22 fect on the date of enactment of this Act. 

23 (b) EFFECT ON EXISTING CONTRACTS.— 

24 (1) IN GENERAL.—Except as provided in para25 graph (2), the amendments made by this title shall 


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1 not affect the validity or terms of any contract en2 tered into by the Secretary of Agriculture under sub3 chapter B of chapter 1 of subtitle D of title XII of 

4 the Food Security Act of 1985 (16 U.S.C. 3831 et 

5 seq.) before October 1, 2012, or any payments re6 quired to be made in connection with the contract. 

7 (2) UPDATING OF EXISTING CONTRACTS.—The 

8 Secretary shall permit an owner or operator with a 

9 contract entered into under subchapter B of chapter 

10 1 of subtitle D of title XII of the Food Security Act 

11 of 1985 (16 U.S.C. 3831 et seq.) before October 1, 

12 2012, to update the contract to reflect the activities 

13 and uses of land under contract permitted under the 

14 terms and conditions of paragraphs (1) and (2) of 

15 section 1233(b) of that Act (as amended by section 

16 2004). 

17 Subtitle B—Conservation 

18 Stewardship Program 

19 SEC. 2101. CONSERVATION STEWARDSHIP PROGRAM. 

20 (a) REVISION OF CURRENT PROGRAM.—Subchapter 

21 B of chapter 2 of subtitle D of title XII of the Food Secu22 rity Act of 1985 (16 U.S.C. 3838d et seq.) is amended 

23 to read as follows: 


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1 ‘‘Subchapter B—Conservation Stewardship 

2 Program 

3 ‘‘SEC. 1238D. DEFINITIONS. 

4 ‘‘In this subchapter: 

5 ‘‘(1) AGRICULTURAL OPERATION.—The term 

6 ‘agricultural operation’ means all eligible land, 

7 whether or not contiguous, that is— 

8 ‘‘(A) under the effective control of a pro9 ducer at the time the producer enters into a 

10 contract under the program; and 

11 ‘‘(B) operated with equipment, labor, man12 agement, and production or cultivation prac13 tices that are substantially separate from other 

14 agricultural operations, as determined by the 

15 Secretary. 

16 ‘‘(2) CONSERVATION ACTIVITIES.— 

17 ‘‘(A) IN GENERAL.—The term ‘conserva18 tion activities’ means conservation systems, 

19 practices, or management measures. 

20 ‘‘(B) INCLUSIONS.—The term ‘conserva21 tion activities’ includes— 

22 ‘‘(i) structural measures, vegetative 

23 measures, and land management measures, 

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1 ment systems, as determined by the Sec2 retary; and 

3 ‘‘(ii) planning needed to address a pri4 ority resource concern. 

5 ‘‘(3) CONSERVATION STEWARDSHIP PLAN.— 

6 The term ‘conservation stewardship plan’ means a 

7 plan that— 

8 ‘‘(A) identifies and inventories priority re9 source concerns; 

10 ‘‘(B) establishes benchmark data and con11 servation objectives; 

12 ‘‘(C) describes conservation activities to be 

13 implemented, managed, or improved; and 

14 ‘‘(D) includes a schedule and evaluation 

15 plan for the planning, installation, and manage16 ment of the new and existing conservation ac17 tivities. 

18 ‘‘(4) ELIGIBLE LAND.— 

19 ‘‘(A) IN GENERAL.—The term ‘eligible 

20 land’ means— 

21 ‘‘(i) private and tribal land on which 

22 agricultural commodities, livestock, or for23 est-related products are produced; and 

24 ‘‘(ii) land associated with the land de25 scribed in clause (i) on which priority reVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00174 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 source concerns could be addressed 

2 through a contract under the program. 

3 ‘‘(B) INCLUSIONS.—The term ‘eligible 

4 land’ includes— 

5 ‘‘(i) cropland; 

6 ‘‘(ii) grassland; 

7 ‘‘(iii) rangeland; 

8 ‘‘(iv) pastureland; 

9 ‘‘(v) nonindustrial private forest land; 

10 and 

11 ‘‘(vi) other agricultural land (includ12 ing cropped woodland, marshes, and agri13 cultural land used for the production of 

14 livestock), as determined by the Secretary. 

15 ‘‘(5) PRIORITY RESOURCE CONCERN.—The 

16 term ‘priority resource concern’ means a natural re17 source concern or problem, as determined by the 

18 Secretary, that— 

19 ‘‘(A) is identified at the national, State or 

20 local level, as a priority for a particular area of 

21 the State; 

22 ‘‘(B) represents a significant concern in a 

23 State or region; and 


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1 ‘‘(C) is likely to be addressed successfully 

2 through the implementation of conservation ac3 tivities under this program. 

4 ‘‘(6) PROGRAM.—The term ‘program’ means 

5 the conservation stewardship program established by 

6 this subchapter. 

7 ‘‘(7) STEWARDSHIP THRESHOLD.—The term 

8 ‘stewardship threshold’ means the level of manage9 ment required, as determined by the Secretary, to 

10 conserve and improve the quality and condition of a 

11 natural resource. 

12 ‘‘SEC. 1238E. CONSERVATION STEWARDSHIP PROGRAM. 

13 ‘‘(a) ESTABLISHMENT AND PURPOSE.—During each 

14 of fiscal years 2013 through 2017, the Secretary shall 

15 carry out a conservation stewardship program to encour16 age producers to address priority resource concerns and 

17 improve and conserve the quality and condition of natural 

18 resources in a comprehensive manner— 

19 ‘‘(1) by undertaking additional conservation ac20 tivities; and 

21 ‘‘(2) by improving, maintaining, and managing 

22 existing conservation activities. 

23 ‘‘(b) EXCLUSIONS.— 

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1 lowing land (even if covered by the definition of eli2 gible land) is not eligible for enrollment in the pro3 gram: 

4 ‘‘(A) Land enrolled in the conservation re5 serve program. 

6 ‘‘(B) Land enrolled in the Agricultural 

7 Conservation Easement Program in a wetland 

8 easement. 

9 ‘‘(C) Land enrolled in the conservation se10 curity program. 

11 ‘‘(2) CONVERSION TO CROPLAND.—Eligible 

12 land used for crop production after October 1, 2012, 

13 that had not been planted, considered to be planted, 

14 or devoted to crop production for at least 4 of the 

15 6 years preceding that date shall not be the basis for 

16 any payment under the program, unless the land 

17 does not meet the requirement because— 

18 ‘‘(A) the land had previously been enrolled 

19 in the conservation reserve program; 

20 ‘‘(B) the land has been maintained using 

21 long-term crop rotation practices, as determined 

22 by the Secretary; or 

23 ‘‘(C) the land is incidental land needed for 

24 efficient operation of the farm or ranch, as de25 termined by the Secretary. 


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1 ‘‘SEC. 1238F. STEWARDSHIP CONTRACTS. 

2 ‘‘(a) SUBMISSION OF CONTRACT OFFERS.—To be eli3 gible to participate in the conservation stewardship pro4 gram, a producer shall submit a contract offer for the ag5 ricultural operation that— 

6 ‘‘(1) demonstrates to the satisfaction of the 

7 Secretary that the producer, at the time of the con8 tract offer, is meeting the stewardship threshold for 

9 at least 2 priority resource concerns; and 

10 ‘‘(2) would, at a minimum, meet or exceed the 

11 stewardship threshold for at least 1 additional pri12 ority resource concern by the end of the stewardship 

13 contract by— 

14 ‘‘(A) installing and adopting additional 

15 conservation activities; and 

16 ‘‘(B) improving, maintaining, and man17 aging existing conservation activities on the ag18 ricultural operation in a manner that increases 

19 or extends the conservation benefits in place at 

20 the time the contract offer is accepted by the 

21 Secretary. 

22 ‘‘(b) EVALUATION OF CONTRACT OFFERS.— 

23 ‘‘(1) RANKING OF APPLICATIONS.—In evalu24 ating contract offers the Secretary shall rank appli25 cations based on— 


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1 ‘‘(A) the level of conservation treatment on 

2 all applicable priority resource concerns at the 

3 time of application; 

4 ‘‘(B) the degree to which the proposed con5 servation activities effectively increase conserva6 tion performance; 

7 ‘‘(C) the number of applicable priority re8 source concerns proposed to be treated to meet 

9 or exceed the stewardship threshold by the end 

10 of the contract; 

11 ‘‘(D) the extent to which other priority re12 source concerns will be addressed to meet or ex13 ceed the stewardship threshold by the end of 

14 the contract period; 

15 ‘‘(E) the extent to which the actual and 

16 anticipated conservation benefits from the con17 tract are provided at the least cost relative to 

18 other similarly beneficial contract offers; and 

19 ‘‘(F) the extent to which priority resource 

20 concerns will be addressed when transitioning 

21 from the conservation reserve program to agri22 cultural production. 

23 ‘‘(2) PROHIBITION.—The Secretary may not as24 sign a higher priority to any application because the 


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1 applicant is willing to accept a lower payment than 

2 the applicant would otherwise be eligible to receive. 

3 ‘‘(3) ADDITIONAL CRITERIA.—The Secretary 

4 may develop and use such additional criteria that 

5 the Secretary determines are necessary to ensure 

6 that national, State, and local priority resource con7 cerns are effectively addressed. 

8 ‘‘(c) ENTERING INTO CONTRACTS.—After a deter9 mination that a producer is eligible for the program under 

10 subsection (a), and a determination that the contract offer 

11 ranks sufficiently high under the evaluation criteria under 

12 subsection (b), the Secretary shall enter into a conserva13 tion stewardship contract with the producer to enroll the 

14 eligible land to be covered by the contract. 

15 ‘‘(d) CONTRACT PROVISIONS.— 

16 ‘‘(1) TERM.—A conservation stewardship con17 tract shall be for a term of 5 years. 

18 ‘‘(2) REQUIRED PROVISIONS.—The conservation 

19 stewardship contract of a producer shall— 

20 ‘‘(A) state the amount of the payment the 

21 Secretary agrees to make to the producer for 

22 each year of the conservation stewardship con23 tract under section 1238G(d); 

24 ‘‘(B) require the producer— 


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1 ‘‘(i) to implement a conservation stew2 ardship plan that describes the program 

3 purposes to be achieved through 1 or more 

4 conservation activities; 

5 ‘‘(ii) to maintain and supply informa6 tion as required by the Secretary to deter7 mine compliance with the conservation 

8 stewardship plan and any other require9 ments of the program; and 

10 ‘‘(iii) not to conduct any activities on 

11 the agricultural operation that would tend 

12 to defeat the purposes of the program; 

13 ‘‘(C) permit all economic uses of the eligi14 ble land that— 

15 ‘‘(i) maintain the agricultural nature 

16 of the land; and 

17 ‘‘(ii) are consistent with the conserva18 tion purposes of the conservation steward19 ship contract; 

20 ‘‘(D) include a provision to ensure that a 

21 producer shall not be considered in violation of 

22 the contract for failure to comply with the con23 tract due to circumstances beyond the control 

24 of the producer, including a disaster or related 

25 condition, as determined by the Secretary; 


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1 ‘‘(E) include provisions where upon the 

2 violation of a term or condition of the contract 

3 at any time the producer has control of the 

4 land— 

5 ‘‘(i) if the Secretary determines that 

6 the violation warrants termination of the 

7 contract— 

8 ‘‘(I) to forfeit all rights to receive 

9 payments under the contract; and 

10 ‘‘(II) to refund all or a portion of 

11 the payments received by the producer 

12 under the contract, including any in13 terest on the payments, as determined 

14 by the Secretary; or 

15 ‘‘(ii) if the Secretary determines that 

16 the violation does not warrant termination 

17 of the contract, to refund or accept adjust18 ments to the payments provided to the pro19 ducer, as the Secretary determines to be 

20 appropriate; 

21 ‘‘(F) include provisions in accordance with 

22 paragraphs (3) and (4) of this section; and 

23 ‘‘(G) include any additional provisions the 

24 Secretary determines are necessary to carry out 

25 the program. 


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1 ‘‘(3) CHANGE OF INTEREST IN LAND SUBJECT

2 TO A CONTRACT.— 

3 ‘‘(A) IN GENERAL.—At the time of appli4 cation, a producer shall have control of the eli5 gible land to be enrolled in the program. Except 

6 as provided in subparagraph (B), a change in 

7 the interest of a producer in eligible land cov8 ered by a contract under the program shall re9 sult in the termination of the contract with re10 gard to that land. 

11 ‘‘(B) TRANSFER OF DUTIES AND

12 RIGHTS.—Subparagraph (A) shall not apply 

13 if— 

14 ‘‘(i) within a reasonable period of time 

15 (as determined by the Secretary) after the 

16 date of the change in the interest in all or 

17 a portion of the land covered by a contract 

18 under the program, the transferee of the 

19 land provides written notice to the Sec20 retary that duties and rights under the 

21 contract have been transferred to, and as22 sumed by, the transferee for the portion of 

23 the land transferred; 

24 ‘‘(ii) the transferee meets the eligi25 bility requirements of the program; and 


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1 ‘‘(iii) the Secretary approves the 

2 transfer of all duties and rights under the 

3 contract. 

4 ‘‘(4) MODIFICATION AND TERMINATION OF

5 CONTRACTS.— 

6 ‘‘(A) VOLUNTARY MODIFICATION OR TER7 MINATION.—The Secretary may modify or ter8 minate a contract with a producer if— 

9 ‘‘(i) the producer agrees to the modi10 fication or termination; and 

11 ‘‘(ii) the Secretary determines that 

12 the modification or termination is in the 

13 public interest. 

14 ‘‘(B) INVOLUNTARY TERMINATION.—The 

15 Secretary may terminate a contract if the Sec16 retary determines that the producer violated the 

17 contract. 

18 ‘‘(5) REPAYMENT.—If a contract is terminated, 

19 the Secretary may, consistent with the purposes of 

20 the program— 

21 ‘‘(A) allow the producer to retain payments 

22 already received under the contract; or 

23 ‘‘(B) require repayment, in whole or in 

24 part, of payments received and assess liquidated 

25 damages. 


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1 ‘‘(e) CONTRACT RENEWAL.—At the end of the initial 

2 5-year contract period, the Secretary may allow the pro3 ducer to renew the contract for 1 additional 5-year period 

4 if the producer— 

5 ‘‘(1) demonstrates compliance with the terms of 

6 the existing contract; 

7 ‘‘(2) agrees to adopt and continue to integrate 

8 conservation activities across the entire agricultural 

9 operation as determined by the Secretary; and 

10 ‘‘(3) agrees, at a minimum, to meet or exceed 

11 the stewardship threshold for at least 2 additional 

12 priority resource concerns on the agricultural oper13 ation by the end of the contract period. 

14 ‘‘SEC. 1238G. DUTIES OF THE SECRETARY. 

15 ‘‘(a) IN GENERAL.—To achieve the conservation 

16 goals of a contract under the conservation stewardship 

17 program, the Secretary shall— 

18 ‘‘(1) make the program available to eligible pro19 ducers on a continuous enrollment basis with 1 or 

20 more ranking periods, 1 of which shall occur in the 

21 first quarter of each fiscal year; 

22 ‘‘(2) identify not less than 5 priority resource 

23 concerns in a particular watershed or other appro24 priate region or area within a State; and 


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1 ‘‘(3) establish a science-based stewardship 

2 threshold for each priority resource concern identi3 fied under subparagraph (2). 

4 ‘‘(b) ALLOCATION TO STATES.—The Secretary shall 

5 allocate acres to States for enrollment, based— 

6 ‘‘(1) primarily on each State’s proportion of eli7 gible land to the total acreage of eligible land in all 

8 States; and 

9 ‘‘(2) also on consideration of— 

10 ‘‘(A) the extent and magnitude of the con11 servation needs associated with agricultural 

12 production in each State; 

13 ‘‘(B) the degree to which implementation 

14 of the program in the State is, or will be, effec15 tive in helping producers address those needs; 

16 and 

17 ‘‘(C) other considerations to achieve equi18 table geographic distribution of funds, as deter19 mined by the Secretary. 

20 ‘‘(c) ACREAGE ENROLLMENT LIMITATION.—During 

21 the period beginning on October 1, 2012, and ending on 

22 September 30, 2021, the Secretary shall, to the maximum 

23 extent practicable— 

24 ‘‘(1) enroll in the program an additional 

25 10,348,000 acres for each fiscal year; and 


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1 ‘‘(2) manage the program to achieve a national 

2 average rate of $18 per acre, which shall include the 

3 costs of all financial assistance, technical assistance, 

4 and any other expenses associated with enrollment 

5 or participation in the program. 

6 ‘‘(d) CONSERVATION STEWARDSHIP PAYMENTS.— 

7 ‘‘(1) AVAILABILITY OF PAYMENTS.—The Sec8 retary shall provide annual payments under the pro9 gram to compensate the producer for— 

10 ‘‘(A) installing and adopting additional 

11 conservation activities; and 

12 ‘‘(B) improving, maintaining, and man13 aging conservation activities in place at the op14 eration of the producer at the time the contract 

15 offer is accepted by the Secretary. 

16 ‘‘(2) PAYMENT AMOUNT.—The amount of the 

17 conservation stewardship annual payment shall be 

18 determined by the Secretary and based, to the max19 imum extent practicable, on the following factors: 

20 ‘‘(A) Costs incurred by the producer asso21 ciated with planning, design, materials, installa22 tion, labor, management, maintenance, or train23 ing. 

24 ‘‘(B) Income forgone by the producer. 

25 ‘‘(C) Expected conservation benefits. 


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1 ‘‘(D) The extent to which priority resource 

2 concerns will be addressed through the installa3 tion and adoption of conservation activities on 

4 the agricultural operation. 

5 ‘‘(E) The level of stewardship in place at 

6 the time of application and maintained over the 

7 term of the contract. 

8 ‘‘(F) The degree to which the conservation 

9 activities will be integrated across the entire ag10 ricultural operation for all applicable priority 

11 resource concerns over the term of the contract. 

12 ‘‘(G) Such other factors as determined by 

13 the Secretary. 

14 ‘‘(3) EXCLUSIONS.—A payment to a producer 

15 under this subsection shall not be provided for— 

16 ‘‘(A) the design, construction, or mainte17 nance of animal waste storage or treatment fa18 cilities or associated waste transport or transfer 

19 devices for animal feeding operations; or 

20 ‘‘(B) conservation activities for which there 

21 is no cost incurred or income forgone to the 

22 producer. 

23 ‘‘(4) DELIVERY OF PAYMENTS.—In making 

24 stewardship payments, the Secretary shall, to the ex25 tent practicable— 


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1 ‘‘(A) prorate conservation performance 

2 over the term of the contract so as to accommo3 date, to the extent practicable, producers earn4 ing equal annual stewardship payments in each 

5 fiscal year; and 

6 ‘‘(B) make stewardship payments as soon 

7 as practicable after October 1 of each fiscal 

8 year for activities carried out in the previous 

9 fiscal year. 

10 ‘‘(e) SUPPLEMENTAL PAYMENTS FOR RESOURCE11 CONSERVING CROP ROTATIONS.— 

12 ‘‘(1) AVAILABILITY OF PAYMENTS.—The Sec13 retary shall provide additional payments to pro14 ducers that, in participating in the program, agree 

15 to adopt resource-conserving crop rotations to 

16 achieve beneficial crop rotations as appropriate for 

17 the eligible land of the producers. 

18 ‘‘(2) BENEFICIAL CROP ROTATIONS.—The Sec19 retary shall determine whether a resource-conserving 

20 crop rotation is a beneficial crop rotation eligible for 

21 additional payments under paragraph (1), based on 

22 whether the resource-conserving crop rotation is de23 signed to provide natural resource conservation and 

24 production benefits. 


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1 ‘‘(3) ELIGIBILITY.—To be eligible to receive a 

2 payment described in paragraph (1), a producer 

3 shall agree to adopt and maintain the resource-con4 serving crop rotations for the term of the contract. 

5 ‘‘(4) RESOURCE-CONSERVING CROP ROTA6 TION.—In this subsection, the term ‘resource-con7 serving crop rotation’ means a crop rotation that— 

8 ‘‘(A) includes at least 1 resource con9 serving crop (as defined by the Secretary); 

10 ‘‘(B) reduces erosion; 

11 ‘‘(C) improves soil fertility and tilth; 

12 ‘‘(D) interrupts pest cycles; and 

13 ‘‘(E) in applicable areas, reduces depletion 

14 of soil moisture or otherwise reduces the need 

15 for irrigation. 

16 ‘‘(f) PAYMENT LIMITATIONS.—A person or legal enti17 ty may not receive, directly or indirectly, payments under 

18 the program that, in the aggregate, exceed $200,000 

19 under all contracts entered into during fiscal years 2013 

20 through 2017, excluding funding arrangements with In21 dian tribes, regardless of the number of contracts entered 

22 into under the program by the person or legal entity. 

23 ‘‘(g) SPECIALTY CROP AND ORGANIC PRODUCERS.— 

24 The Secretary shall ensure that outreach and technical as25 sistance are available, and program specifications are apVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00190 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 propriate to enable specialty crop and organic producers 

2 to participate in the program. 

3 ‘‘(h) COORDINATION WITH ORGANIC CERTIFI4 CATION.—The Secretary shall establish a transparent 

5 means by which producers may initiate organic certifi6 cation under the Organic Foods Production Act of 1990 

7 (7 U.S.C. 6501 et seq.) while participating in a contract 

8 under the program. 

9 ‘‘(i) REGULATIONS.—The Secretary shall promulgate 

10 regulations that— 

11 ‘‘(1) prescribe such other rules as the Secretary 

12 determines to be necessary to ensure a fair and rea13 sonable application of the limitations established 

14 under subsection (f); and 

15 ‘‘(2) otherwise enable the Secretary to carry out 

16 the program.’’. 

17 (b) EFFECTIVE DATE.—The amendment made by 

18 this section shall take effect on October 1, 2012. 

19 (c) EFFECT ON EXISTING CONTRACTS.— 

20 (1) IN GENERAL.—The amendment made by 

21 this section shall not affect the validity or terms of 

22 any contract entered into by the Secretary of Agri23 culture under subchapter B of chapter 2 of subtitle 

24 D of title XII of the Food Security Act of 1985 (16 

25 U.S.C. 3838d et seq.) before October 1, 2012, or 


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1 any payments required to be made in connection 

2 with the contract. 

3 (2) CONSERVATION STEWARDSHIP PROGRAM.— 

4 Funds made available under section 1241(a)(4) of 

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

6 3841(a)(4)) (as amended by section 2601(a)) may 

7 be used to administer and make payments to pro8 gram participants enrolled into contracts during any 

9 of fiscal years 2009 through 2012. 

10 Subtitle C—Environmental Quality 

11 Incentives Program 

12 SEC. 2201. PURPOSES. 

13 Section 1240 of the Food Security Act of 1985 (16 

14 U.S.C. 3839aa) is amended— 

15 (1) in paragraph (3)— 

16 (A) in subparagraph (A), by striking 

17 ‘‘and’’ at the end; 

18 (B) by redesignating subparagraph (B) as 

19 subparagraph (C) and, in such subparagraph, 

20 by inserting ‘‘and’’ after the semicolon; and 

21 (C) by inserting after subparagraph (A) 

22 the following: 

23 ‘‘(B) develop and improve wildlife habitat; 

24 and’’; 


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1 (2) in paragraph (4), by striking ‘‘; and’’ and 

2 inserting a period; and 

3 (3) by striking paragraph (5). 

4 SEC. 2202. DEFINITIONS. 

5 Section 1240A of the Food Security Act of 1985 (16 

6 U.S.C. 3839aa–1) is amended— 

7 (1) by striking paragraph (2) and redesignating 

8 paragraphs (3) through (6) as paragraphs (2) 

9 through (5), respectively; and 

10 (2) in paragraph (2) (as so redesignated), by 

11 inserting ‘‘established under the Organic Foods Pro12 duction Act of 1990 (7 U.S.C. 6501 et seq.)’’ after 

13 ‘‘national organic program’’. 

14 SEC. 2203. ESTABLISHMENT AND ADMINISTRATION. 

15 Section 1240B of the Food Security Act of 1985 (16 

16 U.S.C. 3839aa–2) is amended— 

17 (1) in subsection (a), by striking ‘‘2014’’ and 

18 inserting ‘‘2017’’; 

19 (2) in subsection (b), by striking paragraph (2) 

20 and inserting the following: 

21 ‘‘(2) TERM.—A contract under the program 

22 shall have a term that does not exceed 10 years.’’; 

23 (3) in subsection (d)— 


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1 (A) in paragraph (3), by striking subpara2 graphs (A) through (G) and inserting the fol3 lowing: 

4 ‘‘(A) soil health; 

5 ‘‘(B) water quality and quantity improve6 ment; 

7 ‘‘(C) nutrient management; 

8 ‘‘(D) pest management; 

9 ‘‘(E) air quality improvement; 

10 ‘‘(F) wildlife habitat development, includ11 ing pollinator habitat; 

12 ‘‘(G) invasive species management; or 

13 ‘‘(H) other resource issues of regional or 

14 national significance, as determined by the Sec15 retary.’’; and 

16 (B) in paragraph (4)— 

17 (i) in subparagraph (A) in the matter 

18 preceding clause (i), by inserting ‘‘, veteran 

19 farmer or rancher (as defined in section 

20 2501(e) of the Food, Agriculture, Con21 servation, and Trade Act of 1990 (7 

22 U.S.C. 2279(e))),’’ before ‘‘or a beginning 

23 farmer or rancher’’; and 

24 (ii) by striking subparagraph (B) and 

25 inserting the following: 


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1 ‘‘(B) ADVANCE PAYMENTS.— 

2 ‘‘(i) IN GENERAL.—Not more than 30 

3 percent of the amount determined under 

4 subparagraph (A) may be provided in ad5 vance for the purpose of purchasing mate6 rials or contracting. 

7 ‘‘(ii) RETURN OF FUNDS.—If funds 

8 provided in advance are not expended dur9 ing the 90-day period beginning on the 

10 date of receipt of the funds, the funds shall 

11 be returned within a reasonable time 

12 frame, as determined by the Secretary.’’; 

13 (4) by striking subsection (f) and inserting the 

14 following: 

15 ‘‘(f) ALLOCATION OF FUNDING.— 

16 ‘‘(1) LIVESTOCK.—For each of fiscal years 

17 2013 through 2017, at least 60 percent of the funds 

18 made available for payments under the program 

19 shall be targeted at practices relating to livestock 

20 production. 

21 ‘‘(2) WILDLIFE HABITAT.—For each of fiscal 

22 years 2013 through 2017, at least 5 percent of the 

23 funds made available for payments under the pro24 gram shall be targeted at practices benefitting wild25 life habitat under subsection (g).’’; and 


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1 (5) by striking subsection (g) and inserting the 

2 following: 

3 ‘‘(g) WILDLIFE HABITAT INCENTIVE PRACTICE.— 

4 The Secretary shall provide payments under the program 

5 for conservation practices that support the restoration, de6 velopment, and improvement of wildlife habitat on eligible 

7 land, including— 

8 ‘‘(1) upland wildlife habitat; 

9 ‘‘(2) wetland wildlife habitat; 

10 ‘‘(3) habitat for threatened and endangered 

11 species; 

12 ‘‘(4) fish habitat; 

13 ‘‘(5) habitat on pivot corners and other irreg14 ular areas of a field; and 

15 ‘‘(6) other types of wildlife habitat, as deter16 mined by the Secretary.’’. 

17 SEC. 2204. EVALUATION OF APPLICATIONS. 

18 Section 1240C(b) of the Food Security Act of 1985 

19 (16 U.S.C. 3839aa–3(b)) is amended— 

20 (1) in paragraph (1), by striking ‘‘environ21 mental’’ and inserting ‘‘conservation’’; and 

22 (2) in paragraph (3), by striking ‘‘purpose of 

23 the environmental quality incentives program speci24 fied in section 1240(1)’’ and inserting ‘‘purposes of 

25 the program’’. 


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1 SEC. 2205. DUTIES OF PRODUCERS. 

2 Section 1240D(2) of the Food Security Act of 1985 

3 (16 U.S.C. 3839aa–4(2)) is amended by striking ‘‘farm, 

4 ranch, or forest’’ and inserting ‘‘enrolled’’. 

5 SEC. 2206. LIMITATION ON PAYMENTS. 

6 Section 1240G of the Food Security Act of 1985 (16 

7 U.S.C. 3839aa–7) is amended— 

8 (1) in subsection (a)— 

9 (A) by striking ‘‘by the person or entity 

10 during any six-year period,’’ and inserting 

11 ‘‘during fiscal years 2013 through 2017’’; and 

12 (B) by striking ‘‘federally recognized’’ and 

13 all that follows through the period and inserting 

14 ‘‘Indian tribes under section 1244(l).’’; and 

15 (2) in subsection (b)(2), by striking ‘‘any six16 year period’’ and inserting ‘‘fiscal years 2013 

17 through 2017’’. 

18 SEC. 2207. CONSERVATION INNOVATION GRANTS AND PAY19 MENTS. 

20 Section 1240H of the Food Security Act of 1985 (16 

21 U.S.C. 3839aa–8) is amended by striking subsection (b) 

22 and inserting the following: 

23 ‘‘(b) REPORTING.—Not later than December 31, 

24 2013, and every 2 years thereafter, the Secretary shall 

25 submit to the Committee on Agriculture, Nutrition, and 

26 Forestry of the Senate and the Committee on Agriculture 


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1 of the House of Representatives a report on the status 

2 of projects funded under this section, including— 

3 ‘‘(1) funding awarded; 

4 ‘‘(2) project results; and 

5 ‘‘(3) incorporation of project findings, such as 

6 new technology and innovative approaches, into the 

7 conservation efforts implemented by the Secretary.’’. 

8 SEC. 2208. EFFECTIVE DATE. 

9 (a) IN GENERAL.—The amendments made by this 

10 title shall take effect on October 1, 2012. 

11 (b) EFFECT ON EXISTING CONTRACTS.—The amend12 ments made by this title shall not affect the validity or 

13 terms of any contract entered into by the Secretary of Ag14 riculture under chapter 4 of subtitle D of title XII of the 

15 Food Security Act of 1985 (16 U.S.C. 3839aa et seq.) 

16 before October 1, 2012, or any payments required to be 

17 made in connection with the contract. 

18 Subtitle D—Agricultural 

19 Conservation Easement Program 

20 SEC. 2301. AGRICULTURAL CONSERVATION EASEMENT 

21 PROGRAM. 

22 (a) ESTABLISHMENT.—Title XII of the Food Secu23 rity Act of 1985 is amended by adding at the end the fol24 lowing: 


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1 ‘‘Subtitle H—Agricultural 

2 Conservation Easement Program 

3 ‘‘SEC. 1265. ESTABLISHMENT AND PURPOSES. 

4 ‘‘(a) ESTABLISHMENT.—The Secretary shall estab5 lish an Agricultural Conservation Easement Program for 

6 the conservation of eligible land and natural resources 

7 through easements or other interests in land. 

8 ‘‘(b) PURPOSES.—The purposes of the program are 

9 to— 

10 ‘‘(1) combine the purposes and coordinate the 

11 functions of the wetlands reserve program estab12 lished under section 1237, the grassland reserve pro13 gram established under section 1238N, and the 

14 farmland protection program established under sec15 tion 1238I; 

16 ‘‘(2) restore, protect, and enhance wetland on 

17 eligible land; 

18 ‘‘(3) protect the agricultural use, viability, and 

19 related conservation values of eligible land by lim20 iting nonagricultural uses of that land; and 

21 ‘‘(4) protect grazing uses and related conserva22 tion values by restoring and conserving eligible land. 

23 ‘‘SEC. 1265A. DEFINITIONS. 

24 ‘‘In this subtitle: 


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1 ‘‘(1) AGRICULTURAL LAND EASEMENT.—The 

2 term ‘agricultural land easement’ means an ease3 ment or other interest in eligible land that— 

4 ‘‘(A) is conveyed for the purposes of pro5 tecting natural resources and the agricultural 

6 nature of the land, and of promoting agricul7 tural viability for future generations; and 

8 ‘‘(B) permits the landowner the right to 

9 continue agricultural production and related 

10 uses subject to an agricultural land easement 

11 plan. 

12 ‘‘(2) ELIGIBLE ENTITY.—The term ‘eligible en13 tity’ means— 

14 ‘‘(A) an agency of State or local govern15 ment or an Indian tribe (including farmland 

16 protection board or land resource council estab17 lished under State law); or 

18 ‘‘(B) an organization that is— 

19 ‘‘(i) organized for, and at all times 

20 since the formation of the organization has 

21 been operated principally for, 1 or more of 

22 the conservation purposes specified in 

23 clause (i), (ii), (iii), or (iv) of section 

24 170(h)(4)(A) of the Internal Revenue Code 

25 of 1986; 


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1 ‘‘(ii) an organization described in sec2 tion 501(c)(3) of that Code that is exempt 

3 from taxation under section 501(a) of that 

4 Code; or 

5 ‘‘(iii) described in— 

6 ‘‘(I) paragraph (1) or (2) of sec7 tion 509(a) of that Code; or 

8 ‘‘(II) section 509(a)(3) of that 

9 Code and is controlled by an organiza10 tion described in section 509(a)(2) of 

11 that Code. 

12 ‘‘(3) ELIGIBLE LAND.—The term ‘eligible land’ 

13 means private or tribal land that is— 

14 ‘‘(A) in the case of an agricultural land 

15 easement, agricultural land, including land on a 

16 farm or ranch— 

17 ‘‘(i) that is subject to a pending offer 

18 for purchase from an eligible entity; 

19 ‘‘(ii) that— 

20 ‘‘(I) has prime, unique, or other 

21 productive soil; 

22 ‘‘(II) contains historical or ar23 chaeological resources; or 

24 ‘‘(III) the protection of which will 

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1 sistent with the purposes of the pro2 gram; and 

3 ‘‘(iii) that is— 

4 ‘‘(I) cropland; 

5 ‘‘(II) rangeland; 

6 ‘‘(III) grassland or land that con7 tains forbs, or shrubland for which 

8 grazing is the predominant use; 

9 ‘‘(IV) pastureland; or 

10 ‘‘(V) nonindustrial private forest 

11 land that contributes to the economic 

12 viability of an offered parcel or serves 

13 as a buffer to protect such land from 

14 development; 

15 ‘‘(B) in the case of a wetland easement, a 

16 wetland or related area, including— 

17 ‘‘(i) farmed or converted wetland, to18 gether with the adjacent land that is func19 tionally dependent on that land if the Sec20 retary determines it— 

21 ‘‘(I) is likely to be successfully 

22 restored in a cost effective manner; 

23 and 

24 ‘‘(II) will maximize the wildlife 

25 benefits and wetland functions and 


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1 values as determined by the Secretary 

2 in consultation with the Secretary of 

3 the Interior at the local level; 

4 ‘‘(ii) cropland or grassland that was 

5 used for agricultural production prior to 

6 flooding from the natural overflow of a 

7 closed basin lake or pothole, as determined 

8 by the Secretary, together (where prac9 ticable) with the adjacent land that is 

10 functionally dependent on the cropland or 

11 grassland; 

12 ‘‘(iii) farmed wetland and adjoining 

13 land that— 

14 ‘‘(I) is enrolled in the conserva15 tion reserve program; 

16 ‘‘(II) has the highest wetland 

17 functions and values; and 

18 ‘‘(III) is likely to return to pro19 duction after the land leaves the con20 servation reserve program; 

21 ‘‘(iv) riparian areas that link wetland 

22 that is protected by easements or some 

23 other device that achieves the same pur24 pose as an easement; or 


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1 ‘‘(v) other wetland of an owner that 

2 would not otherwise be eligible if the Sec3 retary determines that the inclusion of 

4 such wetland in such easement would sig5 nificantly add to the functional value of the 

6 easement; and 

7 ‘‘(C) in the case of both an agricultural 

8 land easement or wetland easement, other land 

9 that is incidental to eligible land if the Sec10 retary determines that it is necessary for the ef11 ficient administration of the easements under 

12 this program. 

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

14 the Agricultural Conservation Easement Program 

15 established by this subtitle. 

16 ‘‘(5) WETLAND EASEMENT.—The term ‘wetland 

17 easement’ means a reserved interest in eligible land 

18 that— 

19 ‘‘(A) is defined and delineated in a deed; 

20 and 

21 ‘‘(B) stipulates— 

22 ‘‘(i) the rights, title, and interests in 

23 land conveyed to the Secretary; and 

24 ‘‘(ii) the rights, title, and interests in 

25 land that are reserved to the landowner. 


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1 ‘‘SEC. 1265B. AGRICULTURAL LAND EASEMENTS. 

2 ‘‘(a) AVAILABILITY OF ASSISTANCE.—The Secretary 

3 shall facilitate and provide funding for— 

4 ‘‘(1) the purchase of agricultural land ease5 ments and other interests in eligible land; and 

6 ‘‘(2) technical assistance to provide for the con7 servation of natural resources pursuant to an agri8 cultural land easement plan. 

9 ‘‘(b) COST-SHARE ASSISTANCE.— 

10 ‘‘(1) IN GENERAL.—The Secretary shall provide 

11 cost-share assistance to eligible entities for pur12 chasing agricultural land easements to protect the 

13 agricultural use, including grazing, and related con14 servation values of eligible land. 

15 ‘‘(2) SCOPE OF ASSISTANCE AVAILABLE.— 

16 ‘‘(A) FEDERAL SHARE.—Subject to sub17 paragraph (C), an agreement described in para18 graph (4) shall provide for a Federal share de19 termined by the Secretary of an amount not to 

20 exceed 50 percent of the fair market value of 

21 the agricultural land easement or other interest 

22 in land, as determined by the Secretary using— 

23 ‘‘(i) the Uniform Standards of Profes24 sional Appraisal Practices; 

25 ‘‘(ii) an area-wide market analysis or 

26 survey; or 


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1 ‘‘(iii) another industry approved meth2 od. 

3 ‘‘(B) NON-FEDERAL SHARE.— 

4 ‘‘(i) IN GENERAL.—Subject to sub5 paragraph (C), under the agreement, the 

6 eligible entity shall provide a share that is 

7 at least equivalent to that provided by the 

8 Secretary. 

9 ‘‘(ii) SOURCE OF CONTRIBUTION.—An 

10 eligible entity may include as part of its 

11 share a charitable donation or qualified 

12 conservation contribution (as defined by 

13 section 170(h) of the Internal Revenue 

14 Code of 1986) from the private landowner 

15 if the eligible entity contributes its own 

16 cash resources in an amount that is at 

17 least 50 percent of the amount contributed 

18 by the Secretary. 

19 ‘‘(C) WAIVER AUTHORITY.—In the case of 

20 grassland of special environmental significance, 

21 as determined by the Secretary, the Secretary 

22 may provide up to 75 percent of the fair market 

23 value of the agricultural land easement. 

24 ‘‘(3) EVALUATION AND RANKING OF APPLICA25 TIONS.— 


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1 ‘‘(A) CRITERIA.—The Secretary shall es2 tablish evaluation and ranking criteria to maxi3 mize the benefit of Federal investment under 

4 the program. 

5 ‘‘(B) CONSIDERATIONS.—In establishing 

6 the criteria, the Secretary shall emphasize sup7 port for— 

8 ‘‘(i) protecting agricultural uses and 

9 related conservation values of the land; and 

10 ‘‘(ii) maximizing the protection of con11 tiguous acres devoted to agricultural use. 

12 ‘‘(C) BIDDING DOWN.—If the Secretary 

13 determines that 2 or more applications for cost14 share assistance are comparable in achieving 

15 the purpose of the program, the Secretary shall 

16 not assign a higher priority to any of those ap17 plications solely on the basis of lesser cost to 

18 the program. 

19 ‘‘(4) AGREEMENTS WITH ELIGIBLE ENTITIES.— 

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

21 enter into agreements with eligible entities to 

22 stipulate the terms and conditions under which 

23 the eligible entity is permitted to use cost-share 

24 assistance provided under this section. 


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1 ‘‘(B) LENGTH OF AGREEMENTS.—An 

2 agreement shall be for a term that is— 

3 ‘‘(i) in the case of an eligible entity 

4 certified under the process described in 

5 paragraph (5), a minimum of 5 years; and 

6 ‘‘(ii) for all other eligible entities, at 

7 least 3, but not more than 5 years. 

8 ‘‘(C) MINIMUM TERMS AND CONDITIONS.— 

9 An eligible entity shall be authorized to use its 

10 own terms and conditions for agricultural land 

11 easements so long as the Secretary determines 

12 such terms and conditions— 

13 ‘‘(i) are consistent with the purposes 

14 of the program; 

15 ‘‘(ii) are permanent or for the max16 imum duration allowed under applicable 

17 State law; 

18 ‘‘(iii) permit effective enforcement of 

19 the conservation purposes of such ease20 ments, including appropriate restrictions 

21 depending on the purposes for which the 

22 easement is acquired; 

23 ‘‘(iv) include a right of enforcement 

24 for the Secretary; 


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1 ‘‘(v) subject the land purchased to an 

2 agricultural land easement plan that— 

3 ‘‘(I) describes the activities which 

4 promote the long-term viability of the 

5 land to meet the purposes for which 

6 the easement was acquired; 

7 ‘‘(II) requires the management of 

8 grassland according to a grassland 

9 management plan; and 

10 ‘‘(III) includes a conservation 

11 plan, where appropriate, and requires, 

12 at the option of the Secretary, the 

13 conversion of highly erodible cropland 

14 to less intensive uses; and 

15 ‘‘(vi) include a limit on the impervious 

16 surfaces to be allowed that is consistent 

17 with the agricultural activities to be con18 ducted. 

19 ‘‘(D) SUBSTITUTION OF QUALIFIED

20 PROJECTS.—An agreement shall allow, upon 

21 mutual agreement of the parties, substitution of 

22 qualified projects that are identified at the time 

23 of the proposed substitution. 


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1 ‘‘(E) EFFECT OF VIOLATION.—If a viola2 tion occurs of a term or condition of an agree3 ment under this subsection— 

4 ‘‘(i) the agreement may be termi5 nated; and 

6 ‘‘(ii) the Secretary may require the el7 igible entity to refund all or part of any 

8 payments received by the entity under the 

9 program, with interest on the payments as 

10 determined appropriate by the Secretary. 

11 ‘‘(5) CERTIFICATION OF ELIGIBLE ENTITIES.— 

12 ‘‘(A) CERTIFICATION PROCESS.—The Sec13 retary shall establish a process under which the 

14 Secretary may— 

15 ‘‘(i) directly certify eligible entities 

16 that meet established criteria; 

17 ‘‘(ii) enter into long-term agreements 

18 with certified eligible entities; and 

19 ‘‘(iii) accept proposals for cost-share 

20 assistance for the purchase of agricultural 

21 land easements throughout the duration of 

22 such agreements. 

23 ‘‘(B) CERTIFICATION CRITERIA.—In order 

24 to be certified, an eligible entity shall dem25 onstrate to the Secretary that the entity will 


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1 maintain, at a minimum, for the duration of the 

2 agreement— 

3 ‘‘(i) a plan for administering ease4 ments that is consistent with the purpose 

5 of this subtitle; 

6 ‘‘(ii) the capacity and resources to 

7 monitor and enforce agricultural land ease8 ments; and 

9 ‘‘(iii) policies and procedures to en10 sure— 

11 ‘‘(I) the long-term integrity of 

12 agricultural land easements on eligible 

13 land; 

14 ‘‘(II) timely completion of acqui15 sitions of easements; and 

16 ‘‘(III) timely and complete eval17 uation and reporting to the Secretary 

18 on the use of funds provided under 

19 the program. 

20 ‘‘(C) REVIEW AND REVISION.— 

21 ‘‘(i) REVIEW.—The Secretary shall 

22 conduct a review of eligible entities cer23 tified under subparagraph (A) every 3 

24 years to ensure that such entities are 


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1 meeting the criteria established under sub2 paragraph (B). 

3 ‘‘(ii) REVOCATION.—If the Secretary 

4 finds that the certified entity no longer 

5 meets the criteria established under sub6 paragraph (B), the Secretary may— 

7 ‘‘(I) allow the certified entity a 

8 specified period of time, at a min9 imum 180 days, in which to take such 

10 actions as may be necessary to meet 

11 the criteria; and 

12 ‘‘(II) revoke the certification of 

13 the entity, if after the specified period 

14 of time, the certified entity does not 

15 meet such criteria. 

16 ‘‘(c) TECHNICAL ASSISTANCE.—The Secretary may 

17 provide technical assistance, if requested, to assist in— 

18 ‘‘(1) compliance with the terms and conditions 

19 of easements; and 

20 ‘‘(2) implementation of an agricultural land 

21 easement plan. 

22 ‘‘SEC. 1265C. WETLAND EASEMENTS. 

23 ‘‘(a) AVAILABILITY OF ASSISTANCE.—The Secretary 

24 shall provide assistance to owners of eligible land to re25 store, protect, and enhance wetland through— 


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1 ‘‘(1) easements and related wetland easement 

2 plans; and 

3 ‘‘(2) technical assistance. 

4 ‘‘(b) EASEMENTS.— 

5 ‘‘(1) METHOD OF ENROLLMENT.—The Sec6 retary shall enroll eligible land through the use of— 

7 ‘‘(A) 30-year easements; 

8 ‘‘(B) permanent easements; 

9 ‘‘(C) easements for the maximum duration 

10 allowed under applicable State laws; or 

11 ‘‘(D) as an option for Indian tribes only, 

12 30-year contracts. 

13 ‘‘(2) LIMITATIONS.— 

14 ‘‘(A) INELIGIBLE LAND.—The Secretary 

15 may not acquire easements on— 

16 ‘‘(i) land established to trees under 

17 the conservation reserve program, except in 

18 cases where the Secretary determines it 

19 would further the purposes of the program; 

20 and 

21 ‘‘(ii) farmed wetland or converted wet22 land where the conversion was not com23 menced prior to December 23, 1985. 

24 ‘‘(B) CHANGES IN OWNERSHIP.—No ease25 ment shall be created on land that has changed 


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1 ownership during the preceding 24-month pe2 riod unless— 

3 ‘‘(i) the new ownership was acquired 

4 by will or succession as a result of the 

5 death of the previous owner; 

6 ‘‘(ii)(I) the ownership change occurred 

7 because of foreclosure on the land; and 

8 ‘‘(II) immediately before the fore9 closure, the owner of the land exercises a 

10 right of redemption from the mortgage 

11 holder in accordance with State law; or 

12 ‘‘(iii) the Secretary determines that 

13 the land was acquired under circumstances 

14 that give adequate assurances that such 

15 land was not acquired for the purposes of 

16 placing it in the program. 

17 ‘‘(3) EVALUATION AND RANKING OF OFFERS.— 

18 ‘‘(A) CRITERIA.—The Secretary shall es19 tablish evaluation and ranking criteria to maxi20 mize the benefit of Federal investment under 

21 the program. 

22 ‘‘(B) CONSIDERATIONS.—When evaluating 

23 offers from landowners, the Secretary may con24 sider— 


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1 ‘‘(i) the conservation benefits of ob2 taining an easement or 30-year contract, 

3 including the potential environmental bene4 fits if the land was removed from agricul5 tural production; 

6 ‘‘(ii) the cost-effectiveness of each 

7 easement or 30-year contract, so as to 

8 maximize the environmental benefits per 

9 dollar expended; 

10 ‘‘(iii) whether the landowner or an11 other person is offering to contribute fi12 nancially to the cost of the easement or 

13 30-year contract to leverage Federal funds; 

14 and 

15 ‘‘(iv) such other factors as the Sec16 retary determines are necessary to carry 

17 out the purposes of the program. 

18 ‘‘(C) PRIORITY.—The Secretary shall place 

19 priority on acquiring easements based on the 

20 value of the easement for protecting and en21 hancing habitat for migratory birds and other 

22 wildlife. 

23 ‘‘(4) AGREEMENT.—To be eligible to place eligi24 ble land into the program through a wetland easeVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00215 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 ment, the owner of such land shall enter into an 

2 agreement with the Secretary to— 

3 ‘‘(A) grant an easement on such land to 

4 the Secretary; 

5 ‘‘(B) authorize the implementation of a 

6 wetland easement plan; 

7 ‘‘(C) create and record an appropriate 

8 deed restriction in accordance with applicable 

9 State law to reflect the easement agreed to; 

10 ‘‘(D) provide a written statement of con11 sent to such easement signed by those holding 

12 a security interest in the land; 

13 ‘‘(E) comply with the terms and conditions 

14 of the easement and any related agreements; 

15 and 

16 ‘‘(F) permanently retire any existing crop17 land base and allotment history for the land on 

18 which the easement has been obtained. 

19 ‘‘(5) TERMS AND CONDITIONS OF EASEMENT.— 

20 ‘‘(A) IN GENERAL.—A wetland easement 

21 shall include terms and conditions that— 

22 ‘‘(i) permit— 

23 ‘‘(I) repairs, improvements, and 

24 inspections on the land that are necVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00216 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 essary to maintain existing public 

2 drainage systems; and 

3 ‘‘(II) owners to control public ac4 cess on the easement areas while iden5 tifying access routes to be used for 

6 restoration activities and management 

7 and easement monitoring; 

8 ‘‘(ii) prohibit— 

9 ‘‘(I) the alteration of wildlife 

10 habitat and other natural features of 

11 such land, unless specifically author12 ized by the Secretary; 

13 ‘‘(II) the spraying of such land 

14 with chemicals or the mowing of such 

15 land, except where such spraying or 

16 mowing is authorized by the Secretary 

17 or is necessary— 

18 ‘‘(aa) to comply with Fed19 eral or State noxious weed con20 trol laws; 

21 ‘‘(bb) to comply with a Fed22 eral or State emergency pest 

23 treatment program; or 

24 ‘‘(cc) to meet habitat needs 

25 of specific wildlife species; 


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1 ‘‘(III) any activities to be carried 

2 out on the owner’s or successor’s land 

3 that is immediately adjacent to, and 

4 functionally related to, the land that 

5 is subject to the easement if such ac6 tivities will alter, degrade, or other7 wise diminish the functional value of 

8 the eligible land; and 

9 ‘‘(IV) the adoption of any other 

10 practice that would tend to defeat the 

11 purposes of the program, as deter12 mined by the Secretary; 

13 ‘‘(iii) provide for the efficient and ef14 fective establishment of wetland functions 

15 and values; and 

16 ‘‘(iv) include such additional provi17 sions as the Secretary determines are de18 sirable to carry out the program or facili19 tate the practical administration thereof. 

20 ‘‘(B) VIOLATION.—On the violation of the 

21 terms or conditions of the easement, the ease22 ment shall remain in force and the Secretary 

23 may require the owner to refund all or part of 

24 any payments received by the owner under the 


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1 program, together with interest thereon as de2 termined appropriate by the Secretary. 

3 ‘‘(C) COMPATIBLE USES.—Land subject to 

4 a wetland easement may be used for compatible 

5 economic uses, including such activities as 

6 hunting and fishing, managed timber harvest, 

7 or periodic haying or grazing, if such use is spe8 cifically permitted by the wetland easement plan 

9 and is consistent with the long-term protection 

10 and enhancement of the wetland resources for 

11 which the easement was established. 

12 ‘‘(D) RESERVATION OF GRAZING

13 RIGHTS.—The Secretary may include in the 

14 terms and conditions of an easement a provi15 sion under which the owner reserves grazing 

16 rights if— 

17 ‘‘(i) the Secretary determines that the 

18 reservation and use of the grazing rights— 

19 ‘‘(I) is compatible with the land 

20 subject to the easement; 

21 ‘‘(II) is consistent with the his22 torical natural uses of the land and 

23 long-term protection and enhancement 

24 goals for which the easement was es25 tablished; and 


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1 ‘‘(III) complies with the wetland 

2 easement plan; and 

3 ‘‘(ii) the agreement provides for a 

4 commensurate reduction in the easement 

5 payment to account for the grazing value, 

6 as determined by the Secretary. 

7 ‘‘(E) APPLICATION.—The relevant provi8 sions of this paragraph shall also apply to a 30- 

9 year contract. 

10 ‘‘(6) COMPENSATION.— 

11 ‘‘(A) DETERMINATION.— 

12 ‘‘(i) IN GENERAL.—The Secretary 

13 shall pay as compensation for a permanent 

14 easement acquired an amount necessary to 

15 encourage enrollment in the program based 

16 on the lowest of— 

17 ‘‘(I) the fair market value of the 

18 land, as determined by the Secretary, 

19 using the Uniform Standards of Pro20 fessional Appraisal Practices or an 

21 area-wide market analysis or survey; 

22 ‘‘(II) the amount corresponding 

23 to a geographical cap, as determined 

24 by the Secretary in regulations; or 


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1 ‘‘(III) the offer made by the 

2 landowner. 

3 ‘‘(ii) OTHER.—Compensation for a 

4 30-year contract or 30-year easement shall 

5 be not less than 50 percent, but not more 

6 than 75 percent, of the compensation that 

7 would be paid for a permanent easement. 

8 ‘‘(B) FORM OF PAYMENT.—Compensation 

9 shall be provided by the Secretary in the form 

10 of a cash payment, in an amount determined 

11 under subparagraph (A). 

12 ‘‘(C) PAYMENT SCHEDULE.— 

13 ‘‘(i) EASEMENTS VALUED AT LESS

14 THAN $500,000.—For easements valued at 

15 $500,000 or less, the Secretary may pro16 vide easement payments in not more than 

17 10 annual payments. 

18 ‘‘(ii) EASEMENTS VALUED AT MORE

19 THAN $500,000.—For easements valued at 

20 more than $500,000, the Secretary may 

21 provide easement payments in at least 5, 

22 but not more than 10 annual payments, 

23 except that, if the Secretary determines it 

24 would further the purposes of the program, 


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1 the Secretary may make a lump sum pay2 ment for such an easement. 

3 ‘‘(c) EASEMENT RESTORATION.— 

4 ‘‘(1) IN GENERAL.—The Secretary shall provide 

5 financial assistance to carry out the establishment of 

6 conservation measures and practices and protect 

7 wetland functions and values, including necessary 

8 maintenance activities, as set forth in a wetland 

9 easement plan. 

10 ‘‘(2) PAYMENTS.—The Secretary shall— 

11 ‘‘(A) in the case of a permanent easement, 

12 pay an amount that is not less than 75 percent, 

13 but not more than 100 percent, of the eligible 

14 costs; and 

15 ‘‘(B) in the case of a 30-year contract or 

16 30-year easement, pay an amount that is not 

17 less than 50 percent, but not more than 75 per18 cent, of the eligible costs. 

19 ‘‘(d) TECHNICAL ASSISTANCE.— 

20 ‘‘(1) IN GENERAL.—The Secretary shall assist 

21 owners in complying with the terms and conditions 

22 of easements and 30-year contracts. 

23 ‘‘(2) CONTRACTS OR AGREEMENTS.—The Sec24 retary may enter into 1 or more contracts with pri25 vate entities or agreements with a State, non-governVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00222 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 mental organization, or Indian tribe to carry out 

2 necessary restoration, enhancement or maintenance 

3 of an easement if the Secretary determines that the 

4 contract or agreement will advance the purposes of 

5 the program. 

6 ‘‘(e) WETLAND ENHANCEMENT OPTION.—The Sec7 retary may enter into 1 or more agreements with a State 

8 (including a political subdivision or agency of a State), 

9 nongovernmental organization, or Indian tribe to carry out 

10 a special wetland enhancement option that the Secretary 

11 determines would advance the purposes of the program. 

12 ‘‘(f) ADMINISTRATION.— 

13 ‘‘(1) WETLAND EASEMENT PLAN.—The Sec14 retary shall develop a wetland easement plan for eli15 gible land subject to a wetland easement, which will 

16 include the practices and activities necessary to re17 store, protect, enhance, and maintain the enrolled 

18 land. 

19 ‘‘(2) DELEGATION OF EASEMENT ADMINISTRA20 TION.— 

21 ‘‘(A) IN GENERAL.—The Secretary may 

22 delegate any of the easement management, 

23 monitoring, and enforcement responsibilities of 

24 the Secretary to other Federal or State agencies 

25 that have the appropriate authority, expertise 


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1 and resources necessary to carry out such dele2 gated responsibilities or to other conservation 

3 organizations if the Secretary determines the 

4 organization has similar expertise and re5 sources. 

6 ‘‘(B) LIMITATION.—The Secretary shall 

7 not delegate any of the monitoring or enforce8 ment responsibilities under the program to con9 servation organizations. 

10 ‘‘(3) PAYMENTS.— 

11 ‘‘(A) TIMING OF PAYMENTS.—The Sec12 retary shall provide payment for obligations in13 curred by the Secretary under this section— 

14 ‘‘(i) with respect to any easement res15 toration obligation as soon as possible after 

16 the obligation is incurred; and 

17 ‘‘(ii) with respect to any annual ease18 ment payment obligation incurred by the 

19 Secretary as soon as possible after October 

20 1 of each calendar year. 

21 ‘‘(B) PAYMENTS TO OTHERS.—If an owner 

22 who is entitled to a payment dies, becomes in23 competent, is otherwise unable to receive such 

24 payment, or is succeeded by another person or 

25 entity who renders or completes the required 


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1 performance, the Secretary shall make such 

2 payment, in accordance with regulations pre3 scribed by the Secretary and without regard to 

4 any other provision of law, in such manner as 

5 the Secretary determines is fair and reasonable 

6 in light of all of the circumstances. 

7 ‘‘SEC. 1265D. ADMINISTRATION. 

8 ‘‘(a) INELIGIBLE LAND.—The Secretary may not ac9 quire an easement under the program on— 

10 ‘‘(1) land owned by an agency of the United 

11 States, other than land held in trust for Indian 

12 tribes; 

13 ‘‘(2) land owned in fee title by a State, includ14 ing an agency or a subdivision of a State, or a unit 

15 of local government; 

16 ‘‘(3) land subject to an easement or deed re17 striction which, as determined by the Secretary, pro18 vides similar protection as would be provided by en19 rollment in the program; and 

20 ‘‘(4) land where the purposes of the program 

21 would be undermined due to on-site or off-site condi22 tions, such as risk of hazardous substances, pro23 posed or existing rights of way, infrastructure devel24 opment, or adjacent land uses. 


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1 ‘‘(b) PRIORITY.—In evaluating applications under the 

2 program, the Secretary may give priority to land that is 

3 currently enrolled in the conservation reserve program in 

4 a contract that is set to expire within 1 year and— 

5 ‘‘(1) in the case of an agricultural land ease6 ment, is grassland that would benefit from protec7 tion under a long-term easement; and 

8 ‘‘(2) in the case of a wetland easement, is a 

9 wetland or related area with the highest functions 

10 and values and is likely to return to production after 

11 the land leaves the conservation reserve program. 

12 ‘‘(c) SUBORDINATION, EXCHANGE, MODIFICATION, 

13 AND TERMINATION.— 

14 ‘‘(1) IN GENERAL.—The Secretary may subor15 dinate, exchange, terminate, or modify any interest 

16 in land, or portion of such interest, administered by 

17 the Secretary, either directly or on behalf of the 

18 Commodity Credit Corporation under the program 

19 when the Secretary determines that— 

20 ‘‘(A) it is in the Federal Government’s in21 terest to subordinate, exchange, modify or ter22 minate the interest in land; 

23 ‘‘(B) the subordination, exchange, modi24 fication, or termination action— 


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1 ‘‘(i) will address a compelling public 

2 need for which there is no practicable al3 ternative, or 

4 ‘‘(ii) such action will further the prac5 tical administration of the program; and 

6 ‘‘(C) the subordination, exchange, modi7 fication, or termination action will result in 

8 comparable conservation value and equivalent 

9 or greater economic value to the United States. 

10 ‘‘(2) CONSULTATION.—The Secretary shall 

11 work with the current owner, and eligible entity if 

12 applicable, to address any subordination, exchange, 

13 termination, or modification of the interest, or por14 tion of such interest in land. 

15 ‘‘(3) NOTICE.—At least 90 days before taking 

16 any termination action described in paragraph (1), 

17 the Secretary shall provide written notice of such ac18 tion to the Committee on Agriculture of the House 

19 of Representatives and the Committee on Agri20 culture, Nutrition, and Forestry of the Senate. 

21 ‘‘(d) LAND ENROLLED IN OTHER PROGRAMS.— 

22 ‘‘(1) CONSERVATION RESERVE PROGRAM.—The 

23 Secretary may terminate or modify an existing con24 tract entered into under section 1231(a) if eligible 


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1 land that is subject to such contract is transferred 

2 into the program. 

3 ‘‘(2) OTHER.—Land enrolled in the wetlands 

4 reserve program, grassland reserve program, or 

5 farmland protection program shall be considered en6 rolled in this program. 

7 ‘‘(e) ALLOCATION OF FUNDS FOR AGRICULTURAL

8 LAND EASEMENTS.—Of the funds made available under 

9 section 1241 to carry out the program for a fiscal year, 

10 the Secretary shall, to the extent practicable, use no less 

11 than 40 percent for agricultural land easements.’’. 

12 (b) COMPLIANCE WITH CERTAIN REQUIREMENTS.— 

13 Before an eligible entity or owner of eligible land may re14 ceive assistance under subtitle H of title XII of the Food 

15 Security Act of 1985, the eligible entity or person shall 

16 agree, during the crop year for which the assistance is pro17 vided and in exchange for the assistance— 

18 (1) to comply with applicable conservation re19 quirements under subtitle B of title XII of that Act 

20 (16 U.S.C. 3811 et seq.); and 

21 (2) to comply with applicable wetland protection 

22 requirements under subtitle C of title XII of that 

23 Act (16 U.S.C. 3821 et seq.). 

24 (c) CROSS REFERENCE.—Section 1244 of the Food 

25 Security Act of 1985 (16 U.S.C. 3844) is amended— 


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1 (1) in subsection (c)— 

2 (A) in paragraph (1)— 

3 (i) by inserting ‘‘and’’ at the end of 

4 subparagraph (A); 

5 (ii) by striking ‘‘and’’ at the end of 

6 subparagraph (B); and 

7 (iii) by striking subparagraph (C); 

8 (B) by redesignating paragraph (2) as 

9 paragraph (3); and 

10 (C) by inserting after paragraph (1) the 

11 following: 

12 ‘‘(2) the Agricultural Conservation Easement 

13 Program established under subtitle H; and’’; and 

14 (2) in subsection (f)— 

15 (A) in paragraph (1)— 

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

17 ‘‘programs administered under subchapters 

18 B and C of chapter 1 of subtitle D’’ and 

19 inserting ‘‘conservation reserve program 

20 established under subchapter B of chapter 

21 1 of subtitle D and the Agricultural Con22 servation Easement Program under sub23 title H using wetland easements under sec24 tion 1265C’’; and 


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1 (ii) in subparagraph (B), by striking 

2 ‘‘subchapter C of chapter 1 of subtitle D’’ 

3 and inserting ‘‘the Agricultural Conserva4 tion Easement Program under subtitle H 

5 using wetland easements under section 

6 1265C’’; and 

7 (B) in paragraph (4), by striking ‘‘sub8 chapter C’’ and inserting ‘‘subchapter B’’. 

9 (d) EFFECTIVE DATE.—The amendments made by 

10 this section shall take effect on October 1, 2012. 

11 Subtitle E—Regional Conservation 

12 Partnership Program 

13 SEC. 2401. REGIONAL CONSERVATION PARTNERSHIP PRO14 GRAM. 

15 (a) IN GENERAL.—Title XII of the Food Security 

16 Act of 1985 is amended by inserting after subtitle H (as 

17 added by section 2301) the following: 

18 ‘‘Subtitle I—Regional Conservation 

19 Partnership Program 

20 ‘‘SEC. 1271. ESTABLISHMENT AND PURPOSES. 

21 ‘‘(a) ESTABLISHMENT.—The Secretary shall estab22 lish a Regional Conservation Partnership Program to im23 plement eligible activities through— 

24 ‘‘(1) partnership agreements with eligible part25 ners; and 


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1 ‘‘(2) contracts with producers. 

2 ‘‘(b) PURPOSES.—The purposes of the program 

3 are— 

4 ‘‘(1) to combine the purposes and coordinate 

5 the functions of— 

6 ‘‘(A) the agricultural water enhancement 

7 program established under section 1240I; 

8 ‘‘(B) the Chesapeake Bay watershed pro9 gram established under section 1240Q; 

10 ‘‘(C) the cooperative conservation partner11 ship initiative established under section 1243; 

12 and 

13 ‘‘(D) the Great Lakes basin program for 

14 soil erosion and sediment control established 

15 under section 1240P;. 

16 ‘‘(2) to further the conservation, restoration, 

17 and sustainable use of soil, water, wildlife, and re18 lated natural resources on a regional or watershed 

19 scale; and 

20 ‘‘(3) to encourage partners to cooperate with 

21 producers in— 

22 ‘‘(A) meeting or avoiding the need for na23 tional, State, and local natural resource regu24 latory requirements related to production; and 


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1 ‘‘(B) implementing projects that will result 

2 in the installation and maintenance of eligible 

3 activities that affect multiple agricultural or 

4 nonindustrial private forest operations on a 

5 local, regional, State, or multi-State basis. 

6 ‘‘SEC. 1271A. DEFINITIONS. 

7 ‘‘In this subtitle: 

8 ‘‘(1) COVERED PROGRAMS.—The term ‘covered 

9 programs’ means— 

10 ‘‘(A) the agricultural conservation ease11 ment program; 

12 ‘‘(B) the environmental quality incentives 

13 program; and 

14 ‘‘(C) the conservation stewardship pro15 gram. 

16 ‘‘(2) ELIGIBLE ACTIVITY.—The term ‘eligible 

17 activity’ means any of the following conservation ac18 tivities when delivered through a covered program: 

19 ‘‘(A) Water quality restoration or enhance20 ment projects, including nutrient management 

21 and sediment reduction. 

22 ‘‘(B) Water quantity conservation, restora23 tion, or enhancement projects relating to sur24 face water and groundwater resources, includ25 ing— 


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1 ‘‘(i) the conversion of irrigated crop2 land to the production of less water-inten3 sive agricultural commodities or dryland 

4 farming; and 

5 ‘‘(ii) irrigation system improvement 

6 and irrigation efficiency enhancement. 

7 ‘‘(C) Drought mitigation. 

8 ‘‘(D) Flood prevention. 

9 ‘‘(E) Water retention. 

10 ‘‘(F) Habitat conservation, restoration, 

11 and enhancement. 

12 ‘‘(G) Erosion control. 

13 ‘‘(H) Other related activities that the Sec14 retary determines will help achieve conservation 

15 benefits. 

16 ‘‘(3) ELIGIBLE PARTNER.—The term ‘eligible 

17 partner’ means any of the following: 

18 ‘‘(A) An agricultural or silvicultural pro19 ducer association or other group of producers. 

20 ‘‘(B) A State or unit of local government. 

21 ‘‘(C) An Indian tribe. 

22 ‘‘(D) A farmer cooperative. 

23 ‘‘(E) An institution of higher education. 

24 ‘‘(F) An organization with an established 

25 history of working cooperatively with producers 


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1 on agricultural land, as determined by the Sec2 retary, to address— 

3 ‘‘(i) local conservation priorities re4 lated to agricultural production, wildlife 

5 habitat development, and nonindustrial pri6 vate forest land management; or 

7 ‘‘(ii) critical watershed-scale soil ero8 sion, water quality, sediment reduction, or 

9 other natural resource concerns. 

10 ‘‘(4) PARTNERSHIP AGREEMENT.—The term 

11 ‘partnership agreement’ means an agreement be12 tween the Secretary and an eligible partner. 

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

14 the Regional Conservation Partnership Program es15 tablished by this subtitle. 

16 ‘‘SEC. 1271B. REGIONAL CONSERVATION PARTNERSHIPS. 

17 ‘‘(a) PARTNERSHIP AGREEMENTS AUTHORIZED.— 

18 The Secretary may enter into a partnership agreement 

19 with an eligible partner to implement a project that will 

20 assist producers with installing and maintaining an eligi21 ble activity. 

22 ‘‘(b) LENGTH.—A partnership agreement shall be for 

23 a period not to exceed 5 years, except that the Secretary 

24 may extend the agreement 1 time for up to 12 months 


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1 when an extension is necessary to meet the objectives of 

2 the program. 

3 ‘‘(c) DUTIES OF PARTNERS.— 

4 ‘‘(1) IN GENERAL.—Under a partnership agree5 ment, the eligible partner shall— 

6 ‘‘(A) define the scope of a project, includ7 ing— 

8 ‘‘(i) the eligible activities to be imple9 mented; 

10 ‘‘(ii) the potential agricultural or non11 industrial private forest operations af12 fected; 

13 ‘‘(iii) the local, State, multi-State or 

14 other geographic area covered; and 

15 ‘‘(iv) the planning, outreach, imple16 mentation and assessment to be conducted; 

17 ‘‘(B) conduct outreach and education to 

18 producers for potential participation in the 

19 project; 

20 ‘‘(C) at the request of a producer, act on 

21 behalf of a producer participating in the project 

22 in applying for assistance under section 1271C; 

23 ‘‘(D) leverage financial or technical assist24 ance provided by the Secretary with additional 

25 funds to help achieve the project objectives; 


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1 ‘‘(E) conduct an assessment of the 

2 project’s effects; and 

3 ‘‘(F) at the conclusion of the project, re4 port to the Secretary on its results and funds 

5 leveraged. 

6 ‘‘(2) CONTRIBUTION.—A partner shall provide 

7 a significant portion of the overall costs of the scope 

8 of the project as determined by the Secretary. 

9 ‘‘(d) APPLICATIONS.— 

10 ‘‘(1) COMPETITIVE PROCESS.—The Secretary 

11 shall conduct a competitive process to select applica12 tions for partnership agreements and may assess 

13 and rank applications with similar conservation pur14 poses as a group. 

15 ‘‘(2) CRITERIA USED.—In carrying out the 

16 process described in paragraph (1), the Secretary 

17 shall make public the criteria used in evaluating ap18 plications. 

19 ‘‘(3) CONTENT.—An application to the Sec20 retary shall include a description of— 

21 ‘‘(A) the scope of the project as described 

22 in subsection (c)(1)(A); 

23 ‘‘(B) the plan for monitoring, evaluating, 

24 and reporting on progress made towards achiev25 ing the project’s objectives; 


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1 ‘‘(C) the program resources requested for 

2 the project, including the covered programs to 

3 be used and estimated funding needed from the 

4 Secretary; 

5 ‘‘(D) the partners collaborating to achieve 

6 project objectives, including their roles, respon7 sibilities, capabilities, and financial contribu8 tion; and 

9 ‘‘(E) any other elements the Secretary con10 siders necessary to adequately evaluate and 

11 competitively select applications for funding 

12 under the program. 

13 ‘‘(4) PRIORITY TO CERTAIN APPLICATIONS.— 

14 The Secretary may give a higher priority to applica15 tions that— 

16 ‘‘(A) have a high percentage of producers 

17 in the area to be covered by the agreement; 

18 ‘‘(B) assist producers in meeting or avoid19 ing the need for a natural resource regulatory 

20 requirement; 

21 ‘‘(C) significantly leverage non-Federal fi22 nancial and technical resources and coordinate 

23 with other local, State, regional, or national ef24 forts; 


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1 ‘‘(D) deliver high percentages of applied 

2 conservation to address conservation priorities 

3 or local, State, regional, or national conserva4 tion initiatives; 

5 ‘‘(E) provide innovation in conservation 

6 methods and delivery, including outcome-based 

7 performance measures and methods; or 

8 ‘‘(F) meet other factors that are important 

9 for achieving the purposes of the program, as 

10 determined by the Secretary. 

11 ‘‘SEC. 1271C. ASSISTANCE TO PRODUCERS. 

12 ‘‘(a) IN GENERAL.—The Secretary shall enter into 

13 contracts to provide financial and technical assistance 

14 to— 

15 ‘‘(1) producers participating in a project with 

16 an eligible partner as described in section 1271B; or 

17 ‘‘(2) producers that fit within the scope of a 

18 project described in section 1271B or a critical con19 servation area designated pursuant to section 

20 1271F, but who are seeking to implement an eligible 

21 activity independent of a partner. 

22 ‘‘(b) TERMS AND CONDITIONS.— 

23 ‘‘(1) CONSISTENCY WITH PROGRAM RULES.— 

24 Except as provided in paragraph (2), the Secretary 

25 shall ensure that the terms and conditions of a conVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00238 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 tract under this section are consistent with the ap2 plicable rules of the covered programs to be used as 

3 part of the project, as described in the application 

4 under section 1271B(d)(3)(C). 

5 ‘‘(2) ADJUSTMENTS.—Except for statutory pro6 gram requirements governing appeals, payment limi7 tations, and conservation compliance, the Secretary 

8 may adjust the discretionary program rules of a cov9 ered program— 

10 ‘‘(A) to provide a simplified application 

11 and evaluation process; and 

12 ‘‘(B) to better reflect unique local cir13 cumstances and purposes if the Secretary deter14 mines such adjustments are necessary to 

15 achieve the purposes of the program. 

16 ‘‘(3) ALTERNATIVE FUNDING ARRANGE17 MENTS.— 

18 ‘‘(A) IN GENERAL.—For the purposes of 

19 providing assistance for land described in sub20 section (a) and section 1271F, the Secretary 

21 may enter into alternative funding arrange22 ments with a multistate water resource agency 

23 or authority if— 

24 ‘‘(i) the Secretary determines that the 

25 goals and objectives of the program will be 


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1 met by the alternative funding arrange2 ments; 

3 ‘‘(ii) the agency or authority certifies 

4 that the limitations established under this 

5 section on agreements with individual pro6 ducers will not be exceeded; and 

7 ‘‘(iii) all participating producers meet 

8 applicable payment eligibility provisions. 

9 ‘‘(B) CONDITIONS.—As a condition on re10 ceipt of funding under subparagraph (A), the 

11 multistate water resource agency or authority 

12 shall agree— 

13 ‘‘(i) to submit an annual independent 

14 audit to the Secretary that describes the 

15 use of funds under this paragraph; 

16 ‘‘(ii) to provide any data necessary for 

17 the Secretary to issue a report on the use 

18 of funds under this paragraph; and 

19 ‘‘(iii) not to use any funds for admin20 istration or contracting with another enti21 ty. 

22 ‘‘(C) LIMITATION.—The Secretary may 

23 enter into not more than 10 alternative funding 

24 arrangements under this paragraph. 

25 ‘‘(c) PAYMENTS.— 


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1 ‘‘(1) IN GENERAL.—In accordance with statu2 tory requirements of the covered programs involved, 

3 the Secretary may make payments to a producer in 

4 an amount determined by the Secretary to be nec5 essary to achieve the purposes of the program. 

6 ‘‘(2) PAYMENTS TO PRODUCERS IN STATES

7 WITH WATER QUANTITY CONCERNS.—The Secretary 

8 may provide payments to producers participating in 

9 a project that addresses water quantity concerns for 

10 a period of 5 years in an amount sufficient to en11 courage conversion from irrigated farming to 

12 dryland farming. 

13 ‘‘(3) WAIVER AUTHORITY.—To assist in the im14 plementation of the program, the Secretary may 

15 waive the applicability of the limitation in section 

16 1001D(b)(2) of this Act for participating producers 

17 if the Secretary determines that the waiver is nec18 essary to fulfill the objectives of the program. 

19 ‘‘SEC. 1271D. FUNDING. 

20 ‘‘(a) AVAILABILITY OF FUNDS.—The Secretary shall 

21 use $100,000,000 of the funds of the Commodity Credit 

22 Corporation for each of fiscal years 2013 through 2017 

23 to carry out the program established under this subtitle. 


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1 ‘‘(b) DURATION OF AVAILABILITY.—Funds made 

2 available under subsection (a) shall remain available until 

3 expended. 

4 ‘‘(c) ADDITIONAL FUNDING AND ACRES.— 

5 ‘‘(1) IN GENERAL.—In addition to the funds 

6 made available under subsection (a), the Secretary 

7 shall reserve 6 percent of the funds and acres made 

8 available for a covered program for each of fiscal 

9 years 2013 through 2017 in order to ensure addi10 tional resources are available to carry out this pro11 gram. 

12 ‘‘(2) UNUSED FUNDS AND ACRES.—Any funds 

13 or acres reserved under paragraph (1) for a fiscal 

14 year from a covered program that are not obligated 

15 under this program by April 1 of that fiscal year 

16 shall be returned for use under the covered program. 

17 ‘‘(d) ALLOCATION OF FUNDING.—Of the funds and 

18 acres made available for the program under subsections 

19 (a) and (c), the Secretary shall allocate— 

20 ‘‘(1) 25 percent of the funds and acres to 

21 projects based on a State competitive process admin22 istered by the State conservationist, with the advice 

23 of the State technical committee; 


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1 ‘‘(2) 50 percent of the funds and acres to 

2 projects based on a national competitive process to 

3 be established by the Secretary; and 

4 ‘‘(3) 25 percent of the funds and acres to 

5 projects for the critical conservation areas des6 ignated in section 1271F. 

7 ‘‘(e) LIMITATION ON ADMINISTRATIVE EXPENSES.— 

8 None of the funds made available under the program may 

9 be used to pay for the administrative expenses of partners. 

10 ‘‘SEC. 1271E. ADMINISTRATION. 

11 ‘‘(a) DISCLOSURE.—In addition to the criteria used 

12 in evaluating applications as described in section 

13 1271B(d)(2), the Secretary shall make publicly available 

14 information on projects selected through the competitive 

15 process described in section 1271B(d)(1). 

16 ‘‘(b) REPORTING.—Not later than December 31, 

17 2013, and for every 2 years thereafter, the Secretary shall 

18 submit to the Committee on Agriculture of the House of 

19 Representatives and the Committee on Agriculture, Nutri20 tion, and Forestry of the Senate a report on the status 

21 of projects funded under the program, including— 

22 ‘‘(1) the number and types of partners and pro23 ducers participating in the partnership agreements 

24 selected; 


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1 ‘‘(2) the number of producers receiving assist2 ance; 

3 ‘‘(3) total funding committed to projects, in4 cluding Federal and non-Federal resources; and 

5 ‘‘(4) a description of how the funds under sec6 tion 1271C(b)(3) are being administered, includ7 ing— 

8 ‘‘(A) any oversight mechanisms that the 

9 Secretary has implemented; 

10 ‘‘(B) the process through which the Sec11 retary is resolving appeals by program partici12 pants; and 

13 ‘‘(C) the means by which the Secretary is 

14 tracking adherence to any applicable provisions 

15 for payment eligibility. 

16 ‘‘SEC. 1271F. CRITICAL CONSERVATION AREAS. 

17 ‘‘(a) IN GENERAL.—When administering the funding 

18 described in section 1271D(d)(3), the Secretary shall se19 lect applications for partnership agreements and producer 

20 contracts within designated critical conservation areas. 

21 ‘‘(b) CRITICAL CONSERVATION AREA DESIGNA22 TIONS.—In designating geographical areas as critical con23 servation areas under this section, the Secretary may give 

24 priority to not more than 8 areas based on the degree to 

25 which an area— 


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1 ‘‘(1) includes multiple States with significant 

2 agricultural production; 

3 ‘‘(2) is covered by an existing regional, State, 

4 binational, or multistate agreement or plan that has 

5 established objectives, goals and work plans and is 

6 adopted by a Federal, State, or regional authority; 

7 ‘‘(3) has water quality concerns, including con8 cerns for reducing erosion, promoting sediment con9 trol, and addressing nutrient management activities 

10 affecting large bodies of water of regional, national, 

11 or international significance; 

12 ‘‘(4) has water quantity concerns, including— 

13 ‘‘(A) concerns for groundwater, surface 

14 water, aquifer, or other water sources; or 

15 ‘‘(B) a need to promote water retention 

16 and flood prevention; or 

17 ‘‘(5) will be subject to regulatory requirements 

18 that could reduce the economic scope of agricultural 

19 operations within the area. 

20 ‘‘(c) ADMINISTRATION.— 

21 ‘‘(1) IN GENERAL.—Except as provided in para22 graph (2), the Secretary shall administer any part23 nership agreement or producer contract under this 

24 section in a manner that is consistent with the terms 

25 of the program. 


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1 ‘‘(2) RELATIONSHIP TO EXISTING ACTIVITY.— 

2 The Secretary shall, to the maximum extent prac3 ticable, ensure that eligible activities carried out in 

4 critical conservation areas designated under this sec5 tion complement and are consistent with other Fed6 eral and State programs and water quality and 

7 quantity strategies.’’. 

8 (b) EFFECTIVE DATE.—The amendment made by 

9 this section shall take effect on October 1, 2012. 

10 Subtitle F—Other Conservation 

11 Programs 

12 SEC. 2501. CONSERVATION OF PRIVATE GRAZING LAND. 

13 Section 1240M(e) of the Food Security Act of 1985 

14 (16 U.S.C. 3839bb(e)) is amended inserting ‘‘and 

15 $30,000,000 for each of fiscal years 2013 through 2017’’ 

16 before the period at the end. 

17 SEC. 2502. GRASSROOTS SOURCE WATER PROTECTION 

18 PROGRAM. 

19 Section 1240O(b) of the Food Security Act of 1985 

20 (16 U.S.C. 3839bb–2(b)) is amended by inserting ‘‘and 

21 $15,000,000 for each of fiscal years 2013 through 2017’’ 

22 before the period at the end. 


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1 SEC. 2503. VOLUNTARY PUBLIC ACCESS AND HABITAT IN2 CENTIVE PROGRAM. 

3 (a) FUNDING.—Section 1240R(f) of the Food Secu4 rity Act of 1985 (16 U.S.C. 3839bb–5(f)) is amended by 

5 inserting ‘‘and $40,000,000 for the period of fiscal years 

6 2013 through 2017’’ before the period at the end . 

7 (b) REPORT ON PROGRAM EFFECTIVENESS.—Not 

8 later than 2 years after the date of enactment of this Act, 

9 the Secretary of Agriculture shall submit to the Com10 mittee on Agriculture of the House of Representatives and 

11 the Committee on Agriculture, Nutrition, and Forestry of 

12 the Senate a report evaluating the effectiveness of the vol13 untary public access and habitat incentive program estab14 lished by section 1240R of the Food Security Act of 1985 

15 (16 U.S.C. 3839bb–5), including— 

16 (1) identifying cooperating agencies; 

17 (2) identifying the number of land holdings and 

18 total acres enrolled by State; 

19 (3) evaluating the extent of improved access on 

20 eligible land, improved wildlife habitat, and related 

21 economic benefits; and 

22 (4) any other relevant information and data re23 lating to the program that would be helpful to such 

24 Committees. 

25 (c) EFFECTIVE DATE.—The amendment made by 

26 this section shall take effect on October 1, 2012. 


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1 SEC. 2504. AGRICULTURE CONSERVATION EXPERIENCED 

2 SERVICES PROGRAM. 

3 (a) FUNDING.—Section 1252 of the Food Security 

4 Act of 1985 (16 U.S.C. 3851) is amended by striking sub5 section (c) and inserting the following: 

6 ‘‘(c) FUNDING.— 

7 ‘‘(1) IN GENERAL.—The Secretary may carry 

8 out the ACES program using funds made available 

9 to carry out each program under this title. 

10 ‘‘(2) EXCLUSION.—Funds made available to 

11 carry out the conservation reserve program may not 

12 be used to carry out the ACES program.’’. 

13 (b) EFFECTIVE DATE.—The amendment made by 

14 this section shall take effect on October 1, 2012. 

15 SEC. 2505. SMALL WATERSHED REHABILITATION PRO16 GRAM. 

17 Section 14(h)(2)(E) of the Watershed Protection and 

18 Flood Prevention Act (16 U.S.C. 1012(h)(2)(E)) is 

19 amended by striking ‘‘2012’’ and inserting ‘‘2017’’. 

20 SEC. 2506. TERMINAL LAKES ASSISTANCE. 

21 Section 2507 of the Food, Security, and Rural Invest22 ment Act of 2002 (43 U.S.C. 2211 note; Public Law 107– 

23 171) is amended to read as follows: 

24 ‘‘SEC. 2507. TERMINAL LAKES ASSISTANCE. 

25 ‘‘(a) DEFINITIONS.—In this section: 


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1 ‘‘(1) ELIGIBLE LAND.—The term ‘eligible land’ 

2 means privately owned agricultural land (including 

3 land in which a State has a property interest as a 

4 result of state water law)— 

5 ‘‘(A) that a landowner voluntarily agrees to 

6 sell to a State; and 

7 ‘‘(B) which— 

8 ‘‘(i)(I) is ineligible for enrollment as a 

9 wetland easement established under the 

10 Agricultural Conservation Easement Pro11 gram under subtitle H of the Food Secu12 rity Act of 1985; 

13 ‘‘(II) is flooded to— 

14 ‘‘(aa) an average depth of at 

15 least 6.5 feet; or 

16 ‘‘(bb) a level below which the 

17 State determines the management of 

18 the water level is beyond the control 

19 of the State or landowner; or 

20 ‘‘(III) is inaccessible for agricultural 

21 use due to the flooding of adjoining prop22 erty (such as islands of agricultural land 

23 created by flooding); 


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1 ‘‘(ii) is located within a watershed 

2 with water rights available for lease or 

3 purchase; and 

4 ‘‘(iii) has been used during at least 5 

5 of the immediately preceding 30 years— 

6 ‘‘(I) to produce crops or hay; or 

7 ‘‘(II) as livestock pasture or 

8 grazing. 

9 ‘‘(2) PROGRAM.—The term ‘program’ means 

10 the voluntary land purchase program established 

11 under this section. 

12 ‘‘(3) TERMINAL LAKE.—The term ‘terminal 

13 lake’ means a lake and its associated riparian and 

14 watershed resources that is— 

15 ‘‘(A) considered flooded because there is no 

16 natural outlet for water accumulating in the 

17 lake or the associated riparian area such that 

18 the watershed and surrounding land is consist19 ently flooded; or 

20 ‘‘(B) considered terminal because it has no 

21 natural outlet and is at risk due to a history of 

22 consistent Federal assistance to address critical 

23 resource conditions, including insufficient water 

24 available to meet the needs of the lake, general 

25 uses, and water rights. 


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1 ‘‘(b) ASSISTANCE.—The Secretary shall— 

2 ‘‘(1) provide grants under subsection (c) for the 

3 purchase of eligible land impacted by a terminal lake 

4 described in subsection (a)(3)(A); and 

5 ‘‘(2) provide funds to the Secretary of the Inte6 rior pursuant to subsection (e)(2) with assistance in 

7 accordance with subsection (d) for terminal lakes de8 scribed in subsection (a)(3)(B). 

9 ‘‘(c) LAND PURCHASE GRANTS.— 

10 ‘‘(1) IN GENERAL.—Using funds provided 

11 under subsection (e)(1), the Secretary shall make 

12 available land purchase grants to States for the pur13 chase of eligible land in accordance with this sub14 section. 

15 ‘‘(2) IMPLEMENTATION.— 

16 ‘‘(A) AMOUNT.—A land purchase grant 

17 shall be in an amount not to exceed the lesser 

18 of— 

19 ‘‘(i) 50 percent of the total purchase 

20 price per acre of the eligible land; or 

21 ‘‘(ii)(I) in the case of eligible land 

22 that was used to produce crops or hay, 

23 $400 per acre; and 


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1 ‘‘(II) in the case of eligible land that 

2 was pasture or grazing land, $200 per 

3 acre. 

4 ‘‘(B) DETERMINATION OF PURCHASE

5 PRICE.—A State purchasing eligible land with a 

6 land purchase grant shall ensure, to the max7 imum extent practicable, that the purchase 

8 price of such land reflects the value, if any, of 

9 other encumbrances on the eligible land to be 

10 purchased, including easements and mineral 

11 rights. 

12 ‘‘(C) COST-SHARE REQUIRED.—To be eligi13 ble to receive a land purchase grant, a State 

14 shall provide matching non-Federal funds in an 

15 amount equal to 50 percent of the amount de16 scribed in subparagraph (A), including addi17 tional non-Federal funds. 

18 ‘‘(D) CONDITIONS.—To receive a land pur19 chase grant, a State shall agree— 

20 ‘‘(i) to ensure that any eligible land 

21 purchased is— 

22 ‘‘(I) conveyed in fee simple to the 

23 State; and 


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1 ‘‘(II) free from mortgages or 

2 other liens at the time title is trans3 ferred; 

4 ‘‘(ii) to maintain ownership of the eli5 gible land in perpetuity; 

6 ‘‘(iii) to pay (from funds other than 

7 grant dollars awarded) any costs associ8 ated with the purchase of eligible land 

9 under this section, including surveys and 

10 legal fees; and 

11 ‘‘(iv) to keep eligible land in a con12 serving use, as defined by the Secretary. 

13 ‘‘(E) LOSS OF FEDERAL BENEFITS.—Eligi14 ble land purchased with a grant under this sec15 tion shall lose eligibility for any benefits under 

16 other Federal programs, including— 

17 ‘‘(i) benefits under title XII of the 

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

19 3801 et seq.); 

20 ‘‘(ii) benefits under the Federal Crop 

21 Insurance Act (7 U.S.C. 1501 et seq.); and 

22 ‘‘(iii) covered benefits described in 

23 section 1001D(b) of the Food Security Act 

24 of 1985 (7 U.S.C. 1308–3a). 


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1 ‘‘(F) PROHIBITION.—Any Federal rights 

2 or benefits associated with eligible land prior to 

3 purchase by a State may not be transferred to 

4 any other land or person in anticipation of or 

5 as a result of such purchase. 

6 ‘‘(d) WATER ASSISTANCE.— 

7 ‘‘(1) IN GENERAL.—The Secretary of the Inte8 rior, acting through the Commissioner of Reclama9 tion, may use the funds described in subsection 

10 (e)(2) to administer and provide financial assistance 

11 to carry out this subsection to provide water and as12 sistance to a terminal lake described in subsection 

13 (a)(3)(B) through willing sellers or willing partici14 pants only— 

15 ‘‘(A) to lease water; 

16 ‘‘(B) to purchase land, water appurtenant 

17 to the land, and related interests; and 

18 ‘‘(C) to carry out research, support and 

19 conservation activities for associated fish, wild20 life, plant, and habitat resources.’’ 

21 ‘‘(2) EXCLUSIONS.—The Secretary of the Inte22 rior may not use this subsection to deliver assistance 

23 to the Great Salt Lake in Utah, lakes that are con24 sidered dry lakes, or other lakes that do not meet 


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1 the purposes of this section, as determined by the 

2 Secretary of the Interior. 

3 ‘‘(3) TRANSITIONAL PROVISION.— 

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

5 other provision of this section, any funds made 

6 available before the date of enactment of the 

7 Agriculture Reform, Food, and Jobs Act of 

8 2012 under a provision of law described in sub9 paragraph (B) shall remain available using the 

10 provisions of law (including regulations) in ef11 fect on the day before the date of enactment of 

12 that Act. 

13 ‘‘(B) DESCRIBED LAWS.—The provisions 

14 of law described in this section are— 

15 ‘‘(i) section 2507 of the Farm Secu16 rity and Rural Investment Act of 2002 (43 

17 U.S.C. 2211 note; Public Law 107–171) 

18 (as in effect on the day before the date of 

19 enactment of the Agriculture Reform, 

20 Food, and Jobs Act of 2012); 

21 ‘‘(ii) section 207 of the Energy and 

22 Water Development Appropriations Act, 

23 2003 (Public Law 108–7; 117 Stat. 146); 

24 ‘‘(iii) section 208 of the Energy and 

25 Water Development Appropriations Act, 


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1 2006 (Public Law 109–103; 119 Stat. 

2 2268, 123 Stat. 2856); and 

3 ‘‘(iv) section 208 of the Energy and 

4 Water Development and Related Agencies 

5 Appropriations Act, 2010 (Public Law 

6 111–85; 123 Stat. 2858, 123 Stat. 2967, 

7 125 Stat. 867). 

8 ‘‘(e) FUNDING.— 

9 ‘‘(1) AUTHORIZATION OF APPROPRIATIONS.— 

10 There is authorized to be appropriated to the Sec11 retary to carry out subsection (c) $25,000,000, to 

12 remain available until expended. 

13 ‘‘(2) COMMODITY CREDIT CORPORATION.—As 

14 soon as practicable after the date of enactment of 

15 the Agriculture Reform, Food, and Jobs Act of 

16 2012, the Secretary shall transfer to the Bureau of 

17 Reclamation Water and Related Resources Account 

18 $150,000,000 from the funds of the Commodity 

19 Credit Corporation to carry out subsection (d), to re20 main available until expended.’’. 


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1 Subtitle G—Funding and 

2 Administration 

3 SEC. 2601. FUNDING. 

4 (a) IN GENERAL.—Section 1241 of the Food Security 

5 Act of 1985 (16 U.S.C. 3841) is amended by striking sub6 section (a) and inserting the following: 

7 ‘‘(a) ANNUAL FUNDING.—For each of fiscal years 

8 2013 through 2017, the Secretary shall use the funds, fa9 cilities, and authorities of the Commodity Credit Corpora10 tion to carry out the following programs under this title 

11 (including the provision of technical assistance): 

12 ‘‘(1) The conservation reserve program under 

13 subchapter B of chapter 1 of subtitle D, including, 

14 to the maximum extent practicable— 

15 ‘‘(A) $10,000,000 for the period of fiscal 

16 years 2013 through 2017 to provide payments 

17 under paragraph (3) of section 1234(b) in con18 nection with thinning activities conducted on 

19 land described in subparagraph (B)(iii) of that 

20 paragraph; and 

21 ‘‘(B) $50,000,000 for the period of fiscal 

22 years 2013 through 2017 to carry out section 

23 1235(f) to facilitate the transfer of land subject 

24 to contracts from retired or retiring owners and 


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1 operators to beginning farmers or ranchers and 

2 socially disadvantaged farmers or ranchers. 

3 ‘‘(2) The Agricultural Conservation Easement 

4 Program under subtitle H using to the maximum ex5 tent practicable— 

6 ‘‘(A) $450,000,000 for fiscal year 2013; 

7 ‘‘(B) $475,000,000 for fiscal year 2014; 

8 ‘‘(C) $500,000,000 for fiscal year 2015; 

9 ‘‘(D) $525,000,000 for fiscal year 2016; 

10 and 

11 ‘‘(E) $250,000,000 for fiscal year 2017. 

12 ‘‘(3) The conservation security program under 

13 subchapter A of chapter 2 of subtitle D, using such 

14 sums as are necessary to administer contracts en15 tered into before September 30, 2008. 

16 ‘‘(4) The conservation stewardship program 

17 under subchapter B of chapter 2 of subtitle D. 

18 ‘‘(5) The environmental quality incentives pro19 gram under chapter 4 of subtitle D, using, to the 

20 maximum extent practicable— 

21 ‘‘(A) $1,500,000,000 for fiscal year 2013; 

22 ‘‘(B) $1,600,000,000 for fiscal year 2014; 

23 and 

24 ‘‘(C) $1,650,000,000 for each of fiscal 

25 years 2015 through 2017.’’. 


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1 (b) GUARANTEED AVAILABILITY OF FUNDS.—Sec2 tion 1241 of the Food Security Act of 1985 (16 U.S.C. 

3 3841) is amended— 

4 (1) by redesignating subsections (b) through (h) 

5 as subsections (c) through (i), respectively; and 

6 (2) by inserting after subsection (a) the fol7 lowing: 

8 ‘‘(b) AVAILABILITY OF FUNDS.—Amounts made 

9 available by subsection (a) shall be used by the Secretary 

10 to carry out the programs specified in such subsection for 

11 fiscal years 2013 through 2017 and shall remain available 

12 until expended. Amounts made available for the programs 

13 specified in such subsection during a fiscal year through 

14 modifications, cancellations, terminations, and other re15 lated administrative actions and not obligated in that fis16 cal year shall remain available for obligation during subse17 quent fiscal years, but shall reduce the amount of addi18 tional funds made available in the subsequent fiscal year 

19 by an amount equal to the amount remaining unobli20 gated.’’. 

21 (c) EFFECTIVE DATE.—The amendments made by 

22 this section shall take effect on October 1, 2012. 

23 SEC. 2602. TECHNICAL ASSISTANCE. 

24 Section 1241 of the Food Security Act of 1985 (16 

25 U.S.C. 3841) is amended by striking subsection (c) (as 


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1 redesignated by section 2601(b)(1)) and inserting the fol2 lowing: 

3 ‘‘(c) TECHNICAL ASSISTANCE.— 

4 ‘‘(1) AVAILABILITY OF FUNDS.—Commodity 

5 Credit Corporation funds made available for a fiscal 

6 year for each of the programs specified in subsection 

7 (a)— 

8 ‘‘(A) shall be available for the provision of 

9 technical assistance for the programs for which 

10 funds are made available as necessary to imple11 ment the programs effectively; and 

12 ‘‘(B) shall not be available for the provi13 sion of technical assistance for conservation 

14 programs specified in subsection (a) other than 

15 the program for which the funds were made 

16 available. 

17 ‘‘(2) REPORT.—Not later than December 31, 

18 2012, the Secretary shall submit (and update as 

19 necessary in subsequent years) to the Committee on 

20 Agriculture of the House of Representatives and the 

21 Committee on Agriculture, Nutrition, and Forestry 

22 of the Senate a report— 

23 ‘‘(A) detailing the amount of technical as24 sistance funds requested and apportioned in 


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1 each program specified in subsection (a) during 

2 the preceding fiscal year; and 

3 ‘‘(B) any other data relating to this provi4 sion that would be helpful to such Commit5 tees.’’. 

6 SEC. 2603. REGIONAL EQUITY. 

7 Section 1241 of the Food Security Act of 1985 (16 

8 U.S.C. 3841) is amended by striking subsection (e) (as 

9 redesignated by section 2601(b)(1)) and inserting the fol10 lowing: 

11 ‘‘(e) REGIONAL EQUITY.— 

12 ‘‘(1) EQUITABLE DISTRIBUTION.—When deter13 mining funding allocations each fiscal year, the Sec14 retary shall, after considering available funding and 

15 program demand in each State, provide a distribu16 tion of funds for conservation programs under sub17 title D (excluding the conservation reserve program 

18 under subchapter B of chapter 1), subtitle H (ex19 cluding wetland easements under section 1265C), 

20 and subtitle I to ensure equitable program participa21 tion proportional to historical funding allocations 

22 and usage by all States. 

23 ‘‘(2) MINIMUM PERCENTAGE.—In determining 

24 the specific funding allocations under paragraph (1), 

25 the Secretary shall— 


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1 ‘‘(A) ensure that during the first quarter 

2 of each fiscal year each State has the oppor3 tunity to establish that the State can use an ag4 gregate allocation amount of at least 0.6 per5 cent of the funds made available for those con6 servation programs; and 

7 ‘‘(B) for each State that can so establish, 

8 provide an aggregate amount of at least 0.6 

9 percent of the funds made available for those 

10 conservation programs.’’. 

11 SEC. 2604. RESERVATION OF FUNDS TO PROVIDE ASSIST12 ANCE TO CERTAIN FARMERS OR RANCHERS 

13 FOR CONSERVATION ACCESS. 

14 Subsection (h) of section 1241 of the Food Security 

15 Act of 1985 (16 U.S.C. 3841) (as redesignated by section 

16 2601(b)(1)) is amended— 

17 (1) in paragraph (1) by striking ‘‘2012’’ and in18 serting ‘‘2017’’; and 

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

20 ‘‘(4) PREFERENCE.—In providing assistance 

21 under paragraph (1), the Secretary shall give pref22 erence to a veteran farmer or rancher (as defined in 

23 section 2501(e) of the Food, Agriculture, Conserva24 tion, and Trade Act of 1990 (7 U.S.C. 2279(e))) 


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1 that qualifies under subparagraph (A) or (B) of 

2 paragraph (1).’’. 

3 SEC. 2605. ANNUAL REPORT ON PROGRAM ENROLLMENTS 

4 AND ASSISTANCE. 

5 Subsection (i) of section 1241 of the Food Security 

6 Act of 1985 (16 U.S.C. 3841) (as redesignated by section 

7 2601(b)(1)) is amended— 

8 (1) in paragraph (1), by striking ‘‘wetlands re9 serve program’’ and inserting ‘‘agricultural conserva10 tion easement program’’; 

11 (2) by striking paragraphs (2) and (3) and re12 designating paragraphs (4), (5), and (6) as para13 graphs (2), (3), and (4), respectively; 

14 (3) in paragraph (3) (as so redesignated)— 

15 (A) by striking ‘‘agricultural water en16 hancement program’’ and inserting ‘‘regional 

17 conservation partnership program’’; and 

18 (B) by striking ‘‘section 1240I(g)’’ and in19 serting ‘‘section 1271C(c)(3)’’; and 

20 (4) by adding at the end the following: 

21 ‘‘(5) Payments made under the conservation 

22 stewardship program. 

23 ‘‘(6) Waivers granted by the Secretary under 

24 section 1265B(b)(2)(C).’’. 


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1 SEC. 2606. ADMINISTRATIVE REQUIREMENTS FOR CON2 SERVATION PROGRAMS. 

3 Section 1244 of the Food Security Act of 1985 (16 

4 U.S.C. 3844) is amended— 

5 (1) in subsection (a)(2), by adding at the end 

6 the following: 

7 ‘‘(E) Veteran farmers or ranchers (as de8 fined in section 2501(e) of the Food, Agri9 culture, Conservation, and Trade Act of 1990 

10 (7 U.S.C. 2279(e))).’’; 

11 (2) in subsection (d), by inserting ‘‘, H, and I’’ 

12 before the period at the end; 

13 (3) in subsection (f)— 

14 (A) in paragraph (1)(B), by striking 

15 ‘‘country’’ and inserting ‘‘county’’; and 

16 (B) in paragraph (3), by striking ‘‘sub17 section (c)(2)(B) or (f)(4)’’ and inserting ‘‘sub18 section (c)(2)(A)(ii) or (f)(2)’’; 

19 (4) by striking subsection (i) and inserting the 

20 following: 

21 ‘‘(i) CONSERVATION APPLICATION PROCESS.— 

22 ‘‘(1) INITIAL APPLICATION.— 

23 ‘‘(A) IN GENERAL.—Not later than 1 year 

24 after the date of enactment of this subsection, 

25 the Secretary shall establish a single, simplified 

26 application for eligible entities to use in initially 


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1 requesting assistance under any conservation 

2 program administered by the Secretary (re3 ferred to in this subsection as the ‘initial appli4 cation’). 

5 ‘‘(B) REQUIREMENTS.—To the maximum 

6 extent practicable, the Secretary shall ensure 

7 that— 

8 ‘‘(i) a conservation program applicant 

9 is not required to provide information that 

10 is duplicative of information or resources 

11 already available to the Secretary for that 

12 applicant and the specific operation of the 

13 applicant; and 

14 ‘‘(ii) the initial application process is 

15 streamlined to minimize complexity and re16 dundancy. 

17 ‘‘(2) REVIEW OF APPLICATION PROCESS.— 

18 ‘‘(A) IN GENERAL.—Not later than 1 year 

19 after the date of enactment of this subsection, 

20 the Secretary shall review the application proc21 ess for each conservation program administered 

22 by the Secretary, including the forms and proc23 esses used to receive assistance requests from 

24 eligible program participants. 


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1 ‘‘(B) REQUIREMENTS.—In carrying out 

2 the review, the Secretary shall determine what 

3 information the participant is required to sub4 mit during the application process, including— 

5 ‘‘(i) identification information for the 

6 applicant; 

7 ‘‘(ii) identification and location infor8 mation for the land parcel or tract of con9 cern; 

10 ‘‘(iii) a general statement of the need 

11 or resource concern of the applicant for the 

12 land parcel or tract; and 

13 ‘‘(iv) the minimum amount of other 

14 information the Secretary considers to be 

15 essential for the applicant to provide per16 sonally. 

17 ‘‘(3) REVISION AND STREAMLINE.— 

18 ‘‘(A) IN GENERAL.—Not later than 1 year 

19 after the date of enactment of this subsection, 

20 the Secretary shall carry out a revision of the 

21 application forms and processes for each con22 servation program administered by the Sec23 retary to enable use of information technology 

24 to incorporate appropriate data and information 

25 concerning the conservation needs and solutions 


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1 appropriate for the land area identified by the 

2 applicant. 

3 ‘‘(B) GOAL.—The goal of the revision shall 

4 be to streamline the application process to mini5 mize the burden placed on applicants. 

6 ‘‘(4) CONSERVATION PROGRAM APPLICATION.— 

7 ‘‘(A) IN GENERAL.—Once the needs of an 

8 applicant have been adequately assessed by the 

9 Secretary, or a third party provider under sec10 tion 1242, based on the initial application, in 

11 order to determine the 1 or more programs 

12 under this title that best match the needs of the 

13 applicant, with the approval of the applicant, 

14 the Secretary may convert the initial application 

15 into the specific application for assistance for 

16 the relevant conservation program. 

17 ‘‘(B) SECRETARIAL BURDEN.—To the 

18 maximum extent practicable, the Secretary 

19 shall— 

20 ‘‘(i) complete the specific application 

21 for conservation program assistance for 

22 each applicant; and 

23 ‘‘(ii) request only that specific further 

24 information from the applicant that is not 

25 already available to the Secretary. 


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1 ‘‘(5) IMPLEMENTATION AND NOTIFICATION.— 

2 Not later than 1 year after the date of enactment 

3 of this subsection, the Secretary shall submit to the 

4 Committee on Agriculture of the House of Rep5 resentatives and the Committee on Agriculture, Nu6 trition, and Forestry of the Senate written notifica7 tion that the Secretary has fulfilled the requirements 

8 of this subsection.’’; and 

9 (5) by adding at the end the following: 

10 ‘‘(j) IMPROVED ADMINISTRATIVE EFFICIENCY AND

11 EFFECTIVENESS.—In administrating a conservation pro12 gram under this title, the Secretary shall, to the maximum 

13 extent practicable— 

14 ‘‘(1) seek to reduce administrative burdens and 

15 costs to producers by streamlining conservation 

16 planning and program resources; and 

17 ‘‘(2) take advantage of new technologies to en18 hance efficiency and effectiveness. 

19 ‘‘(k) RELATION TO OTHER PAYMENTS.—Any pay20 ment received by an owner or operator under this title, 

21 including an easement payment or rental payment, shall 

22 be in addition to, and not affect, the total amount of pay23 ments that the owner or operator is otherwise eligible to 

24 receive under any of the following: 

25 ‘‘(1) This Act. 


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1 ‘‘(2) The Agricultural Act of 1949 (7 U.S.C. 

2 1421 et seq.). 

3 ‘‘(3) The Agriculture Reform, Food, and Jobs 

4 Act of 2012. 

5 ‘‘(4) Any law that succeeds a law specified in 

6 paragraph (1), (2), or (3). 

7 ‘‘(l) FUNDING FOR INDIAN TRIBES.—In carrying out 

8 the conservation stewardship program under subchapter 

9 B of chapter 2 of subtitle D and the environmental quality 

10 incentives program under chapter 4 of subtitle D, the Sec11 retary may enter into alternative funding arrangements 

12 with Indian tribes if the Secretary determines that the 

13 goals and objectives of the programs will be met by such 

14 arrangements, and that statutory limitations regarding 

15 contracts with individual producers will not be exceeded 

16 by any Tribal member.’’. 

17 SEC. 2607. RULEMAKING AUTHORITY. 

18 Subtitle E of title XII of the Food Security Act of 

19 1985 (16 U.S.C. 3841 et seq.) is amended by adding at 

20 the end the following: 

21 ‘‘SEC. 1246. REGULATIONS. 

22 ‘‘(a) IN GENERAL.—The Secretary shall promulgate 

23 such regulations as are necessary to implement programs 

24 under this title, including such regulations as the Sec25 retary determines to be necessary to ensure a fair and reaVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00269 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 sonable application of the limitations established under 

2 section 1244(f). 

3 ‘‘(b) RULEMAKING PROCEDURE.—The promulgation 

4 of regulations and administration of programs under this 

5 title— 

6 ‘‘(1) shall be carried out without regard to— 

7 ‘‘(A) the Statement of Policy of the Sec8 retary effective July 24, 1971 (36 Fed. Reg. 

9 13804), relating to notices of proposed rule10 making and public participation in rulemaking; 

11 and 

12 ‘‘(B) chapter 35 of title 44, United States 

13 Code (commonly known as the Paperwork Re14 duction Act); and 

15 ‘‘(2) shall be made as an interim rule effective 

16 on publication with an opportunity for notice and 

17 comment. 

18 ‘‘(c) CONGRESSIONAL REVIEW OF AGENCY RULE19 MAKING.—In promulgating regulations under this section, 

20 the Secretary shall use the authority provided under sec21 tion 808 of title 5, United States Code.’’. 

22 SEC. 2608. STANDARDS FOR STATE TECHNICAL COMMIT23 TEES. 

24 Section 1261(b) of the Food Security Act of 1985 

25 (16 U.S.C. 3861(b)) is amended by striking ‘‘Not later 


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1 than 180 days after the date of enactment of the Food, 

2 Conservation, and Energy Act of 2008, the Secretary shall 

3 develop’’ and inserting ‘‘The Secretary shall review and 

4 update as necessary’’. 

5 Subtitle H—Repeal of Superseded 

6 Program Authorities and Tran7 sitional Provisions 

8 SEC. 2701. COMPREHENSIVE CONSERVATION ENHANCE9 MENT PROGRAM. 

10 Section 1230 of the Food Security Act of 1985 (16 

11 U.S.C. 3830) is repealed. 

12 SEC. 2702. EMERGENCY FORESTRY CONSERVATION RE13 SERVE PROGRAM. 

14 (a) REPEAL.—Section 1231A of the Food Security 

15 Act of 1985 (16 U.S.C. 3831a) is repealed. 

16 (b) TRANSITIONAL PROVISIONS.— 

17 (1) EFFECT ON EXISTING CONTRACTS.—The 

18 amendment made by this section shall not affect the 

19 validity or terms of any contract entered into by the 

20 Secretary of Agriculture under section 1231A of the 

21 Food Security Act of 1985 (16 U.S.C. 3831a) before 

22 October 1, 2012, or any payments required to be 

23 made in connection with the contract. 

24 (2) FUNDING.—The Secretary may use funds 

25 made available to carry out the conservation reserve 


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1 program under subchapter B of chapter 1 of subtitle 

2 D of title XII of the Food Security Act of 1985 (16 

3 U.S.C. 3831 et seq.) to continue to carry out con4 tracts referred to in paragraph (1) using the provi5 sions of law and regulation applicable to such con6 tracts as in existence on September 30, 2012. 

7 (c) EFFECTIVE DATE.—The amendment made by 

8 this section shall take effect on October 1, 2012. 

9 SEC. 2703. WETLANDS RESERVE PROGRAM. 

10 (a) REPEAL.—Subchapter C of chapter 1 of subtitle 

11 D of title XII of the Food Security Act of 1985 (16 U.S.C. 

12 3837 et seq.) is repealed. 

13 (b) TRANSITIONAL PROVISIONS.— 

14 (1) EFFECT ON EXISTING CONTRACTS AND

15 EASEMENTS.—The amendment made by this section 

16 shall not affect the validity or terms of any contract 

17 or easement entered into by the Secretary of Agri18 culture under subchapter C of chapter 1 of subtitle 

19 D of title XII of the Food Security Act of 1985 (16 

20 U.S.C. 3837 et seq.) before October 1, 2012, or any 

21 payments required to be made in connection with the 

22 contract or easement. 

23 (2) FUNDING.— 

24 (A) USE OF PRIOR YEAR FUNDS.—Not25 withstanding the repeal of subchapter C of 


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

2 Security Act of 1985 (16 U.S.C. 3837 et seq.), 

3 any funds made available from the Commodity 

4 Credit Corporation to carry out the wetlands 

5 reserve program under that subchapter for fis6 cal years 2009 through 2012 shall be made 

7 available to carry out contracts or easements 

8 referred to in paragraph (1) that were entered 

9 into prior to October 1, 2012 (including the 

10 provision of technical assistance), provided that 

11 no such contract or easement is modified so as 

12 to increase the amount of the payment received. 

13 (B) OTHER.—The Secretary may use 

14 funds made available to carry out the agricul15 tural conservation easement program under 

16 subtitle H of title XII of the Food Security Act 

17 of 1985, as added by section 2301 of this Act, 

18 to continue to carry out contracts and ease19 ments referred to in paragraph (1) using the 

20 provisions of law and regulation applicable to 

21 such contracts and easements as in existence on 

22 September 30, 2012. 

23 (c) EFFECTIVE DATE.—The amendment made by 

24 this section shall take effect on October 1, 2012. 


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1 SEC. 2704. FARMLAND PROTECTION PROGRAM AND FARM 

2 VIABILITY PROGRAM. 

3 (a) REPEAL.—Subchapter C of chapter 2 of subtitle 

4 D of title XII of the Food Security Act of 1985 (16 U.S.C. 

5 3838h et seq.) is repealed. 

6 (b) TRANSITIONAL PROVISIONS.— 

7 (1) EFFECT ON EXISTING AGREEMENTS AND

8 EASEMENTS.—The amendment made by this section 

9 shall not affect the validity or terms of any agree10 ment or easement entered into by the Secretary of 

11 Agriculture under subchapter C of chapter 2 of sub12 title D of title XII of the Food Security Act of 1985 

13 (16 U.S.C. 3838h et seq.) before October 1, 2012, 

14 or any payments required to be made in connection 

15 with the agreement or easement. 

16 (2) FUNDING.— 

17 (A) USE OF PRIOR YEAR FUNDS.—Not18 withstanding the repeal of subchapter C of 

19 chapter 2 of subtitle D of title XII of the Food 

20 Security Act of 1985 (16 U.S.C. 3838h et seq.), 

21 any funds made available from the Commodity 

22 Credit Corporation to carry out the farmland 

23 protection program under that subchapter for 

24 fiscal years 2009 through 2012 shall be made 

25 available to carry out agreements and ease26 ments referred to in paragraph (1) that were 


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1 entered into prior to October 1, 2012 (including 

2 the provision of technical assistance). 

3 (B) OTHER.—On exhaustion of funds 

4 made available under subparagraph (A), the 

5 Secretary may use funds made available to 

6 carry out the agricultural conservation ease7 ment program under subtitle H of title XII of 

8 the Food Security Act of 1985, as added by 

9 section 2301 of this Act, to continue to carry 

10 out agreements and easements referred to in 

11 paragraph (1) using the provisions of law and 

12 regulation applicable to such agreements and 

13 easement as in existence on September 30, 

14 2012. 

15 (c) EFFECTIVE DATE.—The amendment made by 

16 this section shall take effect on October 1, 2012. 

17 SEC. 2705. GRASSLAND RESERVE PROGRAM. 

18 (a) REPEAL.—Subchapter D of chapter 2 of subtitle 

19 D of title XII of the Food Security Act of 1985 (16 U.S.C. 

20 3838n et seq.) is repealed. 

21 (b) TRANSITIONAL PROVISIONS.— 

22 (1) EFFECT ON EXISTING CONTRACTS, AGREE23 MENTS, AND EASEMENTS.—The amendment made 

24 by this section shall not affect the validity or terms 

25 of any contract, agreement, or easement entered into 


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1 by the Secretary of Agriculture under subchapter D 

2 of chapter 2 of subtitle D of title XII of the Food 

3 Security Act of 1985 (16 U.S.C. 3838n et seq.) be4 fore October 1, 2012, or any payments required to 

5 be made in connection with the contract, agreement, 

6 or easement. 

7 (2) FUNDING.— 

8 (A) USE OF PRIOR YEAR FUNDS.—Not9 withstanding the repeal of subchapter D of 

10 chapter 2 of subtitle D of title XII of the Food 

11 Security Act of 1985 (16 U.S.C. 3838n et seq.), 

12 any funds made available from the Commodity 

13 Credit Corporation to carry out the grassland 

14 reserve program under that subchapter for fis15 cal years 2009 through 2012 shall be made 

16 available to carry out contracts, agreements, or 

17 easements referred to in paragraph (1) that 

18 were entered into prior to October 1, 2012 (in19 cluding the provision of technical assistance), 

20 provided that no such contract, agreement, or 

21 easement is modified so as to increase the 

22 amount of the payment received. 

23 (B) OTHER.—The Secretary may use 

24 funds made available to carry out the agricul25 tural conservation easement program under 


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1 subtitle H of title XII of the Food Security Act 

2 of 1985, as added by section 2301 of this Act, 

3 to continue to carry out contracts, agreements, 

4 and easements referred to in paragraph (1) 

5 using the provisions of law and regulation appli6 cable to such contracts, agreements, and ease7 ments as in existence on September 30, 2012. 

8 (c) EFFECTIVE DATE.—The amendment made by 

9 this section shall take effect on October 1, 2012. 

10 SEC. 2706. AGRICULTURAL WATER ENHANCEMENT PRO11 GRAM. 

12 (a) REPEAL.—Section 1240I of the Food Security 

13 Act of 1985 (16 U.S.C. 3839aa–9) is repealed. 

14 (b) TRANSITIONAL PROVISIONS.— 

15 (1) EFFECT ON EXISTING CONTRACTS AND

16 AGREEMENTS.—The amendment made by this sec17 tion shall not affect the validity or terms of any con18 tract or agreement entered into by the Secretary of 

19 Agriculture under section 1240I of the Food Secu20 rity Act of 1985 (16 U.S.C. 3839aa–9) before Octo21 ber 1, 2012, or any payments required to be made 

22 in connection with the contract or agreement. 

23 (2) FUNDING.— 

24 (A) USE OF PRIOR YEAR FUNDS.—Not25 withstanding the repeal of section 1240I of the 


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1 Food Security Act of 1985 (16 U.S.C. 3839aa– 

2 9), any funds made available from the Com3 modity Credit Corporation to carry out the ag4 ricultural water enhancement program under 

5 that section for fiscal years 2009 through 2012 

6 shall be made available to carry out contracts 

7 and agreements referred to in paragraph (1) 

8 that were entered into prior to October 1, 2012 

9 (including the provision of technical assistance). 

10 (B) OTHER.—On exhaustion of funds 

11 made available under subparagraph (A), the 

12 Secretary may use funds made available to 

13 carry out the regional conservation partnerships 

14 program under subtitle I of title XII of the 

15 Food Security Act of 1985, as added by section 

16 2401 of this Act, to continue to carry out con17 tracts and agreements referred to in paragraph 

18 (1) using the provisions of law and regulation 

19 applicable to such contracts and agreements as 

20 in existence on September 30, 2012. 

21 (c) EFFECTIVE DATE.—The amendment made by 

22 this section shall take effect on October 1, 2012. 

23 SEC. 2707. WILDLIFE HABITAT INCENTIVE PROGRAM. 

24 (a) REPEAL.—Section 1240N of the Food Security 

25 Act of 1985 (16 U.S.C. 3839bb–1) is repealed. 


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1 (b) TRANSITIONAL PROVISIONS.— 

2 (1) EFFECT ON EXISTING CONTRACTS.—The 

3 amendment made by this section shall not affect the 

4 validity or terms of any contract entered into by the 

5 Secretary of Agriculture under section 1240N of the 

6 Food Security Act of 1985 (16 U.S.C. 3839bb–1) 

7 before October 1, 2012, or any payments required to 

8 be made in connection with the contract. 

9 (2) FUNDING.— 

10 (A) USE OF PRIOR YEAR FUNDS.—Not11 withstanding the repeal of section 1240N of the 

12 Food Security Act of 1985 (16 U.S.C. 3839bb– 

13 1), any funds made available from the Com14 modity Credit Corporation to carry out the 

15 wildlife habitat incentive program under that 

16 section for fiscal years 2009 through 2012 shall 

17 be made available to carry out contracts re18 ferred to in paragraph (1) which were entered 

19 into prior to October 1, 2012 (including the 

20 provision of technical assistance). 

21 (B) OTHER.—On exhaustion of funds 

22 made available under subparagraph (A), the 

23 Secretary may use funds made available to 

24 carry out the environmental quality incentives 

25 program under chapter 4 of subtitle D of title 


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1 XII of the Food Security Act of 1985 (16 

2 U.S.C. 3839aa et seq.) to continue to carry out 

3 contracts referred to in paragraph (1) using the 

4 provisions of law and regulation applicable to 

5 such contracts as in existence on September 30, 

6 2012. 

7 (c) EFFECTIVE DATE.—The amendment made by 

8 this section shall take effect on October 1, 2012. 

9 SEC. 2708. GREAT LAKES BASIN PROGRAM. 

10 (a) REPEAL.—Section 1240P of the Food Security 

11 Act of 1985 (16 U.S.C. 3839bb–3) is repealed. 

12 (b) EFFECTIVE DATE.—The amendment made by 

13 this section shall take effect on October 1, 2012. 

14 SEC. 2709. CHESAPEAKE BAY WATERSHED PROGRAM. 

15 (a) REPEAL.—Section 1240Q of the Food Security 

16 Act of 1985 (16 U.S.C. 3839bb–4) is repealed. 

17 (b) TRANSITIONAL PROVISIONS.— 

18 (1) EFFECT ON EXISTING CONTRACTS, AGREE19 MENTS, AND EASEMENTS.—The amendment made 

20 by this section shall not affect the validity or terms 

21 of any contract, agreement, or easement entered into 

22 by the Secretary of Agriculture under section 1240Q 

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

24 3839bb–4) before October 1, 2012, or any payments 


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1 required to be made in connection with the contract, 

2 agreement, or easement. 

3 (2) FUNDING.— 

4 (A) USE OF PRIOR YEAR FUNDS.—Not5 withstanding the repeal of section 1240Q of the 

6 Food Security Act of 1985 (16 U.S.C. 3839bb– 

7 4), any funds made available from the Com8 modity Credit Corporation to carry out the 

9 Chesapeake Bay watershed program under that 

10 section for fiscal years 2009 through 2012 shall 

11 be made available to carry out contracts, agree12 ments, and easements referred to in paragraph 

13 (1) that were entered into prior to October 1, 

14 2012 (including the provision of technical as15 sistance). 

16 (B) OTHER.—The Secretary may use 

17 funds made available to carry out the regional 

18 conservation partnerships program under sub19 title I of title XII of the Food Security Act of 

20 1985, as added by section 2401 of this Act, to 

21 continue to carry out contracts, agreements, 

22 and easements referred to in paragraph (1) 

23 using the provisions of law and regulation appli24 cable to such contracts, agreements, and ease25 ments as in existence on September 30, 2012. 


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1 (c) EFFECTIVE DATE.—The amendment made by 

2 this section shall take effect on October 1, 2012. 

3 SEC. 2710. COOPERATIVE CONSERVATION PARTNERSHIP 

4 INITIATIVE. 

5 (a) REPEAL.—Section 1243 of the Food Security Act 

6 of 1985 (16 U.S.C. 3843) is repealed. 

7 (b) TRANSITIONAL PROVISIONS.— 

8 (1) EFFECT ON EXISTING CONTRACTS AND

9 AGREEMENTS.—The amendment made by this sec10 tion shall not affect the validity or terms of any con11 tract or agreement entered into by the Secretary of 

12 Agriculture under section 1243 of the Food Security 

13 Act of 1985 (16 U.S.C. 3843) before October 1, 

14 2012, or any payments required to be made in con15 nection with the contract or agreement. 

16 (2) FUNDING.— 

17 (A) USE OF PRIOR YEAR FUNDS.—Not18 withstanding the repeal of section 1243 of the 

19 Food Security Act of 1985 (16 U.S.C. 3843), 

20 any funds made available from the Commodity 

21 Credit Corporation to carry out the cooperative 

22 conservation partnership initiative under that 

23 section for fiscal years 2009 through 2012 shall 

24 be made available to carry out contracts and 

25 agreements referred to in paragraph (1) that 


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1 were entered into prior to October 1, 2012 (in2 cluding the provision of technical assistance). 

3 (B) OTHER.—On exhaustion of funds 

4 made available under subparagraph (A), the 

5 Secretary may use funds made available to 

6 carry out the regional conservation partnerships 

7 program under subtitle I of title XII of the 

8 Food Security Act of 1985, as added by section 

9 2401 of this Act, to continue to carry out con10 tracts and agreements referred to in paragraph 

11 (1) using the provisions of law and regulation 

12 applicable to such contracts and agreements as 

13 in existence on September 30, 2012. 

14 (c) EFFECTIVE DATE.—The amendment made by 

15 this section shall take effect on October 1, 2012. 

16 SEC. 2711. ENVIRONMENTAL EASEMENT PROGRAM. 

17 Chapter 3 of subtitle D of title XII of the Food Secu18 rity Act of 1985 (16 U.S.C. 3839 et seq.) is repealed. 

19 SEC. 2712. TECHNICAL AMENDMENTS. 

20 (a) Section 1201(a) of the Food Security Act of 1985 

21 (16 U.S.C. 3801(a)) is amended in the matter preceding 

22 paragraph (1) by striking ‘‘E’’ and inserting ‘‘I’’. 

23 (b) Section 1211(a) of the Food Security Act of 1985 

24 (16 U.S.C. 3811(a)) is amended by striking ‘‘predomi25 nate’’ each place it appears and inserting ‘‘predominant’’. 


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1 (c) Section 1242(i) of the Food Security Act of 

2 1985(16 U.S.C. 3842(i)) is amended in the subsection 

3 heading by striking ‘‘SPECIALITY’’ and inserting ‘‘SPE4 CIALTY’’. 

5 TITLE III—TRADE 

6 Subtitle A—Food for Peace Act 

7 SEC. 3001. SET-ASIDE FOR SUPPORT FOR ORGANIZATIONS 

8 THROUGH WHICH NONEMERGENCY ASSIST9 ANCE IS PROVIDED. 

10 Effective October 1, 2012, section 202(e)(1) of the 

11 Food for Peace Act (7 U.S.C. 1722(e)(1)) is amended— 

12 (1) in the matter preceding subparagraph (A), 

13 by striking ‘‘13 percent’’ and inserting ‘‘15 per14 cent’’; and 

15 (2) in subparagraph (A), by striking ‘‘new’’ and 

16 inserting ‘‘and enhancing’’. 

17 SEC. 3002. FOOD AID QUALITY. 

18 Section 202(h) of the Food for Peace Act (7 U.S.C. 

19 1722(h)) is amended— 

20 (1) by striking paragraph (1) and inserting the 

21 following: 

22 ‘‘(1) IN GENERAL.—The Administrator shall 

23 use funds made available for fiscal year 2013 and 

24 subsequent fiscal years to carry out this title— 


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1 ‘‘(A) to assess the types and quality of ag2 ricultural commodities and products donated for 

3 food aid; 

4 ‘‘(B) to adjust products and formulations, 

5 including potential introduction of new 

6 fortificants and products, as necessary to cost7 effectively meet nutrient needs of target popu8 lations; 

9 ‘‘(C) to test prototypes; 

10 ‘‘(D) to adopt new specifications or im11 prove existing specifications for micronutrient 

12 fortified food aid products, based on the latest 

13 developments in food and nutrition science, and 

14 in coordination with other international part15 ners; 

16 ‘‘(E) to develop new program guidance to 

17 facilitate improved matching of products to pur18 poses having nutritional intent, in coordination 

19 with other international partners; 

20 ‘‘(F) to develop improved guidance for im21 plementing partners on how to address nutri22 tional deficiencies that emerge among recipients 

23 for whom food assistance is the sole source of 

24 diet in emergency programs that extend beyond 


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1 1 year, in coordination with other international 

2 partners; and 

3 ‘‘(G) to evaluate, in appropriate settings 

4 and as necessary, the performance and cost-ef5 fectiveness of new or modified specialized food 

6 products and program approaches designed to 

7 meet the nutritional needs of the most vulner8 able groups, such as pregnant and lactating 

9 mothers, and children under the age of 5.’’; and 

10 (2) in paragraph (3), by striking ‘‘2011’’ and 

11 inserting ‘‘2017’’. 

12 SEC. 3003. MINIMUM LEVELS OF ASSISTANCE. 

13 Section 204(a) of the Food for Peace Act (7 U.S.C. 

14 1724(a)) is amended— 

15 (1) in paragraph (1), by striking ‘‘2012’’ and 

16 inserting ‘‘2017’’; and 

17 (2) in paragraph (2), by striking ‘‘2012’’ and 

18 inserting ‘‘2017’’. 

19 SEC. 3004. REAUTHORIZATION OF FOOD AID CONSULT20 ATIVE GROUP. 

21 Section 205(f) of the Food for Peace Act (7 U.S.C. 

22 1725(f)) is amended by striking ‘‘2012’’ and inserting 

23 ‘‘2017’’. 


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1 SEC. 3005. OVERSIGHT, MONITORING, AND EVALUATION OF 

2 FOOD FOR PEACE ACT PROGRAMS. 

3 Section 207(f) of the Food for Peace Act (7 U.S.C. 

4 1726a(f)) is amended— 

5 (1) by striking paragraph (4) and redesignating 

6 paragraphs (5) and (6) as paragraphs (4) and (5), 

7 respectively; and 

8 (2) in subparagraph (A) of paragraph (5) (as 

9 so redesignated)— 

10 (A) by striking ‘‘2012’’ and inserting 

11 ‘‘2017’’; and 

12 (B) by striking ‘‘during fiscal year 2009’’ 

13 and inserting ‘‘during the period of fiscal years 

14 2013 through 2017’’. 

15 SEC. 3006. ASSISTANCE FOR STOCKPILING AND RAPID 

16 TRANSPORTATION, DELIVERY, AND DIS17 TRIBUTION OF SHELF-STABLE PRE18 PACKAGED FOODS. 

19 Section 208(f) of the Food for Peace Act (7 U.S.C. 

20 1726b(f)) is amended by striking ‘‘2012’’ and inserting 

21 ‘‘2017’’. 

22 SEC. 3007. LIMITATION ON TOTAL VOLUME OF COMMOD23 ITIES MONETIZED. 

24 Section 403 of the Food for Peace Act (7 U.S.C. 

25 1733) is amended by adding at the end the following: 


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1 ‘‘(m) LIMITATION ON MONETIZATION OF COMMOD2 ITIES.— 

3 ‘‘(1) LIMITATION.— 

4 ‘‘(A) IN GENERAL.—Unless the Adminis5 trator grants a waiver under paragraph (2), no 

6 commodity may be made available under this 

7 Act unless the rate of return for the commodity 

8 (as determined under subparagraph (B)) is at 

9 least 70 percent. 

10 ‘‘(B) RATE OF RETURN.—For purposes of 

11 subparagraph (A), the rate of return shall be 

12 equal to the proportion that— 

13 ‘‘(i) the proceeds the implementing 

14 partners generate through monetization; 

15 bears to 

16 ‘‘(ii) the cost to the Federal Govern17 ment to procure and ship the commodities 

18 to a recipient country for monetization. 

19 ‘‘(2) WAIVER AUTHORITY.—The Administrator 

20 may waive the application of the limitation in para21 graph (1) with regard to a commodity for a recipient 

22 country if the Administrator determines that it is 

23 necessary to achieve the purposes of this Act in the 

24 recipient country. 


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1 ‘‘(3) REPORT.—Not later than 90 days after a 

2 waiver is granted under paragraph (2), the Adminis3 trator shall prepare, publish in the Federal Register, 

4 and submit to the Committees on Foreign Affairs, 

5 Agriculture, and Appropriations of the House of 

6 Representatives, and the Committees on Appropria7 tions, Foreign Relations, and Agriculture, Nutrition, 

8 and Forestry of the Senate a report that— 

9 ‘‘(A) contains the reasons for granting the 

10 waiver and the actual rate of return for the 

11 commodity; and 

12 ‘‘(B) includes for the commodity the costs 

13 of bagging or further processing, ocean trans14 portation, inland transportation in the recipient 

15 country, storage costs, and any other informa16 tion that the Administrator determines to be 

17 necessary.’’. 

18 SEC. 3008. FLEXIBILITY. 

19 Section 406 of the Food for Peace Act (7 U.S.C. 

20 1736) is amended— 

21 (1) by redesignating subsections (c) and (d) as 

22 subsections (d) and (e), respectively; and 

23 (2) by inserting after subsection (b) the fol24 lowing: 


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1 ‘‘(c) FLEXIBILITY.—Notwithstanding any other pro2 vision of law and as necessary to achieve the purposes of 

3 this Act, funds available under this Act may be used to 

4 pay the costs of up to 20 percent of activities conducted 

5 in recipient countries by nonprofit voluntary organiza6 tions, cooperatives, or intergovernmental agencies or orga7 nizations.’’. 

8 SEC. 3009. PROCUREMENT, TRANSPORTATION, TESTING, 

9 AND STORAGE OF AGRICULTURAL COMMOD10 ITIES FOR PREPOSITIONING IN THE UNITED 

11 STATES AND FOREIGN COUNTRIES. 

12 Section 407 of the Food for Peace Act (7 U.S.C. 

13 1736a) is amended— 

14 (1) in subparagraph (c)(4)(A)— 

15 (A) by striking ‘‘2012’’ and inserting 

16 ‘‘2017’’; and 

17 (B) by striking ‘‘for each such fiscal year 

18 not more than $10,000,000 of such funds’’ and 

19 inserting ‘‘for each of fiscal years 2001 through 

20 2012 not more than $10,000,000 of such funds 

21 and for each of fiscal years 2013 through 2017 

22 not more than $15,000,000 of such funds’’; and 

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

24 ‘‘(g) FUNDING FOR TESTING OF FOOD AID SHIP25 MENTS.—Funds made available for agricultural products 


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1 acquired under this Act and section 3107 of the Farm 

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

3 1736 o–1) may be used to pay for the testing of those 

4 agricultural products.’’. 

5 SEC. 3010. DEADLINE FOR AGREEMENTS TO FINANCE 

6 SALES OR TO PROVIDE OTHER ASSISTANCE. 

7 Section 408 of the Food for Peace Act (7 U.S.C. 

8 1736b) is amended by striking ‘‘2012’’ and inserting 

9 ‘‘2017’’. 

10 SEC. 3011. MINIMUM LEVEL OF NONEMERGENCY FOOD AS11 SISTANCE. 

12 Section 412 of the Food for Peace Act (7 U.S.C. 

13 1736f) is amended by striking subsection (e) and inserting 

14 the following: 

15 ‘‘(e) MINIMUM LEVEL OF NONEMERGENCY FOOD AS16 SISTANCE.— 

17 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

18 of the amounts made available to carry out emer19 gency and nonemergency food assistance programs 

20 under title II, not less than 15 percent nor more 

21 than 30 percent for each of fiscal years 2013 

22 through 2017 shall be expended for nonemergency 

23 food assistance programs under title II. 

24 ‘‘(2) MINIMUM LEVEL.—The amount made 

25 available to carry out nonemergency food assistance 


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1 programs under title II shall not be less than 

2 $275,000,000 for any fiscal year.’’. 

3 SEC. 3012. COORDINATION OF FOREIGN ASSISTANCE PRO4 GRAMS REPORT. 

5 Section 413 of the Food for Peace Act (7 U.S.C. 

6 1736(g)) is amended— 

7 (1) by striking ‘‘(a) IN GENERAL.—To the 

8 maximum’’ and inserting ‘‘To the maximum’’; and 

9 (2) by striking subsection (b). 

10 SEC. 3013. MICRONUTRIENT FORTIFICATION PROGRAMS. 

11 (a) ELIMINATION OF OBSOLETE REFERENCE TO

12 STUDY.—Section 415(a)(2)(B) of the Food for Peace Act 

13 (7 U.S.C. 1736g–2(a)(2)(B)) is amended by striking ‘‘, 

14 using recommendations’’ and all that follows through 

15 ‘‘quality enhancements’’. 

16 (b) EXTENSION.—Section 415(c) of the Food for 

17 Peace Act (7 U.S.C. 1736g–2(c)) is amended by striking 

18 ‘‘2012’’ and inserting ‘‘2017’’. 

19 SEC. 3014. JOHN OGONOWSKI AND DOUG BEREUTER FARM20 ER-TO-FARMER PROGRAM. 

21 Section 501 of the Food for Peace Act (7 U.S.C. 

22 1737) is amended— 

23 (1) in subsection (d)— 

24 (A) by striking ‘‘0.5 percent’’ and inserting 

25 ‘‘0.6 percent’’; and 


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1 (B) by striking ‘‘2012’’ and inserting 

2 ‘‘2017’’; and 

3 (2) in subsection (e)(1), by striking ‘‘2012’’ and 

4 inserting ‘‘2017’’. 

5 Subtitle B—Agricultural Trade Act 

6 of 1978 

7 SEC. 3101. EXPORT CREDIT GUARANTEE PROGRAMS. 

8 Section 211 of the Agricultural Trade Act of 1978 

9 (7 U.S.C. 5641) is amended by striking subsection (b) and 

10 inserting the following: 

11 ‘‘(b) EXPORT CREDIT GUARANTEE PROGRAMS.—The 

12 Commodity Credit Corporation shall make available for 

13 each of fiscal years 2013 through 2017 credit guarantees 

14 under section 202(a) in an amount equal to not more than 

15 $4,500,000,000 in credit guarantees.’’. 

16 SEC. 3102. FUNDING FOR MARKET ACCESS PROGRAM. 

17 Section 211(c)(1)(A) of the Agricultural Trade Act 

18 of 1978 (7 U.S.C. 5641(c)(1)(A)) is amended by striking 

19 ‘‘2012’’ and inserting ‘‘2017’’. 

20 SEC. 3103. FOREIGN MARKET DEVELOPMENT COOPERATOR 

21 PROGRAM. 

22 Section 703(a) of the Agricultural Trade Act of 1978 

23 (7 U.S.C. 5723(a)) is amended by striking ‘‘2012’’ and 

24 inserting ‘‘2017’’. 


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1 Subtitle C—Other Agricultural 

2 Trade Laws 

3 SEC. 3201. FOOD FOR PROGRESS ACT OF 1985. 

4 (a) EXTENSION.—The Food for Progress Act of 1985 

5 (7 U.S.C. 1736o) is amended— 

6 (1) in subsection (f)(3), by striking ‘‘2012’’ and 

7 inserting ‘‘2017’’; 

8 (2) in subsection (g), by striking ‘‘2012’’ and 

9 inserting ‘‘2017’’; 

10 (3) in subsection (k), by striking ‘‘2012’’ and 

11 inserting ‘‘2017’’; and 

12 (4) in subsection (l)(1), by striking ‘‘2012’’ and 

13 inserting ‘‘2017’’. 

14 (b) REPEAL OF COMPLETED PROJECT.—Subsection 

15 (f) of the Food for Progress Act of 1985 (7 U.S.C. 1736o) 

16 is amended by striking paragraph (6). 

17 (c) FLEXIBILITY.—The Food for Progress Act of 

18 1985 (7 U.S.C. 1736o) is amended in subsection (l) by 

19 adding at the end the following: 

20 ‘‘(5) FLEXIBILITY.—Notwithstanding any other 

21 provision of law and as necessary to achieve the pur22 poses of this Act, funds available under this Act may 

23 be used to pay the costs of up to 20 percent of ac24 tivities conducted in recipient countries by nonprofit 


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1 voluntary organizations, cooperatives, or intergovern2 mental agencies or organizations.’’. 

3 (d) LIMITATION ON TOTAL VOLUME OF COMMOD4 ITIES MONETIZED.—The Food for Progress Act of 1985 

5 (7 U.S.C. 1736o) is amended by adding at the end the 

6 following: 

7 ‘‘(p) LIMITATION ON MONETIZATION OF COMMOD8 ITIES.— 

9 ‘‘(1) LIMITATION.— 

10 ‘‘(A) IN GENERAL.—Unless the Secretary 

11 grants a waiver under paragraph (2), no eligible 

12 commodity may be made available under this 

13 section unless the rate of return for the eligible 

14 commodity (as determined under subparagraph 

15 (B)) is at least 70 percent. 

16 ‘‘(B) RATE OF RETURN.—For purposes of 

17 subparagraph (A), the rate of return shall be 

18 equal to the proportion that— 

19 ‘‘(i) the proceeds the implementing 

20 partners generate through monetization; 

21 bears to 

22 ‘‘(ii) the cost to the Federal Govern23 ment to procure and ship the eligible com24 modities to a recipient country for mone25 tization. 


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1 ‘‘(2) WAIVER AUTHORITY.—The Secretary may 

2 waive the application of the limitation in paragraph 

3 (1) with regard to an eligible commodity for a recipi4 ent country if the Secretary determines that it is 

5 necessary to achieve the purposes of this Act in the 

6 recipient country. 

7 ‘‘(3) REPORT.—Not later than 90 days after a 

8 waiver is granted under paragraph (2), the Sec9 retary shall prepare, publish in the Federal Register, 

10 and submit to the Committees on Foreign Affairs, 

11 Agriculture, and Appropriations of the House of 

12 Representatives, and the Committees on Appropria13 tions, Foreign Relations, and Agriculture, Nutrition, 

14 and Forestry of the Senate a report that— 

15 ‘‘(A) contains the reasons for granting the 

16 waiver and the actual rate of return for the eli17 gible commodity; and 

18 ‘‘(B) includes for the commodity the costs 

19 of bagging or further processing, ocean trans20 portation, inland transportation in the recipient 

21 country, storage costs, and any other informa22 tion that the Secretary determines to be nec23 essary.’’. 


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1 SEC. 3202. BILL EMERSON HUMANITARIAN TRUST. 

2 Section 302 of the Bill Emerson Humanitarian Trust 

3 Act (7 U.S.C. 1736f–1) is amended— 

4 (1) in subsection (b)(2)(B)(i), by striking 

5 ‘‘2012’’ both places it appears and inserting ‘‘2017’’; 

6 and 

7 (2) in subsection (h), by striking ‘‘2012’’ both 

8 places it appears and inserting ‘‘2017’’. 

9 SEC. 3203. PROMOTION OF AGRICULTURAL EXPORTS TO 

10 EMERGING MARKETS. 

11 (a) DIRECT CREDITS OR EXPORT CREDIT GUARAN12 TEES.—Section 1542(a) of the Food, Agriculture, Con13 servation, and Trade Act of 1990 (Public Law 101–624; 

14 7 U.S.C. 5622 note) is amended by striking ‘‘2012’’ and 

15 inserting ‘‘2017’’. 

16 (b) DEVELOPMENT OF AGRICULTURAL SYSTEMS.— 

17 Section 1542(d)(1)(A)(i) of the Food, Agriculture, Con18 servation, and Trade Act of 1990 (Public Law 101–624; 

19 7 U.S.C. 5622 note) is amended by striking ‘‘2012’’ and 

20 inserting ‘‘2017’’. 

21 SEC. 3204. MCGOVERN-DOLE INTERNATIONAL FOOD FOR 

22 EDUCATION AND CHILD NUTRITION PRO23 GRAM. 

24 (a) REAUTHORIZATION.—Section 3107(l)(2) of the 

25 Farm Security and Rural Investment Act of 2002 (7 


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1 U.S.C. 1736o–1(l)(2)) is amended by striking ‘‘2012’’ and 

2 inserting ‘‘2017’’. 

3 (b) TECHNICAL CORRECTION.—Section 3107(d) of 

4 the Farm Security and Rural Investment Act of 2002 (7 

5 U.S.C. 1736o–1(d)) is amended by striking ‘‘to’’ in the 

6 matter preceding paragraph (1). 

7 SEC. 3205. TECHNICAL ASSISTANCE FOR SPECIALTY CROPS. 

8 (a) PURPOSE.—Section 3205(b) of the Farm Secu9 rity and Rural Investment Act of 2002 (7 U.S.C. 5680(b)) 

10 is amended by striking ‘‘related barriers to trade’’ and in11 serting ‘‘technical barriers to trade’’. 

12 (b) FUNDING.—Section 3205(e)(2) of the Farm Se13 curity and Rural Investment Act of 2002 (7 U.S.C. 

14 5680(e)(2)) is amended— 

15 (1) by inserting ‘‘and’’ at the end of subpara16 graph (C); and 

17 (2) by striking subparagraphs (D) and (E) and 

18 inserting the following new subparagraph: 

19 ‘‘(D) $9,000,000 for each of fiscal years 

20 2011 through 2017.’’. 

21 SEC. 3206. GLOBAL CROP DIVERSITY TRUST. 

22 Section 3202(c) of the Food, Conservation, and En23 ergy Act of 2008 (Public Law 110–246; 22 U.S.C. 2220a 

24 note) is amended by striking ‘‘2008 through 2012’’ and 

25 inserting ‘‘2013 through 2017’’. 


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1 SEC. 3207. LOCAL AND REGIONAL FOOD AID PROCURE2 MENT PROJECTS. 

3 Section 3206 of the Food, Conservation, and Energy 

4 Act of 2008 (7 U.S.C. 1726c) is amended— 

5 (1) in subsection (b)— 

6 (A) by striking ‘‘(b) STUDY; FIELD-BASED

7 PROJECTS.—’’ and all that follows through ‘‘(2) 

8 FIELD-BASED PROJECTS.—’’ and inserting the 

9 following: 

10 ‘‘(b) FIELD-BASED PROJECTS.—’’; 

11 (B) by redesignating subparagraphs (A) 

12 and (B) as paragraphs (1) and (2), respectively, 

13 and indenting appropriately; 

14 (C) in paragraph (1) (as so redesignated), 

15 by striking ‘‘subparagraph (B)’’ and inserting 

16 ‘‘paragraph (2)’’; and 

17 (D) in paragraph (2) (as so redesignated), 

18 by striking ‘‘subparagraph (A)’’ and inserting 

19 ‘‘paragraph (1)’’; 

20 (2) in subsection (c)(1), by striking ‘‘subsection 

21 (b)(2)’’ and inserting ‘‘subsection (b)’’; 

22 (3) by striking subsections (d), (f), and (g); 

23 (4) by redesignating subsection (e) as sub24 section (d); 

25 (5) in subsection (d) (as so redesignated)— 

26 (A) in paragraph (2)— 


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1 (i) by striking subparagraph (B); and 

2 (ii) in subparagraph (A)— 

3 (I) by striking ‘‘(A) APPLICA4 TION.—’’ and all that follows through 

5 ‘‘To be eligible’’ in clause (i) and in6 serting the following: 

7 ‘‘(A) IN GENERAL.—To be eligible’’; 

8 (II) by redesignating clause (ii) 

9 as subparagraph (B) and indenting 

10 appropriately; and 

11 (III) in subparagraph (B) (as so 

12 redesignated), by striking ‘‘clause (i)’’ 

13 and inserting ‘‘subparagraph (A)’’; 

14 and 

15 (B) by striking paragraph (4); and 

16 (6) by adding at the end the following: 

17 ‘‘(e) FUNDING.— 

18 ‘‘(1) AUTHORIZATION OF APPROPRIATIONS.— 

19 There is authorized to be appropriated to carry out 

20 this section $40,000,000 for each of fiscal years 

21 2013 through 2017. 

22 ‘‘(2) PREFERENCE.—In carrying out this sec23 tion, the Secretary may give a preference to eligible 

24 organizations that have, or are working toward, 

25 projects under the McGovern-Dole International 


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1 Food for Education and Child Nutrition Program 

2 established under section 3107 of the Farm Security 

3 and Rural Investment Act of 2002 (7 U.S.C. 1736o4 1). 

5 ‘‘(3) REPORTING.—Each year, the Secretary 

6 shall submit to the appropriate committees of Con7 gress a report that describes the use of funds under 

8 this section, including— 

9 ‘‘(A) the impact of procurements and 

10 projects on— 

11 ‘‘(i) local and regional agricultural 

12 producers; and 

13 ‘‘(ii) markets and consumers, includ14 ing low-income consumers; and 

15 ‘‘(B) implementation time frames and 

16 costs.’’. 

17 SEC. 3208. DONALD PAYNE HORN OF AFRICA FOOD RESIL18 IENCE PROGRAM. 

19 (a) DEFINITIONS.—In this section: 

20 (1) ADMINISTRATOR.—The term ‘‘Adminis21 trator’’ means the Administrator of the Agency for 

22 International Development. 

23 (2) APPROPRIATE COMMITTEES OF CON24 GRESS.—The term ‘‘appropriate committees of Con25 gress’’ means— 


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1 (A) the Committee on Agriculture, Nutri2 tion, and Forestry of the Senate; 

3 (B) the Committee on Agriculture of the 

4 House of Representatives; 

5 (C) the Committee on Foreign Relations of 

6 the Senate; and 

7 (D) the Committee on Foreign Affairs of 

8 the House of Representatives. 

9 (3) ELIGIBLE ORGANIZATION.—The term ‘‘eligi10 ble organization’’ means an organization that is— 

11 (A) a private voluntary organization or co12 operative that is, to the extent practicable, reg13 istered with the Administrator; or 

14 (B) an intergovernmental organization, 

15 such as the World Food Program. 

16 (4) HORN OF AFRICA.—The term ‘‘Horn of Af17 rica’’ means the countries of— 

18 (A) Ethiopia; 

19 (B) Somalia; 

20 (C) Kenya; 

21 (D) Djibouti; 

22 (E) Eritrea; 

23 (F) South Sudan; 

24 (G) Uganda; and 


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1 (H) such other countries as the Adminis2 trator determines to be appropriate after pro3 viding notification to the appropriate commit4 tees of Congress. 

5 (5) RESILIENCE.—The term ‘‘resilience’’ 

6 means— 

7 (A) the capacity to mitigate the negative 

8 impacts of crises (including natural disasters, 

9 conflicts, and economic shocks) in order to re10 duce loss of life and depletion of productive as11 sets; 

12 (B) the capacity to respond effectively to 

13 crises, ensuring basic needs are met in a way 

14 that is integrated with long-term development 

15 efforts; and 

16 (C) the capacity to recover and rebuild 

17 after crises so that future shocks can be ab18 sorbed with less need for ongoing external as19 sistance. 

20 (b) PURPOSE.—The purpose of this section is to es21 tablish a pilot program to effectively integrate all United 

22 States-funded emergency and long-term development ac23 tivities that aim to improve food security in the Horn of 

24 Africa, building resilience so as— 

25 (1) to reduce the impacts of future crises; 


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1 (2) to enhance local capacity for emergency re2 sponse; 

3 (3) to enhance sustainability of long-term devel4 opment programs targeting poor and vulnerable 

5 households; and 

6 (4) to reduce the need for repeated costly emer7 gency operations. 

8 (c) STUDY.— 

9 (1) IN GENERAL.—Not later than 30 days after 

10 the date of enactment of this Act, the Administrator 

11 shall initiate a study of prior programs to support 

12 resilience in the Horn of Africa conducted by— 

13 (A) other donor countries; 

14 (B) private voluntary organizations; 

15 (C) the World Food Program of the 

16 United Nations; and 

17 (D) multilateral institutions, including the 

18 World Bank. 

19 (2) REQUIREMENTS.—The study shall— 

20 (A) include all programs implemented 

21 through the Agency for International Develop22 ment, the Department of Agriculture, the De23 partment of Treasury, the Millennium Chal24 lenge Corporation, the Peace Corps, and other 

25 relevant Federal agencies; 


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1 (B) evaluate how well the programs de2 scribed in subparagraph (A) work together to 

3 complement each other and leverage impacts 

4 across programs; 

5 (C) include recommendations for how full 

6 integration of efforts can be achieved; and 

7 (D) evaluate the degree to which country8 led development plans support programs that 

9 increase resilience, including review of the in10 vestments by each country in nutrition and 

11 safety nets. 

12 (3) REPORT.—Not later than 180 days after 

13 the date of enactment of this Act, the Administrator 

14 shall submit to the appropriate committees of Con15 gress a report containing the results of the study. 

16 (d) FIELD-BASED PROJECT GRANTS OR COOPERA17 TIVE AGREEMENTS.— 

18 (1) IN GENERAL.—The Administrator shall— 

19 (A) provide grants to, or enter into cooper20 ative agreements with, eligible organizations to 

21 carry out field-based projects that build resil22 ience in the Horn of Africa in accordance with 

23 this section; and 

24 (B) develop a project approval process to 

25 ensure full integration of efforts. 


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1 (2) REQUIREMENTS OF ELIGIBLE ORGANIZA2 TIONS.— 

3 (A) APPLICATION.—To be eligible to re4 ceive a grant from, or enter into a cooperative 

5 agreement with, the Administrator under this 

6 subsection, an eligible organization shall submit 

7 to the Administrator an application by such 

8 date, in such manner, and containing such in9 formation as the Administrator may require. 

10 (B) COMPLETION REQUIREMENT.—To be 

11 eligible to receive a grant from, or enter into a 

12 cooperative agreement with, the Administrator 

13 under this subsection, an eligible organization 

14 shall agree— 

15 (i) to collect, not later than September 

16 30, 2016, data containing the information 

17 required under subsection (f)(2) relating to 

18 the field-based project funded through the 

19 grant or cooperative agreement; and 

20 (ii) to provide to the Administrator 

21 the data collected under clause (i). 

22 (3) REQUIREMENTS OF ADMINISTRATOR.— 

23 (A) PROJECT DIVERSITY.— 

24 (i) IN GENERAL.—Subject to clause 

25 (ii) and subparagraph (B), in selecting 


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1 proposals for field-based projects to fund 

2 under this section, the Administrator shall 

3 select a diversity of projects, including 

4 projects located in— 

5 (I) areas most prone to repeated 

6 crises; 

7 (II) areas with effective existing 

8 resilience programs that can be 

9 scaled; and 

10 (III) areas in all countries of the 

11 Horn of Africa. 

12 (ii) PRIORITY.—In selecting proposals 

13 for field-based projects under clause (i), 

14 the Administrator shall ensure that the se15 lected proposals are for field-based projects 

16 that— 

17 (I) effectively integrate emer18 gency and long-term development pro19 grams to improve sustainability; 

20 (II) demonstrate the potential to 

21 reduce the need for future emergency 

22 assistance; and 

23 (III) build targeted productive 

24 safety nets, in coordination with host 

25 country governments, through food 


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1 for work, cash for work, and other 

2 proven program methodologies. 

3 (B) AVAILABILITY.—The Administrator 

4 shall not award a grant or cooperative agree5 ment or approve a field-based project under this 

6 subsection until the date on which the Adminis7 trator promulgates regulations or issues guide8 lines under subsection (e). 

9 (e) REGULATIONS; GUIDELINES.— 

10 (1) IN GENERAL.—Not later than 180 days 

11 after the date of completion of the study under sub12 section (c), the Administrator shall promulgate regu13 lations or issue guidelines to carry out field-based 

14 projects under this section. 

15 (2) REQUIREMENTS.—In promulgating regula16 tions or issuing guidelines under paragraph (1), the 

17 Administrator shall— 

18 (A) take into consideration the results of 

19 the study described in subsection (c); and 

20 (B) provide an opportunity for public re21 view and comment. 

22 (f) REPORT.— 

23 (1) IN GENERAL.—Not later than November 1, 

24 2016, the Administrator shall submit to the appro25 priate committees of Congress a report that— 


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1 (A) addresses each factor described in 

2 paragraph (2); and 

3 (B) is conducted in accordance with this 

4 section. 

5 (2) REQUIRED FACTORS.—The report shall in6 clude baseline and end-of-project data that meas7 ures— 

8 (A) the prevalence of moderate and severe 

9 hunger so as to provide an accurate accounting 

10 of project impact on household access to and 

11 consumption of food during every month of the 

12 year prior to data collection; 

13 (B) household ownership of and access to 

14 productive assets, including at a minimum land, 

15 livestock, homes, equipment, and other mate16 rials assets needed for income generation; 

17 (C) household incomes, including informal 

18 sources of employment; and 

19 (D) the productive assets of women using 

20 the Women’s Empowerment in Agriculture 

21 Index. 

22 (3) PUBLIC ACCESS TO RECORDS AND RE23 PORTS.—Not later than 90 days after the date on 

24 which the report is submitted under paragraph (1), 


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1 the Administrator shall provide public access to the 

2 report. 

3 (g) AUTHORIZATION OF APPROPRIATIONS.—There is 

4 authorized to be appropriated to carry out this section 

5 $10,000,000 for each of fiscal years 2013 through 2017. 

6 SEC. 3209. AGRICULTURAL TRADE ENHANCEMENT STUDY. 

7 (a) DEFINITION OF AGRICULTURE COMMITTEES AND

8 SUBCOMMITTEES.—In this section, the term ‘‘agriculture 

9 committees and subcommittees’’ means— 

10 (1) the Committee on Agriculture of the House 

11 of Representatives; 

12 (2) the Committee on Agriculture, Nutrition, 

13 and Forestry of the Senate; and 

14 (3) the subcommittees on agriculture, rural de15 velopment, food and drug administration, and re16 lated agencies of the Committees on Appropriations 

17 of the House of Representatives and the Senate. 

18 (b) DEVELOPMENT.—The Secretary, in consultation 

19 with the agriculture committees and subcommittees, shall 

20 develop a study that takes into consideration a reorganiza21 tion of international trade functions for imports and ex22 ports at the Department of Agriculture. 

23 (c) IMPLEMENTATION.—In implementing the study 

24 under this section, the Secretary— 


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1 (1) in recognition of the importance of agricul2 tural exports to the farm economy and the economy 

3 as a whole, may include a recommendation for the 

4 establishment of an Under Secretary for Trade and 

5 Foreign Agricultural Affairs; 

6 (2) may take into consideration how the Under 

7 Secretary described in paragraph (1) would serve as 

8 a multiagency coordinator of sanitary and 

9 phytosanitary issues and nontariff trade barriers in 

10 agriculture with respect to imports and exports of 

11 agricultural products; and 

12 (3) shall take into consideration all implications 

13 of a reorganization described in subsection (b) on 

14 domestic programs and operations of the Depart15 ment of Agriculture. 

16 (d) REPORT.—Not later than 180 days after the date 

17 of enactment of this Act, the Secretary shall submit to 

18 the agriculture committees and subcommittees a report 

19 describing the results of the study under this section. 


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1 TITLE IV—NUTRITION 

2 Subtitle A—Supplemental 

3 Nutrition Assistance Program 

4 SEC. 4001. FOOD DISTRIBUTION PROGRAM ON INDIAN RES5 ERVATIONS. 

6 Section 4(b)(6)(F) of the Food and Nutrition Act of 

7 2008 (7 U.S.C. 2013(b)(6)(F)) is amended by striking 

8 ‘‘2012’’ and inserting ‘‘2017’’. 

9 SEC. 4002. STANDARD UTILITY ALLOWANCES BASED ON 

10 THE RECEIPT OF ENERGY ASSISTANCE PAY11 MENTS. 

12 (a) STANDARD UTILITY ALLOWANCES IN THE SUP13 PLEMENTAL NUTRITION ASSISTANCE PROGRAM.—Section 

14 5(e)(6)(C) of the Food and Nutrition Act of 2008 (7 

15 U.S.C. 2014(e)(6)(C)) is amended— 

16 (1) in clause (i), by inserting ‘‘, subject to 

17 clause (iv)’’ after ‘‘Secretary’’; and 

18 (2) in clause (iv)(I), by striking ‘‘the household 

19 still incurs’’ and all that follows through the end of 

20 the subclause and inserting ‘‘the payment received 

21 by, or made on behalf of, the household exceeds $10 

22 or a higher amount annually, as determined by the 

23 Secretary.’’. 

24 (b) CONFORMING AMENDMENT.—Section 

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1 ance Act of 1981 (42 U.S.C. 8624(f)(2)(A)) is amended 

2 by inserting before the semicolon at the end ‘‘, except that, 

3 for purposes of the supplemental nutrition assistance pro4 gram established under the Food and Nutrition Act of 

5 2008 (7 U.S.C. 2011 et seq.), such payments or allow6 ances exceed $10 or a higher amount annually, as deter7 mined by the Secretary of Agriculture in accordance with 

8 section 5(e)(6)(C)(iv)(I) of that Act (7 U.S.C. 

9 2014(e)(6)(C)(iv)(I))’’. 

10 (c) EFFECTIVE AND IMPLEMENTATION DATE.— 

11 (1) IN GENERAL.—Except as provided in para12 graph (2), this section and the amendments made by 

13 this section shall take effect beginning on October 1, 

14 2013, for all certification periods beginning after 

15 that date. 

16 (2) STATE OPTION TO DELAY IMPLEMENTATION

17 FOR CURRENT RECIPIENTS.—A State may, at the 

18 option of the State, implement a policy that elimi19 nates or minimizes the effect of the amendments 

20 made by this section for households that receive a 

21 standard utility allowance as of the date of enact22 ment of this Act for not more than a 180-day period 

23 beginning on the date on which the amendments 

24 made by this section would otherwise affect the ben25 efits received by a household. 


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1 SEC. 4003. ELIGIBILITY DISQUALIFICATIONS. 

2 Section 6(e)(3)(B) of Food and Nutrition Act of 

3 2008 (7 U.S.C. 2015(e)(3)(B)) is amended by striking 

4 ‘‘section’’ and inserting the following: ‘‘section, subject to 

5 the condition that the course or program of study— 

6 ‘‘(i) is part of a program of career 

7 and technical education (as defined in sec8 tion 3 of the Carl D. Perkins Career and 

9 Technical Education Act of 2006 (20 

10 U.S.C. 2302)) that may be completed in 

11 not more than 4 years at an institution of 

12 higher education (as defined in section 102 

13 of the Higher Education Act of 1965 (20 

14 U.S.C. 1002)); or 

15 ‘‘(ii) is limited to remedial courses, 

16 basic adult education, literacy, or English 

17 as a second language;’’. 

18 SEC. 4004. ENDING SUPPLEMENTAL NUTRITION ASSIST19 ANCE PROGRAM BENEFITS FOR LOTTERY OR 

20 GAMBLING WINNERS. 

21 (a) IN GENERAL.—Section 6 of the Food and Nutri22 tion Act of 2008 (7 U.S.C. 2015) is amended by adding 

23 at the end the following: 

24 ‘‘(r) INELIGIBILITY FOR BENEFITS DUE TO RECEIPT

25 OF SUBSTANTIAL LOTTERY OR GAMBLING WINNINGS.— 


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1 ‘‘(1) IN GENERAL.—Any household in which a 

2 member receives substantial lottery or gambling 

3 winnings, as determined by the Secretary, shall lose 

4 eligibility for benefits immediately upon receipt of 

5 the winnings. 

6 ‘‘(2) DURATION OF INELIGIBILITY.—A house7 hold described in paragraph (1) shall remain ineli8 gible for participation until the household meets the 

9 allowable financial resources and income eligibility 

10 requirements under subsections (c), (d), (e), (f), (g), 

11 (i), (k), (l), (m), and (n) of section 5. 

12 ‘‘(3) AGREEMENTS.—As determined by the Sec13 retary, each State agency, to the maximum extent 

14 practicable, shall establish agreements with entities 

15 responsible for the regulation or sponsorship of gam16 ing in the State to determine whether individuals 

17 participating in the supplemental nutrition assist18 ance program have received substantial lottery or 

19 gambling winnings.’’. 

20 (b) CONFORMING AMENDMENTS.—Section 5(a) of 

21 the Food and Nutrition Act of 2008 (7 U.S.C. 2014(a)) 

22 is amended in the second sentence by striking ‘‘sections 

23 6(b), 6(d)(2), and 6(g)’’ and inserting ‘‘subsections (b), 

24 (d)(2), (g), and (r) of section 6’’. 


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1 SEC. 4005. RETAIL FOOD STORES. 

2 (a) DEFINITION OF RETAIL FOOD STORE.—Sub3 section (o)(1)(A) of section 3 of the Food and Nutrition 

4 Act of 2008 (7 U.S.C. 2012) (as redesignated by section 

5 4016(a)(4)) is amended by striking ‘‘at least 2’’ and in6 serting ‘‘at least 3’’. 

7 (b) ALTERNATIVE BENEFIT DELIVERY.—Section 

8 7(f) of the Food and Nutrition Act of 2008 (7 U.S.C. 

9 2016(f)) is amended— 

10 (1) by striking paragraph (2) and inserting the 

11 following: 

12 ‘‘(2) IMPOSITION OF COSTS.— 

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

14 subparagraph (B), the Secretary shall require 

15 participating retail food stores (including res16 taurants participating in a State option res17 taurant program intended to serve the elderly, 

18 disabled, and homeless) to pay 100 percent of 

19 the costs of acquiring, and arrange for the im20 plementation of, electronic benefit transfer 

21 point-of-sale equipment and supplies, including 

22 related services. 

23 ‘‘(B) EXEMPTIONS.—The Secretary may 

24 exempt from subparagraph (A)— 

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1 tives, and establishments, organizations, 

2 programs, or group living arrangements 

3 described in paragraphs (5), (7), and (8) 

4 of section 3(k); and 

5 ‘‘(ii) establishments described in para6 graphs (3), (4), and (9) of section 3(k), 

7 other than restaurants participating in a 

8 State option restaurant program.’’; and 

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

10 ‘‘(4) TERMINATION OF MANUAL VOUCHERS.— 

11 ‘‘(A) IN GENERAL.—Effective beginning on 

12 the date of enactment of this paragraph, except 

13 as provided in subparagraph (B), no State shall 

14 issue manual vouchers to a household that re15 ceives supplemental nutrition assistance under 

16 this Act or allow retail food stores to accept 

17 manual vouchers as payment, unless the Sec18 retary determines that the manual vouchers are 

19 necessary, such as in the event of an electronic 

20 benefit transfer system failure or a disaster sit21 uation. 

22 ‘‘(B) EXEMPTIONS.—The Secretary may 

23 exempt categories of retail food stores or indi24 vidual retail food stores from subparagraph (A) 

25 based on criteria established by the Secretary. 


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1 ‘‘(5) UNIQUE IDENTIFICATION NUMBER RE2 QUIRED.—The Secretary shall require all parties 

3 providing electronic benefit transfer services to pro4 vide for and maintain unique terminal identification 

5 number information through the supplemental nutri6 tion assistance program electronic benefit transfer 

7 transaction routing system.’’. 

8 (c) ELECTRONIC BENEFIT TRANSFERS.—Section 

9 7(h)(3)(B) of the Food and Nutrition Act of 2008 (7 

10 U.S.C. 2016(h)(3)(B)) is amended by striking ‘‘is oper11 ational—’’ and all that follows through ‘‘(ii) in the case 

12 of other participating stores,’’ and inserting ‘‘is oper13 ational’’. 

14 (d) APPROVAL OF RETAIL FOOD STORES AND

15 WHOLESALE FOOD CONCERNS.—Section 9 of the Food 

16 and Nutrition Act of 2008 (7 U.S.C. 2018) is amended— 

17 (1) in subsection (a)— 

18 (A) in the second sentence of paragraph 

19 (a)(1), by striking ‘‘; and (C)’’ and inserting ‘‘; 

20 (C) whether the applicant is located in an area 

21 with significantly limited access to food; and 

22 (D)’’; and 

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

24 ‘‘(4) RETAIL FOOD STORES WITH SIGNIFICANT

25 SALES OF EXCEPTED ITEMS.— 


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1 ‘‘(A) IN GENERAL.—No retail food store 

2 for which at least 45 percent of the total sales 

3 of the retail food store is from the sale of ex4 cepted items described in section 3(k)(1) may 

5 be authorized to accept and redeem benefits un6 less the Secretary determines that the partici7 pation of the retail food store is required for 

8 the effective and efficient operation of the sup9 plemental nutrition assistance program. 

10 ‘‘(B) APPLICATION.—Subparagraph (A) 

11 shall be effective— 

12 ‘‘(i) in the case of retail food stores 

13 applying to be authorized for the first 

14 time, beginning on the date that is 1 year 

15 after the date of enactment of this para16 graph; and 

17 ‘‘(ii) in the case of retail food stores 

18 participating in the program on the date of 

19 enactment of this paragraph, during peri20 odic reauthorization in accordance with 

21 paragraph (2)(A).’’; and 

22 (3) by adding at the end the following: 

23 ‘‘(g) EBT SERVICE REQUIREMENT.—An approved 

24 retail food store shall provide adequate EBT service as 

25 described in section 7(h)(3)(B).’’. 


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1 SEC. 4006. IMPROVING SECURITY OF FOOD ASSISTANCE. 

2 Section 7(h)(8) of the Food and Nutrition Act of 

3 2008 (7 U.S.C. 2016(h)(8)) is amended— 

4 (1) by striking the paragraph heading and in5 serting ‘‘REPLACEMENT OF CARDS.—’’; 

6 (2) by striking ‘‘A State’’ and inserting the fol7 lowing: 

8 ‘‘(A) FEES.—A State’’; and 

9 (3) by adding after subparagraph (A) (as so 

10 designated by paragraph (2)) the following: 

11 ‘‘(B) PURPOSEFUL LOSS OF CARDS.— 

12 ‘‘(i) IN GENERAL.—Subject to terms 

13 and conditions established by the Secretary 

14 in accordance with clause (ii), if a house15 hold makes excessive requests for replace16 ment of the electronic benefit transfer card 

17 of the household, the Secretary may re18 quire a State agency to decline to issue a 

19 replacement card to the household unless 

20 the household, upon request of the State 

21 agency, provides an explanation for the 

22 loss of the card. 

23 ‘‘(ii) REQUIREMENTS.—The terms 

24 and conditions established by the Secretary 

25 shall provide that— 


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1 ‘‘(I) the household be given the 

2 opportunity to provide the requested 

3 explanation and meet the require4 ments under this paragraph promptly; 

5 ‘‘(II) after an excessive number 

6 of lost cards, the head of the house7 hold shall be required to review pro8 gram rights and responsibilities with 

9 State agency personnel authorized to 

10 make determinations under section 

11 5(a); and 

12 ‘‘(III) any action taken, including 

13 actions required under section 

14 6(b)(2), other than the withholding of 

15 the electronic benefit transfer card 

16 until an explanation described in sub17 clause (I) is provided, shall be con18 sistent with the due process protec19 tions under section 6(b) or 11(e)(10), 

20 as appropriate. 

21 ‘‘(C) PROTECTING VULNERABLE PER22 SONS.—In implementing this paragraph, a 

23 State agency shall act to protect homeless per24 sons, persons with disabilities, victims of 

25 crimes, and other vulnerable persons who lose 


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1 electronic benefit transfer cards but are not in2 tentionally committing fraud. 

3 ‘‘(D) EFFECT ON ELIGIBILITY.—While a 

4 State may decline to issue an electronic benefits 

5 transfer card until a household satisfies the re6 quirements under this paragraph, nothing in 

7 this paragraph shall be considered a denial of, 

8 or limitation on, the eligibility for benefits 

9 under section 5.’’. 

10 SEC. 4007. TECHNOLOGY MODERNIZATION FOR RETAIL 

11 FOOD STORES. 

12 (a) MOBILE TECHNOLOGIES.—Section 7(h) of the 

13 Food and Nutrition Act of 2008 (7 U.S.C. 2016(h)) (as 

14 amended by section 4016(e)) is amended by adding at the 

15 end the following: 

16 ‘‘(14) MOBILE TECHNOLOGIES.— 

17 ‘‘(A) IN GENERAL.—Subject to subpara18 graph (B), the Secretary shall approve retail 

19 food stores to redeem benefits through elec20 tronic means other than wired point of sale de21 vices for electronic benefit transfer transactions, 

22 if the retail food stores— 

23 ‘‘(i) establish recipient protections re24 garding privacy, ease of use, access, and 


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1 support similar to the protections provided 

2 for transactions made in retail food stores; 

3 ‘‘(ii) bear the costs of obtaining, in4 stalling, and maintaining mobile tech5 nologies, including mechanisms needed to 

6 process EBT cards and transaction fees; 

7 ‘‘(iii) demonstrate the foods purchased 

8 with benefits issued under this section 

9 through mobile technologies are purchased 

10 at a price not higher than the price of the 

11 same food purchased by other methods 

12 used by the retail food store, as determined 

13 by the Secretary; 

14 ‘‘(iv) provide adequate documentation 

15 for each authorized transaction, as deter16 mined by the Secretary; and 

17 ‘‘(v) meet other criteria as established 

18 by the Secretary. 

19 ‘‘(B) DEMONSTRATION PROJECT ON AC20 CEPTANCE OF BENEFITS OF MOBILE TRANS21 ACTIONS.— 

22 ‘‘(i) IN GENERAL.—Before authorizing 

23 implementation of subparagraph (A) in all 

24 States, the Secretary shall pilot the use of 

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1 retary to be appropriate to test the feasi2 bility and implications for program integ3 rity, by allowing retail food stores to accept 

4 benefits from recipients of supplemental 

5 nutrition assistance through mobile trans6 actions. 

7 ‘‘(ii) DEMONSTRATION PROJECTS.— 

8 To be eligible to participate in a dem9 onstration project under clause (i), a retail 

10 food store shall submit to the Secretary for 

11 approval a plan that includes— 

12 ‘‘(I) a description of the tech13 nology; 

14 ‘‘(II) the manner by which the 

15 retail food store will provide proof of 

16 the transaction to households; 

17 ‘‘(III) the provision of data to 

18 the Secretary, consistent with require19 ments established by the Secretary, in 

20 a manner that allows the Secretary to 

21 evaluate the impact of the demonstra22 tion on participant access, ease of use, 

23 and program integrity; and 

24 ‘‘(IV) such other criteria as the 

25 Secretary may require. 


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1 ‘‘(iii) DATE OF COMPLETION.—The 

2 demonstration projects under this subpara3 graph shall be completed and final reports 

4 submitted to the Secretary by not later 

5 than July 1, 2015. 

6 ‘‘(C) REPORT TO CONGRESS.—The Sec7 retary shall— 

8 ‘‘(i) by not later than January 1, 

9 2016, authorize implementation of sub10 paragraph (A) in all States, unless the 

11 Secretary makes a finding, based on the 

12 data provided under subparagraph (B), 

13 that implementation in all States is not in 

14 the best interest of the supplemental nutri15 tion assistance program; and 

16 ‘‘(ii) if the determination made in 

17 clause (i) is not to implement subpara18 graph (A) in all States, submit a report to 

19 the Committee on Agriculture of the House 

20 of Representatives and the Committee on 

21 Agriculture, Nutrition, and Forestry of the 

22 Senate that includes the basis of the find23 ing.’’. 

24 (b) ACCEPTANCE OF BENEFITS THROUGH ON-LINE

25 TRANSACTIONS.— 


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1 (1) IN GENERAL.—Section 7 of the Food and 

2 Nutrition Act of 2008 (7 U.S.C. 2016) is amended 

3 by adding at the end the following: 

4 ‘‘(k) OPTION TO ACCEPT PROGRAM BENEFITS

5 THROUGH ON-LINE TRANSACTIONS.— 

6 ‘‘(1) IN GENERAL.—Subject to paragraph (4), 

7 the Secretary shall approve retail food stores to ac8 cept benefits from recipients of supplemental nutri9 tion assistance through on-line transactions. 

10 ‘‘(2) REQUIREMENTS TO ACCEPT BENEFITS.—A 

11 retail food store seeking to accept benefits from re12 cipients of supplemental nutrition assistance through 

13 on-line transactions shall— 

14 ‘‘(A) establish recipient protections regard15 ing privacy, ease of use, access, and support 

16 similar to the protections provided for trans17 actions made in retail food stores; 

18 ‘‘(B) ensure benefits are not used to pay 

19 delivery, ordering, convenience, or other fees or 

20 charges; 

21 ‘‘(C) clearly notify participating households 

22 at the time a food order is placed— 

23 ‘‘(i) of any delivery, ordering, conven24 ience, or other fee or charge associated 

25 with the food purchase; and 


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1 ‘‘(ii) that any such fee cannot be paid 

2 with benefits provided under this Act; 

3 ‘‘(D) ensure the security of on-line trans4 actions by using the most effective technology 

5 available that the Secretary considers appro6 priate and cost-effective and that is comparable 

7 to the security of transactions at retail food 

8 stores; and 

9 ‘‘(E) meet other criteria as established by 

10 the Secretary. 

11 ‘‘(3) STATE AGENCY ACTION.—Each State 

12 agency shall ensure that recipients of supplemental 

13 nutrition assistance can use benefits on-line as de14 scribed in this subsection as appropriate. 

15 ‘‘(4) DEMONSTRATION PROJECT ON ACCEPT16 ANCE OF BENEFITS THROUGH ON-LINE TRANS17 ACTIONS.— 

18 ‘‘(A) IN GENERAL.—Before the Secretary 

19 authorizes implementation of paragraph (1) in 

20 all States, the Secretary shall carry out a num21 ber of demonstration projects as determined by 

22 the Secretary to test the feasibility of allowing 

23 retail food stores to accept benefits through on24 line transactions. 


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1 ‘‘(B) DEMONSTRATION PROJECTS.—To be 

2 eligible to participate in a demonstration project 

3 under subparagraph (A), a retail food store 

4 shall submit to the Secretary for approval a 

5 plan that includes— 

6 ‘‘(i) a method of ensuring that bene7 fits may be used to purchase only eligible 

8 items under this Act; 

9 ‘‘(ii) a description of the method of 

10 educating participant households about the 

11 availability and operation of on-line pur12 chasing; 

13 ‘‘(iii) adequate testing of the on-line 

14 purchasing option prior to implementation; 

15 ‘‘(iv) the provision of data as re16 quested by the Secretary for purposes of 

17 analyzing the impact of the project on par18 ticipant access, ease of use, and program 

19 integrity; 

20 ‘‘(v) reports on progress, challenges, 

21 and results, as determined by the Sec22 retary; and 

23 ‘‘(vi) such other criteria, including se24 curity criteria, as established by the Sec25 retary. 


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1 ‘‘(C) DATE OF COMPLETION.—The dem2 onstration projects under this paragraph shall 

3 be completed and final reports submitted to the 

4 Secretary by not later than July 1, 2015. 

5 ‘‘(5) REPORT TO CONGRESS.—The Secretary 

6 shall— 

7 ‘‘(A) by not later than January 1, 2016, 

8 authorize implementation of paragraph (1) in 

9 all States, unless the Secretary makes a find10 ing, based on the data provided under para11 graph (4), that implementation in all States is 

12 not in the best interest of the supplemental nu13 trition assistance program; and 

14 ‘‘(B) if the determination made in sub15 paragraph (A) is not to implement in all States, 

16 submit a report to the Committee on Agri17 culture of the House of Representatives and the 

18 Committee on Agriculture, Nutrition, and For19 estry of the Senate that includes the basis of 

20 the finding.’’. 

21 (2) CONFORMING AMENDMENTS.— 

22 (A) Section 7(b) of the Food and Nutrition 

23 Act of 2008 (7 U.S.C. 2016(b)) is amended by 

24 striking ‘‘purchase food in retail food stores’’ 


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1 and inserting ‘‘purchase food from retail food 

2 stores’’. 

3 (B) Section 10 of the Food and Nutrition 

4 Act of 2008 (7 U.S.C. 2019) is amended in the 

5 first sentence by inserting ‘‘retail food stores 

6 authorized to accept and redeem benefits 

7 through on-line transactions shall be authorized 

8 to accept benefits prior to the delivery of food 

9 if the delivery occurs within a reasonable time 

10 of the purchase, as determined by the Sec11 retary,’’ after ‘‘food so purchased,’’. 

12 (c) SAVINGS CLAUSE.—Nothing in this section or an 

13 amendment made by this section alter any requirements 

14 of the Food and Nutrition Act of 2008 (7 U.S.C. 2011 

15 et seq.) unless specifically authorized in this section or an 

16 amendment made by this section. 

17 SEC. 4008. USE OF BENEFITS FOR PURCHASE OF COMMU18 NITY-SUPPORTED AGRICULTURE SHARE. 

19 Section 10 of the Food and Nutrition Act of 2008 

20 (7 U.S.C. 2019) (as amended by section 4007(b)(2)(B)) 

21 is amended in the first sentence by inserting ‘‘agricultural 

22 producers who market agricultural products directly to 

23 consumers shall be authorized to redeem benefits for the 

24 initial cost of the purchase of a community-supported agri25 culture share for an appropriate time in advance of food 


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1 delivery as determined by the Secretary,’’ after ‘‘as deter2 mined by the Secretary,’’. 

3 SEC. 4009. RESTAURANT MEALS PROGRAM. 

4 (a) IN GENERAL.—Section 11(e) of the Food and 

5 Nutrition Act of 2008 (7 U.S.C. 2020(e)) is amended— 

6 (1) in paragraph (22), by striking ‘‘and’’ at the 

7 end; 

8 (2) in paragraph (23), by striking the period at 

9 the end of subparagraph (C) and inserting ‘‘; and’’; 

10 and 

11 (3) by adding at the end the following: 

12 ‘‘(24) if the State elects to carry out a program 

13 to contract with private establishments to offer 

14 meals at concessional prices, as described in para15 graphs 3, 4, and 9 of section 3(k)— 

16 ‘‘(A) the plans of the State agency for op17 erating the program, including— 

18 ‘‘(i) documentation of a need that eli19 gible homeless, elderly, and disabled clients 

20 are underserved in a particular geographic 

21 area; 

22 ‘‘(ii) the manner by which the State 

23 agency will limit participation to only those 

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1 termines necessary to meet the need identi2 fied in clause (i); and 

3 ‘‘(iii) any other conditions the Sec4 retary may prescribe, such as the level of 

5 security necessary to ensure that only eligi6 ble recipients participate in the program; 

7 and 

8 ‘‘(B) a report by the State agency to the 

9 Secretary annually, the schedule of which shall 

10 be established by the Secretary, that includes— 

11 ‘‘(i) the number of households and in12 dividual recipients authorized to partici13 pate in the program, including any infor14 mation on whether the individual recipient 

15 is elderly, disabled, or homeless; and 

16 ‘‘(ii) an assessment of whether the 

17 program is meeting an established need, as 

18 documented under subparagraph (A)(i).’’. 

19 (b) APPROVAL OF RETAIL FOOD STORES AND

20 WHOLESALE FOOD CONCERNS.—Section 9 of the Food 

21 and Nutrition Act of 2008 (7 U.S.C. 2018) (as amended 

22 by section 4005(d)(3)) is amended by adding at the end 

23 the following: 

24 ‘‘(h) PRIVATE ESTABLISHMENTS.— 


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1 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

2 no private establishment that contracts with a State 

3 agency to offer meals at concessional prices as de4 scribed in paragraphs 3, 4, and 9 of section 3(k) 

5 may be authorized to accept and redeem benefits un6 less the Secretary determines that the participation 

7 of the private establishment is required to meet a 

8 documented need in accordance with section 

9 11(e)(24). 

10 ‘‘(2) EXISTING CONTRACTS.— 

11 ‘‘(A) IN GENERAL.—If, on the day before 

12 the date of enactment of this subsection, a 

13 State has entered into a contract with a private 

14 establishment described in paragraph (1) and 

15 the Secretary has not determined that the par16 ticipation of the private establishment is nec17 essary to meet a documented need in accord18 ance with section 11(e)(24), the Secretary shall 

19 allow the operation of the private establishment 

20 to continue without that determination of need 

21 for a period not to exceed 180 days from the 

22 date on which the Secretary establishes deter23 mination criteria, by regulation, under section 

24 11(e)(24). 


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1 ‘‘(B) JUSTIFICATION.—If the Secretary 

2 makes a determination to terminate a contract 

3 with a private establishment that is in effect on 

4 the date of enactment of this subsection, the 

5 Secretary shall provide justification to the State 

6 in which the private establishment is located for 

7 that termination. 

8 ‘‘(3) REPORT TO CONGRESS.—Not later than 

9 90 days after September 30, 2013, and 90 days 

10 after the last day of each fiscal year thereafter, the 

11 Secretary shall report to the Committee on Agri12 culture of the House of Representatives and the 

13 Committee on Agriculture, Nutrition, and Forestry 

14 of the Senate on the effectiveness of a program 

15 under this subsection using any information received 

16 from States under section 11(e)(24) as well as any 

17 other information the Secretary may have relating to 

18 the manner in which benefits are used.’’. 

19 (c) CONFORMING AMENDMENTS.—Section 3(k) of 

20 the Food and Nutrition Act of 2008 (7 U.S.C. 2012(k)) 

21 is amended by inserting ‘‘subject to section 9(h)’’ after 

22 ‘‘concessional prices’’ each place it appears. 


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1 SEC. 4010. QUALITY CONTROL ERROR RATE DETERMINA2 TION. 

3 Section 16(c) of the Food and Nutrition Act of 2008 

4 (7 U.S.C. 2025(c)) is amended by adding at the end the 

5 following: 

6 ‘‘(10) TOLERANCE LEVEL.—For the purposes 

7 of this subsection, the Secretary shall set the toler8 ance level for excluding small errors at $25.’’. 

9 SEC. 4011. AUTHORIZATION OF APPROPRIATIONS. 

10 Section 18(a)(1) of the Food and Nutrition Act of 

11 2008 (7 U.S.C. 2027(a)(1)) is amended in the first sen12 tence by striking ‘‘2012’’ and inserting ‘‘2017’’. 

13 SEC. 4012. ASSISTANCE FOR COMMUNITY FOOD PROJECTS. 

14 Section 25 of the Food and Nutrition Act of 2008 

15 (7 U.S.C. 2034) is amended— 

16 (1) in subsection (a)(1)(B)(ii)— 

17 (A) by striking subclause (I); and 

18 (B) by redesignating subclauses (II) and 

19 (III) as subclauses (I) and (II), respectively; 

20 and 

21 (2) in subsection (b), by adding at the end the 

22 following: 

23 ‘‘(3) FUNDING.— 

24 ‘‘(A) IN GENERAL.—Out of any funds in 

25 the Treasury not otherwise appropriated, the 

26 Secretary of the Treasury shall transfer to the 


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1 Secretary to carry out this section not less than 

2 $5,000,000 for fiscal year 2013 and each fiscal 

3 year thereafter. 

4 ‘‘(B) RECEIPT AND ACCEPTANCE.—The 

5 Secretary shall be entitled to receive, shall ac6 cept, and shall use to carry out this section the 

7 funds transferred under subparagraph (A), 

8 without further appropriation. 

9 ‘‘(C) MAINTENANCE OF FUNDING.—The 

10 funding provided under subparagraph (A) shall 

11 supplement (and not supplant) other Federal 

12 funding made available to the Secretary to 

13 carry out this section.’’. 

14 SEC. 4013. EMERGENCY FOOD ASSISTANCE. 

15 (a) PURCHASE OF COMMODITIES.—Section 27(a) of 

16 the Food and Nutrition Act of 2008 (7 U.S.C. 2036(a)) 

17 is amended— 

18 (1) in paragraph (1), by striking ‘‘2008 

19 through 2012’’ and inserting ‘‘2012 through 2017’’; 

20 (2) by striking paragraph (2) and inserting the 

21 following: 

22 ‘‘(2) AMOUNTS.—The Secretary shall use to 

23 carry out paragraph (1)— 

24 ‘‘(A) for fiscal year 2012, $260,000,000; 

25 and 


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1 ‘‘(B) for each subsequent fiscal year, the 

2 dollar amount of commodities specified in sub3 paragraph (A) adjusted by the percentage by 

4 which the thrifty food plan has been adjusted 

5 under section 3(u)(4) between June 30, 2012, 

6 and June 30 of the immediately preceding fiscal 

7 year, and subsequently increased by— 

8 ‘‘(i) for fiscal year 2013, $28,000,000; 

9 ‘‘(ii) for fiscal year 2014, 

10 $24,000,000; 

11 ‘‘(iii) for fiscal year 2015, 

12 $20,000,000; 

13 ‘‘(iv) for fiscal year 2016, 

14 $18,000,000; and 

15 ‘‘(v) for fiscal year 2017 and each fis16 cal year thereafter, $10,000,000.’’; and 

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

18 ‘‘(3) FUNDS AVAILABILITY.—For purposes of 

19 the funds described in this subsection, the Secretary 

20 shall— 

21 ‘‘(A) make the funds available for 2 fiscal 

22 years; and 

23 ‘‘(B) allow States to carry over unex24 pended balances to the next fiscal year pursuVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00337 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 ant to such terms and conditions as are deter2 mined by the Secretary.’’. 

3 (b) EMERGENCY FOOD PROGRAM INFRASTRUCTURE

4 GRANTS.—Section 209(d) of the Emergency Food Assist5 ance Act of 1983 (7 U.S.C. 7511a(d)) is amended by 

6 striking ‘‘2012’’ and inserting ‘‘2017’’. 

7 SEC. 4014. NUTRITION EDUCATION. 

8 Section 28(b) of the Food and Nutrition Act of 2008 

9 (7 U.S.C. 2036a(b)) is amended by inserting ‘‘and phys10 ical activity’’ after ‘‘healthy food choices’’. 

11 SEC. 4015. RETAIL FOOD STORE AND RECIPIENT TRAF12 FICKING. 

13 The Food and Nutrition Act of 2008 (7 U.S.C. 2011 

14 et seq.) is amended by adding at the end the following: 

15 ‘‘SEC. 29. RETAIL FOOD STORE AND RECIPIENT TRAF16 FICKING. 

17 ‘‘(a) PURPOSE.—The purpose of this section is to 

18 provide the Department of Agriculture with additional re19 sources to prevent trafficking in violation of this Act by 

20 strengthening recipient and retail food store program in21 tegrity. 

22 ‘‘(b) USE OF FUNDS.—Additional funds are provided 

23 under this section to supplement the retail food store and 

24 recipient integrity activities of the Department. 

25 ‘‘(c) FUNDING.— 


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1 ‘‘(1) IN GENERAL.—Out of any funds in the 

2 Treasury not otherwise appropriated, the Secretary 

3 of the Treasury shall transfer to the Secretary to 

4 carry out this section not less than $18,500,000 for 

5 fiscal year 2013 and each fiscal year thereafter. 

6 ‘‘(2) RECEIPT AND ACCEPTANCE.—The Sec7 retary shall be entitled to receive, shall accept, and 

8 shall use to carry out this section the funds trans9 ferred under paragraph (1), without further appro10 priation. 

11 ‘‘(3) MAINTENANCE OF FUNDING.—The fund12 ing provided under paragraph (1) shall supplement 

13 (and not supplant) other Federal funding for pro14 grams carried out under this Act.’’. 

15 SEC. 4016. TECHNICAL AND CONFORMING AMENDMENTS. 

16 (a) Section 3 of the Food and Nutrition Act of 2008 

17 (7 U.S.C. 2012) is amended— 

18 (1) in subsection (g), by striking ‘‘coupon,’’ and 

19 inserting ‘‘coupon’’; 

20 (2) in subsection (k)(7), by striking ‘‘or are’’ 

21 and inserting ‘‘and’’; 

22 (3) by striking subsection (l); 

23 (4) by redesignating subsections (m) through 

24 (t) as subsections (l) through (s), respectively; and 


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1 (5) by inserting after subsection (s) (as so re2 designated) the following: 

3 ‘‘(t) ‘Supplemental nutrition assistance program’ 

4 means the program operated pursuant to this Act.’’. 

5 (b) Section 4(a) of the Food and Nutrition Act of 

6 2008 (7 U.S.C. 2013(a)) is amended in the last sentence 

7 by striking ‘‘benefits’’ and inserting ‘‘Benefits’’. 

8 (c) Section 5 of the Food and Nutrition Act of 2008 

9 (7 U.S.C. 2014) is amended— 

10 (1) in the last sentence of subsection (i)(2)(D), 

11 by striking ‘‘section 13(b)(2)’’ and inserting ‘‘section 

12 13(b)’’; and 

13 (2) in subsection (k)(4)(A), by striking ‘‘para14 graph (2)(H)’’ and inserting ‘‘paragraph (2)(G)’’. 

15 (d) Section 6(d)(4) of the Food and Nutrition Act 

16 of 2008 (7 U.S.C. 2015(d)(4)) is amended in subpara17 graphs (B)(vii) and (F)(iii) by indenting both clauses ap18 propriately. 

19 (e) Section 7(h) of the Food and Nutrition Act of 

20 2008 (7 U.S.C. 2016(h)) is amended by redesignating the 

21 second paragraph (12) (relating to interchange fees) as 

22 paragraph (13). 

23 (f) Section 9(a) of the Food and Nutrition Act of 

24 2008 (7 U.S.C. 2018(a)) is amended by indenting para25 graph (3) appropriately. 


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1 (g) Section 12 of the Food and Nutrition Act of 2008 

2 (7 U.S.C. 2021) is amended— 

3 (1) in subsection (b)(3)(C), by striking ‘‘civil 

4 money penalties’’ and inserting ‘‘civil penalties’’; and 

5 (2) in subsection (g)(1), by striking ‘‘(7 U.S.C. 

6 1786)’’ and inserting ‘‘(42 U.S.C. 1786)’’. 

7 (h) Section 15(b)(1) of the Food and Nutrition Act 

8 of 2008 (7 U.S.C. 2024(b)(1)) is amended in the first sen9 tence by striking ‘‘an benefit’’ and inserting ‘‘a benefit’’. 

10 (i) Section 16(a) of the Food and Nutrition Act of 

11 2008 (7 U.S.C. 2025(a)) is amended in the proviso fol12 lowing paragraph (8) by striking ‘‘as amended.’’. 

13 (j) Section 18(e) of the Food and Nutrition Act of 

14 2008 (7 U.S.C. 2027(e)) is amended in the first sentence 

15 by striking ‘‘sections 7(f)’’ and inserting ‘‘section 7(f)’’. 

16 (k) Section 22(b)(10)(B)(i) of the Food and Nutri17 tion Act of 2008 (7 U.S.C. 2031(b)(10)(B)(i)) is amended 

18 in the last sentence by striking ‘‘Food benefits’’ and in19 serting ‘‘Benefits’’. 

20 (l) Section 26(f)(3)(C) of the Food and Nutrition Act 

21 of 2008 (7 U.S.C. 2035(f)(3)(C)) is amended by striking 

22 ‘‘subsection’’ and inserting ‘‘subsections’’. 

23 (m) Section 27(a)(1) of the Food and Nutrition Act 

24 of 2008 (7 U.S.C. 2036(a)(1)) is amended by striking 


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1 ‘‘(Public Law 98–8; 7 U.S.C. 612c note)’’ and inserting 

2 ‘‘(7 U.S.C. 7515)’’. 

3 (n) Section 509 of the Older Americans Act of 1965 

4 (42 U.S.C. 3056g) is amended in the section heading by 

5 striking ‘‘FOOD STAMP PROGRAMS’’ and inserting 

6 ‘‘SUPPLEMENTAL NUTRITION ASSISTANCE PRO7 GRAMS’’. 

8 (o) Section 4115(c)(2)(H) of the Food, Conservation, 

9 and Energy Act of 2008 (Public Law 110–246; 122 Stat. 

10 1871) is amended by striking ‘‘531’’ and inserting ‘‘454’’. 

11 Subtitle B—Commodity 

12 Distribution Programs 

13 SEC. 4101. COMMODITY DISTRIBUTION PROGRAM. 

14 Section 4(a) of the Agriculture and Consumer Protec15 tion Act of 1973 (7 U.S.C. 612c note; Public Law 93– 

16 86) is amended in the first sentence by striking ‘‘2012’’ 

17 and inserting ‘‘2017’’. 

18 SEC. 4102. COMMODITY SUPPLEMENTAL FOOD PROGRAM. 

19 Section 5 of the Agriculture and Consumer Protec20 tion Act of 1973 (7 U.S.C. 612c note; Public Law 93– 

21 86) is amended— 

22 (1) in paragraphs (1) and (2)(B) of subsection 

23 (a), by striking ‘‘2012’’ each place it appears and in24 serting ‘‘2017’’; 


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1 (2) in the first sentence of subsection (d)(2), by 

2 striking ‘‘2012’’ and inserting ‘‘2017’’; 

3 (3) by striking subsection (g) and inserting the 

4 following: 

5 ‘‘(g) ELIGIBILITY.—Except as provided in subsection 

6 (m), the States shall only provide assistance under the 

7 commodity supplemental food program to low-income per8 sons aged 60 and older.’’; and 

9 (4) by adding at the end the following: 

10 ‘‘(m) PHASE-OUT.—Notwithstanding any other provi11 sion of law, an individual who receives assistance under 

12 the commodity supplemental food program on the day be13 fore the date of enactment of this subsection shall con14 tinue to receive that assistance until the date on which 

15 the individual is no longer eligible for assistance under the 

16 eligibility requirements for the program in effect on the 

17 day before the date of enactment of this subsection.’’. 

18 SEC. 4103. DISTRIBUTION OF SURPLUS COMMODITIES TO 

19 SPECIAL NUTRITION PROJECTS. 

20 Section 1114(a)(2)(A) of the Agriculture and Food 

21 Act of 1981 (7 U.S.C. 1431e(2)(A)) is amended in the 

22 first sentence by striking ‘‘2012’’ and inserting ‘‘2017’’. 


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1 SEC. 4104. TECHNICAL AND CONFORMING AMENDMENTS. 

2 Section 3 of the Commodity Distribution Reform Act 

3 and WIC Amendments of 1987 (7 U.S.C. 612c note; Pub4 lic Law 100–237) is amended— 

5 (1) in subsection (a)— 

6 (A) in paragraph (2), by striking subpara7 graph (B) and inserting the following: 

8 ‘‘(B) the program established under sec9 tion 4(b) of the Food and Nutrition Act of 

10 2008 (7 U.S.C. 2013(b));’’; and 

11 (B) in paragraph (3)(D), by striking ‘‘the 

12 Committee on Education and Labor’’ and in13 serting ‘‘the Committee on Education and the 

14 Workforce’’; 

15 (2) in subsection (b)(1)(A)(ii), by striking ‘‘sec16 tion 32 of the Agricultural Adjustment Act (7 

17 U.S.C. 601 et seq.)’’ and inserting ‘‘section 32 of 

18 the Act of August 24, 1935 (7 U.S.C. 612c)’’; 

19 (3) in subsection (e)(1)(D)(iii), by striking sub20 clause (II) and inserting the following: 

21 ‘‘(II) the program established 

22 under section 4(b) of the Food and 

23 Nutrition Act of 2008 (7 U.S.C. 

24 2013(b));’’; and 


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1 (4) in subsection (k), by striking ‘‘the Com2 mittee on Education and Labor’’ and inserting ‘‘the 

3 Committee on Education and the Workforce’’. 

4 Subtitle C—Miscellaneous 

5 SEC. 4201. PURCHASE OF FRESH FRUITS AND VEGETABLES 

6 FOR DISTRIBUTION TO SCHOOLS AND SERV7 ICE INSTITUTIONS. 

8 Section 10603(b) of the Farm Security and Rural In9 vestment Act of 2002 (7 U.S.C. 612c–4(b)) is amended 

10 by striking ‘‘2012’’ and inserting ‘‘2017’’. 

11 SEC. 4202. SENIORS FARMERS’ MARKET NUTRITION PRO12 GRAM. 

13 Section 4402(a) of the Farm Security and Rural In14 vestment Act of 2002 (7 U.S.C. 3007(a)) is amended by 

15 striking ‘‘2012’’ and inserting ‘‘2017’’. 

16 SEC. 4203. NUTRITION INFORMATION AND AWARENESS 

17 PILOT PROGRAM. 

18 Section 4403 of the Farm Security and Rural Invest19 ment Act of 2002 (7 U.S.C. 3171 note; Public Law 107– 

20 171) is repealed. 

21 SEC. 4204. WHOLE GRAIN PRODUCTS. 

22 Section 4305 of the Food, Conservation, and Energy 

23 Act of 2008 (42 U.S.C. 1755a) is amended— 

24 (1) in subsection (a), by striking ‘‘2005’’ and 

25 inserting ‘‘2010’’; 


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1 (2) in subsection (d), by striking ‘‘2011’’ and 

2 inserting ‘‘2015’’; 

3 (3) in subsection (e), by striking ‘‘Labor of the 

4 House of Representative’’ and inserting ‘‘the Work5 force of the House of Representatives’’; and 

6 (4) by adding at the end the following: 

7 ‘‘(f) FUNDING.— 

8 ‘‘(1) IN GENERAL.—On October 1, 2013, out of 

9 any funds in the Treasury not otherwise appro10 priated, the Secretary of the Treasury shall transfer 

11 to the Secretary to carry out this section 

12 $10,000,000 for the period of fiscal years 2014 

13 through 2015. 

14 ‘‘(2) RECEIPT AND ACCEPTANCE.—The Sec15 retary shall be entitled to receive, shall accept, and 

16 shall use to carry out this section the funds trans17 ferred under paragraph (1), without further appro18 priation. 

19 ‘‘(3) MAINTENANCE OF FUNDING.—The fund20 ing provided under paragraph (1) shall supplement 

21 (and not supplant) other Federal funding (including 

22 funds made available under section 32 of the Act of 

23 August 24, 1935 (7 U.S.C. 612c)) for programs car24 ried out under— 


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1 ‘‘(A) the Richard B. Russell National 

2 School Lunch Act (42 U.S.C. 1751 et seq.), ex3 cept for section 19 of that Act (42 U.S.C. 

4 1769a); 

5 ‘‘(B) the Emergency Food Assistance Act 

6 of 1983 (7 U.S.C. 7501 et seq.); and 

7 ‘‘(C) section 27 of the Food and Nutrition 

8 Act of 2008 (7 U.S.C. 2036).’’. 

9 SEC. 4205. HUNGER-FREE COMMUNITIES. 

10 Section 4405 of the Food, Conservation, and Energy 

11 Act of 2008 (7 U.S.C. 7517) is amended— 

12 (1) in subsection (a)— 

13 (A) by striking paragraph (1) and insert14 ing the following: 

15 ‘‘(1) ELIGIBLE ENTITY.— 

16 ‘‘(A) COLLABORATIVE GRANTS.—In sub17 section (b), the term ‘eligible entity’ means a 

18 public food program service provider or non19 profit organization, including an emergency 

20 feeding organization, that has collaborated or 

21 will collaborate with 1 or more local partner or22 ganizations to achieve at least 1 hunger-free 

23 communities goal. 

24 ‘‘(B) INCENTIVE GRANTS.—In subsection 

25 (c), the term ‘eligible entity’ means a nonprofit 


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1 organization (including an emergency feeding 

2 organization), an agricultural cooperative, pro3 ducer network or association, community health 

4 organization, public benefit corporation, eco5 nomic development corporation, farmers’ mar6 ket, community-supported agriculture program, 

7 buying club, supplemental nutrition assistance 

8 program retail food store, a State, local, or trib9 al agency, and any other entity the Secretary 

10 designates.’’; 

11 (B) by adding at the end the following: 

12 ‘‘(4) SUPPLEMENTAL NUTRITION ASSISTANCE

13 PROGRAM.—The term ‘supplemental nutrition assist14 ance program’ means the supplemental nutrition as15 sistance program established under the Food and 

16 Nutrition Act of 2008 (7 U.S.C. 2011 et seq.). 

17 ‘‘(5) UNDERSERVED COMMUNITY.—The term 

18 ‘underserved community’ has the meaning given the 

19 term in section 25 of the Food and Nutrition Act of 

20 2008 (7 U.S.C. 2034).’’; 

21 (2) in subsection (b)(1)(A), by striking ‘‘not 

22 more than 50 percent of any funds made available 

23 under subsection (e)’’ and inserting ‘‘funds made 

24 available under subsection (d)(1)’’; and 


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1 (3) by striking subsections (c), (d), and (e) and 

2 inserting the following: 

3 ‘‘(c) HUNGER-FREE COMMUNITIES INCENTIVE

4 GRANTS.— 

5 ‘‘(1) AUTHORIZATION.— 

6 ‘‘(A) IN GENERAL.—In each of the years 

7 specified in subsection (d), the Secretary shall 

8 make grants to eligible entities in accordance 

9 with paragraph (2). 

10 ‘‘(B) FEDERAL SHARE.—The Federal 

11 share of the cost of carrying out an activity 

12 under this subsection shall not exceed 50 per13 cent of the total cost of the activity. 

14 ‘‘(C) NON-FEDERAL SHARE.— 

15 ‘‘(i) IN GENERAL.—The non-Federal 

16 share of the cost of an activity under this 

17 subsection may be provided— 

18 ‘‘(I) in cash or in-kind contribu19 tions as determined by the Secretary, 

20 including facilities, equipment, or 

21 services; and 

22 ‘‘(II) by a State or local govern23 ment or a private source. 

24 ‘‘(ii) LIMITATION.—In the case of a 

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1 scribed in clause (i) shall not include serv2 ices of an employee, including salaries paid 

3 or expenses covered by the employer. 

4 ‘‘(2) CRITERIA.— 

5 ‘‘(A) IN GENERAL.—For purposes of this 

6 subsection, an eligible entity is a governmental 

7 agency or nonprofit organization that— 

8 ‘‘(i) meets the application criteria set 

9 forth by the Secretary; and 

10 ‘‘(ii) proposes a project that, at a 

11 minimum— 

12 ‘‘(I) has the support of the State 

13 agency; 

14 ‘‘(II) would increase the purchase 

15 of fruits and vegetables by low-income 

16 consumers participating in the supple17 mental nutrition assistance program 

18 by providing incentives at the point of 

19 purchase; 

20 ‘‘(III) agrees to participate in the 

21 evaluation described in paragraph (4); 

22 ‘‘(IV) ensures that the same 

23 terms and conditions apply to pur24 chases made by individuals with bene25 fits issued under this Act and incenVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00350 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 tives provided for in this subsection as 

2 apply to purchases made by individ3 uals who are not members of house4 holds receiving benefits, such as pro5 vided for in section 278.2(b) of title 7, 

6 Code of Federal Regulations (or a 

7 successor regulation); and 

8 ‘‘(V) includes effective and effi9 cient technologies for benefit redemp10 tion systems that may be replicated in 

11 other for States and communities. 

12 ‘‘(B) PRIORITY.—In awarding grants 

13 under this section, the Secretary shall give pri14 ority to projects that— 

15 ‘‘(i) maximize the share of funds used 

16 for direct incentives to participants; 

17 ‘‘(ii) use direct-to-consumer sales mar18 keting; 

19 ‘‘(iii) demonstrate a track record of 

20 designing and implementing successful nu21 trition incentive programs that connect 

22 low-income consumers and agricultural 

23 producers; 

24 ‘‘(iv) provide locally or regionally pro25 duced fruits and vegetables; 


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1 ‘‘(v) are located in underserved com2 munities; or 

3 ‘‘(vi) address other criteria as estab4 lished by the Secretary. 

5 ‘‘(3) APPLICABILITY.— 

6 ‘‘(A) IN GENERAL.—The value of any ben7 efit provided to a participant in any activity 

8 funded under this subsection shall not be con9 sidered income or resources for any purpose 

10 under any Federal, State, or local law. 

11 ‘‘(B) PROHIBITION ON COLLECTION OF

12 SALES TAXES.—Each State shall ensure that no 

13 State or local tax is collected on a purchase of 

14 food under this subsection. 

15 ‘‘(C) NO LIMITATION ON BENEFITS.—A 

16 grant made available under this subsection shall 

17 not be used to carry out any project that limits 

18 the use of benefits under the Food and Nutri19 tion Act of 2008 (7 U.S.C. 2011 et seq.) or any 

20 other Federal nutrition law. 

21 ‘‘(D) HOUSEHOLD ALLOTMENT.—Assist22 ance provided under this subsection to house23 holds receiving benefits under the supplemental 

24 nutrition assistance program shall not— 


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1 ‘‘(i) be considered part of the supple2 mental nutrition assistance program bene3 fits of the household; or 

4 ‘‘(ii) be used in the collection or dis5 position of claims under section 13 of the 

6 Food and Nutrition Act of 2008 (7 U.S.C. 

7 2022). 

8 ‘‘(4) EVALUATION.— 

9 ‘‘(A) INDEPENDENT EVALUATION.—The 

10 Secretary shall provide for an independent eval11 uation of projects selected under this subsection 

12 that measures the impact of each project on— 

13 ‘‘(i) improving the nutrition and 

14 health status of participating households 

15 receiving incentives under this subsection; 

16 and 

17 ‘‘(ii) increasing fruit and vegetable 

18 purchases in participating households. 

19 ‘‘(B) REQUIREMENT.—The independent 

20 evaluation under subparagraph (A) shall use 

21 rigorous methodologies capable of producing 

22 scientifically valid information regarding the ef23 fectiveness of a project. 

24 ‘‘(C) COSTS.—The Secretary may use 

25 funds not to exceed 10 percent of the funding 


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1 provided to carry out this section to pay costs 

2 associated with administering, monitoring, and 

3 evaluating each project. 

4 ‘‘(d) FUNDING.— 

5 ‘‘(1) AUTHORIZATION OF APPROPRIATIONS.— 

6 There is authorized to be appropriated to carry out 

7 subsection (b) $5,000,000 for each of fiscal years 

8 2013 through 2017. 

9 ‘‘(2) MANDATORY FUNDING.—Of the funds of 

10 the Commodity Credit Corporation, the Secretary 

11 shall use to carry out subsection (c)— 

12 ‘‘(A) $15,000,000 for fiscal year 2013; 

13 ‘‘(B) $20,000,000 for each of fiscal years 

14 2014 through 2016; and 

15 ‘‘(C) $25,000,000 for fiscal year 2017.’’. 

16 SEC. 4206. HEALTHY FOOD FINANCING INITIATIVE. 

17 (a) IN GENERAL.—Subtitle D of title II of the De18 partment of Agriculture Reorganization Act of 1994 (7 

19 U.S.C. 6951 et seq.) is amended by adding at the end 

20 the following: 

21 ‘‘SEC. 242. HEALTHY FOOD FINANCING INITIATIVE. 

22 ‘‘(a) PURPOSE.—The purpose of this section is to en23 hance the authorities of the Secretary to support efforts 

24 to provide access to healthy food by establishing an initia25 tive to improve access to healthy foods in underserved 


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1 areas, to create and preserve quality jobs, and to revitalize 

2 low-income communities by providing loans and grants to 

3 eligible fresh, healthy food retailers to overcome the higher 

4 costs and initial barriers to entry in underserved areas. 

5 ‘‘(b) DEFINITIONS.—In this section: 

6 ‘‘(1) COMMUNITY DEVELOPMENT FINANCIAL IN7 STITUTION.—The term ‘community development fi8 nancial institution’ has the meaning given the term 

9 in section 103 of the Community Development 

10 Banking and Financial Institutions Act of 1994 (12 

11 U.S.C. 4702). 

12 ‘‘(2) INITIATIVE.—The term ‘Initiative’ means 

13 the Healthy Food Financing Initiative established 

14 under subsection (c)(1). 

15 ‘‘(3) NATIONAL FUND MANAGER.—The term 

16 ‘national fund manager’ means a community devel17 opment financial institution that is— 

18 ‘‘(A) in existence on the date of enactment 

19 of this section; and 

20 ‘‘(B) certified by the Community Develop21 ment Financial Institution Fund of the Depart22 ment of Treasury to manage the Initiative for 

23 purposes of— 

24 ‘‘(i) raising private capital; 


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1 ‘‘(ii) providing financial and technical 

2 assistance to partnerships; and 

3 ‘‘(iii) funding eligible projects to at4 tract fresh, healthy food retailers to under5 served areas, in accordance with this sec6 tion. 

7 ‘‘(4) PARTNERSHIP.—The term ‘partnership’ 

8 means a regional, State, or local public-private part9 nership that— 

10 ‘‘(A) is organized to improve access to 

11 fresh, healthy foods; 

12 ‘‘(B) provides financial and technical as13 sistance to eligible projects; and 

14 ‘‘(C) meets such other criteria as the Sec15 retary may establish. 

16 ‘‘(5) PERISHABLE FOOD.—The term ‘perishable 

17 food’ means a staple food that is fresh, refrigerated, 

18 or frozen. 

19 ‘‘(6) QUALITY JOB.—The term ‘quality job’ 

20 means a job that provides wages and other benefits 

21 comparable to, or better than, similar positions in 

22 existing businesses of similar size in similar local 

23 economies. 

24 ‘‘(7) STAPLE FOOD.— 


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1 ‘‘(A) IN GENERAL.—The term ‘staple food’ 

2 means food that is a basic dietary item. 

3 ‘‘(B) INCLUSIONS.—The term ‘staple food’ 

4 includes— 

5 ‘‘(i) bread; 

6 ‘‘(ii) flour; 

7 ‘‘(iii) fruits; 

8 ‘‘(iv) vegetables; and 

9 ‘‘(v) meat. 

10 ‘‘(c) INITIATIVE.— 

11 ‘‘(1) ESTABLISHMENT.—The Secretary shall es12 tablish an initiative to achieve the purpose described 

13 in subsection (a) in accordance with this subsection. 

14 ‘‘(2) IMPLEMENTATION.— 

15 ‘‘(A) IN GENERAL.— 

16 ‘‘(i) IN GENERAL.—In carrying out 

17 the Initiative, the Secretary shall provide 

18 funding to entities with eligible projects, as 

19 described in subparagraph (B), subject to 

20 the priorities described in subparagraph 

21 (C). 

22 ‘‘(ii) USE OF FUNDS.—Funds pro23 vided to an entity pursuant to clause (i) 

24 shall be used— 


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1 ‘‘(I) to create revolving loan pools 

2 of capital or other products to provide 

3 loans to finance eligible projects or 

4 partnerships; 

5 ‘‘(II) to provide grants for eligi6 ble projects or partnerships; 

7 ‘‘(III) to provide technical assist8 ance to funded projects and entities 

9 seeking Initiative funding; and 

10 ‘‘(IV) to cover administrative ex11 penses of the national fund manager 

12 in an amount not to exceed 10 per13 cent of the Federal funds provided. 

14 ‘‘(B) ELIGIBLE PROJECTS.—Subject to the 

15 approval of the Secretary, the national fund 

16 manager shall establish eligibility criteria for 

17 projects under the Initiative, which shall include 

18 the existence or planned execution of agree19 ments— 

20 ‘‘(i) to expand or preserve the avail21 ability of staple foods in underserved areas 

22 with moderate- and low-income populations 

23 by maintaining or increasing the number 

24 of retail outlets that offer an assortment of 

25 perishable food and staple food items, as 


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1 determined by the Secretary, in those 

2 areas; and 

3 ‘‘(ii) to accept benefits under the sup4 plemental nutrition assistance program es5 tablished under the Food and Nutrition 

6 Act of 2008 (7 U.S.C. 2011 et seq.). 

7 ‘‘(C) PRIORITIES.—In carrying out the Ini8 tiative, priority shall be given to projects that— 

9 ‘‘(i) are located in severely distressed 

10 low-income communities, as defined by the 

11 Community Development Financial Insti12 tutions Fund of the Department of Treas13 ury; and 

14 ‘‘(ii) include 1 or more of the fol15 lowing characteristics: 

16 ‘‘(I) The project will create or re17 tain quality jobs for low-income resi18 dents in the community. 

19 ‘‘(II) The project supports re20 gional food systems and locally grown 

21 foods, to the maximum extent prac22 ticable. 

23 ‘‘(III) In areas served by public 

24 transit, the project is accessible by 

25 public transit. 


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1 ‘‘(IV) The project involves 

2 women- or minority-owned businesses. 

3 ‘‘(V) The project receives funding 

4 from other sources, including other 

5 Federal agencies. 

6 ‘‘(VI) The project otherwise ad7 vances the purpose of this section, as 

8 determined by the Secretary. 

9 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 

10 is authorized to be appropriated to the Secretary to carry 

11 out this section $125,000,000, to remain available until 

12 expended.’’. 

13 (b) CONFORMING AMENDMENT.—Section 296(b) of 

14 the Department of Agriculture Reorganization Act of 

15 1994 (7 U.S.C. 7014(b)) (as amended by section 1608(d)) 

16 is amended— 

17 (1) in paragraph (7), by striking ‘‘or’’ at the 

18 end; 

19 (2) in paragraph (8), by striking the period at 

20 the end and inserting ‘‘; or’’; and 

21 (3) by adding at the end the following: 

22 ‘‘(9) the authority of the Secretary to establish 

23 and carry out the Health Food Financing Initiative 

24 under section 242.’’. 


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1 SEC. 4207. PURCHASE OF COMMODITIES BY COMMODITY 

2 CREDIT CORPORATION. 

3 When the Secretary considers the purchasing of com4 modities by the Commodity Credit Corporation or under 

5 section 32 of the Act of August 24, 1935 (7 U.S.C. 612c), 

6 in addition to other appropriate considerations, the Sec7 retary may consider the needs of the States and the de8 mands placed on emergency feeding organizations. 

9 TITLE V—CREDIT 

10 Subtitle A—Farmer Loans, Serv11 icing, and Other Assistance 

12 Under the Consolidated Farm 

13 and Rural Development Act 

14 SEC. 5001. FARMER LOANS, SERVICING, AND OTHER ASSIST15 ANCE UNDER THE CONSOLIDATED FARM AND 

16 RURAL DEVELOPMENT ACT. 

17 The Consolidated Farm and Rural Development Act 

18 (as amended by section 6001) is amended by inserting 

19 after section 3002 the following: 

20 ‘‘Subtitle A—Farmer Loans, 

21 Servicing, and Other Assistance 

22 ‘‘CHAPTER 1—FARM OWNERSHIP LOANS 

23 ‘‘SEC. 3101. FARM OWNERSHIP LOANS. 

24 ‘‘(a) IN GENERAL.—The Secretary may make or 

25 guarantee a farm ownership loan under this chapter to 

26 an eligible farmer. 


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1 ‘‘(b) ELIGIBILITY.—A farmer shall be eligible under 

2 subsection (a) only— 

3 ‘‘(1) if the farmer, or, in the case of an entity, 

4 1 or more individuals holding a majority interest in 

5 the farmer— 

6 ‘‘(A) is a citizen of the United States; and 

7 ‘‘(B) in the case of a direct loan, has train8 ing or farming experience that the Secretary 

9 determines is sufficient to ensure a reasonable 

10 prospect of success in the farming operation 

11 proposed by the farmer; 

12 ‘‘(2)(A) in the case of a farmer that is an indi13 vidual, if the farmer is or proposes to become an 

14 owner and operator of a farm that is not larger than 

15 a family farm; or 

16 ‘‘(B) in the case of a lessee-operator of a farm 

17 located in the State of Hawaii, if the Secretary de18 termines that— 

19 ‘‘(i) the farm is not larger than a family 

20 farm; 

21 ‘‘(ii) the farm cannot be acquired in fee 

22 simple by the lessee-operator; 

23 ‘‘(iii) adequate security is provided for the 

24 loan with respect to the farm for which the les25 see-operator applies under this chapter; and 


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1 ‘‘(iv) there is a reasonable probability of 

2 accomplishing the objectives and repayment of 

3 the loan; 

4 ‘‘(3) in the case of a farmer that is a coopera5 tive, corporation, partnership, trust, limited liability 

6 company, joint operation, or such other legal entity 

7 as the Secretary determines to be appropriate, with 

8 respect to the entity and each farm in which the en9 tity has an ownership or operator interest— 

10 ‘‘(A) if— 

11 ‘‘(i) a majority interest is held by in12 dividuals who are related by blood or mar13 riage, as defined by the Secretary; 

14 ‘‘(ii) all of the individuals are or pro15 pose to become owners or operators of a 

16 farm that is not larger than a family farm; 

17 and 

18 ‘‘(iii) at least 1 of the individuals is or 

19 proposes to become an operator of the 

20 farm; or 

21 ‘‘(B) if— 

22 ‘‘(i) the entire interest is held by indi23 viduals who are related by blood or mar24 riage, as defined by the Secretary; 


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1 ‘‘(ii) all of the individuals are or pro2 pose to become farm operators; and 

3 ‘‘(iii) the ownership interest of each 

4 individual separately constitutes not larger 

5 than a family farm, even if the ownership 

6 interests of the individuals collectively con7 stitute larger than a family farm; 

8 ‘‘(4) in the case of an entity that is, or will be9 come within a reasonable period of time, as deter10 mined by the Secretary, only the operator of a fam11 ily farm, if the 1 or more individuals who are the 

12 owners of the family farm own— 

13 ‘‘(A) a percentage of the family farm that 

14 exceeds 50 percent; or 

15 ‘‘(B) such other percentage as the Sec16 retary determines to be appropriate; 

17 ‘‘(5) in the case of an operator described in 

18 paragraph (3) that is owned, in whole or in part, by 

19 1 or more other entities, if each of the individuals 

20 that have a direct or indirect ownership interest in 

21 such other entities also have a direct ownership in22 terest in the entity applying as an individual; and 

23 ‘‘(6) if the farmer and each individual that 

24 holds a majority interest in the farmer is unable to 

25 obtain credit elsewhere. 


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1 ‘‘(c) DIRECT LOANS.— 

2 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

3 the Secretary may make a direct loan under this 

4 chapter only to a farmer who has participated in 

5 business operations of a farm for not less than 3 

6 years (or has other acceptable experience for a pe7 riod of time determined by the Secretary) and— 

8 ‘‘(A) is a qualified beginning farmer; 

9 ‘‘(B) has not received a previous direct 

10 farm ownership loan made under this chapter; 

11 or 

12 ‘‘(C) has not received a direct farm owner13 ship loan under this chapter more than 10 

14 years before the date on which the new loan 

15 would be made. 

16 ‘‘(2) YOUTH LOANS.—The operation of an en17 terprise by a youth under section 3201(d) shall not 

18 be considered the operation of a farm for purposes 

19 of paragraph (1). 

20 ‘‘SEC. 3102. PURPOSES OF LOANS. 

21 ‘‘(a) ALLOWED PURPOSES.— 

22 ‘‘(1) DIRECT LOANS.—A farmer may use a di23 rect loan made under this chapter only— 

24 ‘‘(A) to acquire or enlarge a farm; 


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1 ‘‘(B) to make capital improvements to a 

2 farm; 

3 ‘‘(C) to pay loan closing costs related to 

4 acquiring, enlarging, or improving a farm; 

5 ‘‘(D) to pay for activities to promote soil 

6 and water conservation and protection described 

7 in section 3103 on a farm; or 

8 ‘‘(E) to refinance a temporary bridge loan 

9 made by a commercial or cooperative lender to 

10 a farmer for the acquisition of land for a farm, 

11 if— 

12 ‘‘(i) the Secretary approved an appli13 cation for a direct farm ownership loan to 

14 the farmer for acquisition of the land; and 

15 ‘‘(ii) funds for direct farm ownership 

16 loans under section 3201(a) were not avail17 able at the time at which the application 

18 was approved. 

19 ‘‘(2) GUARANTEED LOANS.—A farmer may use 

20 a loan guaranteed under this chapter only— 

21 ‘‘(A) to acquire or enlarge a farm; 

22 ‘‘(B) to make capital improvements to a 

23 farm; 

24 ‘‘(C) to pay loan closing costs related to 

25 acquiring, enlarging, or improving a farm; 


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1 ‘‘(D) to pay for activities to promote soil 

2 and water conservation and protection described 

3 in section 3103 on a farm; or 

4 ‘‘(E) to refinance indebtedness. 

5 ‘‘(b) PREFERENCES.—In making or guaranteeing a 

6 loan under this chapter for purchase of a farm, the Sec7 retary shall give preference to a person who— 

8 ‘‘(1) has a dependent family; 

9 ‘‘(2) to the extent practicable, is able to make 

10 an initial down payment on the farm; or 

11 ‘‘(3) is an owner of livestock or farm equipment 

12 that is necessary to successfully carry out farming 

13 operations. 

14 ‘‘(c) HAZARD INSURANCE REQUIREMENT.—The Sec15 retary may not make a loan to a farmer under this chapter 

16 unless the farmer has, or agrees to obtain, hazard insur17 ance on any real property to be acquired or improved with 

18 the loan. 

19 ‘‘SEC. 3103. CONSERVATION LOAN AND LOAN GUARANTEE 

20 PROGRAM. 

21 ‘‘(a) IN GENERAL.—The Secretary may make or 

22 guarantee qualified conservation loans to eligible bor23 rowers under this section. 

24 ‘‘(b) DEFINITIONS.—In this section: 


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1 ‘‘(1) CONSERVATION PLAN.—The term ‘con2 servation plan’ means a plan, approved by the Sec3 retary, that, for a farming operation, identifies the 

4 conservation activities that will be addressed with 

5 loan funds provided under this section, including— 

6 ‘‘(A) the installation of conservation struc7 tures to address soil, water, and related re8 sources; 

9 ‘‘(B) the establishment of forest cover for 

10 sustained yield timber management, erosion 

11 control, or shelter belt purposes; 

12 ‘‘(C) the installation of water conservation 

13 measures; 

14 ‘‘(D) the installation of waste management 

15 systems; 

16 ‘‘(E) the establishment or improvement of 

17 permanent pasture; 

18 ‘‘(F) compliance with section 1212 of the 

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

20 and 

21 ‘‘(G) other purposes consistent with the 

22 plan, including the adoption of any other 

23 emerging or existing conservation practices, 

24 techniques, or technologies approved by the Sec25 retary. 


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1 ‘‘(2) QUALIFIED CONSERVATION LOAN.—The 

2 term ‘qualified conservation loan’ means a loan, the 

3 proceeds of which are used to cover the costs to the 

4 borrower of carrying out a qualified conservation 

5 project. 

6 ‘‘(3) QUALIFIED CONSERVATION PROJECT.— 

7 The term ‘qualified conservation project’ means con8 servation measures that address provisions of a con9 servation plan of the eligible borrower. 

10 ‘‘(c) ELIGIBILITY.— 

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

12 or guarantee loans to farmers. 

13 ‘‘(2) REQUIREMENTS.—To be eligible for a loan 

14 under this section, applicants shall meet the citizen15 ship and training and experience requirements of 

16 section 3101(b). 

17 ‘‘(d) PRIORITY.—In making or guaranteeing loans 

18 under this section, the Secretary shall give priority to— 

19 ‘‘(1) qualified beginning farmers and socially 

20 disadvantaged farmers; 

21 ‘‘(2) owners or tenants who use the loans to 

22 convert to sustainable or organic agricultural pro23 duction systems; and 

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1 tices to comply with section 1212 of the Food Secu2 rity Act of 1985 (16 U.S.C. 3812). 

3 ‘‘(e) LIMITATIONS APPLICABLE TO LOAN GUARAN4 TEES.—The portion of a loan that the Secretary may 

5 guarantee under this section shall not exceed 75 percent 

6 of the principal amount of the loan. 

7 ‘‘(f) ADMINISTRATIVE PROVISIONS.—The Secretary 

8 shall ensure, to the maximum extent practicable, that 

9 loans made or guaranteed under this section are distrib10 uted across diverse geographic regions. 

11 ‘‘(g) CREDIT ELIGIBILITY.—The provisions of para12 graphs (1) and (3) of section 3406(a) shall not apply to 

13 loans made or guaranteed under this section. 

14 ‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—For 

15 each of fiscal years 2012 through 2017, there are author16 ized to be appropriated to the Secretary such sums as are 

17 necessary to carry out this section. 

18 ‘‘SEC. 3104. LOAN MAXIMUMS. 

19 ‘‘(a) MAXIMUM.— 

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

21 or guarantee no loan under sections 3101, 3102, 

22 3103, 3106, and 3107 that would cause the unpaid 

23 indebtedness under those sections of any 1 borrower 

24 to exceed the lesser of— 


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1 ‘‘(A) the value of the farm or other secu2 rity, or 

3 ‘‘(B)(i) in the case of a loan made by the 

4 Secretary, $300,000; or 

5 ‘‘(ii) in the case of a loan guaranteed by 

6 the Secretary, $700,000 (as modified under 

7 paragraph (2)). 

8 ‘‘(2) MODIFICATION.—The amount specified in 

9 paragraph (1)(B)(ii) shall be— 

10 ‘‘(A) increased, beginning with fiscal year 

11 2000, by the inflation percentage applicable to 

12 the fiscal year in which the loan is guaranteed; 

13 and 

14 ‘‘(B) reduced by the amount of any unpaid 

15 indebtedness of the borrower on loans under 

16 chapter 2 that are guaranteed by the Secretary. 

17 ‘‘(b) DETERMINATION OF VALUE.—In determining 

18 the value of the farm, the Secretary shall consider apprais19 als made by competent appraisers under rules established 

20 by the Secretary. 

21 ‘‘(c) INFLATION PERCENTAGE.—For purposes of this 

22 section, the inflation percentage applicable to a fiscal year 

23 is the percentage (if any) by which— 

24 ‘‘(1) the average of the Prices Paid By Farmers 

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1 tistics Service of the Department) for the 12-month 

2 period ending on August 31 of the immediately pre3 ceding fiscal year; exceeds 

4 ‘‘(2) the average of that index (as so defined) 

5 for the 12-month period ending on August 31, 1996. 

6 ‘‘SEC. 3105. REPAYMENT REQUIREMENTS FOR FARM OWN7 ERSHIP LOANS. 

8 ‘‘(a) PERIOD FOR REPAYMENT.—The period for re9 payment of a loan under this chapter shall not exceed 40 

10 years. 

11 ‘‘(b) INTEREST RATES.— 

12 ‘‘(1) IN GENERAL.—Except as otherwise pro13 vided in this title, the interest rate on a loan under 

14 this chapter shall be determined by the Secretary at 

15 a rate— 

16 ‘‘(A) not to exceed the sum obtained by 

17 adding— 

18 ‘‘(i) the current average market yield 

19 on outstanding marketable obligations of 

20 the United States with remaining periods 

21 to maturity comparable to the average ma22 turity of the loan; and 

23 ‘‘(ii) an amount not to exceed 1 per24 cent, as determined by the Secretary; and 


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‘‘(B) adjusted to the nearest 1 1 ⁄8 of 1 per2 cent. 

3 ‘‘(2) LOW INCOME FARM OWNERSHIP LOANS.— 

4 Except as provided in paragraph (3), the interest 

5 rate on a loan (other than a guaranteed loan) under 

6 section 3106 shall be determined by the Secretary at 

7 a rate that is— 

8 ‘‘(A) not greater than the sum obtained by 

9 adding— 

10 ‘‘(i) an amount that does not exceed 

1 11 ⁄2 of the current average market yield on 

12 outstanding marketable obligations of the 

13 United States with maturities of 5 years; 

14 and 

15 ‘‘(ii) an amount not to exceed 1 per16 cent per year, as the Secretary determines 

17 is appropriate; and 

18 ‘‘(B) not less than 5 percent per year. 

19 ‘‘(3) JOINT FINANCING ARRANGEMENT.—If a 

20 direct farm ownership loan is made under this chap21 ter as part of a joint financing arrangement and the 

22 amount of the direct farm ownership loan does not 

23 exceed 50 percent of the total principal amount fi24 nanced under the arrangement, the interest rate on 


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1 the direct farm ownership loan shall be at least 4 

2 percent annually. 

3 ‘‘(4) GUARANTEED LOANS.—The interest rate 

4 on a loan made under this chapter as a guaranteed 

5 loan shall be such rate as may be agreed on by the 

6 borrower and the lender, but not in excess of any 

7 rate determined by the Secretary. 

8 ‘‘(c) PAYMENT OF CHARGES.—A borrower of a loan 

9 made or guaranteed under this chapter shall pay such fees 

10 and other charges as the Secretary may require, and pre11 pay to the Secretary such taxes and insurance as the Sec12 retary may require, on such terms and conditions as the 

13 Secretary may prescribe. 

14 ‘‘(d) SECURITY.— 

15 ‘‘(1) IN GENERAL.—The Secretary shall take as 

16 security for an obligation entered into in connection 

17 with a loan, a mortgage on a farm with respect to 

18 which the loan is made or such other security as the 

19 Secretary may require. 

20 ‘‘(2) LIENS TO UNITED STATES.—An instru21 ment for security under paragraph (1) may con22 stitute a lien running to the United States notwith23 standing the fact that the note for the security may 

24 be held by a lender other than the United States. 


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1 ‘‘(3) MULTIPLE LOANS.—A borrower may use 

2 the same collateral to secure 2 or more loans made 

3 or guaranteed under this chapter, except that the 

4 outstanding amount of the loans may not exceed the 

5 total value of the collateral. 

6 ‘‘(e) MINERAL RIGHTS AS COLLATERAL.— 

7 ‘‘(1) IN GENERAL.—In the case of a farm own8 ership loan made after December 23, 1985, unless 

9 appraised values of the rights to oil, gas, or other 

10 minerals are specifically included as part of the ap11 praised value of collateral securing the loan, the 

12 rights to oil, gas, or other minerals located under 

13 the property shall not be considered part of the col14 lateral securing the loan. 

15 ‘‘(2) COMPENSATORY PAYMENTS.—Nothing in 

16 this subsection prevents the inclusion of, as part of 

17 the collateral securing the loan, any payment or 

18 other compensation the borrower may receive for 

19 damages to the surface of the collateral real estate 

20 resulting from the exploration for or recovery of 

21 minerals. 

22 ‘‘(f) ADDITIONAL COLLATERAL.—The Secretary may 

23 not— 

24 ‘‘(1) require any borrower to provide additional 

25 collateral to secure a farmer program loan made or 


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1 guaranteed under this subtitle, if the borrower is 

2 current in the payment of principal and interest on 

3 the loan; or 

4 ‘‘(2) bring any action to foreclose, or otherwise 

5 liquidate, the loan as a result of the failure of a bor6 rower to provide additional collateral to secure the 

7 loan, if the borrower was current in the payment of 

8 principal and interest on the loan at the time the ad9 ditional collateral was requested. 

10 ‘‘SEC. 3106. LIMITED-RESOURCE LOANS. 

11 ‘‘(a) IN GENERAL.—The Secretary may make or 

12 guarantee a limited-resource loan for any of the purposes 

13 specified in sections 3102(a) or 3103(a) to a farmer in 

14 the United States who— 

15 ‘‘(1) in the case of an entity, all members, 

16 stockholders, or partners are eligible under section 

17 3101(b); 

18 ‘‘(2) has a low income; and 

19 ‘‘(3) demonstrates a need to maximize the in20 come of the farmer from farming operations. 

21 ‘‘(b) INSTALLMENTS.—A loan made or guaranteed 

22 under this section shall be repayable in such installments 

23 as the Secretary determines will provide for reduced pay24 ments during the initial repayment period of the loan and 


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1 larger payments during the remainder of the repayment 

2 period of the loan. 

3 ‘‘(c) INTEREST RATES.—Except as provided in sec4 tion 3105(b)(3) and in section 3204(b)(3), the interest 

5 rate on loans (other than guaranteed loans) under this 

6 section shall not be— 

7 ‘‘(1) greater than the sum obtained by add8 ing— 

‘‘(A) an amount that does not exceed 1 9 ⁄2 of 

10 the current average market yield on out11 standing marketable obligations of the United 

12 States with maturities of 5 years; and 

13 ‘‘(B) an amount not exceeding 1 percent 

14 per year, as the Secretary determines is appro15 priate; or 

16 ‘‘(2) less than 5 percent per year. 

17 ‘‘SEC. 3107. DOWNPAYMENT LOAN PROGRAM. 

18 ‘‘(a) IN GENERAL.— 

19 ‘‘(1) ESTABLISHMENT.—Notwithstanding any 

20 other provision of this chapter, the Secretary shall 

21 establish, under the farm ownership loan program 

22 established under this chapter, a program under 

23 which loans shall be made under this section to a 

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1 taged farmer for a downpayment on a farm owner2 ship loan. 

3 ‘‘(2) COORDINATION.—The Secretary shall be 

4 the primary coordinator of credit supervision for the 

5 downpayment loan program established under this 

6 section, in consultation with a commercial or cooper7 ative lender and, if applicable, a contracting credit 

8 counseling service selected under section 3420(c). 

9 ‘‘(b) LOAN TERMS.— 

10 ‘‘(1) PRINCIPAL.—Each loan made under this 

11 section shall be in an amount that does not exceed 

12 45 percent of the lesser of— 

13 ‘‘(A) the purchase price of the farm to be 

14 acquired; 

15 ‘‘(B) the appraised value of the farm to be 

16 acquired; or 

17 ‘‘(C) $667,000. 

18 ‘‘(2) INTEREST RATE.—The interest rate on 

19 any loan made by the Secretary under this section 

20 shall be a rate equal to the greater of— 

21 ‘‘(A) the difference between— 

22 ‘‘(i) 4 percent; and 

23 ‘‘(ii) the interest rate for farm owner24 ship loans under this chapter; or 

25 ‘‘(B) 1.5 percent. 


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1 ‘‘(3) DURATION.—Each loan under this section 

2 shall be made for a period of 20 years or less, at the 

3 option of the borrower. 

4 ‘‘(4) REPAYMENT.—Each borrower of a loan 

5 under this section shall repay the loan to the Sec6 retary in equal annual installments. 

7 ‘‘(5) NATURE OF RETAINED SECURITY INTER8 EST.—The Secretary shall retain an interest in each 

9 farm acquired with a loan made under this section 

10 that shall— 

11 ‘‘(A) be secured by the farm; 

12 ‘‘(B) be junior only to such interests in the 

13 farm as may be conveyed at the time of acquisi14 tion to the person (including a lender) from 

15 whom the borrower obtained a loan used to ac16 quire the farm; and 

17 ‘‘(C) require the borrower to obtain the 

18 permission of the Secretary before the borrower 

19 may grant an additional security interest in the 

20 farm. 

21 ‘‘(c) LIMITATIONS.— 

22 ‘‘(1) BORROWERS REQUIRED TO MAKE MIN23 IMUM DOWN PAYMENT.—The Secretary shall not 

24 make a loan under this section to any borrower with 

25 respect to a farm if the contribution of the borrower 


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1 to the down payment on the farm will be less than 

2 5 percent of the purchase price of the farm. 

3 ‘‘(2) PROHIBITED TYPES OF FINANCING.—The 

4 Secretary shall not make a loan under this section 

5 with respect to a farm if the farm is to be acquired 

6 with other financing that contains any of the fol7 lowing conditions: 

8 ‘‘(A) The financing is to be amortized over 

9 a period of less than 30 years. 

10 ‘‘(B) A balloon payment will be due on the 

11 financing during the 20-year period beginning 

12 on the date on which the loan is to be made by 

13 the Secretary. 

14 ‘‘(d) ADMINISTRATION.—In carrying out this section, 

15 the Secretary shall, to the maximum extent practicable— 

16 ‘‘(1) facilitate the transfer of farms from retir17 ing farmers to persons eligible for insured loans 

18 under this subtitle; 

19 ‘‘(2) make efforts to widely publicize the avail20 ability of loans under this section among— 

21 ‘‘(A) potentially eligible recipients of the 

22 loans; 

23 ‘‘(B) retiring farmers; and 

24 ‘‘(C) applicants for farm ownership loans 

25 under this chapter; 


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1 ‘‘(3) encourage retiring farmers to assist in the 

2 sale of their farms to qualified beginning farmers 

3 and socially disadvantaged farmers providing seller 

4 financing; 

5 ‘‘(4) coordinate the loan program established by 

6 this section with State programs that provide farm 

7 ownership or operating loans for beginning farmers 

8 or socially disadvantaged farmers; and 

9 ‘‘(5) establish annual performance goals to pro10 mote the use of the down payment loan program and 

11 other joint financing arrangements as the preferred 

12 choice for direct real estate loans made by any lend13 er to a qualified beginning farmer or socially dis14 advantaged farmer. 

15 ‘‘SEC. 3108. BEGINNING FARMER AND SOCIALLY DISADVAN16 TAGED FARMER CONTRACT LAND SALES 

17 PROGRAM. 

18 ‘‘(a) IN GENERAL.—The Secretary shall, in accord19 ance with this section, guarantee a loan made by a private 

20 seller of a farm to a qualified beginning farmer or socially 

21 disadvantaged farmer on a contract land sales basis. 

22 ‘‘(b) ELIGIBILITY.—To be eligible for a loan guar23 antee under subsection (a)— 

24 ‘‘(1) the qualified beginning farmer or socially 

25 disadvantaged farmer shall— 


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1 ‘‘(A) on the date the contract land sale 

2 that is subject of the loan is complete, own and 

3 operate the farm that is the subject of the con4 tract land sale; 

5 ‘‘(B) have a credit history that— 

6 ‘‘(i) includes a record of satisfactory 

7 debt repayment, as determined by the Sec8 retary; and 

9 ‘‘(ii) is acceptable to the Secretary; 

10 and 

11 ‘‘(C) demonstrate to the Secretary that the 

12 farmer is unable to obtain sufficient credit with13 out a guarantee to finance any actual need of 

14 the farmer at a reasonable rate or term; and 

15 ‘‘(2) the loan shall meet applicable underwriting 

16 criteria, as determined by the Secretary. 

17 ‘‘(c) LIMITATIONS.—The Secretary shall not provide 

18 a loan guarantee under subsection (a) if— 

19 ‘‘(1) the contribution of the qualified beginning 

20 farmer or socially disadvantaged farmer to the down 

21 payment for the farm that is the subject of the con22 tract land sale would be less than 5 percent of the 

23 purchase price of the farm; or 


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1 ‘‘(2) the purchase price or the appraisal value 

2 of the farm that is the subject of the contract land 

3 sale is greater than $500,000. 

4 ‘‘(d) PERIOD OF GUARANTEE.—A loan guarantee 

5 under this section shall be in effect for the 10-year period 

6 beginning on the date on which the guarantee is provided. 

7 ‘‘(e) GUARANTEE PLAN.— 

8 ‘‘(1) SELECTION OF PLAN.—A private seller of 

9 a farm who makes a loan guaranteed by the Sec10 retary under subsection (a) may select— 

11 ‘‘(A) a prompt payment guarantee plan, 

12 which shall cover— 

13 ‘‘(i) 3 amortized annual installments; 

14 or 

15 ‘‘(ii) an amount equal to 3 annual in16 stallments (including an amount equal to 

17 the total cost of any tax and insurance in18 curred during the period covered by the 

19 annual installments); or 

20 ‘‘(B) a standard guarantee plan, which 

21 shall cover an amount equal to 90 percent of 

22 the outstanding principal of the loan. 

23 ‘‘(2) ELIGIBILITY FOR STANDARD GUARANTEE

24 PLAN.—To be eligible for a standard guarantee plan 


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1 referred to in paragraph (1)(B), a private seller 

2 shall— 

3 ‘‘(A) secure a commercial lending institu4 tion or similar entity, as determined by the Sec5 retary, to serve as an escrow agent; or 

6 ‘‘(B) in cooperation with the farmer, use 

7 an appropriate alternate arrangement, as deter8 mined by the Secretary. 

9 ‘‘CHAPTER 2—OPERATING LOANS 

10 ‘‘SEC. 3201. OPERATING LOANS. 

11 ‘‘(a) IN GENERAL.—The Secretary may make or 

12 guarantee an operating loan under this chapter to an eligi13 ble farmer in the United States. 

14 ‘‘(b) ELIGIBILITY.—A farmer shall be eligible under 

15 subsection (a) only— 

16 ‘‘(1) if the farmer, or an individual holding a 

17 majority interest in the farmer— 

18 ‘‘(A) is a citizen of the United States; and 

19 ‘‘(B) has training or farming experience 

20 that the Secretary determines is sufficient to 

21 ensure a reasonable prospect of success in the 

22 farming operation proposed by the farmer; 

23 ‘‘(2) in the case of a farmer that is an indi24 vidual, if the farmer is or proposes to become an opVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00384 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 erator of a farm that is not larger than a family 

2 farm; 

3 ‘‘(3) in the case of a farmer that is a coopera4 tive, corporation, partnership, trust, limited liability 

5 company, joint operation, or other such legal entity 

6 as the Secretary determines to be appropriate, with 

7 respect to the entity and each farm in which the en8 tity has an ownership or operator interest— 

9 ‘‘(A) if— 

10 ‘‘(i) a majority interest is held by in11 dividuals who are related by blood or mar12 riage, as defined by the Secretary; 

13 ‘‘(ii) all of the individuals are or pro14 pose to become owners or operators of a 

15 farm that is not larger than a family farm; 

16 and 

17 ‘‘(iii) at least 1 of the individuals is or 

18 proposes to become an operator of the 

19 farm; or 

20 ‘‘(B) if— 

21 ‘‘(i) the entire interest is held by indi22 viduals who are related by blood or mar23 riage, as defined by the Secretary; 

24 ‘‘(ii) all of the individuals are or pro25 pose to become farm operators; and 


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1 ‘‘(iii) the ownership interest of each 

2 individual separately constitutes not larger 

3 than a family farm, even if the ownership 

4 interests of the individuals collectively con5 stitute larger than a family farm; 

6 ‘‘(4) in the case of an operator described in 

7 paragraph (3) that is owned, in whole or in part by 

8 1 or more other entities, if not less than 75 percent 

9 of the ownership interests of each other entity is 

10 owned directly or indirectly by 1 or more individuals 

11 who own the family farm; and 

12 ‘‘(5) if the farmer and each individual that 

13 holds a majority interest in the farmer is unable to 

14 obtain credit elsewhere. 

15 ‘‘(c) DIRECT LOANS.— 

16 ‘‘(1) IN GENERAL.—Subject to paragraph (3), 

17 the Secretary may make a direct loan under this 

18 chapter only to a farmer who— 

19 ‘‘(A) is a qualified beginning farmer; 

20 ‘‘(B) has not received a previous direct op21 erating loan made under this chapter; or 

22 ‘‘(C) has not received a direct operating 

23 loan made under this chapter for a total of 7 

24 years, less 1 year for every 3 consecutive years 

25 the farmer did not receive a direct operating 


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1 loan after the year in which the borrower ini2 tially received a direct operating loan under this 

3 chapter, as determined by the Secretary. 

4 ‘‘(2) YOUTH LOANS.—In this subsection, the 

5 term ‘direct operating loan’ shall not include a loan 

6 made to a youth under subsection (d). 

7 ‘‘(3) TRANSITION RULE.—If, as of April 4, 

8 1996, a farmer has received a direct operating loan 

9 under this chapter during each of 4 or more pre10 vious years, the borrower shall be eligible to receive 

11 a direct operating loan under this chapter during 3 

12 additional years after April 4, 1996. 

13 ‘‘(4) WAIVERS.— 

14 ‘‘(A) FARM OPERATIONS ON TRIBAL

15 LAND.—The Secretary shall waive the limita16 tion under paragraph (1)(C) or (3) for a direct 

17 loan made under this chapter to a farmer whose 

18 farm land is subject to the jurisdiction of an In19 dian tribe and whose loan is secured by 1 or 

20 more security instruments that are subject to 

21 the jurisdiction of an Indian tribe if the Sec22 retary determines that commercial credit is not 

23 generally available for such farm operations. 

24 ‘‘(B) OTHER FARM OPERATIONS.—On a 

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1 ministrative appeal, the Secretary may grant a 

2 borrower a waiver, 1 time only for a period of 

3 2 years, of the limitation under paragraph 

4 (1)(C) or (3) for a direct operating loan if the 

5 borrower demonstrates to the satisfaction of the 

6 Secretary that— 

7 ‘‘(i) the borrower has a viable farm 

8 operation; 

9 ‘‘(ii) the borrower applied for commer10 cial credit from at least 2 commercial lend11 ers; 

12 ‘‘(iii) the borrower was unable to ob13 tain a commercial loan (including a loan 

14 guaranteed by the Secretary); and 

15 ‘‘(iv) the borrower successfully has 

16 completed, or will complete within 1 year, 

17 borrower training under section 3419 

18 (from which requirement the Secretary 

19 shall not grant a waiver under section 

20 3419(f)). 

21 ‘‘(d) YOUTH LOANS.— 

22 ‘‘(1) IN GENERAL.—Notwithstanding subsection 

23 (b), except for citizenship and credit requirements, a 

24 loan may be made under this chapter to a youth who 

25 is a rural resident to enable the youth to operate an 


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1 enterprise in connection with the participation in a 

2 youth organization, as determined by the Secretary. 

3 ‘‘(2) FULL PERSONAL LIABILITY.—A youth re4 ceiving a loan under this subsection who executes a 

5 promissory note for the loan shall incur full personal 

6 liability for the indebtedness evidenced by the note, 

7 in accordance with the terms of the note, free of any 

8 disability of minority. 

9 ‘‘(3) COSIGNER.—The Secretary may accept the 

10 personal liability of a cosigner of a promissory note 

11 for a loan under this subsection, in addition to the 

12 personal liability of the youth borrower. 

13 ‘‘(4) YOUTH ENTERPRISES NOT FARMING.—The 

14 operation of an enterprise by a youth under this 

15 subsection shall not be considered the operation of 

16 a farm under this subtitle. 

17 ‘‘SEC. 3202. PURPOSES OF LOANS. 

18 ‘‘(a) DIRECT LOANS.—A direct loan may be made 

19 under this chapter only— 

20 ‘‘(1) to pay the costs incident to reorganizing a 

21 farm for more profitable operation; 

22 ‘‘(2) to purchase livestock, poultry, or farm 

23 equipment; 


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1 ‘‘(3) to purchase feed, seed, fertilizer, insecti2 cide, or farm supplies, or to meet other essential 

3 farm operating expenses, including cash rent; 

4 ‘‘(4) to finance land or water development, use, 

5 or conservation; 

6 ‘‘(5) to pay loan closing costs; 

7 ‘‘(6) to assist a farmer in changing the equip8 ment, facilities, or methods of operation of a farm 

9 to comply with a standard promulgated under sec10 tion 6 of the Occupational Safety and Health Act of 

11 1970 (29 U.S.C. 655) or a standard adopted by a 

12 State under a plan approved under section 18 of 

13 that Act (29 U.S.C. 667), if the Secretary deter14 mines that without assistance under this paragraph 

15 the farmer is likely to suffer substantial economic in16 jury in complying with the standard; 

17 ‘‘(7) to train a limited-resource borrower receiv18 ing a loan under section 3106 in maintaining 

19 records of farming operations; 

20 ‘‘(8) to train a borrower under section 3419; 

21 ‘‘(9) to refinance the indebtedness of a bor22 rower, if the borrower— 

23 ‘‘(A) has refinanced a loan under this 

24 chapter not more than 4 times previously; and 


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1 ‘‘(B)(i) is a direct loan borrower under this 

2 title at the time of the refinancing and has suf3 fered a qualifying loss because of a natural or 

4 major disaster or emergency; or 

5 ‘‘(ii) is refinancing a debt obtained from a 

6 creditor other than the Secretary; or 

7 ‘‘(10) to provide other farm or home needs, in8 cluding family subsistence. 

9 ‘‘(b) GUARANTEED LOANS.—A loan may be guaran10 teed under this chapter only— 

11 ‘‘(1) to pay the costs incident to reorganizing a 

12 farm for more profitable operation; 

13 ‘‘(2) to purchase livestock, poultry, or farm 

14 equipment; 

15 ‘‘(3) to purchase feed, seed, fertilizer, insecti16 cide, or farm supplies, or to meet other essential 

17 farm operating expenses, including cash rent; 

18 ‘‘(4) to finance land or water development, use, 

19 or conservation; 

20 ‘‘(5) to refinance indebtedness; 

21 ‘‘(6) to pay loan closing costs; 

22 ‘‘(7) to assist a farmer in changing the equip23 ment, facilities, or methods of operation of a farm 

24 to comply with a standard promulgated under sec25 tion 6 of the Occupational Safety and Health Act of 


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1 1970 (29 U.S.C. 655) or a standard adopted by a 

2 State under a plan approved under section 18 of 

3 that Act (29 U.S.C. 667), if the Secretary deter4 mines that without assistance under this paragraph 

5 the farmer is likely to suffer substantial economic in6 jury due to compliance with the standard; 

7 ‘‘(8) to train a borrower under section 3419; or 

8 ‘‘(9) to provide other farm or home needs, in9 cluding family subsistence. 

10 ‘‘(c) HAZARD INSURANCE REQUIREMENT.—The Sec11 retary may not make a loan to a farmer under this chapter 

12 unless the farmer has, or agrees to obtain, hazard insur13 ance on the property to be acquired with the loan. 

14 ‘‘(d) PRIVATE RESERVE.— 

15 ‘‘(1) IN GENERAL.—Notwithstanding any other 

16 provision of this title, the Secretary may reserve a 

17 portion of any loan made under this chapter to be 

18 placed in an unsupervised bank account that may be 

19 used at the discretion of the borrower for the basic 

20 family needs of the borrower and the immediate 

21 family of the borrower. 

22 ‘‘(2) LIMIT ON SIZE OF THE RESERVE.—The 

23 size of the reserve shall not exceed the lesser of— 

24 ‘‘(A) 10 percent of the loan; 

25 ‘‘(B) $5,000; or 


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1 ‘‘(C) the amount needed to provide for the 

2 basic family needs of the borrower and the im3 mediate family of the borrower for 3 calendar 

4 months. 

5 ‘‘SEC. 3203. RESTRICTIONS ON LOANS. 

6 ‘‘(a) REQUIREMENTS.— 

7 ‘‘(1) IN GENERAL.—The Secretary may not 

8 make or guarantee a loan under this chapter— 

9 ‘‘(A) that would cause the total principal 

10 indebtedness outstanding at any 1 time for 

11 loans made under this chapter to any 1 bor12 rower to exceed— 

13 ‘‘(i)(I) in the case of a loan made by 

14 the Secretary, $300,000; or 

15 ‘‘(II) in the case of a loan guaranteed 

16 by the Secretary, $700,000 (as modified 

17 under paragraph (2)); or 

18 ‘‘(B) for the purchasing or leasing of land 

19 other than for cash rent, or for carrying on a 

20 land leasing or land purchasing program. 

21 ‘‘(2) MODIFICATION.—The amount specified in 

22 paragraph (1)(A)(ii) shall be— 

23 ‘‘(A) increased, beginning with fiscal year 

24 2000, by the inflation percentage applicable to 


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1 the fiscal year in which the loan is guaranteed; 

2 and 

3 ‘‘(B) reduced by the unpaid indebtedness 

4 of the borrower on loans under sections speci5 fied in section 3104 that are guaranteed by the 

6 Secretary. 

7 ‘‘(b) INFLATION PERCENTAGE.—For purposes of this 

8 section, the inflation percentage applicable to a fiscal year 

9 is the percentage (if any) by which— 

10 ‘‘(1) the average of the Prices Paid By Farmers 

11 Index (as compiled by the National Agricultural Sta12 tistics Service of the Department) for the 12-month 

13 period ending on August 31 of the immediately pre14 ceding fiscal year; exceeds 

15 ‘‘(2) the average of that index (as so defined) 

16 for the 12-month period ending on August 31, 1996. 

17 ‘‘SEC. 3204. TERMS OF LOANS. 

18 ‘‘(a) PERSONAL LIABILITY.—A borrower of a loan 

19 made under this chapter shall secure the loan with the 

20 full personal liability of the borrower and such other secu21 rity as the Secretary may prescribe. 

22 ‘‘(b) INTEREST RATES.— 

23 ‘‘(1) MAXIMUM RATE.— 

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

25 paragraphs (2) and (3), the interest rate on a 


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1 loan made under this chapter (other than a 

2 guaranteed loan) shall be determined by the 

3 Secretary at a rate not to exceed the sum ob4 tained by adding— 

5 ‘‘(i) the current average market yield 

6 on outstanding marketable obligations of 

7 the United States with remaining periods 

8 to maturity comparable to the average ma9 turity of the loan; and 

10 ‘‘(ii) an additional charge not to ex11 ceed 1 percent, as determined by the Sec12 retary. 

13 ‘‘(B) ADJUSTMENT.—The sum obtained 

14 under subparagraph (A) shall be adjusted to 

the nearest 1 15 ⁄8 of 1 percent. 

16 ‘‘(2) GUARANTEED LOAN.—The interest rate on 

17 a guaranteed loan made under this chapter shall be 

18 such rate as may be agreed on by the borrower and 

19 the lender, but may not exceed any rate prescribed 

20 by the Secretary. 

21 ‘‘(3) LOW INCOME LOAN.—The interest rate on 

22 a direct loan made under this chapter to a low-in23 come, limited-resource borrower shall be determined 

24 by the Secretary at a rate that is not— 


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1 ‘‘(A) greater than the sum obtained by 

2 adding— 

3 ‘‘(i) an amount that does not exceed 

1 4 ⁄2 of the current average market yield on 

5 outstanding marketable obligations of the 

6 United States with a maturity of 5 years; 

7 and 

8 ‘‘(ii) an amount not to exceed 1 per9 cent per year, as the Secretary determines 

10 is appropriate; or 

11 ‘‘(B) less than 5 percent per year. 

12 ‘‘(c) PERIOD FOR REPAYMENT.—The period for re13 payment of a loan made under this chapter may not ex14 ceed 7 years. 

15 ‘‘(d) LINE-OF-CREDIT LOANS.— 

16 ‘‘(1) IN GENERAL.—A loan made or guaranteed 

17 by the Secretary under this chapter may be in the 

18 form of a line-of-credit loan. 

19 ‘‘(2) TERM.—A line-of-credit loan under para20 graph (1) shall terminate not later than 5 years 

21 after the date that the loan is made or guaranteed. 

22 ‘‘(3) ELIGIBILITY.—For purposes of deter23 mining eligibility for an operating loan under this 

24 chapter, each year during which a farmer takes an 

25 advance or draws on a line-of-credit loan the farmer 


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1 shall be considered as having received an operating 

2 loan for 1 year. 

3 ‘‘(4) TERMINATION OF DELINQUENT LOANS.— 

4 If a borrower does not pay an installment on a line5 of-credit loan on schedule, the borrower may not 

6 take an advance or draw on the line-of-credit, unless 

7 the Secretary determines that— 

8 ‘‘(A) the failure of the borrower to pay on 

9 schedule was due to unusual conditions that the 

10 borrower could not control; and 

11 ‘‘(B) the borrower will reduce the line-of12 credit balance to the scheduled level at the end 

13 of— 

14 ‘‘(i) the production cycle; or 

15 ‘‘(ii) the marketing of the agricultural 

16 products of the borrower. 

17 ‘‘(5) AGRICULTURAL COMMODITIES.—A line-of18 credit loan may be used to finance the production or 

19 marketing of an agricultural commodity that is eligi20 ble for a price support program of the Department. 

21 ‘‘CHAPTER 3—EMERGENCY LOANS 

22 ‘‘SEC. 3301. EMERGENCY LOANS. 

23 ‘‘(a) IN GENERAL.—The Secretary shall make or 

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1 gible farmer only to the extent and in such amounts as 

2 provided in advance in appropriation Acts. 

3 ‘‘(b) ELIGIBILITY.—An established farmer shall be 

4 eligible under subsection (a) only— 

5 ‘‘(1) if the farmer or an individual holding a 

6 majority interest in the farmer— 

7 ‘‘(A) is a citizen of the United States; and 

8 ‘‘(B) has experience and resources that the 

9 Secretary determines are sufficient to ensure a 

10 reasonable prospect of success in the farming 

11 operation proposed by the farmer; 

12 ‘‘(2) in the case of a farmer that is an indi13 vidual, if the farmer is— 

14 ‘‘(A) in the case of a loan for a purpose 

15 under chapter 1, an owner, operator, or lessee16 operator described in section 3101(b)(2); and 

17 ‘‘(B) in the case of a loan for a purpose 

18 under chapter 2, an operator of a farm that is 

19 not larger than a family farm; 

20 ‘‘(3) in the case of a farmer that is a coopera21 tive, corporation, partnership, trust, limited liability 

22 company, joint operation, or such other legal entity 

23 as the Secretary determines to be appropriate, with 

24 respect to the entity and each farm in which the en25 tity has an ownership or operator interest— 


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1 ‘‘(A) if— 

2 ‘‘(i) a majority interest is held by in3 dividuals who are related by blood or mar4 riage, as defined by the Secretary; 

5 ‘‘(ii) all of the individuals are or pro6 pose to become owners or operators of a 

7 farm that is not larger than a family farm; 

8 and 

9 ‘‘(iii) at least 1 of the individuals is or 

10 proposes to become an operator of the 

11 farm; or 

12 ‘‘(B) if— 

13 ‘‘(i) the entire interest is held by indi14 viduals who are related by blood or mar15 riage, as defined by the Secretary; 

16 ‘‘(ii) all of the individuals are or pro17 pose to become farm operators; and 

18 ‘‘(iii) the ownership interest of each 

19 individual separately constitutes not larger 

20 than a family farm, even if the ownership 

21 interests of the individuals collectively con22 stitute larger than a family farm; 

23 ‘‘(4) if the entity is owned, in whole or in part, 

24 by 1 or more other entities and each individual who 

25 is an owner of the family farm involved has a direct 


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1 or indirect ownership interest in each of the other 

2 entities; 

3 ‘‘(5) if the farmer and any individual that holds 

4 a majority interest in the farmer is unable to obtain 

5 credit elsewhere; and 

6 ‘‘(6)(A) if the Secretary finds that the oper7 ations of the farmer have been substantially affected 

8 by— 

9 ‘‘(i) a natural or major disaster or emer10 gency designated by the President under the 

11 Robert T. Stafford Disaster Relief and Emer12 gency Assistance Act (42 U.S.C. 5121 et seq.); 

13 or 

14 ‘‘(ii) a quarantine imposed by the Sec15 retary under the Plant Protection Act (7 U.S.C. 

16 7701 et seq.) or the Animal Health Protection 

17 Act (7 U.S.C. 8301 et seq.); or 

18 ‘‘(B) if the farmer conducts farming operations 

19 in a county or a county contiguous to a county in 

20 which the Secretary has found that farming oper21 ations have been substantially affected by a natural 

22 or major disaster or emergency. 

23 ‘‘(c) TIME FOR ACCEPTING AN APPLICATION.—The 

24 Secretary shall accept an application for a loan under this 


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1 chapter from a farmer at any time during the 8-month 

2 period beginning on the date that— 

3 ‘‘(1) the Secretary determines that farming op4 erations of the farmer have been substantially af5 fected by— 

6 ‘‘(A) a quarantine imposed by the Sec7 retary under the Plant Protection Act (7 U.S.C. 

8 7701 et seq.) or the Animal Health Protection 

9 Act (7 U.S.C. 8301 et seq.); or 

10 ‘‘(B) a natural disaster; or 

11 ‘‘(2) the President makes a major disaster or 

12 emergency designation with respect to the affected 

13 county of the farmer referred to in subsection 

14 (b)(5)(B). 

15 ‘‘(d) HAZARD INSURANCE REQUIREMENT.—The Sec16 retary may not make a loan to a farmer under this chapter 

17 to cover a property loss unless the farmer had hazard in18 surance that insured the property at the time of the loss. 

19 ‘‘(e) FAMILY FARM.—The Secretary shall conduct 

20 the loan program under this chapter in a manner that will 

21 foster and encourage the family farm system of agri22 culture, consistent with the reaffirmation of policy and 

23 declaration of the intent of Congress contained in section 

24 102(a) of the Food and Agriculture Act of 1977 (7 U.S.C. 

25 2266(a)). 


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1 ‘‘SEC. 3302. PURPOSES OF LOANS. 

2 ‘‘Subject to the limitations on the amounts of loans 

3 provided in section 3303(a), a loan may be made or guar4 anteed under this chapter for— 

5 ‘‘(1) any purpose authorized for a loan under 

6 chapter 1 or 2; and 

7 ‘‘(2) crop or livestock purposes that are— 

8 ‘‘(A) necessitated by a quarantine, natural 

9 disaster, major disaster, or emergency; and 

10 ‘‘(B) considered desirable by the farmer. 

11 ‘‘SEC. 3303. TERMS OF LOANS. 

12 ‘‘(a) MAXIMUM AMOUNT OF LOAN.—The Secretary 

13 may not make or guarantee a loan under this chapter to 

14 a borrower who has suffered a loss in an amount that— 

15 ‘‘(1) exceeds the actual loss caused by a dis16 aster; or 

17 ‘‘(2) would cause the total indebtedness of the 

18 borrower under this chapter to exceed $500,000. 

19 ‘‘(b) INTEREST RATES.—Any portion of a loan under 

20 this chapter up to the amount of the actual loss suffered 

21 by a farmer caused by a disaster shall be at a rate pre22 scribed by the Secretary, but not in excess of 8 percent 

23 per annum. 

24 ‘‘(c) INTEREST SUBSIDIES FOR GUARANTEED

25 LOANS.—In the case of a guaranteed loan under this 

26 chapter, the Secretary may pay an interest subsidy to the 


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1 lender for any portion of the loan up to the amount of 

2 the actual loss suffered by a farmer caused by a disaster. 

3 ‘‘(d) TIME FOR REPAYMENT.— 

4 ‘‘(1) IN GENERAL.—Subject to paragraph (2), a 

5 loan under this chapter shall be repayable at such 

6 times as the Secretary may determine, considering 

7 the purpose of the loan and the nature and effect of 

8 the disaster, but not later than the maximum repay9 ment period allowed for a loan for a similar purpose 

10 under chapters 1 and 2. 

11 ‘‘(2) EXTENDED REPAYMENT PERIOD.—The 

12 Secretary may, if the loan is for a purpose described 

13 in chapter 2 and the Secretary determines that the 

14 need of the loan applicant justifies the longer repay15 ment period, make the loan repayable at the end of 

16 a period of more than 7 years, but not more than 

17 20 years. 

18 ‘‘(e) SECURITY FOR LOAN.— 

19 ‘‘(1) IN GENERAL.—A borrower of a loan made 

20 under this chapter shall secure the loan with the full 

21 personal liability of the borrower and such other se22 curity as the Secretary may prescribe. 

23 ‘‘(2) ADEQUATE SECURITY.—Subject to para24 graph (3), the Secretary may not make or guarantee 


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1 a loan under this chapter unless the security for the 

2 loan is adequate to ensure repayment of the loan. 

3 ‘‘(3) INADEQUATE SECURITY DUE TO DIS4 ASTER.—If adequate security for a loan under this 

5 chapter is not available because of a disaster, the 

6 Secretary shall accept as security any collateral that 

7 is available if the Secretary is confident that the col8 lateral and the repayment ability of the farmer are 

9 adequate security for the loan. 

10 ‘‘(4) VALUATION OF FARM ASSETS.—If a farm 

11 asset (including land, livestock, or equipment) is 

12 used as collateral to secure a loan applied for under 

13 this chapter and the governor of the State in which 

14 the farm is located requests assistance under this 

15 chapter or the Robert T. Stafford Disaster Relief 

16 and Emergency Assistance Act (42 U.S.C. 5121 et 

17 seq.) for the portion of the State in which the asset 

18 is located, the Secretary shall establish the value of 

19 the asset as of the day before the occurrence of the 

20 natural or major disaster or emergency. 

21 ‘‘(f) REVIEW OF LOAN.— 

22 ‘‘(1) IN GENERAL.—In the case of a loan made, 

23 but not guaranteed, under section 3301, the Sec24 retary shall review the loan 3 years after the loan 


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1 is made, and every 2 years thereafter for the term 

2 of the loan. 

3 ‘‘(2) TERMINATION OF FEDERAL ASSIST4 ANCE.—If, based on a review under paragraph (1), 

5 the Secretary determines that the borrower is able to 

6 obtain a loan from a non-Federal source at reason7 able rates and terms, the borrower shall, on request 

8 by the Secretary, apply for, and accept, a non-Fed9 eral loan in a sufficient amount to repay the Sec10 retary. 

11 ‘‘SEC. 3304. PRODUCTION LOSSES. 

12 ‘‘(a) IN GENERAL.—The Secretary shall make or 

13 guarantee a loan under this chapter to an eligible farmer 

14 for production losses if a single enterprise that constitutes 

15 a basic part of the farming operation of the farmer has 

16 sustained at least a 30 percent loss in normal per acre 

17 or per animal production, or such lesser percentage as the 

18 Secretary may determine, as a result of a disaster. 

19 ‘‘(b) BASIS FOR PERCENTAGE.—A percentage loss 

20 under subsection (a) shall be based on the average month21 ly price in effect for the previous crop or calendar year, 

22 as appropriate. 

23 ‘‘(c) AMOUNT OF LOAN.—A loan under subsection 

24 (a) shall be in an amount that is equal to 80 percent, or 

25 such greater percentage as the Secretary may determine, 


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1 of the total calculated actual production loss sustained by 

2 the farmer. 

3 ‘‘CHAPTER 4—GENERAL FARMER LOAN 

4 PROVISIONS 

5 ‘‘SEC. 3401. AGRICULTURAL CREDIT INSURANCE FUND. 

6 ‘‘The fund established pursuant to section 11(a) of 

7 the Bankhead-Jones Farm Tenant Act (60 Stat. 1075, 

8 chapter 964) shall be known as the Agricultural Credit 

9 Insurance Fund (referred to in this section as the ‘Fund’, 

10 unless the context otherwise requires) for the discharge 

11 of the obligations of the Secretary under agreements in12 suring loans under this subtitle and loans and mortgages 

13 insured under prior authority. 

14 ‘‘SEC. 3402. GUARANTEED FARMER LOANS. 

15 ‘‘(a) IN GENERAL.—The Secretary may provide fi16 nancial assistance to a borrower for a purpose provided 

17 in this subtitle by guaranteeing a loan made by any Fed18 eral or State chartered bank, savings and loan association, 

19 cooperative lending agency, or other legally organized 

20 lending agency. 

21 ‘‘(b) INTEREST RATE.—The interest rate payable by 

22 a borrower on the portion of a guaranteed loan that is 

23 sold by a lender to the secondary market under this sub24 title may be lower than the interest rate charged on the 

25 portion retained by the lender, but shall not exceed the 


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1 average interest rate charged by the lender on loans made 

2 to farm borrowers. 

3 ‘‘(c) FEES.—In the case of a loan guarantee on a 

4 loan made by a commercial or cooperative lender related 

5 to a loan made by the Secretary under section 3107— 

6 ‘‘(1) the Secretary shall not charge a fee to any 

7 person (including a lender); and 

8 ‘‘(2) a lender may charge a loan origination and 

9 servicing fee in an amount not to exceed 1 percent 

10 of the amount of the loan. 

11 ‘‘(d) MAXIMUM GUARANTEE OF 90 PERCENT.—Ex12 cept as provided in subsections (e) and (f), a loan guar13 antee under this subtitle shall be for not more than 90 

14 percent of the principal and interest due on the loan. 

15 ‘‘(e) REFINANCED LOANS GUARANTEED AT 95 PER16 CENT.—The Secretary shall guarantee 95 percent of— 

17 ‘‘(1) in the case of a loan that solely refinances 

18 a direct loan made under this subtitle, the principal 

19 and interest due on the loan on the date of the refi20 nancing; or 

21 ‘‘(2) in the case of a loan that is used for mul22 tiple purposes, the portion of the loan that refi23 nances the principal and interest due on a direct 

24 loan made under this subtitle that is outstanding on 

25 the date the loan is guaranteed. 


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1 ‘‘(f) BEGINNING FARMER LOANS GUARANTEED UP

2 TO 95 PERCENT.—The Secretary may guarantee not more 

3 than 95 percent of— 

4 ‘‘(1) a farm ownership loan for acquiring a 

5 farm to a borrower who is participating in the down6 payment loan program under section 3107; or 

7 ‘‘(2) an operating loan to a borrower who is 

8 participating in the downpayment loan program 

9 under section 3107 that is made during the period 

10 that the borrower has a direct loan outstanding 

11 under chapter 1 for acquiring a farm. 

12 ‘‘(g) GUARANTEE OF LOANS MADE UNDER STATE

13 BEGINNING FARMER PROGRAMS.—The Secretary may 

14 guarantee under this subtitle a loan made under a State 

15 beginning farmer program, including a loan financed by 

16 the net proceeds of a qualified small issue agricultural 

17 bond for land or property described in section 

18 144(a)(12)(B)(ii) of the Internal Revenue Code of 1986. 

19 ‘‘SEC. 3403. PROVISION OF INFORMATION TO BORROWERS. 

20 ‘‘(a) APPROVAL NOTIFICATION.—The Secretary shall 

21 approve or disapprove an application for a loan or loan 

22 guarantee made under this subtitle, and notify the appli23 cant of such action, not later than 60 days after the date 

24 on which the Secretary has received a complete application 

25 for the loan or loan guarantee. 


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1 ‘‘(b) LIST OF LENDERS.—The Secretary shall make 

2 available to any farmer, on request, a list of lenders in 

3 the area that participate in guaranteed farmer program 

4 loan programs established under this subtitle, and other 

5 lenders in the area that express a desire to participate in 

6 the programs and that request inclusion on the list. 

7 ‘‘(c) OTHER INFORMATION.— 

8 ‘‘(1) IN GENERAL.—On the request of a bor9 rower, the Secretary shall make available to the bor10 rower— 

11 ‘‘(A) a copy of each document signed by 

12 the borrower; 

13 ‘‘(B) a copy of each appraisal performed 

14 with respect to the loan; and 

15 ‘‘(C) any document that the Secretary is 

16 required to provide to the borrower under any 

17 law in effect on the date of the request. 

18 ‘‘(2) RULE OF CONSTRUCTION.—Paragraph (1) 

19 shall not supersede any duty imposed on the Sec20 retary by a law in effect on January 5, 1988, unless 

21 the duty directly conflicts with a duty under para22 graph (1). 

23 ‘‘SEC. 3404. NOTICE OF LOAN SERVICE PROGRAMS. 

24 ‘‘(a) REQUIREMENT.—The Secretary shall provide 

25 notice by certified mail to each borrower who is at least 


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1 90 days past due on the payment of principal or interest 

2 on a loan made under this subtitle. 

3 ‘‘(b) CONTENTS.—The notice required under sub4 section (a) shall— 

5 ‘‘(1) include a summary of all primary loan 

6 service programs, homestead retention programs, 

7 debt settlement programs, and appeal procedures, 

8 including the eligibility criteria, and terms and con9 ditions of the programs and procedures; 

10 ‘‘(2) include a summary of the manner in which 

11 the borrower may apply, and be considered, for all 

12 such programs, except that the Secretary shall not 

13 require the borrower to select among the programs 

14 or waive any right to be considered for any program 

15 carried out by the Secretary; 

16 ‘‘(3) advise the borrower regarding all filing re17 quirements and any deadlines that must be met for 

18 requesting loan servicing; 

19 ‘‘(4) provide any relevant forms, including ap20 plicable response forms; 

21 ‘‘(5) advise the borrower that a copy of regula22 tions is available on request; and 

23 ‘‘(6) be designed to be readable and under24 standable by the borrower. 


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1 ‘‘(c) CONTAINED IN REGULATIONS.—All notices re2 quired by this section shall be contained in the regulations 

3 issued to carry out this title. 

4 ‘‘(d) TIMING.—The notice described in subsection (b) 

5 shall be provided— 

6 ‘‘(1) at the time an application is made for par7 ticipation in a loan service program; 

8 ‘‘(2) on written request of the borrower; and 

9 ‘‘(3) before the earliest of the date of— 

10 ‘‘(A) initiating any liquidation; 

11 ‘‘(B) requesting the conveyance of security 

12 property; 

13 ‘‘(C) accelerating the loan; 

14 ‘‘(D) repossessing property; 

15 ‘‘(E) foreclosing on property; or 

16 ‘‘(F) taking any other collection action. 

17 ‘‘(e) CONSIDERATION OF BORROWERS FOR LOAN

18 SERVICE PROGRAMS.— 

19 ‘‘(1) IN GENERAL.—The Secretary shall con20 sider a farmer program loan borrower for all loan 

21 service programs if, not later than 60 days after re22 ceipt of the notice described in subsection (b), the 

23 borrower requests the consideration in writing. 

24 ‘‘(2) PRIORITY.—In considering a borrower for 

25 a loan service program, the Secretary shall place the 


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1 highest priority on the preservation of the farming 

2 operations of the borrower. 

3 ‘‘SEC. 3405. PLANTING AND PRODUCTION HISTORY GUIDE4 LINES. 

5 ‘‘(a) IN GENERAL.—The Secretary shall ensure that 

6 appropriate procedures, including, to the extent prac7 ticable, onsite inspections, or use of county or State yield 

8 averages, are used in calculating future yields for an appli9 cant for a loan, when an accurate projection cannot be 

10 made because the past production history of the farmer 

11 has been affected by a natural or major disaster or emer12 gency. 

13 ‘‘(b) CALCULATION OF YIELDS.— 

14 ‘‘(1) IN GENERAL.—For the purpose of aver15 aging the past yields of the farm of a farmer over 

16 a period of crop years to calculate the future yield 

17 of the farm under this title, the Secretary shall per18 mit the farmer to exclude the crop year with the 

19 lowest actual or county average yield for the farm 

20 from the calculation, if the farmer was affected by 

21 a natural or major disaster or emergency during at 

22 least 2 of the crop years during the period. 

23 ‘‘(2) AFFECTED BY A NATURAL OR MAJOR DIS24 ASTER OR EMERGENCY.—A farmer was affected by 

25 a natural or major disaster or emergency under 


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1 paragraph (1) if the Secretary finds that the farm2 ing operations of the farmer have been substantially 

3 affected by a natural or major disaster or emer4 gency, including a farmer who has a qualifying loss 

5 but is not located in a designated or declared dis6 aster area. 

7 ‘‘(3) APPLICATION OF SUBSECTION.—This sub8 section shall apply to any action taken by the Sec9 retary that involves— 

10 ‘‘(A) a loan under chapter 1 or 2; and 

11 ‘‘(B) the yield of a farm of a farmer, in12 cluding making a loan or loan guarantee, serv13 icing a loan, or making a credit sale. 

14 ‘‘SEC. 3406. SPECIAL CONDITIONS AND LIMITATIONS ON 

15 LOANS. 

16 ‘‘(a) APPLICANT REQUIREMENTS.—In connection 

17 with a loan made or guaranteed under this subtitle, the 

18 Secretary shall require— 

19 ‘‘(1) the applicant— 

20 ‘‘(A) to certify in writing that, and the 

21 Secretary shall determine whether, the appli22 cant is unable to obtain credit elsewhere; and 

23 ‘‘(B) to furnish an appropriate written fi24 nancial statement; 


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1 ‘‘(2) except for a guaranteed loan, an agree2 ment by the borrower that if at any time it appears 

3 to the Secretary that the borrower may be able to 

4 obtain a loan from a production credit association, 

5 a Federal land bank, or other responsible coopera6 tive or private credit source (or, in the case of a bor7 rower under section 3106, the borrower may be able 

8 to obtain a loan under section 3101), at reasonable 

9 rates and terms for loans for similar purposes and 

10 periods of time, the borrower will, on request by the 

11 Secretary, apply for and accept the loan in a suffi12 cient amount to repay the Secretary or the insured 

13 lender, or both, and to pay for any stock necessary 

14 to be purchased in a cooperative lending agency in 

15 connection with the loan; 

16 ‘‘(3) such provision for supervision of the oper17 ations of the borrower as the Secretary shall con18 sider necessary to achieve the objectives of the loan 

19 and protect the interests of the United States; and 

20 ‘‘(4) the application of a person who is a vet21 eran for a loan under chapter 1 or 2 to be given 

22 preference over a similar application from a person 

23 who is not a veteran if the applications are on file 

24 in a county or area office at the same time. 

25 ‘‘(b) AGENCY PROCESSING REQUIREMENTS.— 


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1 ‘‘(1) NOTIFICATIONS.— 

2 ‘‘(A) INCOMPLETE APPLICATION NOTIFICA3 TION.—If an application for a loan or loan 

4 guarantee under this subtitle (other than an op5 erating loan or loan guarantee) is incomplete, 

6 the Secretary shall inform the applicant of the 

7 reasons the application is incomplete not later 

8 than 20 days after the date on which the Sec9 retary has received the application. 

10 ‘‘(B) OPERATING LOANS.— 

11 ‘‘(i) ADDITIONAL INFORMATION

12 NEEDED.—Not later than 10 calendar 

13 days after the Secretary receives an appli14 cation for an operating loan or loan guar15 antee, the Secretary shall notify the appli16 cant of any information required before a 

17 decision may be made on the application. 

18 ‘‘(ii) INFORMATION NOT RECEIVED.— 

19 If, not later than 20 calendar days after 

20 the date a request is made pursuant to 

21 clause (i) with respect to an application, 

22 the Secretary has not received the informa23 tion requested, the Secretary shall notify 

24 the applicant and the district office of the 


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1 Farm Service Agency, in writing, of the 

2 outstanding information. 

3 ‘‘(C) REQUEST INFORMATION.— 

4 ‘‘(i) IN GENERAL.—On receipt of an 

5 application, the Secretary shall request 

6 from other parties such information as 

7 may be needed in connection with the ap8 plication. 

9 ‘‘(ii) INFORMATION FROM AN AGENCY

10 OF THE DEPARTMENT.—Not later than 15 

11 calendar days after the date on which an 

12 agency of the Department receives a re13 quest for information made pursuant to 

14 subparagraph (A), the agency shall provide 

15 the Secretary with the requested informa16 tion. 

17 ‘‘(2) REPORT OF PENDING APPLICATIONS.— 

18 ‘‘(A) IN GENERAL.—A county office shall 

19 notify the district office of the Farm Service 

20 Agency of each application for an operating 

21 loan or loan guarantee that is pending more 

22 than 45 days after receipt, and the reasons for 

23 which the application is pending. 

24 ‘‘(B) ACTION ON PENDING APPLICA25 TIONS.—A district office that receives a notice 


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1 provided under subparagraph (A) with respect 

2 to an application shall immediately take steps 

3 to ensure that final action is taken on the appli4 cation not later than 15 days after the date of 

5 the receipt of the notice. 

6 ‘‘(C) PENDING APPLICATION REPORT.— 

7 The district office shall report to the State of8 fice of the Farm Service Agency on each appli9 cation for an operating loan or loan guarantee 

10 that is pending more than 45 days after receipt, 

11 and the reasons for which the application is 

12 pending. 

13 ‘‘(D) REPORT TO CONGRESS.—Each 

14 month, the Secretary shall notify the Com15 mittee on Agriculture of the House of Rep16 resentatives and the Committee on Agriculture, 

17 Nutrition, and Forestry of the Senate, on a 

18 State-by-State basis, as to each application for 

19 an operating loan or loan guarantee on which 

20 final action had not been taken within 60 cal21 endar days after receipt by the Secretary, and 

22 the reasons for which final action had not been 

23 taken. 

24 ‘‘(3) DISAPPROVALS.— 


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1 ‘‘(A) IN GENERAL.—If an application for a 

2 loan or loan guarantee under this subtitle is 

3 disapproved by the Secretary, the Secretary 

4 shall state the reasons for the disapproval in 

5 the notice required under paragraph (1). 

6 ‘‘(B) DISAPPROVAL DUE TO LACK OF

7 FUNDS.— 

8 ‘‘(i) IN GENERAL.—Notwithstanding 

9 paragraph (1), each application for a loan 

10 or loan guarantee under section 3601(e), 

11 or for a loan under section 3501(a) or 

12 3502(a), that is to be disapproved by the 

13 Secretary solely because the Secretary 

14 lacks the funds necessary to make the loan 

15 or guarantee shall not be disapproved but 

16 shall be placed in pending status. 

17 ‘‘(ii) RECONSIDERATION.—The Sec18 retary shall retain each pending application 

19 and reconsider the application beginning 

20 on the date that sufficient funds become 

21 available. 

22 ‘‘(iii) NOTIFICATION.—Not later than 

23 60 days after funds become available re24 garding each pending application, the Sec25 retary shall notify the applicant of the apVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00418 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 proval or disapproval of funding for the 

2 application. 

3 ‘‘(4) APPROVALS ON APPEAL.—If an application 

4 for a loan or loan guarantee under this subtitle is 

5 disapproved by the Secretary, but that action is sub6 sequently reversed or revised as the result of an ap7 peal within the Department or to the courts of the 

8 United States and the application is returned to the 

9 Secretary for further consideration, the Secretary 

10 shall act on the application and provide the appli11 cant with notice of the action not later than 15 days 

12 after the date of return of the application to the 

13 Secretary. 

14 ‘‘(5) PROVISION OF PROCEEDS.— 

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

16 subparagraph (B), if an application for an in17 sured loan under this title is approved by the 

18 Secretary, the Secretary shall provide the loan 

19 proceeds to the applicant not later than 15 days 

20 (or such longer period as the applicant may ap21 prove) after the application for the loan is ap22 proved by the Secretary. 

23 ‘‘(B) LACK OF FUNDS.—If the Secretary is 

24 unable to provide the loan proceeds to the ap25 plicant during the 15-day period described in 


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1 subparagraph (A) because sufficient funds are 

2 not available to the Secretary for that purpose, 

3 the Secretary shall provide the loan proceeds to 

4 the applicant as soon as practicable (but in no 

5 event later than 15 days unless the applicant 

6 agrees to a longer period) after sufficient funds 

7 for that purpose become available to the Sec8 retary. 

9 ‘‘SEC. 3407. GRADUATION OF BORROWERS. 

10 ‘‘(a) GRADUATION OF SEASONED DIRECT LOAN

11 BORROWERS TO THE LOAN GUARANTEE PROGRAM.— 

12 ‘‘(1) REVIEW OF LOANS.— 

13 ‘‘(A) IN GENERAL.—The Secretary, or a 

14 contracting third party, shall annually review 

15 under section 3420 the loans of each seasoned 

16 direct loan borrower. 

17 ‘‘(B) ASSISTANCE.—If, based on the re18 view, it is determined that a borrower would be 

19 able to obtain a loan, guaranteed by the Sec20 retary, from a commercial or cooperative lender 

21 at reasonable rates and terms for loans for 

22 similar purposes and periods of time, the Sec23 retary shall assist the borrower in applying for 

24 the commercial or cooperative loan. 

25 ‘‘(2) PROSPECTUS.— 


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1 ‘‘(A) IN GENERAL.—In accordance with 

2 section 3422, the Secretary shall prepare a pro3 spectus on each seasoned direct loan borrower 

4 determined eligible to obtain a guaranteed loan. 

5 ‘‘(B) REQUIREMENTS.—The prospectus 

6 shall contain a description of the amounts of 

7 the loan guarantee and interest assistance that 

8 the Secretary will provide to the seasoned direct 

9 loan borrower to enable the seasoned direct loan 

10 borrower to carry out a financially viable farm11 ing plan if a guaranteed loan is made. 

12 ‘‘(3) VERIFICATION.— 

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

14 provide a prospectus of a seasoned direct loan 

15 borrower to each approved lender whose lending 

16 area includes the location of the seasoned direct 

17 loan borrower. 

18 ‘‘(B) NOTIFICATION.—The Secretary shall 

19 notify each borrower of a loan that a prospectus 

20 has been provided to a lender under subpara21 graph (A). 

22 ‘‘(C) CREDIT EXTENDED.—If the Sec23 retary receives an offer from an approved lend24 er to extend credit to the seasoned direct loan 

25 borrower under terms and conditions contained 


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1 in the prospectus, the seasoned direct loan bor2 rower shall not be eligible for a loan from the 

3 Secretary under chapter 1 or 2, except as other4 wise provided in this section. 

5 ‘‘(4) INSUFFICIENT ASSISTANCE OR OFFERS.— 

6 If the Secretary is unable to provide loan guarantees 

7 and, if necessary, interest assistance to the seasoned 

8 direct loan borrower under this section in amounts 

9 sufficient to enable the seasoned direct loan bor10 rower to borrow from commercial sources the 

11 amount required to carry out a financially viable 

12 farming plan, or if the Secretary does not receive an 

13 offer from an approved lender to extend credit to a 

14 seasoned direct loan borrower under the terms and 

15 conditions contained in the prospectus, the Secretary 

16 shall make a loan to the seasoned direct loan bor17 rower under chapter 1 or 2, whichever is applicable. 

18 ‘‘(5) INTEREST RATE REDUCTIONS.—To the ex19 tent necessary for the borrower to obtain a loan, 

20 guaranteed by the Secretary, from a commercial or 

21 cooperative lender, the Secretary shall provide inter22 est rate reductions as provided for under section 

23 3413. 

24 ‘‘(b) TRANSITION TO PRIVATE COMMERCIAL OR

25 OTHER SOURCES OF CREDIT.— 


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1 ‘‘(1) IN GENERAL.—In making an operating or 

2 ownership loan, the Secretary shall establish a plan 

3 and promulgate regulations (including performance 

4 criteria) that promote the goal of transitioning bor5 rowers to private commercial credit and other 

6 sources of credit in the shortest period of time prac7 ticable. 

8 ‘‘(2) COORDINATION.—In carrying out this sec9 tion, the Secretary shall integrate and coordinate the 

10 transition policy described in subsection (a) with— 

11 ‘‘(A) the borrower training program estab12 lished by section 3419; 

13 ‘‘(B) the loan assessment process estab14 lished by section 3420; 

15 ‘‘(C) the supervised credit requirement es16 tablished by section 3421; 

17 ‘‘(D) the market placement program estab18 lished by section 3422; and 

19 ‘‘(E) other appropriate programs and au20 thorities, as determined by the Secretary. 

21 ‘‘(c) GRADUATION OF BORROWERS WITH OPERATING

22 LOANS OR GUARANTEES TO PRIVATE COMMERCIAL

23 CREDIT.—The Secretary shall establish a plan, in coordi24 nation with activities under sections 3419 through 3422, 

25 to encourage each borrower with an outstanding loan 


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1 under this chapter, or with respect to whom there is an 

2 outstanding guarantee under this chapter, to graduate to 

3 private commercial or other sources of credit. 

4 ‘‘SEC. 3408. DEBT ADJUSTMENT AND CREDIT COUNSELING. 

5 ‘‘In carrying out this subtitle, the Secretary may— 

6 ‘‘(1) provide voluntary debt adjustment assist7 ance between— 

8 ‘‘(A) farmers; and 

9 ‘‘(B) the creditors of the farmers; 

10 ‘‘(2) cooperate with State, territorial, and local 

11 agencies and committees engaged in the debt adjust12 ment; and 

13 ‘‘(3) give credit counseling. 

14 ‘‘SEC. 3409. SECURITY SERVICING. 

15 ‘‘(a) SALE OF PROPERTY.— 

16 ‘‘(1) IN GENERAL.—Subject to this subsection 

17 and subsection (e)(1), the Secretary shall offer to 

18 sell real property that is acquired by the Secretary 

19 under this subtitle using the following order and 

20 method of sale: 

21 ‘‘(A) ADVERTISEMENT.—Not later than 15 

22 days after acquiring real property, the Sec23 retary shall publicly advertise the property for 

24 sale. 

25 ‘‘(B) QUALIFIED BEGINNING FARMER.— 


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1 ‘‘(i) IN GENERAL.—Not later than 75 

2 days after acquiring real property, the Sec3 retary shall offer to sell the property to a 

4 qualified beginning farmer or a socially 

5 disadvantaged farmer at current market 

6 value based on a current appraisal. 

7 ‘‘(ii) RANDOM SELECTION.—If more 

8 than 1 qualified beginning farmer or so9 cially disadvantaged farmer offers to pur10 chase the property, the Secretary shall se11 lect between the qualified applicants on a 

12 random basis. 

13 ‘‘(iii) APPEAL OF RANDOM SELEC14 TION.—A random selection or denial by 

15 the Secretary of a qualified beginning 

16 farmer or a socially disadvantaged farmer 

17 for farm inventory property under this 

18 subparagraph shall be final and not admin19 istratively appealable. 

20 ‘‘(C) PUBLIC SALE.—If no acceptable offer 

21 is received from a qualified beginning farmer or 

22 a socially disadvantaged farmer under subpara23 graph (B) not later than 135 days after acquir24 ing the real property, the Secretary shall, not 

25 later than 30 days after the 135-day period, sell 


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1 the property after public notice at a public sale, 

2 and, if no acceptable bid is received, by nego3 tiated sale, at the best price obtainable. 

4 ‘‘(2) INTEREST.— 

5 ‘‘(A) IN GENERAL.—Subject to subpara6 graph (B), any conveyance of real property 

7 under this subsection shall include all of the in8 terest of the United States in the property, in9 cluding mineral rights. 

10 ‘‘(B) CONSERVATION.—The Secretary may 

11 for conservation purposes grant or sell an ease12 ment, restriction, development right, or similar 

13 legal right to real property to a State, a polit14 ical subdivision of a State, or a private non15 profit organization separately from the under16 lying fee or other rights to the property owned 

17 by the United States. 

18 ‘‘(3) OTHER LAW.—Subtitle I of title 40, 

19 United States Code, and title III of the Federal 

20 Property and Administrative Services Act of 1949 

21 (41 U.S.C. 251 et seq.) shall not apply to any exer22 cise of authority under this subtitle. 

23 ‘‘(4) LEASE OF PROPERTY.— 


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1 ‘‘(A) IN GENERAL.—Subject to subpara2 graph (B), the Secretary may not lease any real 

3 property acquired under this subtitle. 

4 ‘‘(B) EXCEPTION.— 

5 ‘‘(i) QUALIFIED BEGINNING FARMER

6 OR SOCIALLY DISADVANTAGED FARMER.— 

7 The Secretary may lease or contract to sell 

8 to a qualified beginning farmer or a so9 cially disadvantaged farmer a farm ac10 quired by the Secretary under this subtitle 

11 if the qualified beginning farmer qualifies 

12 for a credit sale or direct farm ownership 

13 loan under chapter 1 but credit sale au14 thority for loans or direct farm ownership 

15 loan funds, respectively, are not available. 

16 ‘‘(ii) TERM.—The term of a lease or 

17 contract to sell to a qualified beginning 

18 farmer or a socially disadvantaged farmer 

19 under clause (i) shall be until the earlier 

20 of— 

21 ‘‘(I) the date that is 18 months 

22 after the date of the lease or sale; or 

23 ‘‘(II) the date that direct farm 

24 ownership loan funds or credit sale 

25 authority for loans becomes available 


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1 to the qualified beginning farmer or 

2 socially disadvantaged farmer. 

3 ‘‘(iii) INCOME-PRODUCING CAPA4 BILITY.—In determining the rental rate on 

5 real property leased under this subpara6 graph, the Secretary shall consider the in7 come-producing capability of the property 

8 during the term that the property is 

9 leased. 

10 ‘‘(5) EXPEDITED DETERMINATION.— 

11 ‘‘(A) IN GENERAL.—On the request of an 

12 applicant, not later than 30 days after denial of 

13 the application, the appropriate State director 

14 shall provide an expedited review and deter15 mination of whether the applicant is a qualified 

16 beginning farmer or a socially disadvantaged 

17 farmer for the purpose of acquiring farm inven18 tory property. 

19 ‘‘(B) APPEAL.—The determination of a 

20 State Director under subparagraph (A) shall be 

21 final and not administratively appealable. 

22 ‘‘(C) EFFECTS OF DETERMINATIONS.— 

23 ‘‘(i) IN GENERAL.—The Secretary 

24 shall maintain statistical data on the num25 ber and results of determinations made 


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1 under subparagraph (A) and the effect of 

2 the determinations on— 

3 ‘‘(I) selling farm inventory prop4 erty to qualified beginning farmers or 

5 socially disadvantaged farmers; and 

6 ‘‘(II) disposing of real property 

7 in inventory. 

8 ‘‘(ii) NOTIFICATION.—The Secretary 

9 shall notify the Committee on Agriculture 

10 of the House of Representatives and the 

11 Committee on Agriculture, Nutrition, and 

12 Forestry of the Senate if the Secretary de13 termines that the review process under 

14 subparagraph (A) is adversely affecting the 

15 selling of farm inventory property to quali16 fied beginning farmers or socially dis17 advantaged farmers or the disposing of 

18 real property in inventory. 

19 ‘‘(b) ROAD AND UTILITY EASEMENTS AND CON20 DEMNATIONS.—In the case of any real property adminis21 tered under this subtitle, the Secretary may grant or sell 

22 easements or rights-of-way for roads, utilities, and other 

23 appurtenances that are not inconsistent with the public 

24 interest. 

25 ‘‘(c) SALE OR LEASE OF FARMLAND.— 


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1 ‘‘(1) DISPOSITION OF REAL PROPERTY ON IN2 DIAN RESERVATIONS.— 

3 ‘‘(A) DEFINITION OF INDIAN RESERVA4 TION.—In this paragraph, the term ‘Indian res5 ervation’ means— 

6 ‘‘(i) all land located within the limits 

7 of any Indian reservation under the juris8 diction of the United States, notwith9 standing the issuance of any patent, and, 

10 including any right-of-way running through 

11 the reservation; 

12 ‘‘(ii) trust or restricted land located 

13 within the boundaries of a former reserva14 tion of an Indian tribe in the State of 

15 Oklahoma; or 

16 ‘‘(iii) all Indian allotments the Indian 

17 titles to which have not been extinguished 

18 if the allotments are subject to the juris19 diction of an Indian tribe. 

20 ‘‘(B) DISPOSITION.—Except as provided in 

21 paragraph (3), the Secretary shall dispose of or 

22 administer the property as provided in this 

23 paragraph when— 


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1 ‘‘(i) the Secretary acquires property 

2 under this subtitle that is located within an 

3 Indian reservation; and 

4 ‘‘(ii) the borrower-owner is the Indian 

5 tribe that has jurisdiction over the reserva6 tion in which the real property is located 

7 or the borrower-owner is a member of the 

8 Indian tribe; 

9 ‘‘(C) PRIORITY.—Not later than 90 days 

10 after acquiring the property, the Secretary shall 

11 afford an opportunity to purchase or lease the 

12 real property in accordance with the order of 

13 priority established under subparagraph (D) to 

14 the Indian tribe having jurisdiction over the In15 dian reservation within which the real property 

16 is located or, if no order of priority is estab17 lished by the Indian tribe under subparagraph 

18 (D), in the following order: 

19 ‘‘(i) An Indian member of the Indian 

20 tribe that has jurisdiction over the reserva21 tion within which the real property is lo22 cated. 

23 ‘‘(ii) An Indian corporate entity. 

24 ‘‘(iii) The Indian tribe. 


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1 ‘‘(D) REVISION OF PRIORITY AND RE2 STRICTION OF ELIGIBILITY.—The governing 

3 body of any Indian tribe having jurisdiction 

4 over an Indian reservation may revise the order 

5 of priority provided in subparagraph (C) under 

6 which land located within the reservation shall 

7 be offered for purchase or lease by the Sec8 retary under subparagraph (C) and may re9 strict the eligibility for the purchase or lease 

10 to— 

11 ‘‘(i) persons who are members of the 

12 Indian tribe; 

13 ‘‘(ii) Indian corporate entities that are 

14 authorized by the Indian tribe to lease or 

15 purchase land within the boundaries of the 

16 reservation; or 

17 ‘‘(iii) the Indian tribe itself. 

18 ‘‘(E) TRANSFER OF PROPERTY TO SEC19 RETARY OF THE INTERIOR.— 

20 ‘‘(i) IN GENERAL.—If real property 

21 described in subparagraph (B) is not pur22 chased or leased under subparagraph (C) 

23 and the Indian tribe having jurisdiction 

24 over the reservation within which the real 

25 property is located is unable to purchase or 


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1 lease the real property, the Secretary shall 

2 transfer the real property to the Secretary 

3 of the Interior who shall administer the 

4 real property as if the real property were 

5 held in trust by the United States for the 

6 benefit of the Indian tribe. 

7 ‘‘(ii) USE OF RENTAL INCOME.—From 

8 the rental income derived from the lease of 

9 the transferred real property, and all other 

10 income generated from the transferred real 

11 property, the Secretary of the Interior 

12 shall pay the State, county, municipal, or 

13 other local taxes to which the transferred 

14 real property was subject at the time of ac15 quisition by the Secretary, until the earlier 

16 of— 

17 ‘‘(I) the expiration of the 4-year 

18 period beginning on the date on which 

19 the real property is so transferred; or 

20 ‘‘(II) such time as the land is 

21 transferred into trust pursuant to 

22 subparagraph (H). 

23 ‘‘(F) RESPONSIBILITIES OF SECRE24 TARIES.—If any real property is transferred to 


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1 the Secretary of the Interior under subpara2 graph (E)— 

3 ‘‘(i) the Secretary of Agriculture shall 

4 have no further responsibility under this 

5 title for— 

6 ‘‘(I) collection of any amounts 

7 with regard to the farm program loan 

8 that had been secured by the real 

9 property; 

10 ‘‘(II) any lien arising out of the 

11 loan transaction; or 

12 ‘‘(III) repayment of any amount 

13 with regard to the loan transaction or 

14 lien to the Treasury of the United 

15 States; and 

16 ‘‘(ii) the Secretary of the Interior 

17 shall succeed to all right, title, and interest 

18 of the Secretary of Agriculture in the real 

19 estate arising from the farm program loan 

20 transaction, including the obligation to 

21 remit to the Treasury of the United States, 

22 in repayment of the original loan, the 

23 amounts provided in subparagraph (G). 

24 ‘‘(G) USE OF INCOME.—After the payment 

25 of any taxes that are required to be paid under 


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1 subparagraph (E)(ii), all remaining rental in2 come derived from the lease of the real property 

3 transferred to the Secretary of the Interior 

4 under subparagraph (E)(i), and all other in5 come generated from the real property trans6 ferred to the Secretary of the Interior under 

7 that subparagraph, shall be deposited as mis8 cellaneous receipts in the Treasury of the 

9 United States until the amount deposited is 

10 equal to the lesser of— 

11 ‘‘(i) the amount of the outstanding 

12 lien of the United States against the real 

13 property, as of the date the real property 

14 was acquired by the Secretary; 

15 ‘‘(ii) the fair market value of the real 

16 property, as of the date of the transfer to 

17 the Secretary of the Interior; or 

18 ‘‘(iii) the capitalized value of the real 

19 property, as of the date of the transfer to 

20 the Secretary of the Interior. 

21 ‘‘(H) HOLDING OF TITLE IN TRUST.—If 

22 the total amount that is required to be depos23 ited under subparagraph (G) with respect to 

24 any real property has been deposited into the 

25 Treasury of the United States, title to the real 


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1 property shall be held in trust by the United 

2 States for the benefit of the Indian tribe having 

3 jurisdiction over the Indian reservation within 

4 which the real property is located. 

5 ‘‘(I) PAYMENT OF REMAINING LIEN OR

6 FAIR MARKET VALUE OF PROPERTY.— 

7 ‘‘(i) IN GENERAL.—Notwithstanding 

8 any other subparagraph of this paragraph, 

9 the Indian tribe having jurisdiction over 

10 the Indian reservation within which the 

11 real property described in subparagraph 

12 (B) is located may, at any time after the 

13 real property has been transferred to the 

14 Secretary of the Interior under subpara15 graph (E), offer to pay the remaining 

16 amount on the lien or the fair market 

17 value of the real property, whichever is 

18 less. 

19 ‘‘(ii) EFFECT OF PAYMENT.—On pay20 ment of the amount, title to the real prop21 erty shall be held by the United States in 

22 trust for the tribe and the trust or re23 stricted land that has been acquired by the 

24 Secretary under foreclosure or voluntary 

25 transfer under a loan made or insured 


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1 under this subtitle and transferred to an 

2 Indian person, entity, or tribe under this 

3 paragraph shall be considered to have 

4 never lost trust or restricted status. 

5 ‘‘(J) APPLICABILITY.— 

6 ‘‘(i) IN GENERAL.—This paragraph 

7 shall apply to all land in the land inventory 

8 established under this subtitle (as of No9 vember 28, 1990) that was (immediately 

10 prior to the date) owned by an Indian bor11 rower-owner described in subparagraph 

12 (B) and that is situated within an Indian 

13 reservation, regardless of the date of fore14 closure or acquisition by the Secretary. 

15 ‘‘(ii) OPPORTUNITY TO PURCHASE OR

16 LEASE.—The Secretary shall afford an op17 portunity to an Indian person, entity, or 

18 tribe to purchase or lease the real property 

19 as provided in subparagraph (C). 

20 ‘‘(iii) TRANSFER.—If the right is not 

21 exercised or no expression of intent to ex22 ercise the right is received within 180 days 

23 after November 28, 1990, the Secretary 

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1 retary of the Interior as provided in sub2 paragraph (E). 

3 ‘‘(2) ADDITIONAL RIGHTS.—The rights pro4 vided in this subsection shall be in addition to any 

5 right of first refusal under the law of the State in 

6 which the property is located. 

7 ‘‘(3) DISPOSITION OF REAL PROPERTY ON IN8 DIAN RESERVATIONS AFTER PROCEDURES EX9 HAUSTED.— 

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

11 dispose of or administer real property described 

12 in paragraph (1)(B) only as provided in para13 graph (1), as modified by this paragraph, if— 

14 ‘‘(i) the real property described in 

15 paragraph (1)(B) is located within an In16 dian reservation; 

17 ‘‘(ii) the borrower-owner is an Indian 

18 tribe that has jurisdiction over the reserva19 tion in which the real property is located 

20 or the borrower-owner is a member of an 

21 Indian tribe; 

22 ‘‘(iii) the borrower-owner has obtained 

23 a loan made or guaranteed under this title; 

24 and 


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1 ‘‘(iv) the borrower-owner and the Sec2 retary have exhausted all of the procedures 

3 provided for in this title to permit a bor4 rower-owner to retain title to the real prop5 erty, so that it is necessary for the bor6 rower-owner to relinquish title. 

7 ‘‘(B) NOTICE OF RIGHT TO CONVEY PROP8 ERTY.—The Secretary shall provide the bor9 rower-owner of real property that is described 

10 in subparagraph (A) with written notice of— 

11 ‘‘(i) the right of the borrower-owner to 

12 voluntarily convey the real property to the 

13 Secretary; and 

14 ‘‘(ii) the fact that real property so 

15 conveyed will be placed in the inventory of 

16 the Secretary. 

17 ‘‘(C) NOTICE OF RIGHTS AND PROTEC18 TIONS.—The Secretary shall provide the bor19 rower-owner of the real property with written 

20 notice of the rights and protections provided 

21 under this title to the borrower-owner, and the 

22 Indian tribe that has jurisdiction over the res23 ervation in which the real property is located, 

24 from foreclosure or liquidation of the real prop25 erty, including written notice— 


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1 ‘‘(i) of paragraph (1), this paragraph, 

2 and subsection (e)(3); 

3 ‘‘(ii) if the borrower-owner does not 

4 voluntarily convey the real property to the 

5 Secretary, that— 

6 ‘‘(I) the Secretary may foreclose 

7 on the property; 

8 ‘‘(II) in the event of foreclosure, 

9 the property will be offered for sale; 

10 ‘‘(III) the Secretary shall offer a 

11 bid for the property that is equal to 

12 the fair market value of the property 

13 or the outstanding principal and inter14 est of the loan, whichever is higher; 

15 ‘‘(IV) the property may be pur16 chased by another party; and 

17 ‘‘(V) if the property is purchased 

18 by another party, the property will not 

19 be placed in the inventory of the Sec20 retary and the borrower-owner will 

21 forfeit the rights and protections pro22 vided under this title; and 

23 ‘‘(iii) of the opportunity of the bor24 rower-owner to consult with the Indian 

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1 tion in which the real property is located 

2 or counsel to determine if State or tribal 

3 law provides rights and protections that 

4 are more beneficial than the rights and 

5 protections provided the borrower-owner 

6 under this title. 

7 ‘‘(D) ACCEPTANCE OF VOLUNTARY CON8 VEYANCE.— 

9 ‘‘(i) IN GENERAL.—Except as pro10 vided in clause (ii), the Secretary shall ac11 cept the voluntary conveyance of real prop12 erty described in subparagraph (A). 

13 ‘‘(ii) HAZARDOUS SUBSTANCES.—If a 

14 hazardous substance (as defined in section 

15 101(14) of the Comprehensive Environ16 mental Response, Compensation, and Li17 ability Act of 1980 (42 U.S.C. 9601(14))) 

18 is located on the property and the Sec19 retary takes remedial action to protect 

20 human health or the environment if the 

21 property is taken into inventory, the Sec22 retary shall accept the voluntary convey23 ance of the property only if the Secretary 

24 determines that the conveyance is in the 

25 best interests of the Federal Government. 


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1 ‘‘(E) FORECLOSURE PROCEDURES.— 

2 ‘‘(i) NOTICE TO BORROWER.—If an 

3 Indian borrower-owner does not voluntarily 

4 convey to the Secretary real property de5 scribed in subparagraph (A), not less than 

6 30 days before a foreclosure sale of the 

7 property, the Secretary shall provide the 

8 Indian borrower-owner with the option 

9 of— 

10 ‘‘(I) requiring the Secretary to 

11 assign the loan and security instru12 ments to the Secretary of the Interior, 

13 if the Secretary of the Interior agrees 

14 to an assignment releasing the Sec15 retary of Agriculture from all further 

16 responsibility for collection of any 

17 amounts with regard to the loan se18 cured by the real property; or 

19 ‘‘(II) requiring the Secretary to 

20 assign the loan and security instru21 ments to the tribe having jurisdiction 

22 over the reservation in which the real 

23 property is located, if the tribe agrees 

24 to assume the loan under the terms 

25 specified in clause (iii). 


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1 ‘‘(ii) NOTICE TO TRIBE.—If an Indian 

2 borrower-owner does not voluntarily convey 

3 to the Secretary real property described in 

4 subparagraph (A), not less than 30 days 

5 before a foreclosure sale of the property, 

6 the Secretary shall provide written notice 

7 to the Indian tribe that has jurisdiction 

8 over the reservation in which the real prop9 erty is located of— 

10 ‘‘(I) the sale; 

11 ‘‘(II) the fair market value of the 

12 property; and 

13 ‘‘(III) the requirements of this 

14 paragraph. 

15 ‘‘(iii) ASSUMED LOANS.—If an Indian 

16 tribe assumes a loan under clause (i)— 

17 ‘‘(I) the Secretary shall not fore18 close the loan because of any default 

19 that occurred prior to the date of the 

20 assumption; 

21 ‘‘(II) the loan shall be for the 

22 lesser of the outstanding principal and 

23 interest of the loan or the fair market 

24 value of the property; and 


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1 ‘‘(III) the loan shall be treated as 

2 though the loan was made under Pub3 lic Law 91–229 (25 U.S.C. 488 et 

4 seq.). 

5 ‘‘(F) AMOUNT OF BID BY SECRETARY.— 

6 ‘‘(i) IN GENERAL.—Except as pro7 vided in clause (ii), at a foreclosure sale of 

8 real property described in subparagraph 

9 (A), the Secretary shall offer a bid for the 

10 property that is equal to the higher of— 

11 ‘‘(I) the fair market value of the 

12 property; or 

13 ‘‘(II) the outstanding principal 

14 and interest on the loan. 

15 ‘‘(ii) HAZARDOUS SUBSTANCES.—If a 

16 hazardous substance (as defined in section 

17 101(14) of the Comprehensive Environ18 mental Response, Compensation, and Li19 ability Act of 1980 (42 U.S.C. 9601(14))) 

20 is located on the property and the Sec21 retary takes remedial action to protect 

22 human health or the environment if the 

23 property is taken into inventory, clause (i) 

24 shall apply only if the Secretary determines 


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1 that bidding is in the best interests of the 

2 Federal Government. 

3 ‘‘(4) DETRIMENTAL EFFECT ON VALUE OF

4 AREA FARMLAND.—The Secretary shall not offer for 

5 sale or sell any farmland referred to in paragraphs 

6 (1) through (3) if placing the farmland on the mar7 ket will have a detrimental effect on the value of 

8 farmland in the area. 

9 ‘‘(5) INSTALLMENT SALES AND MULTIPLE OP10 ERATORS.— 

11 ‘‘(A) IN GENERAL.—The Secretary may 

12 sell farmland administered under this title 

13 through an installment sale or similar device 

14 that contains such terms as the Secretary con15 siders necessary to protect the investment of 

16 the Federal Government in the land. 

17 ‘‘(B) SALE OF CONTRACT.—The Secretary 

18 may subsequently sell any contract entered into 

19 to carry out subparagraph (A). 

20 ‘‘(6) HIGHLY ERODIBLE LAND.—In the case of 

21 farmland administered under this title that is highly 

22 erodible land (as defined in section 1201 of the Food 

23 Security Act of 1985 (16 U.S.C. 3801)), the Sec24 retary may require the use of specified conservation 


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1 practices on the land as a condition of the sale or 

2 lease of the land. 

3 ‘‘(7) NO EFFECT ON ACREAGE ALLOTMENTS, 

4 MARKETING QUOTAS, OR ACREAGE BASES.—Not5 withstanding any other law, compliance by the Sec6 retary with this subsection shall not cause any acre7 age allotment, marketing quota, or acreage base as8 signed to the property to lapse, terminate, be re9 duced, or otherwise be adversely affected. 

10 ‘‘(8) NO PREEMPTION OF STATE LAW.—If a 

11 conflict exists between any provision of this sub12 section and any provision of the law of any State 

13 providing a right of first refusal to the owner of 

14 farmland or the operator of a farm before the sale 

15 or lease of land to any other person, the provision 

16 of State law shall prevail. 

17 ‘‘(d) RELEASE OF NORMAL INCOME SECURITY.— 

18 ‘‘(1) DEFINITION OF NORMAL INCOME SECU19 RITY.—In this subsection: 

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

21 subparagraph (B), the term ‘normal income se22 curity’ means all security not considered basic 

23 security, including crops, livestock, poultry 

24 products, Farm Service Agency payments and 

25 Commodity Credit Corporation payments, and 


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1 other property covered by Farm Service Agency 

2 liens that is sold in conjunction with the oper3 ation of a farm or other business. 

4 ‘‘(B) EXCEPTIONS.—The term ‘normal in5 come security’ does not include any equipment 

6 (including fixtures in States that have adopted 

7 the Uniform Commercial Code), or foundation 

8 herd or flock, that is— 

9 ‘‘(i) the basis of the farming or other 

10 operation; and 

11 ‘‘(ii) the basic security for a farmer 

12 program loan. 

13 ‘‘(2) GENERAL RELEASE.—The Secretary shall 

14 release from the normal income security provided for 

15 a loan an amount sufficient to pay for the essential 

16 household and farm operating expenses of the bor17 rower, until such time as the Secretary accelerates 

18 the loan. 

19 ‘‘(3) NOTICE OF REPORTING REQUIREMENTS

20 AND RIGHTS.—If a borrower is required to plan for 

21 or to report as to how proceeds from the sale of col22 lateral property will be used, the Secretary shall no23 tify the borrower of— 

24 ‘‘(A) the requirement; and 


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1 ‘‘(B) the right to the release of funds 

2 under this subsection and the means by which 

3 a request for the funds may be made. 

4 ‘‘(e) EASEMENTS ON INVENTORIED PROPERTY.— 

5 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

6 in the disposal of real property under this section, 

7 the Secretary shall establish perpetual wetland con8 servation easements to protect and restore wetland 

9 or converted wetland that exists on inventoried prop10 erty. 

11 ‘‘(2) LIMITATION.—The Secretary shall not es12 tablish a wetland conservation easement on an 

13 inventoried property that— 

14 ‘‘(A) was cropland on the date the prop15 erty entered the inventory of the Secretary; or 

16 ‘‘(B) was used for farming at any time 

17 during the period— 

18 ‘‘(i) beginning on the date that is 5 

19 years before the property entered the in20 ventory of the Secretary; and 

21 ‘‘(ii) ending on the date on which the 

22 property entered the inventory of the Sec23 retary. 

24 ‘‘(3) NOTIFICATION.—The Secretary shall pro25 vide prior written notification to a borrower considVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00448 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 ering homestead retention that a wetland conserva2 tion easement may be placed on land for which the 

3 borrower is negotiating a lease option. 

4 ‘‘(4) APPRAISED VALUE.—The appraised value 

5 of the farm shall reflect the value of the land due 

6 to the placement of wetland conservation easements. 

7 ‘‘SEC. 3410. CONTRACTS ON LOAN SECURITY PROPERTIES. 

8 ‘‘(a) CONTRACTS ON LOAN SECURITY PROP9 ERTIES.—Subject to subsection (b), the Secretary may 

10 enter into a contract related to real property for conserva11 tion, recreation, or wildlife purposes. 

12 ‘‘(b) LIMITATIONS.—The Secretary may enter into a 

13 contract under subsection (a) if— 

14 ‘‘(1) the property is wetland, upland, or highly 

15 erodible land; 

16 ‘‘(2) the property is determined by the Sec17 retary to be suitable for the purpose involved; and 

18 ‘‘(3)(A) the property secures a loan made under 

19 a law administered and held by the Secretary; and 

20 ‘‘(B) the contract would better enable a quali21 fied borrower to repay the loan in a timely manner, 

22 as determined by the Secretary. 

23 ‘‘(c) TERMS AND CONDITIONS.—The terms and con24 ditions specified in a contract under subsection (a) shall— 


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1 ‘‘(1) specify the purposes for which the real 

2 property may be used; 

3 ‘‘(2) identify any conservation measure to be 

4 taken, and any recreational and wildlife use to be al5 lowed, with respect to the real property; and 

6 ‘‘(3) require the owner to permit the Secretary, 

7 and any person or governmental entity designated by 

8 the Secretary, to have access to the real property for 

9 the purpose of monitoring compliance with the con10 tract. 

11 ‘‘(d) REDUCTION OR FORGIVENESS OF DEBT.— 

12 ‘‘(1) IN GENERAL.—Subject to this section, the 

13 Secretary may reduce or forgive the outstanding 

14 debt of a borrower— 

15 ‘‘(A) in the case of a borrower to whom the 

16 Secretary has made an outstanding loan under 

17 a law administered by the Secretary, by can18 celing that part of the aggregate amount of the 

19 outstanding loan that bears the same ratio to 

20 the aggregate amount as— 

21 ‘‘(i) the number of acres of the real 

22 property of the borrower that are subject 

23 to the contract; bears to 

24 ‘‘(ii) the aggregate number of acres 

25 securing the loan; or 


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1 ‘‘(B) in any other case, by treating as pre2 paid that part of the principal amount of a new 

3 loan to the borrower issued and held by the 

4 Secretary under a law administered by the Sec5 retary that bears the same ratio to the principal 

6 amount as— 

7 ‘‘(i) the number of acres of the real 

8 property of the borrower that are subject 

9 to the contract; bears to 

10 ‘‘(ii) the aggregate number of acres 

11 securing the new loan. 

12 ‘‘(2) MAXIMUM CANCELED AMOUNT.—The 

13 amount canceled or treated as prepaid under para14 graph (1) shall not exceed— 

15 ‘‘(A) in the case of a delinquent loan, the 

16 greater of— 

17 ‘‘(i) the value of the land on which the 

18 contract is entered into; or 

19 ‘‘(ii) the difference between— 

20 ‘‘(I) the amount of the out21 standing loan secured by the land; 

22 and 

23 ‘‘(II) the value of the land; or 


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1 ‘‘(B) in the case of a nondelinquent loan, 

2 33 percent of the amount of the loan secured 

3 by the land. 

4 ‘‘(e) CONSULTATION WITH FISH AND WILDLIFE

5 SERVICE.—If the Secretary uses the authority provided by 

6 this section, the Secretary shall consult with the Director 

7 of the Fish and Wildlife Service for the purposes of— 

8 ‘‘(1) selecting real property in which the Sec9 retary may enter into a contract under this section; 

10 ‘‘(2) formulating the terms and conditions of 

11 the contract; and 

12 ‘‘(3) enforcing the contract. 

13 ‘‘(f) ENFORCEMENT.—The Secretary, and any person 

14 or governmental entity designated by the Secretary, may 

15 enforce a contract entered into by the Secretary under this 

16 section. 

17 ‘‘SEC. 3411. DEBT RESTRUCTURING AND LOAN SERVICING. 

18 ‘‘(a) IN GENERAL.—The Secretary shall modify a de19 linquent farmer program loan made under this subtitle, 

20 or purchased from the lender or the Federal Deposit In21 surance Corporation under section 3902, to the maximum 

22 extent practicable— 

23 ‘‘(1) to avoid a loss to the Secretary on the 

24 loan, with priority consideration being placed on 

25 writing-down the loan principal and interest (subject 


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1 to subsections (d) and (e)), and debt set-aside (sub2 ject to subsection (e)), to facilitate keeping the bor3 rower on the farm, or otherwise through the use of 

4 primary loan service programs under this section; 

5 and 

6 ‘‘(2) to ensure that a borrower is able to con7 tinue farming operations. 

8 ‘‘(b) ELIGIBILITY.—To be eligible to obtain assist9 ance under subsection (a)— 

10 ‘‘(1) the delinquency shall be due to a cir11 cumstance beyond the control of the borrower, as de12 fined in regulations issued by the Secretary, except 

13 that the regulations shall require that, if the value 

14 of the assets calculated under subsection 

15 (c)(2)(A)(ii) that may be realized through liquida16 tion or other methods would produce enough income 

17 to make the delinquent loan current, the borrower 

18 shall not be eligible for assistance under subsection 

19 (a); 

20 ‘‘(2) the borrower shall have acted in good faith 

21 with the Secretary in connection with the loan as de22 fined in regulations issued by the Secretary; 

23 ‘‘(3) the borrower shall present a preliminary 

24 plan to the Secretary that contains reasonable asVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00453 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 sumptions that demonstrate that the borrower will 

2 be able— 

3 ‘‘(A) to meet the necessary family living 

4 and farm operating expenses of the borrower; 

5 and 

6 ‘‘(B) to service all debts of the borrower, 

7 including restructured loans; and 

8 ‘‘(4) the loan, if restructured, shall result in a 

9 net recovery to the Federal Government, during the 

10 term of the loan as restructured, that would be more 

11 than or equal to the net recovery to the Federal 

12 Government from an involuntary liquidation or fore13 closure on the property securing the loan. 

14 ‘‘(c) RESTRUCTURING DETERMINATIONS.— 

15 ‘‘(1) DETERMINATION OF NET RECOVERY.—In 

16 determining the net recovery from the involuntary 

17 liquidation of a loan under this section, the Sec18 retary shall calculate— 

19 ‘‘(A) the recovery value of the collateral se20 curing the loan, in accordance with paragraph 

21 (2); and 

22 ‘‘(B) the value of the restructured loan, in 

23 accordance with paragraph (3). 

24 ‘‘(2) RECOVERY VALUE.—For the purpose of 

25 paragraph (1), the recovery value of the collateral 


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1 securing the loan shall be based on the difference be2 tween— 

3 ‘‘(A)(i) the amount of the current ap4 praised value of the interests of the borrower in 

5 the property securing the loan; and 

6 ‘‘(ii) the value of the interests of the bor7 rower in all other assets that are— 

8 ‘‘(I) not essential for necessary family 

9 living expenses; 

10 ‘‘(II) not essential to the operation of 

11 the farm; and 

12 ‘‘(III) not exempt from judgment 

13 creditors or in a bankruptcy action under 

14 Federal or State law; 

15 ‘‘(B) the estimated administrative, attor16 ney, and other expenses associated with the liq17 uidation and disposition of the loan and collat18 eral, including— 

19 ‘‘(i) the payment of prior liens; 

20 ‘‘(ii) taxes and assessments, deprecia21 tion, management costs, the yearly per22 centage decrease or increase in the value of 

23 the property, and lost interest income, each 

24 calculated for the average holding period 

25 for the type of property involved; 


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1 ‘‘(iii) resale expenses, such as repairs, 

2 commissions, and advertising; and 

3 ‘‘(iv) other administrative and attor4 ney costs; and 

5 ‘‘(C) the value, as determined by the Sec6 retary, of any property not included in subpara7 graph (A)(i) if the property is specified in any 

8 security agreement with respect to the loan and 

9 the Secretary determines that the value of the 

10 property should be included for purposes of this 

11 section. 

12 ‘‘(3) VALUE OF THE RESTRUCTURED LOAN.— 

13 ‘‘(A) IN GENERAL.—For the purpose of 

14 paragraph (1), the value of the restructured 

15 loan shall be based on the present value of pay16 ments that the borrower would make to the 

17 Federal Government if the terms of the loan 

18 were modified under any combination of pri19 mary loan service programs to ensure that the 

20 borrower is able to meet the obligations and 

21 continue farming operations. 

22 ‘‘(B) PRESENT VALUE.—For the purpose 

23 of calculating the present value referred to in 

24 subparagraph (A), the Secretary shall use a dis25 count rate of not more than the current rate at 


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1 the time of the calculation of 90-day Treasury 

2 bills. 

3 ‘‘(C) CASH FLOW MARGIN.—For the pur4 pose of assessing under subparagraph (A) the 

5 ability of a borrower to meet debt obligations 

6 and continue farming operations, the Secretary 

7 shall assume that the borrower needs up to 110 

8 percent of the amount indicated for payment of 

9 farm operating expenses, debt service obliga10 tions, and family living expenses. 

11 ‘‘(4) NOTIFICATION.—Not later than 90 days 

12 after receipt of a written request for restructuring 

13 from the borrower, the Secretary shall— 

14 ‘‘(A) make the calculations specified in 

15 paragraphs (2) and (3); 

16 ‘‘(B) notify the borrower in writing of the 

17 results of the calculations; and 

18 ‘‘(C) provide documentation for the cal19 culations. 

20 ‘‘(5) RESTRUCTURING OF LOANS.— 

21 ‘‘(A) IN GENERAL.—If the value of a re22 structured loan is greater than or equal to the 

23 recovery value of the collateral securing the 

24 loan, not later than 45 days after notifying the 

25 borrower under paragraph (4), the Secretary 


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1 shall offer to restructure the loan obligations of 

2 the borrower under this subtitle through pri3 mary loan service programs that would enable 

4 the borrower to meet the obligations (as modi5 fied) under the loan and to continue the farm6 ing operations of the borrower. 

7 ‘‘(B) RESTRUCTURING.—If the borrower 

8 accepts an offer under subparagraph (A), not 

9 later than 45 days after receipt of notice of ac10 ceptance, the Secretary shall restructure the 

11 loan accordingly. 

12 ‘‘(6) TERMINATION OF LOAN OBLIGATIONS.— 

13 The obligations of a borrower to the Secretary under 

14 a loan shall terminate if— 

15 ‘‘(A) the borrower satisfies the require16 ments of paragraphs (1) and (2) of subsection 

17 (b); 

18 ‘‘(B) the value of the restructured loan is 

19 less than the recovery value; and 

20 ‘‘(C) not later than 90 days after receipt 

21 of the notification described in paragraph 

22 (4)(B), the borrower pays (or obtains third23 party financing to pay) the Secretary an 

24 amount equal to the current market value. 

25 ‘‘(7) NEGOTIATION OF APPRAISAL.— 


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1 ‘‘(A) IN GENERAL.—In making a deter2 mination concerning restructuring under this 

3 subsection, the Secretary, at the request of the 

4 borrower, shall enter into negotiations with the 

5 borrower concerning appraisals required under 

6 this subsection. 

7 ‘‘(B) INDEPENDENT APPRAISAL.— 

8 ‘‘(i) IN GENERAL.—If the borrower, 

9 based on a separate current appraisal, ob10 jects to the decision of the Secretary re11 garding an appraisal, the borrower and the 

12 Secretary shall mutually agree, to the ex13 tent practicable, on an independent ap14 praiser who shall conduct another ap15 praisal of the property of the borrower. 

16 ‘‘(ii) VALUE OF FINAL APPRAISAL.— 

17 The average of the 2 appraisals under 

18 clause (i) that are closest in value shall be19 come the final appraisal under this para20 graph. 

21 ‘‘(iii) COST OF APPRAISAL.—The borrower and the Secretary shall each pay 1 22 ⁄2

23 of the cost of any independent appraisal. 

24 ‘‘(d) PRINCIPAL AND INTEREST WRITE-DOWN.— 

25 ‘‘(1) IN GENERAL.— 


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1 ‘‘(A) PRIORITY CONSIDERATION.—In se2 lecting the restructuring alternatives to be used 

3 in the case of a borrower who has requested re4 structuring under this section, the Secretary 

5 shall give priority consideration to the use of a 

6 principal and interest write-down if other credi7 tors of the borrower (other than any creditor 

8 who is fully collateralized) representing a sub9 stantial portion of the total debt of the bor10 rower held by the creditors of the borrower, 

11 agree to participate in the development of the 

12 restructuring plan or agree to participate in a 

13 State mediation program. 

14 ‘‘(B) FAILURE OF CREDITORS TO

15 AGREE.—Failure of creditors to agree to par16 ticipate in the restructuring plan or mediation 

17 program shall not preclude the use of a prin18 cipal and interest write-down by the Secretary 

19 if the Secretary determines that restructuring 

20 results in the least cost to the Secretary. 

21 ‘‘(2) PARTICIPATION OF CREDITORS.—Before 

22 eliminating the option to use debt write-down in the 

23 case of a borrower, the Secretary shall make a rea24 sonable effort to contact the creditors of the bor25 rower, either directly or through the borrower, and 


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1 encourage the creditors to participate with the Sec2 retary in the development of a restructuring plan for 

3 the borrower. 

4 ‘‘(e) SHARED APPRECIATION ARRANGEMENTS.— 

5 ‘‘(1) IN GENERAL.—As a condition of restruc6 turing a loan in accordance with this section, the 

7 borrower of the loan may be required to enter into 

8 a shared appreciation arrangement that requires the 

9 repayment of amounts written off or set aside. 

10 ‘‘(2) TERMS.—A shared appreciation agreement 

11 shall— 

12 ‘‘(A) have a term not to exceed 10 years; 

13 and 

14 ‘‘(B) provide for recapture based on the 

15 difference between the appraised values of the 

16 real security property at the time of restruc17 turing and at the time of recapture. 

18 ‘‘(3) PERCENTAGE OF RECAPTURE.—The 

19 amount of the appreciation to be recaptured by the 

20 Secretary shall be— 

21 ‘‘(A) 75 percent of the appreciation in the 

22 value of the real security property if the recap23 ture occurs not later than 4 years after the date 

24 of restructuring; and 


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1 ‘‘(B) 50 percent if the recapture occurs 

2 during the remainder of the term of the agree3 ment. 

4 ‘‘(4) TIME OF RECAPTURE.—Recapture shall 

5 take place on the date that is the earliest of— 

6 ‘‘(A) the end of the term of the agreement; 

7 ‘‘(B) the conveyance of the real security 

8 property; 

9 ‘‘(C) the repayment of the loans; or 

10 ‘‘(D) the cessation of farming operations 

11 by the borrower. 

12 ‘‘(5) TRANSFER OF TITLE.—Transfer of title to 

13 the spouse of a borrower on the death of the bor14 rower shall not be treated as a conveyance for the 

15 purpose of paragraph (4). 

16 ‘‘(6) NOTICE OF RECAPTURE.—Not later than 

17 12 months before the end of the term of a shared 

18 appreciation arrangement, the Secretary shall notify 

19 the borrower involved of the provisions of the ar20 rangement. 

21 ‘‘(7) FINANCING OF RECAPTURE PAYMENT.— 

22 ‘‘(A) IN GENERAL.—The Secretary may 

23 amortize a recapture payment owed to the Sec24 retary under this subsection. 


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1 ‘‘(B) TERM.—The term of an amortization 

2 under this paragraph may not exceed 25 years. 

3 ‘‘(C) INTEREST RATE.—The interest rate 

4 applicable to an amortization under this para5 graph may not exceed the rate applicable to a 

6 loan to reacquire homestead property less 100 

7 basis points. 

8 ‘‘(D) REAMORTIZATION.— 

9 ‘‘(i) IN GENERAL.—The Secretary 

10 may modify the amortization of a recap11 ture payment referred to in subparagraph 

12 (A) of this paragraph on which a payment 

13 has become delinquent if— 

14 ‘‘(I) the default is due to cir15 cumstances beyond the control of the 

16 borrower; and 

17 ‘‘(II) the borrower acted in good 

18 faith (as determined by the Secretary) 

19 in attempting to repay the recapture 

20 amount. 

21 ‘‘(ii) LIMITATIONS.— 

22 ‘‘(I) TERM OF REAMORTIZA23 TION.—The term of a reamortization 

24 under this subparagraph may not exVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00463 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 ceed 25 years from the date of the 

2 original amortization agreement. 

3 ‘‘(II) NO REDUCTION OR PRIN4 CIPAL OR UNPAID INTEREST DUE.—A 

5 reamortization of a recapture payment 

6 under this subparagraph may not pro7 vide for reducing the outstanding 

8 principal or unpaid interest due on 

9 the recapture payment. 

10 ‘‘(f) INTEREST RATES.—Any loan for farm owner11 ship purposes, farm operating purposes, or disaster emer12 gency purposes, other than a guaranteed loan, that is de13 ferred, consolidated, rescheduled, or reamortized shall, 

14 notwithstanding any other provision of this subtitle, bear 

15 interest on the balance of the original loan and for the 

16 term of the original loan at a rate that is the lowest of— 

17 ‘‘(1) the rate of interest on the original loan; 

18 ‘‘(2) the rate being charged by the Secretary 

19 for loans, other than guaranteed loans, of the same 

20 type at the time at which the borrower applies for 

21 a deferral, consolidation, rescheduling, or re22 amortization; or 

23 ‘‘(3) the rate being charged by the Secretary 

24 for loans, other than guaranteed loans, of the same 


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1 type at the time of the deferral, consolidation, re2 scheduling, or reamortization. 

3 ‘‘(g) PERIOD AND EFFECT.— 

4 ‘‘(1) PERIOD.—The Secretary may consolidate 

5 or reschedule outstanding loans for payment over a 

6 period not to exceed 7 years (or, in the case of loans 

7 for farm operating purposes, 15 years) from the 

8 date of the consolidation or rescheduling. 

9 ‘‘(2) EFFECT.—The amount of unpaid principal 

10 and interest of the prior loans so consolidated or re11 scheduled shall not create a new charge against any 

12 loan levels authorized by law. 

13 ‘‘(h) PREREQUISITES TO FORECLOSURE OR LIQUIDA14 TION.—No foreclosure or other similar action shall be 

15 taken to liquidate any loan determined to be ineligible for 

16 restructuring by the Secretary under this section— 

17 ‘‘(1) until the borrower has been given the op18 portunity to appeal the decision; and 

19 ‘‘(2) if the borrower appeals, the appeals proc20 ess has been completed, and a determination has 

21 been made that the loan is ineligible for restruc22 turing. 

23 ‘‘(i) NOTICE OF INELIGIBILITY FOR RESTRUC24 TURING.— 


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1 ‘‘(1) IN GENERAL.—A notice of ineligibility for 

2 restructuring shall be sent to the borrower by reg3 istered or certified mail not later than 15 days after 

4 a determination of ineligibility. 

5 ‘‘(2) CONTENTS.—The notice required under 

6 paragraph (1) shall contain— 

7 ‘‘(A) the determination and the reasons for 

8 the determination; 

9 ‘‘(B) the computations used to make the 

10 determination, including the calculation of the 

11 recovery value of the collateral securing the 

12 loan; and 

13 ‘‘(C) a statement of the right of the bor14 rower to appeal the decision to the appeals divi15 sion, and to appear before a hearing officer. 

16 ‘‘(j) INDEPENDENT APPRAISALS.— 

17 ‘‘(1) IN GENERAL.—An appeal may include a 

18 request by the borrower for an independent ap19 praisal of any property securing the loan. 

20 ‘‘(2) PROCESS FOR APPRAISAL.—On a request 

21 under paragraph (1), the Secretary shall present the 

22 borrower with a list of 3 appraisers approved by the 

23 county supervisor, from which the borrower shall se24 lect an appraiser to conduct the appraisal. 


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1 ‘‘(3) COST.—The cost of an appraisal under 

2 this subsection shall be paid by the borrower. 

3 ‘‘(4) RESULT.—The result of an appraisal 

4 under this subsection shall be considered in any final 

5 determination concerning the loan. 

6 ‘‘(5) COPY.—A copy of any appraisal under this 

7 subsection shall be provided to the borrower. 

8 ‘‘(k) PARTIAL LIQUIDATIONS.—If a partial liquida9 tion of a delinquent loan is performed (with the prior con10 sent of the Secretary) as part of loan servicing by a guar11 anteed lender under this title, the Secretary shall not re12 quire full liquidation of the loan for the lender to be eligi13 ble to receive payment on losses. 

14 ‘‘(l) ONLY 1 WRITE-DOWN OR NET RECOVERY BUY15 OUT PER BORROWER FOR A LOAN MADE AFTER JANU16 ARY 6, 1988.— 

17 ‘‘(1) IN GENERAL.—The Secretary may provide 

18 for each borrower not more than 1 write-down or net 

19 recovery buy-out under this section with respect to 

20 all loans made to the borrower after January 6, 

21 1988. 

22 ‘‘(2) SPECIAL RULE.—For purposes of para23 graph (1), the Secretary shall treat any loan made 

24 on or before January 6, 1988, with respect to which 

25 a restructuring, write-down, or net recovery buy-out 


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1 is provided under this section after January 6, 1988, 

2 as a loan made after January 6, 1988. 

3 ‘‘(m) LIQUIDATION OF ASSETS.—The Secretary may 

4 not use the authority provided by this section to reduce 

5 or terminate any portion of the debt of the borrower that 

6 the borrower could pay through the liquidation of assets 

7 (or through the payment of the loan value of the assets, 

8 if the loan value is greater than the liquidation value) de9 scribed in subsection (c)(2)(A)(ii). 

10 ‘‘(n) LIFETIME LIMITATION ON DEBT FORGIVENESS

11 PER BORROWER.—The Secretary may provide each bor12 rower not more than $300,000 in debt forgiveness under 

13 this section. 

14 ‘‘SEC. 3412. RELIEF FOR MOBILIZED MILITARY RESERVISTS 

15 FROM CERTAIN AGRICULTURAL LOAN OBLI16 GATIONS. 

17 ‘‘(a) DEFINITION OF MOBILIZED MILITARY RESERV18 IST.—In this section, the term ‘mobilized military reserv19 ist’ means an individual who— 

20 ‘‘(1) is on active duty under section 688, 

21 12301(a), 12301(g), 12302, 12304, 12306, or 

22 12406, or chapter 15 of title 10, United States 

23 Code, or any other provision of law during a war or 

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1 dent or Congress, regardless of the location at which 

2 the active duty service is performed; or 

3 ‘‘(2) in the case of a member of the National 

4 Guard, is on full-time National Guard duty (as de5 fined in section 101(d)(5) of title 10, United States 

6 Code) under a call to active service authorized by 

7 the President or the Secretary of Defense for a pe8 riod of more than 30 consecutive days under section 

9 502(f) of title 32, United States Code, for purposes 

10 of responding to a national emergency declared by 

11 the President and supported by Federal funds. 

12 ‘‘(b) FORGIVENESS OF INTEREST PAYMENTS DUE

13 WHILE BORROWER IS A MOBILIZED MILITARY RESERV14 IST.—Any requirement that a borrower of a direct loan 

15 made under this subtitle make any interest payment on 

16 the loan that would otherwise be required to be made while 

17 the borrower is a mobilized military reservist is rescinded. 

18 ‘‘(c) DEFERRAL OF PRINCIPAL PAYMENTS DUE

19 WHILE OR AFTER BORROWER IS A MOBILIZED MILITARY

20 RESERVIST.—The due date of any payment of principal 

21 on a direct loan made to a borrower under this subtitle 

22 that would otherwise be required to be made while or after 

23 the borrower is a mobilized military reservist is deferred 

24 for a period equal in length to the period for which the 

25 borrower is a mobilized military reservist. 


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1 ‘‘(d) NONACCRUAL OF INTEREST.—Interest on a di2 rect loan made to a borrower described in this section shall 

3 not accrue during the period the borrower is a mobilized 

4 military reservist. 

5 ‘‘(e) BORROWER NOT CONSIDERED TO BE DELIN6 QUENT OR RECEIVING DEBT FORGIVENESS.—Notwith7 standing section 3425 or any other provision of this title, 

8 a borrower who receives assistance under this section shall 

9 not, as a result of the assistance, be considered to be delin10 quent or receiving debt forgiveness for purposes of receiv11 ing a direct or guaranteed loan under this subtitle. 

12 ‘‘SEC. 3413. INTEREST RATE REDUCTION PROGRAM. 

13 ‘‘(a) ESTABLISHMENT OF PROGRAM.—The Secretary 

14 shall establish and carry out in accordance with this sec15 tion an interest rate reduction program for any loan guar16 anteed under this subtitle. 

17 ‘‘(b) ENTERING INTO CONTRACTS.—The Secretary 

18 shall enter into a contract with, and make payments to, 

19 an institution to reduce, during the term of the contract, 

20 the interest rate paid by the borrower on the guaranteed 

21 loan if— 

22 ‘‘(1) the borrower— 

23 ‘‘(A) is unable to obtain credit elsewhere; 

24 ‘‘(B) is unable to make payments on the 

25 loan in a timely manner; and 


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1 ‘‘(C) during the 24-month period beginning 

2 on the date on which the contract is entered 

3 into, has a total estimated cash income, includ4 ing all farm and nonfarm income, that will 

5 equal or exceed the total estimated cash ex6 penses, including all farm and nonfarm ex7 penses, to be incurred by the borrower during 

8 the period; and 

9 ‘‘(2) during the term of the contract, the lender 

10 reduces the annual rate of interest payable on the 

11 loan by a minimum percentage specified in the con12 tract. 

13 ‘‘(c) PAYMENTS.— 

14 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

15 in return for a contract entered into by a lender 

16 under subsection (b) for the reduction of the interest 

17 rate paid on a loan, the Secretary shall make pay18 ments to the lender in an amount equal to not more 

19 than 100 percent of the cost of reducing the annual 

20 rate of interest payable on the loan. 

21 ‘‘(2) LIMITATION.—Payments under paragraph 

22 (1) may not exceed the cost of reducing the rate by 

23 more than 400 basis points. 


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1 ‘‘(d) TERM.—The term of a contract entered into 

2 under this section to reduce the interest rate on a guaran3 teed loan may not exceed the outstanding term of the loan. 

4 ‘‘(e) CONDITION ON FORECLOSURE.—Notwith5 standing any other law, any contract of guarantee on a 

6 farm loan entered into under this subtitle shall contain 

7 a condition that the lender of the loan may not initiate 

8 a foreclosure action on the loan until 60 days after a de9 termination is made with respect to the eligibility of the 

10 borrower to participate in the program established under 

11 this section. 

12 ‘‘SEC. 3414. HOMESTEAD PROPERTY. 

13 ‘‘(a) DEFINITIONS.—In this section: 

14 ‘‘(1) ADMINISTRATOR.—The term ‘Adminis15 trator’ means the Administrator of the Small Busi16 ness Administration. 

17 ‘‘(2) BORROWER-OWNER.—The term ‘borrower18 owner’ means— 

19 ‘‘(A) a borrower-owner of a loan made or 

20 guaranteed by the Secretary or the Adminis21 trator who meets the eligibility requirements of 

22 subsection (c)(1); or 

23 ‘‘(B) in a case in which an owner of home24 stead property pledged the property to secure 


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1 the loan and the owner is different than the 

2 borrower, the owner. 

3 ‘‘(3) FARM PROGRAM LOAN.—The term ‘farm 

4 program loan’ means a loan made by the Adminis5 trator under the Small Business Act (15 U.S.C. 631 

6 et seq.) for any of the purposes authorized for loans 

7 under chapter 1 or 2. 

8 ‘‘(4) HOMESTEAD PROPERTY.—The term 

9 ‘homestead property’ means— 

10 ‘‘(A) the principal residence and adjoining 

11 property possessed and occupied by a borrower12 owner, including a reasonable number of farm 

13 outbuildings located on the adjoining land that 

14 are useful to any occupant of the homestead; 

15 and 

16 ‘‘(B) not more than 10 acres of adjoining 

17 land that is used to maintain the family of the 

18 borrower-owner. 

19 ‘‘(b) RETENTION OF HOMESTEAD PROPERTY.— 

20 ‘‘(1) IN GENERAL.—The Secretary or the Ad21 ministrator shall, on application by a borrower22 owner who meets the eligibility requirements of sub23 section (c)(1), permit the borrower-owner to retain 

24 possession and occupancy of homestead property 


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1 under the terms set forth, and until the action de2 scribed in this section has been completed, if— 

3 ‘‘(A) the Secretary forecloses or takes into 

4 inventory property securing a loan made under 

5 this subtitle; 

6 ‘‘(B) the Administrator forecloses or takes 

7 into inventory property securing a farm pro8 gram loan made under the Small Business Act 

9 (15 U.S.C. 631 et seq.); or 

10 ‘‘(C) the borrower-owner of a loan made by 

11 the Secretary or the Administrator files a peti12 tion in bankruptcy that results in the convey13 ance of the homestead property to the Secretary 

14 or the Administrator, or agrees to voluntarily 

15 liquidate or convey the property in whole or in 

16 part. 

17 ‘‘(2) PERIOD OF OCCUPANCY.—Subject to sub18 section (c), the Secretary or the Administrator shall 

19 not grant a period of occupancy of less than 3 nor 

20 more than 5 years. 

21 ‘‘(c) ELIGIBILITY.— 

22 ‘‘(1) IN GENERAL.—To be eligible to occupy 

23 homestead property, a borrower-owner of a loan 

24 made by the Secretary or the Administrator shall— 


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1 ‘‘(A) apply for the occupancy not later 

2 than 30 days after the property is acquired by 

3 the Secretary or Administrator; 

4 ‘‘(B) have received from farming oper5 ations gross farm income that is reasonably 

6 commensurate with— 

7 ‘‘(i) the size and location of the farm8 ing unit of the borrower-owner; and 

9 ‘‘(ii) local agricultural conditions (in10 cluding natural and economic conditions), 

11 during at least 2 calendar years of the 6- 

12 year period preceding the calendar year in 

13 which the application is made; 

14 ‘‘(C) have received from farming oper15 ations at least 60 percent of the gross annual 

16 income of the borrower-owner and any spouse 

17 of the borrower-owner during at least 2 cal18 endar years of the 6-year period described in 

19 subparagraph (B); 

20 ‘‘(D) have continuously occupied the home21 stead property during the 6-year period de22 scribed in subparagraph (B), except that the re23 quirement of this subparagraph may be waived 

24 if a borrower-owner, due to circumstances be25 yond the control of the borrower-owner, had to 


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1 leave the homestead property for a period of 

2 time not to exceed 12 months during the 6-year 

3 period; 

4 ‘‘(E) during the period of occupancy of the 

5 homestead property, pay a reasonable sum as 

6 rent for the property to the Secretary or the 

7 Administrator in an amount substantially equiv8 alent to rents charged for similar residential 

9 properties in the area in which the homestead 

10 property is located; 

11 ‘‘(F) during the period of the occupancy of 

12 the homestead property, maintain the property 

13 in good condition; and 

14 ‘‘(G) meet such other reasonable and nec15 essary terms and conditions as the Secretary 

16 may require. 

17 ‘‘(2) DEFINITION OF FARMING OPERATIONS.— 

18 In subparagraphs (B) and (C) of paragraph (1), the 

19 term ‘farming operations’ includes rent paid by a 

20 lessee of agricultural land during a period in which 

21 the borrower-owner, due to circumstances beyond 

22 the control of the borrower-owner, is unable to ac23 tively farm the land. 

24 ‘‘(3) TERMINATION OF RIGHTS.— 


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1 ‘‘(A) IN GENERAL.—For purposes of para2 graph (1)(E), the failure of the borrower-owner 

3 to make a timely rental payment shall con4 stitute cause for the termination of all rights of 

5 the borrower-owner to possession and occu6 pancy of the homestead property under this sec7 tion. 

8 ‘‘(B) PROCEDURE FOR TERMINATION.—In 

9 effecting a termination under subparagraph 

10 (A), the Secretary shall— 

11 ‘‘(i) afford the borrower-owner or les12 see the notice and hearing procedural 

13 rights described in subtitle H of the De14 partment of Agriculture Reorganization 

15 Act of 1994 (7 U.S.C. 6991 et seq.); and 

16 ‘‘(ii) comply with any applicable State 

17 and local law governing eviction of a per18 son from residential property. 

19 ‘‘(4) RIGHTS OF BORROWER-OWNER.— 

20 ‘‘(A) PERIOD OF OCCUPANCY.—Subject to 

21 subsection (b)(2), the period of occupancy al22 lowed the borrower-owner of homestead prop23 erty under this section shall be the period re24 quested in writing by the borrower-owner. 

25 ‘‘(B) RIGHT TO REACQUIRE.— 


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1 ‘‘(i) IN GENERAL.—During the period 

2 the borrower-owner occupies the homestead 

3 property, the borrower-owner shall have a 

4 right to reacquire the homestead property 

5 on such terms and conditions as the Sec6 retary shall determine. 

7 ‘‘(ii) SOCIALLY DISADVANTAGED BOR8 ROWER-OWNER.—During the period of oc9 cupancy of a borrower-owner who is a so10 cially disadvantaged farmer, the borrower11 owner or a member of the immediate fam12 ily of the borrower-owner shall have a right 

13 of first refusal to reacquire the homestead 

14 property on such terms and conditions as 

15 the Secretary shall determine. 

16 ‘‘(iii) INDEPENDENT APPRAISAL.— 

17 The Secretary may not demand a payment 

18 for the homestead property that is in ex19 cess of the current market value of the 

20 homestead property as established by an 

21 independent appraisal. 

22 ‘‘(iv) CONDUCT OF APPRAISAL.—An 

23 independent appraisal under clause (iii) 

24 shall be conducted by an appraiser selected 

25 by the borrower-owner, or, in the case of a 


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1 borrower-owner who is a socially disadvan2 taged farmer, the immediate family mem3 ber of the borrower-owner, from a list of 3 

4 appraisers approved by the county super5 visor. 

6 ‘‘(5) TRANSFER OF RIGHTS.— 

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

8 subparagraph (B), no right of a borrower-owner 

9 under this section, and no agreement entered 

10 into between the borrower-owner and the Sec11 retary for occupancy of the homestead property, 

12 shall be transferable or assignable by the bor13 rower-owner or by operation of law. 

14 ‘‘(B) DEATH OR INCOMPETENCY.—In the 

15 case of death or incompetency of the borrower16 owner, the right and agreement shall be trans17 ferable to a spouse of the borrower-owner if the 

18 spouse agrees to comply with any terms and 

19 conditions of the right or agreement. 

20 ‘‘(6) NOTIFICATION.—Not later than the date 

21 of acquisition of the property securing a loan made 

22 under this title, the Secretary shall notify the bor23 rower-owner of the property of the availability of 

24 homestead protection rights under this section. 

25 ‘‘(d) END OF PERIOD OF OCCUPANCY.— 


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1 ‘‘(1) IN GENERAL.—At the end of the period of 

2 occupancy allowed a borrower-owner under sub3 section (c), the Secretary or the Administrator shall 

4 grant to the borrower-owner a right of first refusal 

5 to reacquire the homestead property on such terms 

6 and conditions (which may include payment of prin7 cipal in installments) as the Secretary or the Admin8 istrator shall determine. 

9 ‘‘(2) TERMS AND CONDITIONS.—The terms and 

10 conditions granted under paragraph (1) may not be 

11 less favorable than those offered by the Secretary or 

12 Administrator or intended by the Secretary or Ad13 ministrator to be offered to any other buyer. 

14 ‘‘(e) MAXIMUM PAYMENT OF PRINCIPAL.— 

15 ‘‘(1) IN GENERAL.—At the time a reacquisition 

16 agreement is entered into, the Secretary or the Ad17 ministrator may not demand a total payment of 

18 principal that is in excess of the value of the home19 stead property. 

20 ‘‘(2) DETERMINATION OF VALUE.—To the max21 imum extent practicable, the value of the homestead 

22 property shall be determined by an independent ap23 praisal made during the 180 day period beginning 

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1 rower-owner to retain possession and occupancy of 

2 the homestead property. 

3 ‘‘(f) TITLE NOT NEEDED TO ENTER INTO CON4 TRACTS.—The Secretary may enter into a contract au5 thorized by this section before the Secretary acquires title 

6 to the homestead property that is the subject of the con7 tract. 

8 ‘‘(g) STATE LAW PREVAILS.—In the event of a con9 flict between this section and a provision of State law re10 lating to the right of a borrower-owner to designate for 

11 separate sale or redeem part or all of the real property 

12 securing a loan foreclosed on by a lender to the borrower13 owner, the provision of State law shall prevail. 

14 ‘‘SEC. 3415. TRANSFER OF INVENTORY LAND. 

15 ‘‘(a) IN GENERAL.—Subject to subsection (b), the 

16 Secretary may transfer to a Federal or State agency, for 

17 conservation purposes, any real property, or interest in 

18 real property, administered by the Secretary under this 

19 subtitle— 

20 ‘‘(1) with respect to which the rights of all prior 

21 owners and operators have expired; 

22 ‘‘(2) that is eligible to be disposed of in accord23 ance with section 3409; and 

24 ‘‘(3) that— 


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1 ‘‘(A) has marginal value for agricultural 

2 production; 

3 ‘‘(B) is environmentally sensitive; or 

4 ‘‘(C) has special management importance. 

5 ‘‘(b) CONDITIONS.—The Secretary may not transfer 

6 any property or interest in property under subsection (a) 

7 unless— 

8 ‘‘(1) at least 2 public notices are given of the 

9 transfer; 

10 ‘‘(2) if requested, at least 1 public meeting is 

11 held prior to the transfer; and 

12 ‘‘(3) the Governor and at least 1 elected county 

13 official of the State and county in which the prop14 erty is located are consulted prior to the transfer. 

15 ‘‘SEC. 3416. TARGET PARTICIPATION RATES. 

16 ‘‘(a) ESTABLISHMENT.— 

17 ‘‘(1) IN GENERAL.—The Secretary shall estab18 lish annual target participation rates, on a county19 wide basis, that shall ensure that members of so20 cially disadvantaged groups shall— 

21 ‘‘(A) receive loans made or guaranteed 

22 under chapter 1; and 

23 ‘‘(B) have the opportunity to purchase or 

24 lease farmland acquired by the Secretary under 

25 this subtitle. 


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1 ‘‘(2) GROUP POPULATION.—Except as provided 

2 in paragraph (3), in establishing the target rates, 

3 the Secretary shall take into consideration— 

4 ‘‘(A) the portion of the population of the 

5 county made up of the socially disadvantaged 

6 groups; and 

7 ‘‘(B) the availability of inventory farmland 

8 in the county. 

9 ‘‘(3) GENDER.—In the case of gender, target 

10 participation rates shall take into consideration the 

11 number of current and potential socially disadvan12 taged farmers in a State in proportion to the total 

13 number of farmers in the State. 

14 ‘‘(b) RESERVATION AND ALLOCATION.— 

15 ‘‘(1) RESERVATION.—To the maximum extent 

16 practicable, the Secretary shall reserve sufficient 

17 loan funds made available under chapter 1 for use 

18 by members of socially disadvantaged groups identi19 fied under target participation rates established 

20 under subsection (a). 

21 ‘‘(2) ALLOCATION.—The Secretary shall allo22 cate the loans on the basis of the proportion of 

23 members of socially disadvantaged groups in a coun24 ty and the availability of inventory farmland, with 

25 the greatest amount of loan funds being distributed 


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1 in the county with the greatest proportion of socially 

2 disadvantaged group members and the greatest 

3 quantity of available inventory farmland. 

4 ‘‘(3) INDIAN RESERVATIONS.—In distributing 

5 loan funds in counties within the boundaries of an 

6 Indian reservation, the Secretary shall allocate the 

7 funds on a reservation-wide basis. 

8 ‘‘(c) OPERATING LOANS.— 

9 ‘‘(1) ESTABLISHMENT.— 

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

11 establish annual target participation rates that 

12 shall ensure that socially disadvantaged farmers 

13 receive loans made or guaranteed under chapter 

14 2. 

15 ‘‘(B) CONSIDERATIONS.—In establishing 

16 the target rates, the Secretary shall consider 

17 the number of socially disadvantaged farmers in 

18 a State in proportion to the total number of 

19 farmers in the State. 

20 ‘‘(2) RESERVATION AND ALLOCATION.— 

21 ‘‘(A) IN GENERAL.—To the maximum ex22 tent practicable, the Secretary shall reserve and 

23 allocate the proportion of the loan funds of each 

24 State made available under chapter 2 that is 

25 equal to the target participation rate of the 


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1 State for use by the socially disadvantaged 

2 farmers in the State. 

3 ‘‘(B) DISTRIBUTION.—To the maximum 

4 extent practicable, the Secretary shall distribute 

5 the total loan funds reserved under subpara6 graph (A) on a county-by-county basis accord7 ing to the number of socially disadvantaged 

8 farmers in the county. 

9 ‘‘(C) REALLOCATION OF UNUSED

10 FUNDS.—Any funds reserved and allocated 

11 under this paragraph but not used within a 

12 State shall, to the extent necessary to satisfy 

13 pending applications under this title, be avail14 able for use by socially disadvantaged farmers 

15 in other States, as determined by the Secretary, 

16 and any remaining funds shall be reallocated 

17 within the State. 

18 ‘‘(d) REPORT.—The Secretary shall prepare and sub19 mit to the Committee on Agriculture of the House of Rep20 resentatives and the Committee on Agriculture, Nutrition, 

21 and Forestry of the Senate a report that describes the an22 nual target participation rates and the success in meeting 

23 the rates. 

24 ‘‘(e) IMPLEMENTATION CONSISTENT WITH SUPREME

25 COURT HOLDING.—Not later than 180 days after April 


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1 4, 1996, the Secretary shall ensure that the implementa2 tion of this section is consistent with the holding of the 

3 Supreme Court in Adarand Constructors, Inc. v. Federico 

4 Pena, Secretary of Transportation, 115 S. Ct. 2097 

5 (1995). 

6 ‘‘SEC. 3417. COMPROMISE OR ADJUSTMENT OF DEBTS OR 

7 CLAIMS BY GUARANTEED LENDER. 

8 ‘‘(a) LOSS BY LENDER.—If the lender of a guaran9 teed farmer program loan takes any action described in 

10 section 3903(a)(4) with respect to the loan and the Sec11 retary approves the action, for purposes of the guarantee, 

12 the lender shall be treated as having sustained a loss equal 

13 to the amount by which— 

14 ‘‘(1) the outstanding balance of the loan imme15 diately before the action; exceeds 

16 ‘‘(2) the outstanding balance of the loan imme17 diately after the action. 

18 ‘‘(b) NET PRESENT VALUE OF LOAN.—The Sec19 retary shall approve the taking of an action described in 

20 section 3903(a)(4) by the lender of a guaranteed farmer 

21 program loan with respect to the loan if the action reduces 

22 the net present value of the loan to an amount equal to 

23 not less than the greater of— 

24 ‘‘(1) the greatest net present value of a loan the 

25 borrower could reasonably be expected to repay; and 


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1 ‘‘(2) the difference between— 

2 ‘‘(A) the greatest amount that the lender 

3 of the loan could reasonably expect to recover 

4 from the borrower through bankruptcy, or liq5 uidation of the property securing the loan; and 

6 ‘‘(B) all reasonable and necessary costs 

7 and expenses that the lender of the loan could 

8 reasonably expect to incur to preserve or dis9 pose of the property (including all associated 

10 legal and property management costs) in the 

11 course of such a bankruptcy or liquidation. 

12 ‘‘(c) NO LIMITATION ON AUTHORITY.—This section 

13 shall not limit the authority of the Secretary to enter into 

14 a shared appreciation arrangement with a borrower under 

15 section 3411(e). 

16 ‘‘SEC. 3418. WAIVER OF MEDIATION RIGHTS BY BOR17 ROWERS. 

18 ‘‘The Secretary may not make or guarantee any 

19 farmer program loan to a farm borrower on the condition 

20 that the borrower waive any right under the mediation 

21 program of any State. 

22 ‘‘SEC. 3419. BORROWER TRAINING. 

23 ‘‘(a) IN GENERAL.—The Secretary shall contract to 

24 provide educational training to all borrowers of direct 


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1 loans made under this subtitle in financial and farm man2 agement concepts associated with commercial farming. 

3 ‘‘(b) CONTRACT.— 

4 ‘‘(1) IN GENERAL.—The Secretary may con5 tract with a State or private provider of farm man6 agement and credit counseling services (including a 

7 community college, the extension service of a State, 

8 a State department of agriculture, or a nonprofit or9 ganization) to carry out this section. 

10 ‘‘(2) CONSULTATION.—The Secretary may con11 sult with the chief executive officer of a State con12 cerning the identity of the contracting organization 

13 and the process for contracting. 

14 ‘‘(c) ELIGIBILITY FOR LOANS.— 

15 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

16 to be eligible to obtain a direct or guaranteed loan 

17 under this subtitle, a borrower shall be required to 

18 obtain management assistance under this section, 

19 appropriate to the management ability of the bor20 rower during the determination of eligibility for the 

21 loan. 

22 ‘‘(2) LOAN CONDITIONS.—The need of a bor23 rower who satisfies the criteria set out in section 

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1 nial of eligibility of the borrower for a direct or 

2 guaranteed loan under this subtitle. 

3 ‘‘(d) GUIDELINES AND CURRICULUM.—The Sec4 retary shall issue regulations establishing guidelines and 

5 curriculum for the borrower training program established 

6 under this section. 

7 ‘‘(e) PAYMENT.—A borrower— 

8 ‘‘(1) shall pay for training received under this 

9 section; and 

10 ‘‘(2) may use funds from operating loans made 

11 under chapter 2 to pay for the training. 

12 ‘‘(f) WAIVERS.— 

13 ‘‘(1) IN GENERAL.—The Secretary may waive 

14 the requirements of this section for an individual 

15 borrower on a determination that the borrower dem16 onstrates adequate knowledge in areas described in 

17 this section. 

18 ‘‘(2) CRITERIA.—The Secretary shall establish 

19 criteria providing for the application of paragraph 

20 (1) consistently in all counties nationwide. 

21 ‘‘SEC. 3420. LOAN ASSESSMENTS. 

22 ‘‘(a) IN GENERAL.—After an applicant is determined 

23 to be eligible for assistance under this subtitle, the Sec24 retary shall evaluate, in accordance with regulations issued 


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1 by the Secretary, the farming plan and financial situation 

2 of each qualified farmer applicant. 

3 ‘‘(b) DETERMINATIONS.—In evaluating the farming 

4 plan and financial situation of an applicant under this sec5 tion, the Secretary shall determine— 

6 ‘‘(1) the amount that the applicant needs to 

7 borrow to carry out the proposed farming plan; 

8 ‘‘(2) the rate of interest that the applicant 

9 would need to be able to cover expenses and build 

10 an adequate equity base; 

11 ‘‘(3) the goals of the proposed farming plan of 

12 the applicant; 

13 ‘‘(4) the financial viability of the plan and any 

14 changes that are necessary to make the plan viable; 

15 and 

16 ‘‘(5) whether assistance is necessary under this 

17 title and, if so, the amount of the assistance. 

18 ‘‘(c) CONTRACT.—The Secretary may contract with 

19 a third party (including an entity that is eligible to provide 

20 borrower training under section 3419(b)) to conduct a 

21 loan assessment under this section. 

22 ‘‘(d) REVIEW OF LOANS.— 

23 ‘‘(1) IN GENERAL.—Loan assessments con24 ducted under this section shall include biannual re25 view of direct loans, and periodic review (as deterVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00490 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 mined necessary by the Secretary) of guaranteed 

2 loans, made under this title to assess the progress 

3 of a borrower in meeting the goals for the farm op4 eration. 

5 ‘‘(2) CONTRACTS.—The Secretary may contract 

6 with an entity that is eligible to provide borrower 

7 training under section 3419(b) to conduct a loan re8 view under paragraph (1). 

9 ‘‘(3) PROBLEM ASSESSMENTS.—If a borrower is 

10 delinquent in payments on a direct or guaranteed 

11 loan made under this title, the Secretary or the con12 tracting entity shall determine the cause of, and ac13 tion necessary to correct, the delinquency. 

14 ‘‘(e) GUIDELINES.—The Secretary shall issue regula15 tions providing guidelines for loan assessments conducted 

16 under this section. 

17 ‘‘SEC. 3421. SUPERVISED CREDIT. 

18 ‘‘The Secretary shall provide adequate training to 

19 employees of the Farm Service Agency on credit analysis 

20 and financial and farm management— 

21 ‘‘(1) to better acquaint the employees with what 

22 constitutes adequate financial data on which to base 

23 a direct or guaranteed loan approval decision; and 

24 ‘‘(2) to ensure proper supervision of farmer 

25 program loans. 


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1 ‘‘SEC. 3422. MARKET PLACEMENT. 

2 ‘‘The Secretary shall establish a market placement 

3 program for a qualified beginning farmer and any other 

4 borrower of farmer program loans that the Secretary be5 lieves has a reasonable chance of qualifying for commercial 

6 credit with a guarantee provided under this subtitle. 

7 ‘‘SEC. 3423. RECORDKEEPING OF LOANS BY GENDER OF 

8 BORROWER. 

9 ‘‘The Secretary shall classify, by gender, records of 

10 applicants for loans and loan guarantees under this sub11 title. 

12 ‘‘SEC. 3424. CROP INSURANCE REQUIREMENT. 

13 ‘‘(a) IN GENERAL.—As a condition of obtaining any 

14 benefit (including a direct loan, loan guarantee, or pay15 ment) described in subsection (b), a borrower shall be re16 quired to obtain at least catastrophic risk protection insur17 ance coverage under section 508 of the Federal Crop In18 surance Act (7 U.S.C. 1508) for the crop and crop year 

19 for which the benefit is sought, if the coverage is offered 

20 by the Federal Crop Insurance Corporation. 

21 ‘‘(b) APPLICABLE BENEFITS.—Subsection (a) shall 

22 apply to— 

23 ‘‘(1) a farm ownership loan under section 3102; 

24 ‘‘(2) an operating loan under section 3202; and 

25 ‘‘(3) an emergency loan under section 3301. 


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1 ‘‘SEC. 3425. LOAN AND LOAN SERVICING LIMITATIONS. 

2 ‘‘(a) DELINQUENT BORROWERS PROHIBITED FROM

3 OBTAINING DIRECT OPERATING LOANS.—The Secretary 

4 may not make a direct operating loan under chapter 2 

5 to a borrower who is delinquent on any loan made or guar6 anteed under this subtitle. 

7 ‘‘(b) LOANS PROHIBITED FOR BORROWERS THAT

8 HAVE RECEIVED DEBT FORGIVENESS.— 

9 ‘‘(1) PROHIBITIONS.—Except as provided in 

10 paragraph (2)— 

11 ‘‘(A) the Secretary may not make a loan 

12 under this subtitle to a borrower that has re13 ceived debt forgiveness on a loan made or guar14 anteed under this subtitle; and 

15 ‘‘(B) the Secretary may not guarantee a 

16 loan under this subtitle to a borrower that has 

17 received— 

18 ‘‘(i) debt forgiveness after April 4, 

19 1996, on a loan made or guaranteed under 

20 this subtitle; or 

21 ‘‘(ii) received debt forgiveness on more 

22 than 3 occasions on or before April 4, 

23 1996. 

24 ‘‘(2) EXCEPTIONS.— 

25 ‘‘(A) IN GENERAL.—The Secretary may 

26 make a direct or guaranteed farm operating 


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1 loan for paying annual farm operating expenses 

2 of a borrower who— 

3 ‘‘(i) was restructured with a write4 down under section 3411; 

5 ‘‘(ii) is current on payments under a 

6 confirmed reorganization plan under chap7 ters 1 11, 12, or 13 of title 11 of the 

8 United States Code; or 

9 ‘‘(iii) received debt forgiveness on not 

10 more than 1 occasion resulting directly and 

11 primarily from a major disaster or emer12 gency designated by the President on or 

13 after April 4, 1996, under the Robert T. 

14 Stafford Disaster Relief and Emergency 

15 Assistance Act (42 U.S.C. 5121 et seq.). 

16 ‘‘(B) EMERGENCY LOANS.—The Secretary 

17 may make an emergency loan under section 

18 3301 to a borrower that— 

19 ‘‘(i) on or before April 4, 1996, re20 ceived not more than 1 debt forgiveness on 

21 a loan made or guaranteed under this sub22 title; and 

23 ‘‘(ii) after April 4, 1996, has not re24 ceived debt forgiveness on a loan made or 

25 guaranteed under this subtitle. 


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1 ‘‘(c) NO MORE THAN 1 DEBT FORGIVENESS FOR A

2 BORROWER ON A DIRECT LOAN.—The Secretary may not 

3 provide to a borrower debt forgiveness on a direct loan 

4 made under this subtitle if the borrower has received debt 

5 forgiveness on another direct loan made under this sub6 title. 

7 ‘‘SEC. 3426. SHORT FORM CERTIFICATION OF FARM PRO8 GRAM BORROWER COMPLIANCE. 

9 ‘‘The Secretary shall develop and use a consolidated 

10 short form for farmer program loan borrowers to use in 

11 certifying compliance with any applicable provision of law 

12 (including a regulation) that serves as an eligibility pre13 requisite for a loan made under this subtitle. 

14 ‘‘SEC. 3427. UNDERWRITING FORMS AND STANDARDS. 

15 ‘‘In the administration of this subtitle, the Secretary 

16 shall, to the extent practicable, use underwriting forms, 

17 standards, practices, and terminology similar to the forms, 

18 standards, practices, and terminology used by lenders in 

19 the private sector. 

20 ‘‘SEC. 3428. BEGINNING FARMER INDIVIDUAL DEVELOP21 MENT ACCOUNTS PILOT PROGRAM. 

22 ‘‘(a) DEFINITIONS.—In this section: 

23 ‘‘(1) DEMONSTRATION PROGRAM.—The term 

24 ‘demonstration program’ means a demonstration 


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1 program carried out by a qualified entity under the 

2 pilot program established in subsection (b)(1). 

3 ‘‘(2) ELIGIBLE PARTICIPANT.—The term ‘eligi4 ble participant’ means a qualified beginning farmer 

5 that— 

6 ‘‘(A) lacks significant financial resources 

7 or assets; and 

8 ‘‘(B) has an income that is less than— 

9 ‘‘(i) 80 percent of the median income 

10 of the State in which the farmer resides; or 

11 ‘‘(ii) 200 percent of the most recent 

12 annual Federal Poverty Income Guidelines 

13 published by the Department of Health 

14 and Human Services for the State. 

15 ‘‘(3) INDIVIDUAL DEVELOPMENT ACCOUNT.— 

16 The term ‘individual development account’ means a 

17 savings account described in subsection (b)(4)(A). 

18 ‘‘(4) QUALIFIED ENTITY.— 

19 ‘‘(A) IN GENERAL.—The term ‘qualified 

20 entity’ means— 

21 ‘‘(i) 1 or more organizations— 

22 ‘‘(I) described in section 

23 501(c)(3) of the Internal Revenue 

24 Code of 1986; and 


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1 ‘‘(II) exempt from taxation under 

2 section 501(a) of such Code; or 

3 ‘‘(ii) a State, local, or tribal govern4 ment submitting an application jointly with 

5 an organization described in clause (i). 

6 ‘‘(B) NO PROHIBITION ON COLLABORA7 TION.—An organization described in subpara8 graph (A)(i) may collaborate with a financial 

9 institution or for-profit community development 

10 corporation to carry out the purposes of this 

11 section. 

12 ‘‘(b) PILOT PROGRAM.— 

13 ‘‘(1) IN GENERAL.—The Secretary shall estab14 lish a pilot program to be known as the ‘New Farm15 er Individual Development Accounts Pilot Program’ 

16 under which the Secretary shall work through quali17 fied entities to establish demonstration programs— 

18 ‘‘(A) of at least 5 years in duration; and 

19 ‘‘(B) in at least 15 States. 

20 ‘‘(2) COORDINATION.—The Secretary shall op21 erate the pilot program through and in coordination 

22 with the farmer program loans of the Farm Service 

23 Agency. 

24 ‘‘(3) RESERVE FUNDS.— 


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1 ‘‘(A) IN GENERAL.—A qualified entity car2 rying out a demonstration program under this 

3 section shall establish a reserve fund consisting 

4 of a non-Federal match of 50 percent of the 

5 total amount of the grant awarded to the dem6 onstration program under this section. 

7 ‘‘(B) FEDERAL FUNDS.—After the quali8 fied entity has deposited the non-Federal 

9 matching funds described in subparagraph (A) 

10 in the reserve fund, the Secretary shall provide 

11 the total amount of the grant awarded under 

12 this section to the demonstration program for 

13 deposit in the reserve fund. 

14 ‘‘(C) USE OF FUNDS.—Of the funds depos15 ited under subparagraph (B) in the reserve 

16 fund established for a demonstration program, 

17 the qualified entity carrying out the demonstra18 tion program— 

19 ‘‘(i) may use up to 10 percent for ad20 ministrative expenses; and 

21 ‘‘(ii) shall use the remainder in mak22 ing matching awards described in para23 graph (4)(B)(ii)(I). 

24 ‘‘(D) INTEREST.—Any interest earned on 

25 amounts in a reserve fund established under 


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1 subparagraph (A) may be used by the qualified 

2 entity as additional matching funds for, or to 

3 administer, the demonstration program. 

4 ‘‘(E) GUIDANCE.—The Secretary shall 

5 issue guidance regarding the investment re6 quirements of reserve funds established under 

7 this paragraph. 

8 ‘‘(F) REVERSION.—On the date on which 

9 all funds remaining in any individual develop10 ment account established by a qualified entity 

11 have reverted under paragraph (5)(B)(ii) to the 

12 reserve fund established by the qualified entity, 

13 there shall revert to the Treasury of the United 

14 States a percentage of the amount (if any) in 

15 the reserve fund equal to— 

16 ‘‘(i) the amount of Federal funds de17 posited in the reserve fund under subpara18 graph (B) that were not used for adminis19 trative expenses; divided by 

20 ‘‘(ii) the total amount of funds depos21 ited in the reserve fund. 

22 ‘‘(4) INDIVIDUAL DEVELOPMENT ACCOUNTS.— 

23 ‘‘(A) IN GENERAL.—A qualified entity re24 ceiving a grant under this section shall establish 


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1 and administer individual development accounts 

2 for eligible participants. 

3 ‘‘(B) CONTRACT REQUIREMENTS.—To be 

4 eligible to receive funds under this section from 

5 a qualified entity, an eligible participant shall 

6 enter into a contract with only 1 qualified enti7 ty under which— 

8 ‘‘(i) the eligible participant agrees— 

9 ‘‘(I) to deposit a certain amount 

10 of funds of the eligible participant in 

11 a personal savings account, as pre12 scribed by the contractual agreement 

13 between the eligible participant and 

14 the qualified entity; 

15 ‘‘(II) to use the funds described 

16 in subclause (I) only for 1 or more eli17 gible expenditures described in para18 graph (5)(A); and 

19 ‘‘(III) to complete financial train20 ing; and 

21 ‘‘(ii) the qualified entity agrees— 

22 ‘‘(I) to deposit, not later than 1 

23 month after an amount is deposited 

24 pursuant to clause (i)(I), at least a 

25 100-percent, and up to a 200-percent, 


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1 match of that amount into the indi2 vidual development account estab3 lished for the eligible participant; and 

4 ‘‘(II) with uses of funds proposed 

5 by the eligible participant. 

6 ‘‘(C) LIMITATION.— 

7 ‘‘(i) IN GENERAL.—A qualified entity 

8 administering a demonstration program 

9 under this section may provide not more 

10 than $6,000 for each fiscal year in match11 ing funds to the individual development ac12 count established by the qualified entity 

13 for an eligible participant. 

14 ‘‘(ii) TREATMENT OF AMOUNT.—An 

15 amount provided under clause (i) shall not 

16 be considered to be a gift or loan for mort17 gage purposes. 

18 ‘‘(5) ELIGIBLE EXPENDITURES.— 

19 ‘‘(A) IN GENERAL.—An eligible expendi20 ture described in this subparagraph is an ex21 penditure— 

22 ‘‘(i) to purchase farmland or make a 

23 down payment on an accepted purchase 

24 offer for farmland; 


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1 ‘‘(ii) to make mortgage payments on 

2 farmland purchased pursuant to clause (i), 

3 for up to 180 days after the date of the 

4 purchase; 

5 ‘‘(iii) to purchase breeding stock, fruit 

6 or nut trees, or trees to harvest for timber; 

7 and 

8 ‘‘(iv) for other similar expenditures, 

9 as determined by the Secretary. 

10 ‘‘(B) TIMING.— 

11 ‘‘(i) IN GENERAL.—An eligible partici12 pant may make an eligible expenditure at 

13 any time during the 2-year period begin14 ning on the date on which the last match15 ing funds are provided under paragraph 

16 (4)(B)(ii)(I) to the individual development 

17 account established for the eligible partici18 pant. 

19 ‘‘(ii) UNEXPENDED FUNDS.—At the 

20 end of the period described in clause (i), 

21 any funds remaining in an individual devel22 opment account established for an eligible 

23 participant shall revert to the reserve fund 

24 of the demonstration program under which 

25 the account was established. 


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1 ‘‘(c) APPLICATIONS.— 

2 ‘‘(1) IN GENERAL.—A qualified entity that 

3 seeks to carry out a demonstration program under 

4 this section may submit to the Secretary an applica5 tion at such time, in such form, and containing such 

6 information as the Secretary may prescribe. 

7 ‘‘(2) CRITERIA.—In considering whether to ap8 prove an application to carry out a demonstration 

9 program under this section, the Secretary shall as10 sess— 

11 ‘‘(A) the degree to which the demonstra12 tion program described in the application is 

13 likely to aid eligible participants in successfully 

14 pursuing new farming opportunities; 

15 ‘‘(B) the experience and ability of the 

16 qualified entity to responsibly administer the 

17 demonstration program; 

18 ‘‘(C) the experience and ability of the 

19 qualified entity in recruiting, educating, and as20 sisting eligible participants to increase economic 

21 independence and pursue or advance farming 

22 opportunities; 

23 ‘‘(D) the aggregate amount of direct funds 

24 from non-Federal public sector and private 

25 sources that are formally committed to the 


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1 demonstration program as matching contribu2 tions; 

3 ‘‘(E) the adequacy of the plan of the quali4 fied entity to provide information relevant to an 

5 evaluation of the demonstration program; and 

6 ‘‘(F) such other factors as the Secretary 

7 considers to be appropriate. 

8 ‘‘(3) PREFERENCES.—In considering an appli9 cation to conduct a demonstration program under 

10 this section, the Secretary shall give preference to an 

11 application from a qualified entity that dem12 onstrates— 

13 ‘‘(A) a track record of serving clients tar14 geted by the program, including, as appro15 priate, socially disadvantaged farmers; and 

16 ‘‘(B) expertise in dealing with financial 

17 management aspects of farming. 

18 ‘‘(4) APPROVAL.—Not later than 1 year after 

19 the date of enactment of this section, in accordance 

20 with this section, the Secretary shall, on a competi21 tive basis, approve such applications to conduct dem22 onstration programs as the Secretary considers ap23 propriate. 

24 ‘‘(5) TERM OF AUTHORITY.—If the Secretary 

25 approves an application to carry out a demonstration 


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1 program, the Secretary shall authorize the applicant 

2 to carry out the project for a period of 5 years, plus 

3 an additional 2 years to make eligible expenditures 

4 in accordance with subsection (b)(5)(B). 

5 ‘‘(d) GRANT AUTHORITY.— 

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

7 grant to a qualified entity authorized to carry out a 

8 demonstration program under this section. 

9 ‘‘(2) MAXIMUM AMOUNT OF GRANTS.—The ag10 gregate amount of grant funds provided to a dem11 onstration program carried out under this section 

12 shall not exceed $250,000. 

13 ‘‘(3) TIMING OF GRANT PAYMENTS.—The Sec14 retary shall pay the amounts awarded under a grant 

15 made under this section— 

16 ‘‘(A) on the awarding of the grant; or 

17 ‘‘(B) pursuant to such payment plan as 

18 the qualified entity may specify. 

19 ‘‘(e) REPORTS.— 

20 ‘‘(1) ANNUAL PROGRESS REPORTS.— 

21 ‘‘(A) IN GENERAL.—Not later than 60 

22 days after the end of the calendar year in which 

23 the Secretary authorizes a qualified entity to 

24 carry out a demonstration program under this 

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1 clusion of the demonstration program, the 

2 qualified entity shall prepare an annual report 

3 that includes, for the period covered by the re4 port— 

5 ‘‘(i) an evaluation of the progress of 

6 the demonstration program; 

7 ‘‘(ii) information about the dem8 onstration program, including the eligible 

9 participants and the individual develop10 ment accounts that have been established; 

11 and 

12 ‘‘(iii) such other information as the 

13 Secretary may require. 

14 ‘‘(B) SUBMISSION OF REPORTS.—A quali15 fied entity shall submit each report required 

16 under subparagraph (A) to the Secretary. 

17 ‘‘(2) REPORTS BY THE SECRETARY.—Not later 

18 than 1 year after the date on which all demonstra19 tion programs under this section are concluded, the 

20 Secretary shall submit to Congress a final report 

21 that describes the results and findings of all reports 

22 and evaluations carried out under this section. 

23 ‘‘(f) ANNUAL REVIEW.—The Secretary may conduct 

24 an annual review of the financial records of a qualified 

25 entity— 


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1 ‘‘(1) to assess the financial soundness of the 

2 qualified entity; and 

3 ‘‘(2) to determine the use of grant funds made 

4 available to the qualified entity under this section. 

5 ‘‘(g) REGULATIONS.—In carrying out this section, 

6 the Secretary may promulgate regulations to ensure that 

7 the program includes provisions for— 

8 ‘‘(1) the termination of demonstration pro9 grams; 

10 ‘‘(2) control of the reserve funds in the case of 

11 such a termination; 

12 ‘‘(3) transfer of demonstration programs to 

13 other qualified entities; and 

14 ‘‘(4) remissions from a reserve fund to the Sec15 retary in a case in which a demonstration program 

16 is terminated without transfer to a new qualified en17 tity. 

18 ‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There 

19 is authorized to be appropriated to carry out this section 

20 $5,000,000 for each of fiscal years 2012 through 2017. 

21 ‘‘SEC. 3429. FARMER LOAN PILOT PROJECTS. 

22 ‘‘(a) IN GENERAL.—The Secretary may conduct pilot 

23 projects of limited scope and duration that are consistent 

24 with this subtitle to evaluate processes and techniques that 


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1 may improve the efficiency and effectiveness of the pro2 grams carried out under this subtitle 

3 ‘‘(b) NOTIFICATION.—The Secretary shall— 

4 ‘‘(1) not less than 60 days before the date on 

5 which the Secretary initiates a pilot project under 

6 subsection (a), submit notice of the proposed pilot 

7 project to the Committee on Agriculture of the 

8 House of Representatives and the Committee on Ag9 riculture, Nutrition, and Forestry of the Senate; and 

10 ‘‘(2) consider any recommendations or feedback 

11 provided to the Secretary in response to the notice 

12 provided under paragraph (1). 

13 ‘‘SEC. 3430. AUTHORIZATION OF APPROPRIATIONS AND AL14 LOCATION OF FUNDS. 

15 ‘‘(a) AUTHORIZATION FOR LOANS.— 

16 ‘‘(1) IN GENERAL.—The Secretary may make 

17 or guarantee loans under chapters 1 and 2 from the 

18 Agricultural Credit Insurance Fund for not more 

19 than $4,226,000,000 for each of fiscal years 2012 

20 through 2017, of which, for each fiscal year— 

21 ‘‘(A) $1,200,000,000 shall be for direct 

22 loans, of which— 

23 ‘‘(i) $350,000,000 shall be for farm 

24 ownership loans; and 


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1 ‘‘(ii) $850,000,000 shall be for oper2 ating loans; and 

3 ‘‘(B) $3,026,000,000 shall be for guaran4 teed loans, of which— 

5 ‘‘(i) $1,000,000,000 shall be for guar6 antees of farm ownership loans; and 

7 ‘‘(ii) $2,026,000,000 shall be for 

8 guarantees of operating loans. 

9 ‘‘(2) BEGINNING FARMERS.— 

10 ‘‘(A) DIRECT LOANS.— 

11 ‘‘(i) FARM OWNERSHIP LOANS.— 

12 ‘‘(I) IN GENERAL.—Of the 

13 amounts made available under para14 graph (1) for direct farm ownership 

15 loans, the Secretary shall reserve an 

16 amount that is not less than 75 per17 cent of the total amount for qualified 

18 beginning farmers. 

19 ‘‘(II) DOWN PAYMENT LOANS; 

20 JOINT FINANCING ARRANGEMENTS.— 

21 Of the amounts reserved for a fiscal 

22 year under subclause (I), the Sec23 retary shall reserve an amount not 

less than 2 24 ⁄3 of the amount for the 

25 down payment loan program under 


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1 section 3107 and joint financing ar2 rangements under section 3105 until 

3 April 1 of the fiscal year. 

4 ‘‘(ii) OPERATING LOANS.—Of the 

5 amounts made available under paragraph 

6 (1) for direct operating loans, the Sec7 retary shall reserve for qualified beginning 

8 farmers for each of fiscal years 2012 

9 through 2017, an amount that is not less 

10 than 50 percent of the total amount. 

11 ‘‘(iii) FUNDS RESERVED UNTIL SEP12 TEMBER 1.—Except as provided in clause 

13 (i)(II), funds reserved for qualified begin14 ning farmers under this subparagraph for 

15 a fiscal year shall be reserved only until 

16 September 1 of the fiscal year. 

17 ‘‘(B) GUARANTEED LOANS.— 

18 ‘‘(i) FARM OWNERSHIP LOANS.—Of 

19 the amounts made available under para20 graph (1) for guarantees of farm owner21 ship loans, the Secretary shall reserve an 

22 amount that is not less than 40 percent of 

23 the total amount for qualified beginning 

24 farmers. 


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1 ‘‘(ii) OPERATING LOANS.—Of the 

2 amounts made available under paragraph 

3 (1) for guarantees of operating loans, the 

4 Secretary shall reserve 40 percent for 

5 qualified beginning farmers. 

6 ‘‘(iii) FUNDS RESERVED UNTIL APRIL

7 1.—Funds reserved for qualified beginning 

8 farmers under this subparagraph for a fis9 cal year shall be reserved only until April 

10 1 of the fiscal year. 

11 ‘‘(C) RESERVED FUNDS FOR ALL QUALI12 FIED BEGINNING FARMERS.—If a qualified be13 ginning farmer meets the eligibility criteria for 

14 receiving a direct or guaranteed loan under sec15 tion 3101, 3107, or 3201, the Secretary shall 

16 make or guarantee the loan if sufficient funds 

17 reserved under this paragraph are available to 

18 make or guarantee the loan. 

19 ‘‘(3) TRANSFER FOR DOWN PAYMENT LOANS.— 

20 ‘‘(A) IN GENERAL.—Subject to subpara21 graph (B)— 

22 ‘‘(i) beginning on August 1 of each 

23 fiscal year, the Secretary shall use avail24 able unsubsidized guaranteed farm oper25 ating loan funds to provide direct farm 


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1 ownership loans approved by the Secretary 

2 to qualified beginning farmers under the 

3 down payment loan program established 

4 under section 3107, if sufficient direct 

5 farm ownership loan funds are not other6 wise available; and 

7 ‘‘(ii) beginning on September 1 of 

8 each fiscal year, the Secretary shall use 

9 available unsubsidized guaranteed farm op10 erating loan funds to provide direct farm 

11 ownership loans approved by the Secretary 

12 to qualified beginning farmers, if sufficient 

13 direct farm ownership loan funds are not 

14 otherwise available. 

15 ‘‘(B) LIMITATION.—The Secretary shall 

16 limit the transfer of funds under subparagraph 

17 (A) so that all guaranteed farm operating loans 

18 that have been approved, or will be approved, 

19 by the Secretary during the fiscal year will be 

20 made to the extent of available amounts. 

21 ‘‘(4) TRANSFER FOR CREDIT SALES OF FARM

22 INVENTORY PROPERTY.— 

23 ‘‘(A) IN GENERAL.—Subject to subpara24 graphs (B) and (C), beginning on September 1 

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1 able funds made available under chapter 3 for 

2 the fiscal year to fund the credit sale of farm 

3 real estate in the inventory of the Secretary. 

4 ‘‘(B) SUPPLEMENTAL APPROPRIATIONS.— 

5 The transfer authority provided under subpara6 graph (A) shall not apply to any funds made 

7 available to the Secretary for any fiscal year 

8 under an Act making supplemental appropria9 tions. 

10 ‘‘(C) LIMITATION.—The Secretary shall 

11 limit the transfer of funds under subparagraph 

12 (A) so that all emergency disaster loans that 

13 have been approved, or will be approved, by the 

14 Secretary during the fiscal year will be made to 

15 the extent of available amounts. 

16 ‘‘(5) AVAILABILITY OF FUNDS.—Funds made 

17 available to carry out this subtitle shall remain avail18 able until expended. 

19 ‘‘(b) COST PROJECTIONS.— 

20 ‘‘(1) IN GENERAL.—The Secretary shall develop 

21 long-term cost projections for loan program author22 izations required under subsection (a). 

23 ‘‘(2) ANALYSIS.—Each projection under para24 graph (1) shall include analyses of— 


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1 ‘‘(A) the long-term costs of the lending lev2 els that the Secretary requests to be authorized 

3 under subsection (a); and 

4 ‘‘(B) the long-term costs for increases in 

5 lending levels beyond those requested to be au6 thorized, based on increments of $10,000,000 

7 or such other levels as the Secretary considers 

8 appropriate. 

9 ‘‘(3) SUBMISSION TO CONGRESS.—The Sec10 retary shall submit to the Committees on Agri11 culture and Appropriations of the House of Rep12 resentatives and the Committees on Agriculture, Nu13 trition, and Forestry and Appropriations of the Sen14 ate reports containing the long-term cost projections 

15 for the 3-year period beginning with fiscal year 1983 

16 and each 3-year period thereafter at the time the re17 quests for authorizations for those periods are sub18 mitted to Congress. 

19 ‘‘(c) LOW-INCOME, LIMITED-RESOURCE BOR20 ROWERS.— 

21 ‘‘(1) RESERVE.—Notwithstanding any other 

22 provision of law, not less than 25 percent of the 

23 loans for farm ownership purposes for each fiscal 

24 year under this subtitle shall be for low-income, lim25 ited-resource borrowers. 


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1 ‘‘(2) NOTIFICATION.—The Secretary shall pro2 vide notification to farm borrowers under this sub3 title in the normal course of loan making and loan 

4 servicing operations, of the provisions of this subtitle 

5 relating to low-income, limited-resource borrowers 

6 and the procedures by which persons may apply for 

7 loans under the low-income, limited-resource bor8 rower program.’’. 

9 Subtitle B—Miscellaneous 

10 SEC. 5101. STATE AGRICULTURAL MEDIATION PROGRAMS. 

11 Section 506 of the Agricultural Credit Act of 1987 

12 (7 U.S.C. 5106) is amended by striking ‘‘2015’’ and in13 serting ‘‘2017’’. 

14 SEC. 5102. LOANS TO PURCHASERS OF HIGHLY 

15 FRACTIONATED LAND. 

16 The first section of Public Law 91–229 (25 U.S.C. 

17 488) is amended in subsection (b)(1) by inserting ‘‘or to 

18 intermediaries in order to establish revolving loan funds 

19 for the purchase of highly fractionated land under that 

20 section’’ before the period at the end. 

21 SEC. 5103. REMOVAL OF DUPLICATIVE APPRAISALS. 

22 Notwithstanding any other law (including regula23 tions), in making loans under the first section of Public 

24 Law 91–229 (25 U.S.C. 488), borrowers who are Indian 

25 tribes, members of Indian tribes, or tribal corporations 


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1 shall only be required to obtain 1 appraisal under an ap2 praisal standard recognized as of the date of enactment 

3 of this Act by the Secretary or the Secretary of the Inte4 rior. 

5 TITLE VI—RURAL 

6 DEVELOPMENT 

7 Subtitle A—Reorganization of the 

8 Consolidated Farm and Rural 

9 Development Act 

10 SEC. 6001. REORGANIZATION OF THE CONSOLIDATED FARM 

11 AND RURAL DEVELOPMENT ACT. 

12 Title III of the Agricultural Act of 1961 (7 U.S.C. 

13 1921 et seq.) is amended to read as follows: 

14 ‘‘TITLE III—AGRICULTURAL 

15 CREDIT 

16 ‘‘SEC. 3001. SHORT TITLE; TABLE OF CONTENTS. 

17 ‘‘(a) SHORT TITLE.—This title may be cited as the 

18 ‘Consolidated Farm and Rural Development Act’. 

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

20 of this title is as follows: 

‘‘TITLE III—AGRICULTURAL CREDIT 

‘‘Sec. 3001. Short title; table of contents. 

‘‘Sec. 3002. Definitions. 

‘‘Subtitle A—Farmer Loans, Servicing, and Other Assistance 

‘‘CHAPTER 1—FARM OWNERSHIP LOANS

‘‘Sec. 3101. Farm ownership loans. 

‘‘Sec. 3102. Purposes of loans. 

‘‘Sec. 3103. Conservation loan and loan guarantee program. 

‘‘Sec. 3104. Loan maximums. 


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‘‘Sec. 3105. Repayment requirements for farm ownership loans. 

‘‘Sec. 3106. Limited-resource loans. 

‘‘Sec. 3107. Downpayment loan program. 

‘‘Sec. 3108. Beginning farmer and socially disadvantaged farmer contract land 

sales program. 

‘‘CHAPTER 2—OPERATING LOANS

‘‘Sec. 3201. Operating loans. 

‘‘Sec. 3202. Purposes of loans. 

‘‘Sec. 3203. Restrictions on loans. 

‘‘Sec. 3204. Terms of loans. 

‘‘CHAPTER 3—EMERGENCY LOANS

‘‘Sec. 3301. Emergency loans. 

‘‘Sec. 3302. Purposes of loans. 

‘‘Sec. 3303. Terms of loans. 

‘‘Sec. 3304. Production losses. 

‘‘CHAPTER 4—GENERAL FARMER LOAN PROVISIONS

‘‘Sec. 3401. Agricultural Credit Insurance Fund. 

‘‘Sec. 3402. Guaranteed farmer loans. 

‘‘Sec. 3403. Provision of information to borrowers. 

‘‘Sec. 3404. Notice of loan service programs. 

‘‘Sec. 3405. Planting and production history guidelines. 

‘‘Sec. 3406. Special conditions and limitations on loans. 

‘‘Sec. 3407. Graduation of borrowers. 

‘‘Sec. 3408. Debt adjustment and credit counseling. 

‘‘Sec. 3409. Security servicing. 

‘‘Sec. 3410. Contracts on loan security properties. 

‘‘Sec. 3411. Debt restructuring and loan servicing. 

‘‘Sec. 3412. Relief for mobilized military reservists from certain agricultural 

loan obligations. 

‘‘Sec. 3413. Interest rate reduction program. 

‘‘Sec. 3414. Homestead property. 

‘‘Sec. 3415. Transfer of inventory land. 

‘‘Sec. 3416. Target participation rates. 

‘‘Sec. 3417. Compromise or adjustment of debts or claims by guaranteed lender. 

‘‘Sec. 3418. Waiver of mediation rights by borrowers. 

‘‘Sec. 3419. Borrower training. 

‘‘Sec. 3420. Loan assessments. 

‘‘Sec. 3421. Supervised credit. 

‘‘Sec. 3422. Market placement. 

‘‘Sec. 3423. Recordkeeping of loans by gender of borrower. 

‘‘Sec. 3424. Crop insurance requirement. 

‘‘Sec. 3425. Loan and loan servicing limitations. 

‘‘Sec. 3426. Short form certification of farm program borrower compliance. 

‘‘Sec. 3427. Underwriting forms and standards. 

‘‘Sec. 3428. Beginning farmer individual development accounts pilot program. 

‘‘Sec. 3429. Farmer loan pilot projects. 

‘‘Sec. 3430. Authorization of appropriations and allocation of funds. 

‘‘Subtitle B—Rural Development 


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‘‘CHAPTER 1—RURAL COMMUNITY PROGRAMS

‘‘Sec. 3501. Water and waste disposal loans, loan guarantees, and grants. 

‘‘Sec. 3502. Community facilities loans, loan guarantees, and grants. 

‘‘Sec. 3503. Health care services. 

‘‘CHAPTER 2—RURAL BUSINESS AND COOPERATIVE DEVELOPMENT

‘‘Sec. 3601. Business programs. 

‘‘Sec. 3602. Rural business investment program. 

‘‘CHAPTER 3—GENERAL RURAL DEVELOPMENT PROVISIONS

‘‘Sec. 3701. General provisions for loans and grants. 

‘‘Sec. 3702. Strategic economic and community development. 

‘‘Sec. 3703. Guaranteed rural development loans. 

‘‘Sec. 3704. Rural Development Insurance Fund. 

‘‘Sec. 3705. Rural economic area partnership zones. 

‘‘Sec. 3706. Streamlining applications and improving accessibility of rural development programs. 

‘‘CHAPTER 4—DELTA REGIONAL AUTHORITY

‘‘Sec. 3801. Definitions. 

‘‘Sec. 3802. Delta Regional Authority. 

‘‘Sec. 3803. Economic and community development grants. 

‘‘Sec. 3804. Supplements to Federal grant programs. 

‘‘Sec. 3805. Local development districts; certification and administrative expenses. 

‘‘Sec. 3806. Distressed counties and areas and nondistressed counties. 

‘‘Sec. 3807. Development planning process. 

‘‘Sec. 3808. Program development criteria. 

‘‘Sec. 3809. Approval of development plans and projects. 

‘‘Sec. 3810. Consent of States. 

‘‘Sec. 3811. Records. 

‘‘Sec. 3812. Annual report. 

‘‘Sec. 3813. Authorization of appropriations. 

‘‘Sec. 3814. Termination of authority. 

‘‘CHAPTER 5—NORTHERN GREAT PLAINS REGIONAL AUTHORITY

‘‘Sec. 3821. Definitions. 

‘‘Sec. 3822. Northern Great Plains Regional Authority. 

‘‘Sec. 3823. Interstate cooperation for economic opportunity and efficiency. 

‘‘Sec. 3824. Economic and community development grants. 

‘‘Sec. 3825. Supplements to Federal grant programs. 

‘‘Sec. 3826. Multistate and local development districts and organizations and 

Northern Great Plains Inc. 

‘‘Sec. 3827. Distressed counties and areas and nondistressed counties. 

‘‘Sec. 3828. Development planning process. 

‘‘Sec. 3829. Program development criteria. 

‘‘Sec. 3830. Approval of development plans and projects. 

‘‘Sec. 3831. Consent of States. 

‘‘Sec. 3832. Records. 

‘‘Sec. 3833. Annual report. 

‘‘Sec. 3834. Authorization of appropriations. 

‘‘Sec. 3835. Termination of authority. 


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‘‘Subtitle C—General Provisions 

‘‘Sec. 3901. Full faith and credit. 

‘‘Sec. 3902. Purchase and sale of guaranteed portions of loans. 

‘‘Sec. 3903. Administration. 

‘‘Sec. 3904. Loan moratorium and policy on foreclosures. 

‘‘Sec. 3905. Oil and gas royalty payments on loans. 

‘‘Sec. 3906. Taxation. 

‘‘Sec. 3907. Conflicts of interest. 

‘‘Sec. 3908. Loan summary statements. 

‘‘Sec. 3909. Certified lenders program. 

‘‘Sec. 3910. Loans to resident aliens. 

‘‘Sec. 3911. Expedited clearing of title to inventory property. 

‘‘Sec. 3912. Prohibition on use of loans for certain purposes. 

‘‘Sec. 3913. Transfer of land to Secretary. 

‘‘Sec. 3914. Competitive sourcing limitations. 

‘‘Sec. 3915. Regulations. 

1 ‘‘SEC. 3002. DEFINITIONS. 

2 ‘‘In this title (unless the context otherwise requires): 

3 ‘‘(1) ABLE TO OBTAIN CREDIT ELSEWHERE.— 

4 The term ‘able to obtain credit elsewhere’ means 

5 able to obtain a loan from a production credit asso6 ciation, a Federal land bank, or other responsible co7 operative or private credit source (or, in the case of 

8 a borrower under section 3106, the borrower may be 

9 able to obtain a loan under section 3101) at reason10 able rates and terms, taking into consideration pre11 vailing private and cooperative rates and terms in 

12 the community in or near which the applicant re13 sides for loans for similar purposes and periods of 

14 time. 

15 ‘‘(2) AGRICULTURAL CREDIT INSURANCE

16 FUND.—The term ‘Agricultural Credit Insurance 


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1 Fund’ means the fund established under section 

2 3401. 

3 ‘‘(3) APPROVED LENDER.—The term ‘approved 

4 lender’ means— 

5 ‘‘(A) a lender approved prior to October 

6 28, 1992, by the Secretary under the approved 

7 lender program established by exhibit A to sub8 part B of part 1980 of title 7, Code of Federal 

9 Regulations (as in effect on January 1, 1991); 

10 or 

11 ‘‘(B) a lender certified under section 3909. 

12 ‘‘(4) AQUACULTURE.—The term ‘aquaculture’ 

13 means the culture or husbandry of aquatic animals 

14 or plants by private industry for commercial pur15 poses, including the culture and growing of fish by 

16 private industry for the purpose of creating or aug17 menting publicly owned and regulated stocks of fish. 

18 ‘‘(5) BEGINNING FARMER.—The term ‘begin19 ning farmer’ has the meaning given the term by the 

20 Secretary. 

21 ‘‘(6) BORROWER.— 

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

23 subparagraph (B), the term ‘borrower’ means 

24 an individual or entity who has an outstanding 

25 obligation to the Secretary under any loan 


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1 made or guaranteed under this title, without re2 gard to whether the loan has been accelerated. 

3 ‘‘(B) EXCLUSIONS.—The term ‘borrower’ 

4 does not include an individual or entity all of 

5 whose loans and accounts have been foreclosed 

6 on or liquidated, voluntarily or otherwise. 

7 ‘‘(7) COUNTY COMMITTEE.—The term ‘county 

8 committee’ means the appropriate county committee 

9 established under section 8(b)(5) of the Soil Con10 servation and Domestic Allotment Act (16 U.S.C. 

11 590h(b)(5)). 

12 ‘‘(8) DEBT FORGIVENESS.— 

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

14 subparagraph (B), the term ‘debt forgiveness’ 

15 means reducing or terminating a loan made or 

16 guaranteed under this title, in a manner that 

17 results in a loss to the Secretary, through— 

18 ‘‘(i) writing down or writing off a loan 

19 under section 3411; 

20 ‘‘(ii) compromising, adjusting, reduc21 ing, or charging-off a debt or claim under 

22 section 3903; 

23 ‘‘(iii) paying a loss on a guaranteed 

24 loan under this title; or 


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1 ‘‘(iv) discharging a debt as a result of 

2 bankruptcy. 

3 ‘‘(B) LOAN RESTRUCTURING.—The term 

4 ‘debt forgiveness’ does not include consolida5 tion, rescheduling, reamortization, or deferral. 

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

7 means the Department of Agriculture. 

8 ‘‘(10) DIRECT LOAN.—The term ‘direct loan’ 

9 means a loan made by the Secretary from appro10 priated funds. 

11 ‘‘(11) ENTITY.—The term ‘entity’ means a cor12 poration, farm cooperative, partnership, joint oper13 ation, governmental entity, or other legal organiza14 tion, as determined by the Secretary. 

15 ‘‘(12) FARM.—The term ‘farm’ means an oper16 ation involved in— 

17 ‘‘(A) the production of an agricultural 

18 commodity; 

19 ‘‘(B) ranching; or 

20 ‘‘(C) aquaculture. 

21 ‘‘(13) FARMER.—The term ‘farmer’ means an 

22 individual or entity engaged primarily and directly 

23 in— 

24 ‘‘(A) the production of an agricultural 

25 commodity; 


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1 ‘‘(B) ranching; or 

2 ‘‘(C) aquaculture. 

3 ‘‘(14) FARMER PROGRAM LOAN.—The term 

4 ‘farmer program loan’ means— 

5 ‘‘(A) a farm ownership loan under section 

6 3101; 

7 ‘‘(B) a conservation loan under section 

8 3103; 

9 ‘‘(C) an operating loan under section 3201; 

10 ‘‘(D) an emergency loan under section 

11 3301; 

12 ‘‘(E) an economic emergency loan under 

13 section 202 of the Emergency Agricultural 

14 Credit Adjustment Act of 1978 (7 U.S.C. prec. 

15 1961 note; Public Law 95-334); 

16 ‘‘(F) a loan for a farm service building 

17 under section 502 of the Housing Act of 1949 

18 (42 U.S.C. 1472); 

19 ‘‘(G) an economic opportunity loan under 

20 section 602 of the Economic Opportunity Act of 

21 1964 (Public Law 88–452; 42 U.S.C. 2942 

22 note) (as it existed before the amendment made 

23 by section 683(a) of the Omnibus Budget Rec24 onciliation Act of 1981 (Public Law 97–35; 95 

25 Stat. 519)); 


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1 ‘‘(H) a softwood timber loan under section 

2 608 of the Agricultural Programs Adjustment 

3 Act of 1984 (7 U.S.C. 1981 note; Public Law 

4 98–258); or 

5 ‘‘(I) any other loan described in section 

6 343(a)(10) of this title (as it existed before the 

7 amendment made by section 2 of the Agri8 culture Reform, Food, and Jobs Act of 2012) 

9 that is outstanding on the date of enactment of 

10 that Act. 

11 ‘‘(15) FARM SERVICE AGENCY.—The term 

12 ‘Farm Service Agency’ means the offices of the 

13 Farm Service Agency to which the Secretary dele14 gates responsibility to carry out this title. 

15 ‘‘(16) GOVERNMENTAL ENTITY.—The term 

16 ‘governmental entity’ means any agency of the 

17 United States, a State, or a unit of local government 

18 of a State, or subdivision thereof. 

19 ‘‘(17) GUARANTEE.—The term ‘guarantee’ 

20 means guaranteeing the payment of a loan origi21 nated, held, and serviced by a private financial agen22 cy, or lender, approved by the Secretary. 

23 ‘‘(18) HIGHLY ERODIBLE LAND.—The term 

24 ‘highly erodible land’ has the meaning given the 


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1 term in section 1201(a) of the Food Security Act of 

2 1985 (16 U.S.C. 3801(a)). 

3 ‘‘(19) HOMESTEAD RETENTION.—The term 

4 ‘homestead retention’ means homestead retention as 

5 authorized under section 3414. 

6 ‘‘(20) INDIAN TRIBE.—The term ‘Indian tribe’ 

7 means a Federal and State-recognized Indian tribe 

8 or other federally recognized Indian tribal group (in9 cluding a Tribal College or University, as defined in 

10 section 316(b) of the Higher Education Act of 1965 

11 (20 U.S.C. 1059c(b)). 

12 ‘‘(21) LOAN SERVICE PROGRAM.—The term 

13 ‘loan service program’ means, with respect to a 

14 farmer program loan borrower, a primary loan serv15 ice program or a homestead retention program. 

16 ‘‘(22) NATURAL OR MAJOR DISASTER OR EMER17 GENCY.—The term ‘natural or major disaster or 

18 emergency’ means— 

19 ‘‘(A) a disaster due to nonmanmade causes 

20 declared by the Secretary; or 

21 ‘‘(B) a major disaster or emergency des22 ignated by the President under the Robert T. 

23 Stafford Disaster Relief and Emergency Assist24 ance Act (42 U.S.C. 5121 et seq.). 


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1 ‘‘(23) PRIMARY LOAN SERVICE PROGRAM.—The 

2 term ‘primary loan service program’ means, with re3 spect to a farmer program loan— 

4 ‘‘(A) loan consolidation, rescheduling, or 

5 reamortization; 

6 ‘‘(B) interest rate reduction, including the 

7 use of the limited resource program; 

8 ‘‘(C) loan restructuring, including deferral, 

9 set aside, or writing down of the principal or 

10 accumulated interest charges, or both, of the 

11 loan; or 

12 ‘‘(D) any combination of actions described 

13 in subparagraphs (A), (B), and (C). 

14 ‘‘(24) PRIME FARMLAND.—The term ‘prime 

15 farmland’ means prime farmland and unique farm16 land (as defined in subsections (a) and (b) of section 

17 657.5 of title 7, Code of Federal Regulations 

18 (1980)). 

19 ‘‘(25) PROJECT.—For purposes of section 

20 3501, the term ‘project’ includes a facility providing 

21 central service or a facility serving an individual 

22 property, or both. 

23 ‘‘(26) QUALIFIED BEGINNING FARMER.—The 

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1 cant, regardless of whether the applicant is partici2 pating in a program under section 3107, who— 

3 ‘‘(A) is eligible for assistance under this 

4 title; 

5 ‘‘(B) has not operated a farm, or has oper6 ated a farm for not more than 10 years; 

7 ‘‘(C) in the case of a cooperative, corpora8 tion, partnership, or joint operation, has mem9 bers, stockholders, partners, or joint operators 

10 who are all related to each other by blood or 

11 marriage; 

12 ‘‘(D) in the case of a farmer who is the 

13 owner and operator of a farm— 

14 ‘‘(i) in the case of a loan made to an 

15 individual, individually or with the imme16 diate family of the applicant— 

17 ‘‘(I) materially and substantially 

18 participates in the operation of the 

19 farm; and 

20 ‘‘(II) provides substantial day-to21 day labor and management of the 

22 farm, consistent with the practices in 

23 the State or county in which the farm 

24 is located; or 


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1 ‘‘(ii)(I) in the case of a loan made to 

2 a cooperative, corporation, partnership, or 

3 joint operation, has members, stockholders, 

4 partners, or joint operators who materially 

5 and substantially participate in the oper6 ation of the farm; and 

7 ‘‘(II) in the case of a loan made to a 

8 corporation, has stockholders who all qual9 ify individually as beginning farmers; 

10 ‘‘(E) in the case of an applicant seeking to 

11 become an owner and operator of a farm— 

12 ‘‘(i) in the case of a loan made to an 

13 individual, individually or with the imme14 diate family of the applicant, will— 

15 ‘‘(I) materially and substantially 

16 participate in the operation of the 

17 farm; and 

18 ‘‘(II) provide substantial day-to19 day labor and management of the 

20 farm, consistent with the practices in 

21 the State or county in which the farm 

22 is located; or 

23 ‘‘(ii)(I) in the case of a loan made to 

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1 holders, partners, or joint operators who 

2 will materially and substantially participate 

3 in the operation of the farm; and 

4 ‘‘(II) in the case of a loan made to a 

5 corporation, has stockholders who will all 

6 qualify individually as beginning farmers; 

7 ‘‘(F) agrees to participate in such loan as8 sessment, borrower training, and financial man9 agement programs as the Secretary may re10 quire; 

11 ‘‘(G)(i) does not own farm land; or 

12 ‘‘(ii) directly or through interests in family 

13 farm corporations, owns farm land, the aggre14 gate acreage of which does not exceed 30 per15 cent of the average acreage of the farms, as the 

16 case may be, in the county in which the farm 

17 operations of the applicant are located, as re18 ported in the most recent census of agriculture 

19 taken in accordance with the Census of Agri20 culture Act of 1997 (7 U.S.C. 2204g et seq.), 

21 except that this subparagraph shall not apply to 

22 a loan made or guaranteed under chapter 2 of 

23 subtitle A; and 

24 ‘‘(H) demonstrates that the available re25 sources of the applicant and any spouse of the 


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1 applicant are not sufficient to enable the appli2 cant to farm on a viable scale. 

3 ‘‘(27) RECREATIONAL PURPOSE.—For purposes 

4 of section 3410, the term ‘recreational purpose’ has 

5 the meaning provided by the Secretary, but shall in6 clude hunting. 

7 ‘‘(28) RURAL AND RURAL AREA.— 

8 ‘‘(A) IN GENERAL.—Subject to any deter9 mination made under subparagraph (B), the 

10 terms ‘rural’ and ‘rural area’ mean any area 

11 other than— 

12 ‘‘(i) a city or town that has a popu13 lation of greater than 50,000 inhabitants; 

14 and 

15 ‘‘(ii) any urbanized area contiguous 

16 and adjacent to a city or town described in 

17 clause (i). 

18 ‘‘(B) DETERMINATION OF AREAS RURAL IN

19 CHARACTER.— 

20 ‘‘(i) IN GENERAL.—On petition of a 

21 unit of local government in an urbanized 

22 area described in subparagraph (A)(ii), or 

23 on the initiative of the Secretary, acting 

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1 graph as the ‘Under Secretary’), the 

2 Under Secretary may determine that part 

3 of an area described in subparagraph 

4 (A)(ii) is a rural area based on the criteria 

5 described in clause (ii). 

6 ‘‘(ii) CRITERIA.—In making a deter7 mination under clause (i), the Under Sec8 retary shall consider— 

9 ‘‘(I) population density, favoring 

10 a rural area determination for the 

11 most sparsely populated areas; 

12 ‘‘(II) economic conditions, favor13 ing a rural area determination for 

14 areas facing— 

15 ‘‘(aa) chronic unemployment 

16 in excess of statewide averages; 

17 ‘‘(bb) sudden loss of employ18 ment from natural disaster or the 

19 loss of a significant employer in 

20 the area; or 

21 ‘‘(cc) chronic poverty dem22 onstrated at the census block or 

23 county level compared to state24 wide median household income; 


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1 ‘‘(III) commuting patterns, favor2 ing a rural area determination for 

3 areas that can demonstrate higher 

4 proportions of the population living 

5 and working in the area; and 

6 ‘‘(IV) whether the area was eligi7 ble under the definitions of the terms 

8 ‘rural’ and ‘rural area’ in section 343 

9 (as in effect before the date of enact10 ment of the Agriculture Reform, 

11 Food, and Jobs Act of 2012) for com12 munity facility, water and waste dis13 posal, and broadband programs. 

14 ‘‘(iii) ADMINISTRATION.—In carrying 

15 out this subparagraph, the Under Sec16 retary shall— 

17 ‘‘(I) not delegate the authority to 

18 carry out this subparagraph; 

19 ‘‘(II) consult with the applicable 

20 rural development State or regional 

21 director of the Department and the 

22 Governor of the respective State; 

23 ‘‘(III) provide to the petitioner 

24 an opportunity to appeal to the Under 


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1 Secretary a determination made under 

2 this subparagraph; 

3 ‘‘(IV) release to the public notice 

4 of a petition filed or initiative of the 

5 Under Secretary under this subpara6 graph not later than 30 days after re7 ceipt of the petition or the commence8 ment of the initiative, as appropriate; 

9 ‘‘(V) make a determination under 

10 this subparagraph not less than 15 

11 days, and not more than 60 days, 

12 after the release of the notice under 

13 subclause (IV); 

14 ‘‘(VI) submit to the Committee 

15 on Agriculture of the House of Rep16 resentatives and the Committee on 

17 Agriculture, Nutrition, and Forestry 

18 of the Senate an annual report on ac19 tions taken to carry out this subpara20 graph; and 

21 ‘‘(VII) terminate a determination 

22 under this subparagraph that part of 

23 an area is a rural area on the date 

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1 tion 141(a) of title 13, United States 

2 Code. 

3 ‘‘(iv) HAWAII AND PUERTO RICO.— 

4 Notwithstanding any other provision of 

5 this subsection, within the areas of the 

6 County of Honolulu, Hawaii, and the Com7 monwealth of Puerto Rico, the Under Sec8 retary may designate any part of the areas 

9 as a rural area if the Under Secretary de10 termines that the part is not urban in 

11 character, other than any area included in 

12 the Honolulu Census Designated Place or 

13 the San Juan Census Designated Place. 

14 ‘‘(C) EXCLUSIONS.—Notwithstanding any 

15 other provision of this paragraph, in deter16 mining which census blocks in an urbanized 

17 area are not in a rural area (as defined in this 

18 paragraph), the Secretary shall exclude any 

19 cluster of census blocks that would otherwise be 

20 considered not in a rural area only because the 

21 cluster is adjacent to not more than 2 census 

22 blocks that are otherwise considered not in a 

23 rural area under this paragraph. 

24 ‘‘(29) SEASONED DIRECT LOAN BORROWER.— 

25 The term ‘seasoned direct loan borrower’ means a 


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1 borrower who could reasonably be expected to qual2 ify for commercial credit using criteria determined 

3 by the Secretary. 

4 ‘‘(30) SECRETARY.—The term ‘Secretary’ 

5 means the Secretary of Agriculture. 

6 ‘‘(31) SOCIALLY DISADVANTAGED FARMER.— 

7 The term ‘socially disadvantaged farmer’ means a 

8 farmer who is a member of a socially disadvantaged 

9 group. 

10 ‘‘(32) SOCIALLY DISADVANTAGED GROUP.—The 

11 term ‘socially disadvantaged group’ means a group 

12 whose members have been subjected to racial, ethnic, 

13 or gender prejudice because of the identity of the 

14 members as members of a group without regard to 

15 the individual qualities of the members. 

16 ‘‘(33) SOLAR ENERGY.—The term ‘solar energy’ 

17 means energy derived from sources (other than fossil 

18 fuels) and technologies included in the Federal Non19 nuclear Energy Research and Development Act of 

20 1974 (42 U.S.C. 5901 et seq.). 

21 ‘‘(34) STATE.—The term ‘State’ means— 

22 ‘‘(A) in this title (other than subtitle A), 

23 each of the 50 States, the Commonwealth of 

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1 ern Mariana Islands, the Republic of the Mar2 shall Islands, the Federated States of Micro3 nesia, and the Republic of Palau; and 

4 ‘‘(B) in subtitle A, each of the 50 States, 

5 the Commonwealth of Puerto Rico, the Virgin 

6 Islands, Guam, American Samoa, the Common7 wealth of the Northern Mariana Islands, and, 

8 to the extent the Secretary determines it to be 

9 feasible and appropriate, the Republic of the 

10 Marshall Islands, the Federated States of Mi11 cronesia, and the Republic of Palau. 

12 ‘‘(35) STATE BEGINNING FARMER PROGRAM.— 

13 The term ‘State beginning farmer program’ means 

14 any program that is— 

15 ‘‘(A) carried out by, or under contract 

16 with, a State; and 

17 ‘‘(B) designed to assist qualified beginning 

18 farmers in obtaining the financial assistance 

19 necessary to enter agriculture and establish via20 ble farming operations. 

21 ‘‘(36) VETERAN.—The term ‘veteran’ has the 

22 meaning given the term in section 101 of title 38, 

23 United States Code. 


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1 ‘‘(37) WETLAND.—The term ‘wetland’ has the 

2 meaning given the term in section 1201(a) of the 

3 Food Security Act of 1985 (16 U.S.C. 3801(a)). 

4 ‘‘(38) WILDLIFE.—The term ‘wildlife’ means 

5 fish or wildlife (as defined in section 2(a) of the 

6 Lacey Act Amendments of 1981 (16 U.S.C. 

7 3371(a))). 

8 ‘‘Subtitle B—Rural Development 

9 ‘‘CHAPTER 1—RURAL COMMUNITY 

10 PROGRAMS 

11 ‘‘SEC. 3501. WATER AND WASTE DISPOSAL LOANS, LOAN 

12 GUARANTEES, AND GRANTS. 

13 ‘‘(a) IN GENERAL.—The Secretary may make grants 

14 and loans and issue loan guarantees (including a guar15 antee of a loan financed by the net proceeds of a bond 

16 described in section 142(a) of the Internal Revenue Code 

17 of 1986) to eligible entities described in subsection (b) for 

18 projects in rural areas that primarily serve rural residents 

19 to provide for— 

20 ‘‘(1) the development, storage, treatment, puri21 fication, or distribution of water or the collection, 

22 treatment, or disposal of waste; and 

23 ‘‘(2) financial assistance and other aid in the 

24 planning of projects for purposes described in para25 graph (1). 


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1 ‘‘(b) ELIGIBLE ENTITIES.—Entities eligible for as2 sistance described in subsection (a) are— 

3 ‘‘(1) associations (including corporations not 

4 operated for profit); 

5 ‘‘(2) Indian tribes; 

6 ‘‘(3) public and quasi-public agencies; and 

7 ‘‘(4) in the case of a project to attach an indi8 vidual property in a rural area to a water system to 

9 alleviate a health risk, an individual. 

10 ‘‘(c) LOAN AND LOAN GUARANTEE REQUIRE11 MENTS.—In connection with loans made or guaranteed 

12 under this section, the Secretary shall require the appli13 cant— 

14 ‘‘(1) to certify in writing, and the Secretary 

15 shall determine, that the applicant is unable to ob16 tain sufficient credit elsewhere to finance the actual 

17 needs of the applicant at reasonable rates and terms, 

18 taking into consideration prevailing private and co19 operative rates and terms in the community in or 

20 near which the applicant resides for loans for similar 

21 purposes and periods of time; and 

22 ‘‘(2) to furnish an appropriate written financial 

23 statement. 

24 ‘‘(d) GRANT AMOUNTS.— 


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1 ‘‘(1) MAXIMUM.—Except as otherwise provided 

2 in this subsection, the amount of any grant made 

3 under this section shall not exceed 75 percent of the 

4 development cost of the project for which the grant 

5 is provided. 

6 ‘‘(2) GRANT RATE.—The Secretary shall estab7 lish the grant rate for each project in conformity 

8 with regulations issued by the Secretary that shall 

9 provide for a graduated scale of grant rates that es10 tablish higher rates for projects in communities that 

11 have— 

12 ‘‘(A) low community population; 

13 ‘‘(B) high rates of outmigration; and 

14 ‘‘(C) low income levels. 

15 ‘‘(3) LOCAL SHARE REQUIREMENTS.—Grants 

16 made under this section may be used to pay the 

17 local share requirements of another Federal grant18 in-aid program to the extent permitted under the 

19 law providing for the grant-in-aid program. 

20 ‘‘(e) SPECIAL GRANTS.— 

21 ‘‘(1) REVOLVING FUNDS FOR FINANCING

22 WATER AND WASTEWATER PROJECTS.— 

23 ‘‘(A) IN GENERAL.—The Secretary may 

24 make grants to qualified, nonprofit entities in 

25 rural areas to capitalize revolving funds for the 


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1 purpose of providing financing to eligible enti2 ties for— 

3 ‘‘(i) predevelopment costs associated 

4 with proposed water and wastewater 

5 projects or with existing water and waste6 water systems; and 

7 ‘‘(ii) short-term costs incurred for re8 placement equipment, small-scale extension 

9 services, or other small capital projects 

10 that are not part of the regular operations 

11 and maintenance activities of existing 

12 water and wastewater systems. 

13 ‘‘(B) MAXIMUM AMOUNT OF FINANCING.— 

14 The amount of financing made to an eligible 

15 entity under this paragraph shall not exceed— 

16 ‘‘(i) $100,000 for costs described in 

17 subparagraph (A)(i); and 

18 ‘‘(ii) $100,000 for costs described in 

19 subparagraph (A)(ii). 

20 ‘‘(C) TERM.—The term of financing pro21 vided to an eligible entity under this paragraph 

22 shall not exceed 10 years. 

23 ‘‘(D) ADMINISTRATION.—The Secretary 

24 shall limit the amount of grant funds that may 


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1 be used by a grant recipient for administrative 

2 costs incurred under this paragraph. 

3 ‘‘(E) ANNUAL REPORT.—A nonprofit enti4 ty receiving a grant under this paragraph shall 

5 submit to the Secretary an annual report that 

6 describes the number and size of communities 

7 served and the type of financing provided. 

8 ‘‘(F) AUTHORIZATION OF APPROPRIA9 TIONS.—There is authorized to be appropriated 

10 to carry out this paragraph $30,000,000 for 

11 each of fiscal years 2013 through 2017. 

12 ‘‘(2) EMERGENCY AND IMMINENT COMMUNITY

13 WATER ASSISTANCE PROGRAM.— 

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

15 provide grants in accordance with this para16 graph to assist the residents of rural areas and 

17 small communities to secure adequate quan18 tities of safe water— 

19 ‘‘(i) after a significant decline in the 

20 quantity or quality of water available from 

21 the water supplies of the rural areas and 

22 small communities, or when such a decline 

23 is imminent; or 


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1 ‘‘(ii) when repairs, partial replace2 ment, or significant maintenance efforts on 

3 established water systems would remedy— 

4 ‘‘(I) an acute or imminent short5 age of quality water; or 

6 ‘‘(II) a significant or imminent 

7 decline in the quantity or quality of 

8 water that is available. 

9 ‘‘(B) PRIORITY.—In carrying out subpara10 graph (A), the Secretary shall— 

11 ‘‘(i) give priority to projects described 

12 in subparagraph (A)(i); and 

13 ‘‘(ii) provide at least 70 percent of all 

14 grants under this paragraph to those 

15 projects. 

16 ‘‘(C) ELIGIBILITY.—To be eligible to ob17 tain a grant under this paragraph, an applicant 

18 shall— 

19 ‘‘(i) be a public or private nonprofit 

20 entity; and 

21 ‘‘(ii) in the case of a grant made 

22 under subparagraph (A)(i), demonstrate to 

23 the Secretary that the decline referred to 

24 in that subparagraph occurred, or will 

25 occur, not later than 2 years after the date 


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1 on which the application was filed for the 

2 grant. 

3 ‘‘(D) USES.— 

4 ‘‘(i) IN GENERAL.—Grants made 

5 under this paragraph may be used— 

6 ‘‘(I) for waterline extensions from 

7 existing systems, laying of new 

8 waterlines, repairs, significant mainte9 nance, digging of new wells, equip10 ment replacement, and hook and tap 

11 fees; 

12 ‘‘(II) for any other appropriate 

13 purpose associated with developing 

14 sources of, treating, storing, or dis15 tributing water; 

16 ‘‘(III) to assist communities in 

17 complying with the requirements of 

18 the Federal Water Pollution Control 

19 Act (33 U.S.C. 1251 et seq.) or the 

20 Safe Drinking Water Act (42 U.S.C. 

21 300f et seq.); and 

22 ‘‘(IV) to provide potable water to 

23 communities through other means. 

24 ‘‘(ii) JOINT PROPOSALS.— 


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1 ‘‘(I) IN GENERAL.—Subject to 

2 the restrictions in subparagraph (E), 

3 nothing in this paragraph precludes 

4 rural communities from submitting 

5 joint proposals for emergency water 

6 assistance. 

7 ‘‘(II) CONSIDERATION OF RE8 STRICTIONS.—The restrictions in sub9 paragraph (E) shall be considered in 

10 the aggregate, depending on the num11 ber of communities involved. 

12 ‘‘(E) RESTRICTIONS.— 

13 ‘‘(i) MAXIMUM INCOME.—No grant 

14 provided under this paragraph shall be 

15 used to assist any rural area or community 

16 that has a median household income in ex17 cess of the State nonmetropolitan median 

18 household income according to the most re19 cent decennial census of the United States. 

20 ‘‘(ii) SET-ASIDE FOR SMALLER COM21 MUNITIES.—Not less than 50 percent of 

22 the funds allocated under this paragraph 

23 shall be allocated to rural communities 

24 with populations that do not exceed 3,000 

25 inhabitants. 


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1 ‘‘(F) MAXIMUM GRANTS.—Grants made 

2 under this paragraph may not exceed— 

3 ‘‘(i) in the case of each grant made 

4 under subparagraph (A)(i), $500,000; and 

5 ‘‘(ii) in the case of each grant made 

6 under subparagraph (A)(ii), $150,000. 

7 ‘‘(G) FULL FUNDING.—Subject to sub8 paragraph (F), grants under this paragraph 

9 shall be made in an amount equal to 100 per10 cent of the costs of the projects conducted 

11 under this paragraph. 

12 ‘‘(H) APPLICATION.— 

13 ‘‘(i) NATIONALLY COMPETITIVE AP14 PLICATION PROCESS.— 

15 ‘‘(I) IN GENERAL.—The Sec16 retary shall develop a nationally com17 petitive application process to award 

18 grants under this paragraph. 

19 ‘‘(II) REQUIREMENTS.—The 

20 process shall include criteria for evalu21 ating applications, including popu22 lation, median household income, and 

23 the severity of the decline, or immi24 nent decline, in the quantity or qual25 ity of water. 


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1 ‘‘(ii) TIMING OF REVIEW OF APPLICA2 TIONS.— 

3 ‘‘(I) SIMPLIFIED APPLICATION.— 

4 The application process developed by 

5 the Secretary under clause (i) shall in6 clude a simplified application form 

7 that will permit expedited consider8 ation of an application for a grant 

9 filed under this paragraph. 

10 ‘‘(II) PRIORITY REVIEW.—In 

11 processing applications for any water 

12 or waste grant or loan authorized 

13 under this section, the Secretary shall 

14 afford priority processing to an appli15 cation for a grant under this para16 graph to the extent funds will be 

17 available for an award on the applica18 tion at the conclusion of priority proc19 essing. 

20 ‘‘(III) TIMING.—The Secretary 

21 shall, to the maximum extent prac22 ticable, review and act on an applica23 tion under this paragraph not later 

24 than 60 days after the date on which 


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1 the application is submitted to the 

2 Secretary. 

3 ‘‘(I) FUNDING.— 

4 ‘‘(i) RESERVATION.— 

5 ‘‘(I) IN GENERAL.—For each fis6 cal year, not less than 3 nor more 

7 than 5 percent of the total amount 

8 made available to carry out this sec9 tion for the fiscal year shall be re10 served for grants under this para11 graph. 

12 ‘‘(II) RELEASE.—Funds reserved 

13 under subclause (I) for a fiscal year 

14 shall be reserved only until July 1 of 

15 the fiscal year. 

16 ‘‘(ii) AUTHORIZATION OF APPROPRIA17 TIONS.—In addition to funds made avail18 able under clause (i), there is authorized to 

19 be appropriated to carry out this para20 graph $35,000,000 for each of fiscal years 

21 2013 through 2017. 

22 ‘‘(3) WATER AND WASTE FACILITY LOANS AND

23 GRANTS TO ALLEVIATE HEALTH RISKS.— 

24 ‘‘(A) DEFINITION OF COOPERATIVE.—In 

25 this paragraph, the term ‘cooperative’ means a 


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1 cooperative formed specifically for the purpose 

2 of the installation, expansion, improvement, or 

3 operation of water supply or waste disposal fa4 cilities or systems. 

5 ‘‘(B) LOANS AND GRANTS TO PERSONS

6 OTHER THAN INDIVIDUALS.— 

7 ‘‘(i) IN GENERAL.—The Secretary 

8 shall make or guarantee loans and make 

9 grants to provide for the conservation, de10 velopment, use, and control of water (in11 cluding the extension or improvement of 

12 existing water supply systems) and the in13 stallation or improvement of drainage or 

14 waste disposal facilities and essential com15 munity facilities, including necessary re16 lated equipment, training, and technical 

17 assistance to— 

18 ‘‘(I) rural water supply corpora19 tions, cooperatives, or similar entities; 

20 ‘‘(II) Indian tribes; 

21 ‘‘(III) rural or native villages in 

22 the State of Alaska; 

23 ‘‘(IV) native tribal health consor24 tiums; 

25 ‘‘(V) public agencies; and 


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1 ‘‘(VI) Native Hawaiian Home 

2 Lands. 

3 ‘‘(ii) ELIGIBLE PROJECTS.—Loans 

4 and grants described in clause (i) shall be 

5 available only to provide the described 

6 water and waste facilities and services to 

7 communities whose residents face signifi8 cant health risks, as determined by the 

9 Secretary, due to the fact that a significant 

10 proportion of the residents of the commu11 nity do not have access to, or are not 

12 served by, adequate affordable— 

13 ‘‘(I) water supply systems; or 

14 ‘‘(II) waste disposal facilities. 

15 ‘‘(iii) MATCHING REQUIREMENTS.— 

16 For entities described under subclauses 

17 (III), (IV), or (V) of clause (i) to be eligi18 ble to receive a grant for water supply sys19 tems or waste disposal facilities, the State 

20 in which the project will occur shall pro21 vide 25 percent in matching funds from 

22 non-Federal sources. 

23 ‘‘(iv) CERTAIN AREAS TARGETED.— 

24 ‘‘(I) IN GENERAL.—Loans and 

25 grants under clause (i) shall be made 


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1 only if the loan or grant funds will be 

2 used primarily to provide water or 

3 waste services, or both, to residents of 

4 a county or census area— 

5 ‘‘(aa) the per capita income 

6 of the residents of which is not 

7 more than 70 percent of the na8 tional average per capita income, 

9 as determined by the Department 

10 of Commerce; and 

11 ‘‘(bb) the unemployment 

12 rate of the residents of which is 

13 not less than 125 percent of the 

14 national average unemployment 

15 rate, as determined by the Bu16 reau of Labor Statistics. 

17 ‘‘(II) EXCEPTION.—Notwith18 standing subclause (I), loans and 

19 grants under clause (i) may also be 

20 made if the loan or grant funds will 

21 be used primarily to provide water or 

22 waste services, or both, to residents of 

23 a rural area that was recognized as a 

24 colonia as of October 1, 1989. 


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1 ‘‘(C) LOANS AND GRANTS TO INDIVID2 UALS.— 

3 ‘‘(i) IN GENERAL.—The Secretary 

4 shall make or guarantee loans and make 

5 grants to individuals who reside in a com6 munity described in subparagraph (B)(i) 

7 for the purpose of extending water supply 

8 and waste disposal systems, connecting the 

9 systems to the residences of the individ10 uals, or installing plumbing and fixtures 

11 within the residences of the individuals to 

12 facilitate the use of the water supply and 

13 waste disposal systems. 

14 ‘‘(ii) INTEREST.—Loans described in 

15 clause (i) shall be at a rate of interest no 

16 greater than the Federal Financing Bank 

17 rate on loans of a similar term at the time 

18 the loans are made. 

19 ‘‘(iii) AMORTIZATION.—The repay20 ment of loans described in clause (i) shall 

21 be amortized over the expected life of the 

22 water supply or waste disposal system to 

23 which the residence of the borrower will be 

24 connected. 


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1 ‘‘(iv) MANNER IN WHICH LOANS AND

2 GRANTS ARE TO BE MADE.—Loans and 

3 grants to individuals under clause (i) shall 

4 be made— 

5 ‘‘(I) directly to the individuals by 

6 the Secretary; or 

7 ‘‘(II) to the individuals through 

8 the rural water supply corporation, 

9 cooperative, or similar entity, or pub10 lic agency, providing the water supply 

11 or waste disposal services, pursuant to 

12 regulations issued by the Secretary. 

13 ‘‘(D) PREFERENCE.—The Secretary shall 

14 give preference in the awarding of loans and 

15 grants under subparagraphs (B) and (C) to en16 tities described in clause (i) of subparagraph 

17 (B) that propose to provide water supply or 

18 waste disposal services to the residents of In19 dian reservations, rural or native villages in the 

20 State of Alaska, Native Hawaiian Home Lands, 

21 and those rural subdivisions commonly referred 

22 to as colonias, that are characterized by sub23 standard housing, inadequate roads and drain24 age, and a lack of adequate water or waste fa25 cilities. 


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1 ‘‘(E) AUTHORIZATION OF APPROPRIA2 TIONS.—There are authorized to be appro3 priated— 

4 ‘‘(i) for grants under this paragraph, 

5 $60,000,000 for each fiscal year; 

6 ‘‘(ii) for loans under this paragraph, 

7 $60,000,000 for each fiscal year; and 

8 ‘‘(iii) in addition to grants provided 

9 under clause (i), for grants under this sec10 tion to benefit Indian tribes, $20,000,000 

11 for each fiscal year. 

12 ‘‘(4) SOLID WASTE MANAGEMENT GRANTS.— 

13 ‘‘(A) IN GENERAL.—The Secretary may 

14 make grants to nonprofit organizations for the 

15 provision of regional technical assistance to 

16 local and regional governments and related 

17 agencies for the purpose of reducing or elimi18 nating pollution of water resources and improv19 ing the planning and management of solid 

20 waste disposal facilities in rural areas. 

21 ‘‘(B) TECHNICAL ASSISTANCE GRANT

22 AMOUNTS.—Grants made under this paragraph 

23 for the provision of technical assistance shall be 

24 made for 100 percent of the cost of the tech25 nical assistance. 


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1 ‘‘(C) AUTHORIZATION OF APPROPRIA2 TIONS.—There is authorized to be appropriated 

3 to carry out this paragraph $10,000,000 for 

4 each of fiscal years 2013 through 2017 

5 ‘‘(5) RURAL WATER AND WASTEWATER TECH6 NICAL ASSISTANCE AND TRAINING PROGRAMS.— 

7 ‘‘(A) GRANTS TO NONPROFITS.— 

8 ‘‘(i) IN GENERAL.—The Secretary 

9 may make grants to nonprofit organiza10 tions to enable the organizations to provide 

11 to associations that provide water and 

12 wastewater services in rural areas technical 

13 assistance and training— 

14 ‘‘(I) to identify, and evaluate al15 ternative solutions to, problems relat16 ing to the obtaining, storage, treat17 ment, purification, or distribution of 

18 water or the collection, treatment, or 

19 disposal of waste in rural areas; 

20 ‘‘(II) to prepare applications to 

21 receive financial assistance for any 

22 purpose specified in subsection (a)(1) 

23 from any public or private source; and 

24 ‘‘(III) to improve the operation 

25 and maintenance practices at any exVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00554 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 isting works for the storage, treat2 ment, purification, or distribution of 

3 water or the collection, treatment, or 

4 disposal of waste in rural areas. 

5 ‘‘(ii) SELECTION PRIORITY.—In se6 lecting recipients of grants to be made 

7 under clause (i), the Secretary shall give 

8 priority to nonprofit organizations that 

9 have experience in providing the technical 

10 assistance and training described in clause 

11 (i) to associations serving rural areas in 

12 which— 

13 ‘‘(I) residents have low income; 

14 and 

15 ‘‘(II) water supply systems or 

16 waste facilities are unhealthful. 

17 ‘‘(iii) FUNDING.— 

18 ‘‘(I) IN GENERAL.—Except as 

19 provided in subclause (II), not less 

20 than 1 nor more than 3 percent of 

21 any funds made available to carry out 

22 water and waste disposal projects de23 scribed in subsection (a) for any fiscal 

24 year shall be reserved for grants 

25 under this paragraph. 


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1 ‘‘(II) EXCEPTION.—The min2 imum amount specified in subclause 

3 (I) shall not apply if the aggregate 

4 amount of grant funds requested by 

5 applications that qualify for grants re6 ceived by the Secretary from eligible 

7 nonprofit organizations for the fiscal 

8 year totals less than 1 percent of 

9 those funds. 

10 ‘‘(B) RURAL WATER AND WASTEWATER

11 CIRCUIT RIDER PROGRAM.— 

12 ‘‘(i) IN GENERAL.—The Secretary 

13 shall continue a national rural water and 

14 wastewater circuit rider program that— 

15 ‘‘(I) is consistent with the activi16 ties and results of the program con17 ducted before January 1, 2012, as de18 termined by the Secretary; and 

19 ‘‘(II) received funding from the 

20 Secretary, acting through the Admin21 istrator of the Rural Utilities Service. 

22 ‘‘(ii) AUTHORIZATION OF APPROPRIA23 TIONS.—There is authorized to be appro24 priated to carry out this subparagraph 


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1 $25,000,000 for fiscal year 2013 and each 

2 fiscal year thereafter. 

3 ‘‘(6) SEARCH PROGRAM.— 

4 ‘‘(A) IN GENERAL.—The Secretary may es5 tablish a Special Evaluation Assistance for 

6 Rural Communities and Households 

7 (SEARCH) program to make predevelopment 

8 planning grants for feasibility studies, design 

9 assistance, and technical assistance, to finan10 cially distressed communities in rural areas 

11 with populations of 2,500 or fewer inhabitants 

12 for water and waste disposal projects described 

13 in this section. 

14 ‘‘(B) TERMS.— 

15 ‘‘(i) DOCUMENTATION.—With respect 

16 to grants made under this paragraph, the 

17 Secretary shall require the lowest quantity 

18 of documentation practicable. 

19 ‘‘(ii) MATCHING.—Notwithstanding 

20 any other provision of this section, the Sec21 retary may fund up to 100 percent of the 

22 eligible costs of grants provided under this 

23 paragraph, as determined by the Secretary. 

24 ‘‘(iii) FUNDING.—The Secretary may 

25 use not more than 4 percent of the total 


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1 amount of funds made available for a fiscal 

2 year for water, waste disposal, and essen3 tial community facility activities under this 

4 chapter to carry out this paragraph. 

5 ‘‘(C) RELATIONSHIP TO OTHER AUTHOR6 ITY.— 

7 ‘‘(i) IN GENERAL.—The funds and au8 thorities provided under this paragraph are 

9 in addition to any other funds or authori10 ties the Secretary may have to carry out 

11 activities described in this section. 

12 ‘‘(ii) AUTHORIZED ACTIVITIES.—The 

13 Secretary may furnish financial assistance 

14 or other aid in planning projects for the 

15 purposes described in subparagraph (A). 

16 ‘‘(f) PRIORITY.—In making grants and loans, and 

17 guaranteeing loans, for water, wastewater, and waste dis18 posal projects under this section, the Secretary shall give 

19 priority consideration to projects that serve rural commu20 nities that, as determined by the Secretary— 

21 ‘‘(1) have a population of less than 5,500 per22 manent residents; 

23 ‘‘(2) have a community water, wastewater, or 

24 waste disposal system that— 

25 ‘‘(A) is experiencing— 


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1 ‘‘(i) an unanticipated reduction in the 

2 quality of water, the quantity of water, or 

3 the ability to deliver water; or 

4 ‘‘(ii) some other deterioration in the 

5 supply of water to the community; 

6 ‘‘(B) is not adequate to meet the needs of 

7 the community; and 

8 ‘‘(C) requires immediate corrective action; 

9 ‘‘(3) are experiencing outmigration; 

10 ‘‘(4) have a high percentage of low-income resi11 dents; or 

12 ‘‘(5) are isolated from other significant popu13 lation centers. 

14 ‘‘(g) CURTAILMENT OR LIMITATION OF SERVICE

15 PROHIBITED.—The service provided or made available 

16 through any such association shall not be curtailed or lim17 ited by inclusion of the area served by such association 

18 within the boundaries of any municipal corporation or 

19 other public body, or by the granting of any private fran20 chise for similar service within such area during the term 

21 of such loan; nor shall the happening of any such event 

22 be the basis of requiring such association to secure any 

23 franchise, license, or permit as a condition to continuing 

24 to serve the area served by the association at the time 

25 of the occurrence of such event. 


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1 ‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There 

2 are authorized to be appropriated to carry out this section 

3 such sums as are necessary. 

4 ‘‘SEC. 3502. COMMUNITY FACILITIES LOANS, LOAN GUARAN5 TEES, AND GRANTS. 

6 ‘‘(a) IN GENERAL.—The Secretary may make grants 

7 and loans and issue loan guarantees (including a guar8 antee of a loan financed by the net proceeds of a bond 

9 described in section 142(a) of the Internal Revenue Code 

10 of 1986) to eligible entities described in subsection (b) for 

11 projects in rural areas that primarily serve rural residents 

12 to provide for— 

13 ‘‘(1) essential community facilities, including— 

14 ‘‘(A) necessary equipment; 

15 ‘‘(B) recreational developments; and 

16 ‘‘(2) financial assistance and other assistance in 

17 the planning of projects for purposes described in 

18 this section. 

19 ‘‘(b) ELIGIBLE ENTITIES.—Entities eligible for as20 sistance described in subsection (a) are— 

21 ‘‘(1) associations (including corporations not 

22 operated for profit); 

23 ‘‘(2) Indian tribes (including groups of individ24 uals described in paragraph (4) of section 815 of the 


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1 Native American Programs Act of 1974 (42 U.S.C. 

2 2992c)); and 

3 ‘‘(3) public and quasi-public agencies. 

4 ‘‘(c) LOAN AND LOAN GUARANTEE REQUIRE5 MENTS.— 

6 ‘‘(1) IN GENERAL.—In connection with loans 

7 made or guaranteed under this section, the Sec8 retary shall require the applicant— 

9 ‘‘(A) to certify in writing, and the Sec10 retary shall determine, that the applicant is un11 able to obtain sufficient credit elsewhere to fi12 nance the actual needs of the applicant; and 

13 ‘‘(B) to furnish an appropriate written fi14 nancial statement. 

15 ‘‘(2) DEBT RESTRUCTURING AND LOAN SERV16 ICING FOR COMMUNITY FACILITY LOANS.—The Sec17 retary shall establish and implement a program that 

18 is similar to the program established under section 

19 3411, except that the debt restructuring and loan 

20 servicing procedures shall apply to delinquent com21 munity facility program loans to a hospital or health 

22 care facility under subsection (a). 

23 ‘‘(d) GRANT AMOUNTS.— 

24 ‘‘(1) MAXIMUM.—Except as otherwise provided 

25 in this subsection, the amount of any grant made 


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1 under this section shall not exceed 75 percent of the 

2 development cost of the project for which the grant 

3 is provided. 

4 ‘‘(2) GRANT RATE.—The Secretary shall estab5 lish the grant rate for each project in conformity 

6 with regulations issued by the Secretary that shall 

7 provide for a graduated scale of grant rates that es8 tablish higher rates for projects in communities that 

9 have— 

10 ‘‘(A) low community population; 

11 ‘‘(B) high rates of outmigration; and 

12 ‘‘(C) low income levels. 

13 ‘‘(3) LOCAL SHARE REQUIREMENTS.—Grants 

14 made under this section may be used to pay the 

15 local share requirements of another Federal grant16 in-aid program to the extent permitted under the 

17 law providing for the grant-in-aid program. 

18 ‘‘(e) PRIORITY.—In making grants and loans, and 

19 guaranteeing loans under this section, the Secretary shall 

20 give priority consideration to projects that serve rural 

21 communities that— 

22 ‘‘(1) have a population of less than 20,000 per23 manent residents; 

24 ‘‘(2) are experiencing outmigration; 


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1 ‘‘(3) have a high percentage of low-income resi2 dents; or 

3 ‘‘(4) are isolated from other significant popu4 lation centers. 

5 ‘‘(f) TRIBAL COLLEGES AND UNIVERSITIES.— 

6 ‘‘(1) IN GENERAL.—The Secretary may make 

7 grants to an entity that is a Tribal College or Uni8 versity (as defined in section 316(b) of the Higher 

9 Education Act of 1965 (20 U.S.C. 1059c(b))) to 

10 provide the Federal share of the cost of developing 

11 specific Tribal College or University essential com12 munity facilities in rural areas. 

13 ‘‘(2) FEDERAL SHARE.—The Secretary shall es14 tablish the maximum percentage of the cost of the 

15 project that may be covered by a grant under this 

16 subsection, except that the Secretary may not re17 quire non-Federal financial support in an amount 

18 that is greater than 5 percent of the total cost of the 

19 project. 

20 ‘‘(3) AUTHORIZATION OF APPROPRIATIONS.— 

21 There is authorized to be appropriated to carry out 

22 this subsection $10,000,000 for each of fiscal years 

23 2013 through 2017. 

24 ‘‘(g) TECHNICAL ASSISTANCE FOR COMMUNITY FA25 CILITIES PROJECTS.— 


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1 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

2 the Secretary may use funds made available for com3 munity facilities programs authorized under this sec4 tion to provide technical assistance to applicants and 

5 participants for community facilities programs. 

6 ‘‘(2) FUNDING.—The Secretary may use not 

7 more than 3 percent of the amount of funds made 

8 available to participants for a fiscal year for a com9 munity facilities program to provide technical assist10 ance described in paragraph (1). 

11 ‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There 

12 are authorized to be appropriated to carry out this section 

13 such sums as are necessary. 

14 ‘‘SEC. 3503. HEALTH CARE SERVICES. 

15 ‘‘(a) PURPOSE.—The purpose of this section is to ad16 dress the continued unmet health needs in the Delta re17 gion through cooperation among health care professionals, 

18 institutions of higher education, research institutions, and 

19 other individuals and entities in the region. 

20 ‘‘(b) DEFINITION OF ELIGIBLE ENTITY.—In this sec21 tion, the term ‘eligible entity’ means a consortium of re22 gional institutions of higher education, academic health 

23 and research institutes, and economic development entities 

24 located in the Delta region that have experience in ad25 dressing the health care issues in the region. 


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1 ‘‘(c) GRANTS.—To carry out the purpose described 

2 in subsection (a), the Secretary may award a grant to an 

3 eligible entity for— 

4 ‘‘(1) the development of— 

5 ‘‘(A) health care services; 

6 ‘‘(B) health education programs; and 

7 ‘‘(C) health care job training programs; 

8 and 

9 ‘‘(2) the development and expansion of public 

10 health-related facilities in the Delta region to ad11 dress longstanding and unmet health needs of the 

12 region. 

13 ‘‘(d) USE.—As a condition of the receipt of the grant, 

14 the eligible entity shall use the grant to fund projects and 

15 activities described in subsection (c), based on input solic16 ited from local governments, public health care providers, 

17 and other entities in the Delta region. 

18 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There 

19 is authorized to be appropriated to the Secretary to carry 

20 out this section $3,000,000 for each of fiscal years 2013 

21 through 2017. 

22 ‘‘CHAPTER 2—RURAL BUSINESS AND 

23 COOPERATIVE DEVELOPMENT 

24 ‘‘SEC. 3601. BUSINESS PROGRAMS. 

25 ‘‘(a) RURAL BUSINESS DEVELOPMENT GRANTS.— 


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

2 grants under this subsection to eligible entities de3 scribed in paragraph (2) in rural areas that pri4 marily serve rural areas for purposes described in 

5 paragraph (3). 

6 ‘‘(2) ELIGIBLE ENTITIES.—The Secretary may 

7 make grants under this subsection to— 

8 ‘‘(A) governmental entities; 

9 ‘‘(B) Indian tribes; and 

10 ‘‘(C) nonprofit entities. 

11 ‘‘(3) ELIGIBLE PURPOSES FOR GRANTS.—Eligi12 ble entities that receive grants under this subsection 

13 may use the grant funds for— 

14 ‘‘(A) business opportunity projects that— 

15 ‘‘(i) identify and analyze business op16 portunities; 

17 ‘‘(ii) identify, train, and provide tech18 nical assistance to existing or prospective 

19 rural entrepreneurs and managers; 

20 ‘‘(iii) assist in the establishment of 

21 new rural businesses and the maintenance 

22 of existing businesses, including through 

23 business support centers; 

24 ‘‘(iv) conduct regional, community, 

25 and local economic development planning 


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1 and coordination, and leadership develop2 ment; and 

3 ‘‘(v) establish centers for training, 

4 technology, and trade that will provide 

5 training to rural businesses in the use of 

6 interactive communications technologies to 

7 develop international trade opportunities 

8 and markets; and 

9 ‘‘(B) projects that support the development 

10 of business enterprises that finance or facili11 tate— 

12 ‘‘(i) the development of small and 

13 emerging private business enterprise; 

14 ‘‘(ii) the establishment, expansion, 

15 and operation of rural distance learning 

16 networks; 

17 ‘‘(iii) the development of rural learn18 ing programs that provide educational in19 struction or job training instruction related 

20 to potential employment or job advance21 ment to adult students; and 

22 ‘‘(iv) the provision of technical assist23 ance and training to rural communities for 

24 the purpose of improving passenger trans25 portation services or facilities. 


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1 ‘‘(4) AUTHORIZATION OF APPROPRIATIONS.— 

2 There is authorized to be appropriated to the Sec3 retary to carry out this subsection $65,000,000 for 

4 each of fiscal years 2013 through 2017, to remain 

5 available until expended. 

6 ‘‘(b) VALUE-ADDED AGRICULTURAL PRODUCER

7 GRANTS.— 

8 ‘‘(1) DEFINITIONS.—In this subsection: 

9 ‘‘(A) MID-TIER VALUE CHAIN.—The term 

10 ‘mid-tier value chain’ means a local and re11 gional supply network that links independent 

12 producers with businesses and cooperatives that 

13 market value-added agricultural products in a 

14 manner that— 

15 ‘‘(i) targets and strengthens the prof16 itability and competitiveness of small- and 

17 medium-sized farms that are structured as 

18 family farms; and 

19 ‘‘(ii) obtains agreement from an eligi20 ble agricultural producer group, farmer co21 operative, or majority-controlled producer22 based business venture that is engaged in 

23 the value chain on a marketing strategy. 

24 ‘‘(B) PRODUCER.—The term ‘producer’ 

25 means a farmer. 


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1 ‘‘(C) VALUE-ADDED AGRICULTURAL PROD2 UCT.—The term ‘value-added agricultural prod3 uct’ means any agricultural commodity or prod4 uct— 

5 ‘‘(i) that— 

6 ‘‘(I) has undergone a change in 

7 physical state; 

8 ‘‘(II) was produced in a manner 

9 that enhances the value of the agricul10 tural commodity or product, as dem11 onstrated through a business plan 

12 that shows the enhanced value, as de13 termined by the Secretary; 

14 ‘‘(III) is physically segregated in 

15 a manner that results in the enhance16 ment of the value of the agricultural 

17 commodity or product; 

18 ‘‘(IV) is a source of farm-based 

19 renewable energy, including E–85 

20 fuel; or 

21 ‘‘(V) is aggregated and marketed 

22 as a locally produced agricultural food 

23 product; and 

24 ‘‘(ii) for which, as a result of the 

25 change in physical state or the manner in 


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1 which the agricultural commodity or prod2 uct was produced, marketed, or seg3 regated— 

4 ‘‘(I) the customer base for the 

5 agricultural commodity or product is 

6 expanded; and 

7 ‘‘(II) a greater portion of the rev8 enue derived from the marketing, 

9 processing, or physical segregation of 

10 the agricultural commodity or product 

11 is available to the producer of the 

12 commodity or product. 

13 ‘‘(2) GRANTS.— 

14 ‘‘(A) IN GENERAL.—The Secretary may 

15 make grants under this subsection to— 

16 ‘‘(i) independent producers of value17 added agricultural products; and 

18 ‘‘(ii) an agricultural producer group, 

19 farmer cooperative, or majority-controlled 

20 producer-based business venture, as deter21 mined by the Secretary. 

22 ‘‘(B) GRANTS TO A PRODUCER.—A grantee 

23 under subparagraph (A)(i) shall use the 

24 grant— 


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1 ‘‘(i) to develop a business plan or per2 form a feasibility study to establish a via3 ble marketing opportunity (including 

4 through mid-tier value chains) for value5 added agricultural products; or 

6 ‘‘(ii) to provide capital to establish al7 liances or business ventures that allow the 

8 producer to better compete in domestic or 

9 international markets. 

10 ‘‘(C) GRANTS TO AN AGRICULTURAL PRO11 DUCER GROUP, COOPERATIVE OR PRODUCER12 BASED BUSINESS VENTURE.—A grantee under 

13 subparagraph (A)(ii) shall use the grant— 

14 ‘‘(i) to develop a business plan for via15 ble marketing opportunities in emerging 

16 markets for a value-added agricultural 

17 product; or 

18 ‘‘(ii) to develop strategies that are in19 tended to create marketing opportunities 

20 in emerging markets for the value-added 

21 agricultural product. 

22 ‘‘(D) AWARD SELECTION.— 

23 ‘‘(i) PRIORITY.—In awarding grants 

24 under this subsection, the Secretary shall 

25 give priority to projects— 


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1 ‘‘(I) that contribute to increasing 

2 opportunities for operators of small3 and medium-sized farms that are 

4 structured as family farms; or 

‘‘(II) at least 1 5 ⁄4 of the recipients 

6 of which are beginning farmers or so7 cially disadvantaged farmers. 

8 ‘‘(ii) RANKING.—In evaluating and 

9 ranking proposals under this subsection, 

10 the Secretary shall provide substantial 

11 weight to the priorities described in clause 

12 (i). 

13 ‘‘(E) AMOUNT OF GRANT.— 

14 ‘‘(i) IN GENERAL.—The total amount 

15 provided to a grant recipient under this 

16 subsection shall not exceed $500,000. 

17 ‘‘(ii) MAJORITY-CONTROLLED, PRO18 DUCER-BASED BUSINESS VENTURES.—The 

19 total amount of all grants provided to ma20 jority-controlled, producer-based business 

21 ventures under this subsection for a fiscal 

22 year shall not exceed 10 percent of the 

23 amount of funds used to make all grants 

24 for the fiscal year under this subsection. 


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1 ‘‘(F) TERM.—The term of a grant under 

2 this paragraph shall not exceed 3 years. 

3 ‘‘(G) SIMPLIFIED APPLICATION.—The Sec4 retary shall offer a simplified application form 

5 and process for project proposals requesting 

6 less than $50,000 under this subsection. 

7 ‘‘(3) FUNDING.— 

8 ‘‘(A) AUTHORIZATION OF APPROPRIA9 TIONS.—There is authorized to be appropriated 

10 to carry out this subsection $40,000,000 for 

11 each of fiscal years 2013 through 2017. 

12 ‘‘(B) RESERVATION OF FUNDS FOR

13 PROJECTS TO BENEFIT BEGINNING FARMERS, 

14 SOCIALLY DISADVANTAGED FARMERS, AND MID15 TIER VALUE CHAINS.— 

16 ‘‘(i) IN GENERAL.—The Secretary 

17 shall reserve 10 percent of the amounts 

18 made available for each fiscal year under 

19 this subsection to fund projects that ben20 efit beginning farmers or socially disadvan21 taged farmers. 

22 ‘‘(ii) MID-TIER VALUE CHAINS.—The 

23 Secretary shall reserve 10 percent of the 

24 amounts made available for each fiscal 

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1 tions of eligible entities described in para2 graph (2) that propose to develop mid-tier 

3 value chains. 

4 ‘‘(iii) UNOBLIGATED AMOUNTS.—Any 

5 amounts in the reserves for a fiscal year 

6 established under clauses (i) and (ii) that 

7 are not obligated by June 30 of the fiscal 

8 year shall be available to the Secretary to 

9 make grants under this subsection to eligi10 ble entities in any State, as determined by 

11 the Secretary. 

12 ‘‘(c) RURAL COOPERATIVE DEVELOPMENT

13 GRANTS.— 

14 ‘‘(1) DEFINITIONS.—In this subsection: 

15 ‘‘(A) NONPROFIT INSTITUTION.—The term 

16 ‘nonprofit institution’ means any organization 

17 or institution, including an accredited institu18 tion of higher education, no part of the net 

19 earnings of which inures, or may lawfully inure, 

20 to the benefit of any private shareholder or in21 dividual. 

22 ‘‘(B) UNITED STATES.—The term ‘United 

23 States’ means— 

24 ‘‘(i) the several States; and 

25 ‘‘(ii) the District of Columbia. 


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1 ‘‘(2) GRANTS.—The Secretary shall make 

2 grants under this subsection to nonprofit institutions 

3 for the purpose of enabling the nonprofit institutions 

4 to establish and operate centers for rural cooperative 

5 development. 

6 ‘‘(3) GOALS.—The goals of a center funded 

7 under this subsection shall be to facilitate the cre8 ation of jobs in rural areas through the development 

9 of new rural cooperatives, value -added processing, 

10 and rural businesses. 

11 ‘‘(4) APPLICATION.— 

12 ‘‘(A) IN GENERAL.—Any nonprofit institu13 tion seeking a grant under paragraph (2) shall 

14 submit to the Secretary an application con15 taining a plan for the establishment and oper16 ation by the institution of 1 or more centers for 

17 cooperative development. 

18 ‘‘(B) REQUIREMENTS.—The Secretary 

19 may approve an application if the plan contains 

20 the following: 

21 ‘‘(i) A provision that substantiates 

22 that the center will effectively serve rural 

23 areas in the United States. 

24 ‘‘(ii) A provision that the primary ob25 jective of the center will be to improve the 


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1 economic condition of rural areas through 

2 cooperative development. 

3 ‘‘(iii) A description of the activities 

4 that the center will carry out to accomplish 

5 the objective, which may include pro6 grams— 

7 ‘‘(I) for applied research and fea8 sibility studies that may be useful to 

9 individuals, cooperatives, small busi10 nesses, and other similar entities in 

11 rural areas served by the center; 

12 ‘‘(II) for the collection, interpre13 tation, and dissemination of informa14 tion that may be useful to individuals, 

15 cooperatives, small businesses, and 

16 other similar entities in rural areas 

17 served by the center; 

18 ‘‘(III) providing training and in19 struction for individuals, cooperatives, 

20 small businesses, and other similar 

21 entities in rural areas served by the 

22 center; 

23 ‘‘(IV) providing loans and grants 

24 to individuals, cooperatives, small 


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1 businesses, and other similar entities 

2 in rural areas served by the center; 

3 ‘‘(V) providing technical assist4 ance, research services, and advisory 

5 services to individuals, cooperatives, 

6 small businesses, and other similar 

7 entities in rural areas served by the 

8 center; and 

9 ‘‘(VI) providing for the coordina10 tion of services and sharing of infor11 mation by the center. 

12 ‘‘(iv) A description of the contribu13 tions that the activities are likely to make 

14 to the improvement of the economic condi15 tions of the rural areas for which the cen16 ter will provide services. 

17 ‘‘(v) Provisions that the center, in car18 rying out the activities, will seek, if appro19 priate, the advice, participation, expertise, 

20 and assistance of representatives of busi21 ness, industry, educational institutions, the 

22 Federal Government, and State and local 

23 governments. 

24 ‘‘(vi) Provisions that the center will 

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1 tinuing sources of financial support for the 

2 center, particularly from sources in the pri3 vate sector. 

4 ‘‘(vii) Provisions for— 

5 ‘‘(I) monitoring and evaluating 

6 the activities by the nonprofit institu7 tion operating the center; and 

8 ‘‘(II) accounting for funds re9 ceived by the institution under this 

10 section. 

11 ‘‘(5) AWARDING GRANTS.— 

12 ‘‘(A) IN GENERAL.—Grants made under 

13 paragraph (2) shall be made on a competitive 

14 basis. 

15 ‘‘(B) PREFERENCE.—In making grants 

16 under paragraph (2), the Secretary shall give 

17 preference to grant applications providing for 

18 the establishment of centers for rural coopera19 tive development that— 

20 ‘‘(i) demonstrate a proven track 

21 record in carrying out activities to promote 

22 and assist the development of cooperatively 

23 and mutually owned businesses; 

24 ‘‘(ii) demonstrate previous expertise in 

25 providing technical assistance in rural 


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1 areas to promote and assist the develop2 ment of cooperatively and mutually owned 

3 businesses; 

4 ‘‘(iii) demonstrate the ability to assist 

5 in the retention of businesses, facilitate the 

6 establishment of cooperatives and new co7 operative approaches, and generate em8 ployment opportunities that will improve 

9 the economic conditions of rural areas; 

10 ‘‘(iv) commit to providing technical 

11 assistance and other services to under12 served and economically distressed areas in 

13 rural areas of the United States; 

14 ‘‘(v) demonstrate a commitment to— 

15 ‘‘(I) networking with and sharing 

16 the results of the efforts of the center 

17 with other cooperative development 

18 centers and other organizations in19 volved in rural economic development 

20 efforts; and 

21 ‘‘(II) developing multiorganiza22 tion and multistate approaches to ad23 dressing the economic development 

24 and cooperative needs of rural areas; 

25 and 


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1 ‘‘(vi) commit to providing a 25 per2 cent matching contribution with private 

3 funds and in-kind contributions, except 

4 that the Secretary shall not require non5 Federal financial support in an amount 

6 that is greater than 5 percent in the case 

7 of a 1994 institution (as defined in section 

8 532 of the Equity in Educational Land9 Grant Status Act of 1994 (7 U.S.C. 301 

10 note; Public Law 103–382)). 

11 ‘‘(6) GRANT PERIOD.— 

12 ‘‘(A) IN GENERAL.—A grant awarded to a 

13 center that has received no prior funding under 

14 this subsection shall be made for a period of 1 

15 year. 

16 ‘‘(B) MULTIYEAR GRANTS.—If the Sec17 retary determines it to be in the best interest 

18 of the program, the Secretary shall award 

19 grants for a period of more than 1 year, but 

20 not more than 3 years, to a center that has suc21 cessfully met the requirements of paragraph 

22 (5)(B), as determined by the Secretary. 

23 ‘‘(7) AUTHORITY TO EXTEND GRANT PERIOD.— 

24 The Secretary may extend for 1 additional 12-month 


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1 period the period during which a grantee may use a 

2 grant made under this subsection. 

3 ‘‘(8) TECHNICAL ASSISTANCE TO PREVENT EX4 CESSIVE UNEMPLOYMENT OR UNDEREMPLOY5 MENT.— 

6 ‘‘(A) IN GENERAL.—In carrying out this 

7 subsection, the Secretary may provide technical 

8 assistance to alleviate or prevent conditions of 

9 excessive unemployment, underemployment, 

10 outmigration, or low employment growth in eco11 nomically distressed rural areas that the Sec12 retary determines have a substantial need for 

13 the assistance. 

14 ‘‘(B) INCLUSIONS.—The assistance may 

15 include planning and feasibility studies, man16 agement and operational assistance, and studies 

17 evaluating the need for the development poten18 tial of projects that increase employment and 

19 improve economic growth in the areas. 

20 ‘‘(9) GRANTS TO DEFRAY ADMINISTRATIVE

21 COSTS.— 

22 ‘‘(A) IN GENERAL.—The Secretary may 

23 make grants to defray not to exceed 75 percent 

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1 lic bodies to carry out projects for which grants 

2 or loans are made under this subsection. 

3 ‘‘(B) COST-SHARING.—For purposes of de4 termining the non-Federal share of the costs, 

5 the Secretary shall include contributions in cash 

6 and in kind, fairly evaluated, including prem7 ises, equipment, and services. 

8 ‘‘(10) COOPERATIVE RESEARCH PROGRAM.— 

9 The Secretary shall offer to enter into a cooperative 

10 research agreement with 1 or more qualified aca11 demic institutions in each fiscal year to conduct re12 search on the effects of all types of cooperatives on 

13 the national economy. 

14 ‘‘(11) ADDRESSING NEEDS OF MINORITY COM15 MUNITIES.— 

16 ‘‘(A) IN GENERAL.—If the total amount 

17 appropriated under paragraph (13) for a fiscal 

18 year exceeds $7,500,000, the Secretary shall re19 serve an amount equal to 20 percent of the 

20 total amount appropriated for grants for coop21 erative development centers, individual coopera22 tives, or groups of cooperatives— 

23 ‘‘(i) that serve socially disadvantaged 

24 groups; and 


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1 ‘‘(ii) a majority of the boards of direc2 tors or governing boards of which are com3 prised of individuals who are members of 

4 socially disadvantaged groups. 

5 ‘‘(B) INSUFFICIENT APPLICATIONS.—To 

6 the extent there are insufficient applications to 

7 carry out subparagraph (A), the Secretary shall 

8 use the funds as otherwise authorized by this 

9 subsection. 

10 ‘‘(12) INTERAGENCY WORKING GROUP.—Not 

11 later than 90 days after the date of enactment of 

12 the Agriculture Reform, Food, and Jobs Act of 

13 2012, the Secretary shall coordinate and chair an 

14 interagency working group to foster cooperative de15 velopment and ensure coordination with Federal 

16 agencies and national and local cooperative organiza17 tions that have cooperative programs and interests. 

18 ‘‘(13) AUTHORIZATION OF APPROPRIATIONS.— 

19 There is authorized to be appropriated to carry out 

20 this subsection $50,000,000 for each of fiscal years 

21 2013 through 2017. 

22 ‘‘(d) APPROPRIATE TECHNOLOGY TRANSFER FOR

23 RURAL AREAS PROGRAM.— 

24 ‘‘(1) DEFINITION OF NATIONAL NONPROFIT AG25 RICULTURAL ASSISTANCE INSTITUTION.—In this 


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1 subsection, the term ‘national nonprofit agricultural 

2 assistance institution’ means an organization that— 

3 ‘‘(A) is described in section 501(c)(3) of 

4 the Internal Revenue Code of 1986 and exempt 

5 from taxation under 501(a) of that Code; 

6 ‘‘(B) has staff and offices in multiple re7 gions of the United States; 

8 ‘‘(C) has experience and expertise in oper9 ating national agricultural technical assistance 

10 programs; 

11 ‘‘(D) expands markets for the agricultural 

12 commodities produced by producers through the 

13 use of practices that enhance the environment, 

14 natural resource base, and quality of life; and 

15 ‘‘(E) improves the economic viability of ag16 ricultural operations. 

17 ‘‘(2) ESTABLISHMENT.—The Secretary shall es18 tablish a national appropriate technology transfer 

19 for rural areas program to assist agricultural pro20 ducers that are seeking information— 

21 ‘‘(A) to reduce input costs; 

22 ‘‘(B) to conserve energy resources; 

23 ‘‘(C) to diversify operations through new 

24 energy crops and energy generation facilities; 

25 and 


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1 ‘‘(D) to expand markets for agricultural 

2 commodities produced by the producers by 

3 using practices that enhance the environment, 

4 natural resource base, and quality of life. 

5 ‘‘(3) IMPLEMENTATION.— 

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

7 carry out the program under this subsection by 

8 making a grant to, or offering to enter into a 

9 cooperative agreement with, a national non10 profit agricultural assistance institution. 

11 ‘‘(B) GRANT AMOUNT.—A grant made, or 

12 cooperative agreement entered into, under sub13 paragraph (A) shall provide 100 percent of the 

14 cost of providing information described in para15 graph (2). 

16 ‘‘(4) AUTHORIZATION OF APPROPRIATIONS.— 

17 There is authorized to be appropriated to carry out 

18 this subsection $5,000,000 for each of fiscal years 

19 2013 through 2017. 

20 ‘‘(e) BUSINESS AND INDUSTRY DIRECT AND GUAR21 ANTEED LOANS.— 

22 ‘‘(1) DEFINITION OF BUSINESS AND INDUSTRY

23 LOAN.—In this section, the term ‘business and in24 dustry loan’ means a direct loan that is made, or a 


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1 loan that is guaranteed, by the Secretary under this 

2 subsection. 

3 ‘‘(2) LOAN PURPOSES.—The Secretary may 

4 make business and industry loans to public, private, 

5 or cooperative organizations organized for profit or 

6 nonprofit, private investment funds that invest pri7 marily in cooperative organizations, or to individ8 uals— 

9 ‘‘(A) to improve, develop, or finance busi10 ness, industry, and employment and improve 

11 the economic and environmental climate in 

12 rural communities, including pollution abate13 ment and control; 

14 ‘‘(B) to conserve, develop, and use water 

15 for aquaculture purposes in rural areas; and 

16 ‘‘(C) to reduce the reliance on nonrenew17 able energy resources by encouraging the devel18 opment and construction of renewable energy 

19 systems (including solar energy systems, wind 

20 energy systems, and anaerobic digestors for the 

21 purpose of energy generation), including the 

22 modification of existing systems, in rural areas. 

23 ‘‘(3) LOAN GUARANTEES FOR CERTAIN

24 LOANS.—The Secretary may guarantee loans made 


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1 under this subsection to finance the issuance of 

2 bonds for the projects described in paragraph (2). 

3 ‘‘(4) MAXIMUM AMOUNT OF PRINCIPAL.— 

4 ‘‘(A) IN GENERAL.—Except as otherwise 

5 provided in this paragraph, no loan may be 

6 made or guaranteed under this subsection that 

7 exceeds $25,000,000 in principal amount. 

8 ‘‘(B) LIMITATIONS ON LOAN GUARANTEES

9 FOR COOPERATIVE ORGANIZATIONS.— 

10 ‘‘(i) PRINCIPAL AMOUNT.—Subject to 

11 clause (ii), the principal amount of a busi12 ness and industry loan made to a coopera13 tive organization and guaranteed under 

14 this subsection shall not exceed 

15 $40,000,000. 

16 ‘‘(ii) USE.—To be eligible for a guar17 antee under this subsection for a business 

18 and industry loan made to a cooperative 

19 organization, the principal amount of the 

20 loan in excess of $25,000,000 shall be used 

21 to carry out a project that is in a rural 

22 area and— 

23 ‘‘(I) provides for the value-added 

24 processing of agricultural commod25 ities; or 


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1 ‘‘(II) significantly benefits 1 or 

2 more entities eligible for assistance for 

3 the purposes described in paragraph 

4 (2), as determined by the Secretary. 

5 ‘‘(iii) APPLICATIONS.—If a coopera6 tive organization submits an application 

7 for a guarantee under this paragraph, the 

8 Secretary shall make the determination 

9 whether to approve the application, and 

10 the Secretary may not delegate this au11 thority. 

12 ‘‘(iv) MAXIMUM AMOUNT.—The total 

13 amount of business and industry loans 

14 made to cooperative organizations and 

15 guaranteed for a fiscal year under this 

16 subsection with principal amounts that are 

17 in excess of $25,000,000 may not exceed 

18 10 percent of the total amount of business 

19 and industry loans guaranteed for the fis20 cal year under this subsection. 

21 ‘‘(5) FEES.—The Secretary may assess a 1- 

22 time fee and an annual renewal fee for any guaran23 teed business and industry loan in an amount that 

24 does not exceed 3 percent of the guaranteed prin25 cipal portion of the loan. 


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1 ‘‘(6) INTANGIBLE ASSETS.—In determining 

2 whether a cooperative organization is eligible for a 

3 guaranteed business and industry loan, the Sec4 retary may consider the market value of a properly 

5 appraised brand name, patent, or trademark of the 

6 cooperative. 

7 ‘‘(7) LOAN APPRAISALS.—The Secretary may 

8 require that any appraisal made in connection with 

9 a business and industry loan be conducted by a spe10 cialized appraiser that uses standards that are com11 parable to standards used for similar purposes in the 

12 private sector, as determined by the Secretary. 

13 ‘‘(8) LOAN GUARANTEES FOR THE PURCHASE

14 OF COOPERATIVE STOCK.— 

15 ‘‘(A) IN GENERAL.—The Secretary may 

16 guarantee a business and industry loan to indi17 vidual farmers to purchase capital stock of a 

18 farmer cooperative established for the purpose 

19 of processing an agricultural commodity. 

20 ‘‘(B) PROCESSING CONTRACTS DURING INI21 TIAL PERIOD.—A cooperative described in sub22 paragraph (A) for which a farmer receives a 

23 guarantee to purchase stock under that sub24 paragraph may contract for services to process 

25 agricultural commodities or otherwise process 


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1 value added for the period beginning on the 

2 date of the startup of the cooperative in order 

3 to provide adequate time for the planning and 

4 construction of the processing facility of the co5 operative. 

6 ‘‘(C) FINANCIAL INFORMATION.—Financial 

7 information required by the Secretary from a 

8 farmer as a condition of making a business and 

9 industry loan guarantee under this paragraph 

10 shall be provided in the manner generally re11 quired by commercial agricultural lenders in the 

12 applicable area. 

13 ‘‘(9) LOANS TO COOPERATIVES.— 

14 ‘‘(A) ELIGIBILITY.— 

15 ‘‘(i) IN GENERAL.—The Secretary 

16 may make or guarantee a business and in17 dustry loan to a cooperative organization 

18 that is headquartered in a metropolitan 

19 area if the loan is— 

20 ‘‘(I) used for a project or venture 

21 described in paragraph (2) that is lo22 cated in a rural area; or 

23 ‘‘(II) a loan guarantee that meets 

24 the requirements of paragraph (10). 


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1 ‘‘(ii) EQUITY.—The Secretary may 

2 guarantee a loan made for the purchase of 

3 preferred stock or similar equity issued by 

4 a cooperative organization or a fund that 

5 invests primarily in cooperative organiza6 tions, if the guarantee significantly bene7 fits 1 or more entities eligible for assist8 ance for the purposes described in para9 graph (2)(A), as determined by the Sec10 retary. 

11 ‘‘(B) REFINANCING.—A cooperative orga12 nization that is eligible for a business and in13 dustry loan shall be eligible to refinance an ex14 isting business and industry loan with a lender 

15 if— 

16 ‘‘(i) the cooperative organization— 

17 ‘‘(I) is current and performing 

18 with respect to the existing loan; and 

19 ‘‘(II)(aa) is not, and has not 

20 been, in payment default, with respect 

21 to the existing loan; or 

22 ‘‘(bb) has not converted any of 

23 the collateral with respect to the exist24 ing loan; and 


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1 ‘‘(ii) there is adequate security or full 

2 collateral for the refinanced loan. 

3 ‘‘(10) LOAN GUARANTEES IN NONRURAL

4 AREAS.—The Secretary may guarantee a business 

5 and industry loan to a cooperative organization for 

6 a facility that is not located in a rural area if— 

7 ‘‘(A) the primary purpose of the loan guar8 antee is for a facility to provide value-added 

9 processing for agricultural producers that are 

10 located within 80 miles of the facility; 

11 ‘‘(B) the applicant demonstrates to the 

12 Secretary that the primary benefit of the loan 

13 guarantee will be to provide employment for 

14 residents of a rural area; and 

15 ‘‘(C) the total amount of business and in16 dustry loans guaranteed for a fiscal year under 

17 this paragraph does not exceed 10 percent of 

18 the business and industry loans guaranteed for 

19 the fiscal year under this subsection. 

20 ‘‘(11) LOCALLY OR REGIONALLY PRODUCED AG21 RICULTURAL FOOD PRODUCTS.— 

22 ‘‘(A) DEFINITIONS.—In this paragraph: 

23 ‘‘(i) LOCALLY OR REGIONALLY PRO24 DUCED AGRICULTURAL FOOD PRODUCT.— 

25 The term ‘locally or regionally produced 


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1 agricultural food product’ means any agri2 cultural food product that is raised, pro3 duced, and distributed in— 

4 ‘‘(I) the locality or region in 

5 which the final product is marketed, 

6 so that the total distance that the 

7 product is transported is less than 

8 400 miles from the origin of the prod9 uct; or 

10 ‘‘(II) the State in which the 

11 product is produced. 

12 ‘‘(ii) UNDERSERVED COMMUNITY.— 

13 The term ‘underserved community’ means 

14 a community (including an urban or rural 

15 community and an Indian tribal commu16 nity) that, as determined by the Secretary, 

17 has— 

18 ‘‘(I) limited access to affordable, 

19 healthy foods, including fresh fruits 

20 and vegetables, in grocery retail stores 

21 or farmer-to-consumer direct markets; 

22 and 

23 ‘‘(II) a high rate of hunger or 

24 food insecurity or a high poverty rate. 


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1 ‘‘(B) LOAN AND LOAN GUARANTEE PRO2 GRAM.— 

3 ‘‘(i) IN GENERAL.—The Secretary 

4 shall make or guarantee loans to individ5 uals, cooperatives, cooperative organiza6 tions, businesses, and other entities to es7 tablish and facilitate enterprises that proc8 ess, distribute, aggregate, store, and mar9 ket locally or regionally produced agricul10 tural food products to support community 

11 development and farm income. 

12 ‘‘(ii) REQUIREMENT.—The recipient 

13 of a loan or loan guarantee under this 

14 paragraph shall include in an appropriate 

15 agreement with retail and institutional fa16 cilities to which the recipient sells locally 

17 or regionally produced agricultural food 

18 products a requirement to inform con19 sumers of the retail or institutional facili20 ties that the consumers are purchasing or 

21 consuming locally or regionally produced 

22 agricultural food products. 

23 ‘‘(iii) PRIORITY.—In making or guar24 anteeing a loan under this paragraph, the 

25 Secretary shall give priority to projects 


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1 that have components benefitting under2 served communities. 

3 ‘‘(iv) REPORTS.—Not later than 2 

4 years after the date of enactment of the 

5 Agriculture Reform, Food, and Jobs Act of 

6 2012 and annually thereafter, the Sec7 retary shall submit to the Committee on 

8 Agriculture of the House of Representa9 tives and the Committee on Agriculture, 

10 Nutrition, and Forestry of the Senate, and 

11 publish on the Internet, a report that de12 scribes projects carried out using loans or 

13 loan guarantees made under clause (i), in14 cluding— 

15 ‘‘(I) summary information about 

16 all projects; 

17 ‘‘(II) the characteristics of the 

18 communities served; and 

19 ‘‘(III) resulting benefits. 

20 ‘‘(v) RESERVATION OF FUNDS.—For 

21 each of fiscal years 2012 through 2017, 

22 the Secretary shall reserve not less than 5 

23 percent of the total amount of funds made 

24 available to carry out this subsection to 


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1 carry out this paragraph until April 1 of 

2 the fiscal year. 

3 ‘‘(vi) OUTREACH.—The Secretary 

4 shall develop and implement an outreach 

5 plan to publicize the availability of loans 

6 and loan guarantees under this paragraph, 

7 working closely with rural cooperative de8 velopment centers, credit unions, commu9 nity development financial institutions, re10 gional economic development authorities, 

11 and other financial and economic develop12 ment entities. 

13 ‘‘(12) AUTHORIZATION OF APPROPRIATIONS.— 

14 There is authorized to be appropriated to carry out 

15 this subsection $75,000,000 for each of fiscal years 

16 2013 through 2017. 

17 ‘‘(f) RELENDING PROGRAMS.— 

18 ‘‘(1) INTERMEDIATE RELENDING PROGRAM.— 

19 ‘‘(A) IN GENERAL.—The Secretary may 

20 make or guarantee loans to eligible entities de21 scribed in subparagraph (B) so that the eligible 

22 entities may relend the funds to individuals and 

23 entities for the purposes described in subpara24 graph (C). 


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1 ‘‘(B) ELIGIBLE ENTITIES.—Entities eligi2 ble for loans and loan guarantees described in 

3 subparagraph (A) are— 

4 ‘‘(i) public agencies; 

5 ‘‘(ii) Indian tribes; 

6 ‘‘(iii) cooperatives; and 

7 ‘‘(iv) nonprofit corporations. 

8 ‘‘(C) ELIGIBLE PURPOSES.—The proceeds 

9 from loans made or guaranteed by the Sec10 retary pursuant to subparagraph (A) may be 

11 relent by eligible entities for projects that— 

12 ‘‘(i) predominately serve communities 

13 in rural areas; and 

14 ‘‘(ii) as determined by the Secretary— 

15 ‘‘(I) promote community develop16 ment; 

17 ‘‘(II) establish new businesses; 

18 ‘‘(III) establish and support 

19 microlending programs; and 

20 ‘‘(IV) create or retain employ21 ment opportunities. 

22 ‘‘(D) AUTHORIZATION OF APPROPRIA23 TIONS.—There is authorized to be appropriated 

24 to carry out this subsection $50,000,000 for 

25 each of fiscal years 2013 through 2017. 


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1 ‘‘(2) RURAL MICROENTREPRENEUR ASSISTANCE

2 PROGRAM.— 

3 ‘‘(A) DEFINITIONS.—In this paragraph: 

4 ‘‘(i) MICROENTREPRENEUR.—The 

5 term ‘microentrepreneur’ means an owner 

6 and operator, or prospective owner and op7 erator, of a rural microenterprise who is 

8 unable to obtain sufficient training, tech9 nical assistance, or credit other than under 

10 this subsection, as determined by the Sec11 retary. 

12 ‘‘(ii) MICROENTERPRISE DEVELOP13 MENT ORGANIZATION.—The term ‘micro14 enterprise development organization’ 

15 means an organization that is— 

16 ‘‘(I) a nonprofit entity; 

17 ‘‘(II) an Indian tribe, the tribal 

18 government of which certifies to the 

19 Secretary that— 

20 ‘‘(aa) no microenterprise de21 velopment organization serves the 

22 Indian tribe; and 

23 ‘‘(bb) no rural microentre24 preneur assistance program exVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00598 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 ists under the jurisdiction of the 

2 Indian tribe; 

3 ‘‘(III) a public institution of 

4 higher education; or 

5 ‘‘(IV) a collaboration of rural 

6 nonprofit entities serving a region or 

7 State, if 1 lead nonprofit entity is the 

8 sole underwriter of all loans and is re9 sponsible for associated risks. 

10 ‘‘(iii) MICROLOAN.—The term 

11 ‘microloan’ means a business loan of not 

12 more than $50,000 that is provided to a 

13 rural microenterprise. 

14 ‘‘(iv) PROGRAM.—The term ‘program’ 

15 means the rural microentrepreneur assist16 ance program established under subpara17 graph (B). 

18 ‘‘(v) RURAL MICROENTERPRISE.—The 

19 term ‘rural microenterprise’ means a busi20 ness entity with not more than 10 full-time 

21 equivalent employees located in a rural 

22 area. 

23 ‘‘(vi) TRAINING.—The term ‘training’ 

24 means teaching broad business principles 


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1 or general business skills in a group or 

2 public setting. 

3 ‘‘(vii) TECHNICAL ASSISTANCE.—The 

4 term ‘technical assistance’ means working 

5 with a business client in a 1-to-1 manner 

6 to provide business and financial manage7 ment counseling, assist in the preparation 

8 of business or marketing plans, or provide 

9 other skills tailored to an individual micro10 entrepreneur. 

11 ‘‘(B) RURAL MICROENTREPRENEUR AS12 SISTANCE PROGRAM.— 

13 ‘‘(i) ESTABLISHMENT.—The Secretary 

14 shall establish a rural microentrepreneur 

15 assistance program to provide loans and 

16 grants to support microentrepreneurs in 

17 the development and ongoing success of 

18 rural microenterprises. 

19 ‘‘(ii) PURPOSE.—The purpose of the 

20 program is to provide microentrepreneurs 

21 with— 

22 ‘‘(I) the skills necessary to estab23 lish new rural microenterprises; and 

24 ‘‘(II) continuing technical and fi25 nancial assistance related to the sucVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00600 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 cessful operation of rural microenter2 prises. 

3 ‘‘(iii) LOANS.— 

4 ‘‘(I) IN GENERAL.—The Sec5 retary shall make loans to microenter6 prise development organizations for 

7 the purpose of providing fixed-interest 

8 rate microloans to microentrepreneurs 

9 for startup and growing rural micro10 enterprises. 

11 ‘‘(II) LOAN TERMS.—A loan 

12 made by the Secretary to a microen13 terprise development organization 

14 under this subparagraph shall— 

15 ‘‘(aa) be for a term not to 

16 exceed 20 years; and 

17 ‘‘(bb) bear an annual inter18 est rate of at least 1 percent. 

19 ‘‘(III) LOAN LOSS RESERVE

20 FUND.—The Secretary shall require 

21 each microenterprise development or22 ganization that receives a loan under 

23 this subparagraph to— 

24 ‘‘(aa) establish a loan loss 

25 reserve fund; and 


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1 ‘‘(bb) maintain the reserve 

2 fund in an amount equal to at 

3 least 5 percent of the outstanding 

4 balance of such loans owed by 

5 the microenterprise development 

6 organization, until all obligations 

7 owed to the Secretary under this 

8 subparagraph are repaid. 

9 ‘‘(IV) DEFERRAL OF INTEREST

10 AND PRINCIPAL.—The Secretary may 

11 permit the deferral of payments on 

12 principal and interest due on a loan to 

13 a microenterprise development organi14 zation made under this paragraph for 

15 a 2-year period beginning on the date 

16 on which the loan is made. 

17 ‘‘(iv) GRANTS TO SUPPORT RURAL MI18 CROENTERPRISE DEVELOPMENT.— 

19 ‘‘(I) IN GENERAL.—The Sec20 retary shall make grants to microen21 terprise development organizations— 

22 ‘‘(aa) to provide training 

23 and technical assistance, and 

24 other related services to rural 

25 microentrepreneurs; and 


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1 ‘‘(bb) to carry out such 

2 other projects and activities as 

3 the Secretary determines appro4 priate to further the purposes of 

5 the program. 

6 ‘‘(II) SELECTION.—In making 

7 grants under subclause (I), the Sec8 retary shall— 

9 ‘‘(aa) place an emphasis on 

10 microenterprise development or11 ganizations that serve micro12 entrepreneurs that are located in 

13 rural areas that have suffered 

14 significant outward migration, as 

15 determined by the Secretary; and 

16 ‘‘(bb) ensure, to the max17 imum extent practicable, that 

18 grant recipients include microen19 terprise development organiza20 tions of varying sizes and that 

21 serve racially and ethnically di22 verse populations. 

23 ‘‘(v) GRANTS TO ASSIST MICROENTRE24 PRENEURS.— 


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1 ‘‘(I) IN GENERAL.—The Sec2 retary shall make annual grants to 

3 microenterprise development organiza4 tions to provide technical assistance to 

5 microentrepreneurs that— 

6 ‘‘(aa) received a loan from 

7 the microenterprise development 

8 organization under subparagraph 

9 (B)(iii); or 

10 ‘‘(bb) are seeking a loan 

11 from the microenterprise develop12 ment organization under sub13 paragraph (B)(iii). 

14 ‘‘(II) MAXIMUM AMOUNT OF

15 TECHNICAL ASSISTANCE GRANT.—The 

16 maximum amount of a grant under 

17 this clause shall be in an amount 

18 equal to not more than 25 percent of 

19 the total outstanding balance of 

20 microloans made by the microenter21 prise development organization under 

22 clause (iii), as of the date the grant is 

23 awarded. 

24 ‘‘(vi) ADMINISTRATIVE EXPENSES.— 

25 Not more than 10 percent of a grant reVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00604 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 ceived by a microenterprise development 

2 organization for a fiscal year under this 

3 subparagraph may be used to pay adminis4 trative expenses. 

5 ‘‘(C) ADMINISTRATION.— 

6 ‘‘(i) MATCHING REQUIREMENT.—As a 

7 condition of any grant made under clauses 

8 (iv) and (v) of subparagraph (B), the Sec9 retary shall require the microenterprise de10 velopment organization to match not less 

11 than 15 percent of the total amount of the 

12 grant in the form of matching funds (in13 cluding community development block 

14 grants), indirect costs, or in-kind goods or 

15 services. 

16 ‘‘(ii) OVERSIGHT.—At a minimum, 

17 not later than December 1 of each fiscal 

18 year, a microenterprise development orga19 nization that receives a loan or grant 

20 under this section shall provide to the Sec21 retary such information as the Secretary 

22 may require to ensure that assistance pro23 vided under this section is used for the 

24 purposes for which the loan or grant was 

25 made. 


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1 ‘‘(D) AUTHORIZATION OF APPROPRIA2 TIONS.—There is authorized to be appropriated 

3 to carry out this paragraph $40,000,000 for 

4 each of fiscal years 2013 through 2017. 

5 ‘‘SEC. 3602. RURAL BUSINESS INVESTMENT PROGRAM. 

6 ‘‘(a) DEFINITIONS.—In this section: 

7 ‘‘(1) ARTICLES.—The term ‘articles’ means ar8 ticles of incorporation for an incorporated body or 

9 the functional equivalent or other similar documents 

10 specified by the Secretary for other business entities. 

11 ‘‘(2) DEVELOPMENTAL VENTURE CAPITAL.— 

12 The term ‘developmental venture capital’ means cap13 ital in the form of equity capital investments in rural 

14 business investment companies with an objective of 

15 fostering economic development in rural areas. 

16 ‘‘(3) EMPLOYEE WELFARE BENEFIT PLAN; 

17 PENSION PLAN.— 

18 ‘‘(A) IN GENERAL.—The terms ‘employee 

19 welfare benefit plan’ and ‘pension plan’ have 

20 the meanings given the terms in section 3 of 

21 the Employee Retirement Income Security Act 

22 of 1974 (29 U.S.C. 1002). 

23 ‘‘(B) INCLUSIONS.—The terms ‘employee 

24 welfare benefit plan’ and ‘pension plan’ in25 clude— 


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1 ‘‘(i) public and private pension or re2 tirement plans subject to this subtitle; and 

3 ‘‘(ii) similar plans not covered by this 

4 subtitle that have been established, and 

5 that are maintained, by the Federal Gov6 ernment or any State (including by a polit7 ical subdivision, agency, or instrumentality 

8 of the Federal Government or a State) for 

9 the benefit of employees. 

10 ‘‘(4) EQUITY CAPITAL.—The term ‘equity cap11 ital’ means common or preferred stock or a similar 

12 instrument, including subordinated debt with equity 

13 features. 

14 ‘‘(5) LEVERAGE.—The term ‘leverage’ in15 cludes— 

16 ‘‘(A) debentures purchased or guaranteed 

17 by the Secretary; 

18 ‘‘(B) participating securities purchased or 

19 guaranteed by the Secretary; and 

20 ‘‘(C) preferred securities outstanding as of 

21 the date of enactment of the Agriculture Re22 form, Food, and Jobs Act of 2012. 

23 ‘‘(6) LICENSE.—The term ‘license’ means a li24 cense issued by the Secretary in accordance with in 

25 subsection (d)(5). 


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1 ‘‘(7) LIMITED LIABILITY COMPANY.—The term 

2 ‘limited liability company’ means a business entity 

3 that is organized and operating in accordance with 

4 a State limited liability company law approved by 

5 the Secretary. 

6 ‘‘(8) MEMBER.—The term ‘member’ means, 

7 with respect to a rural business investment company 

8 that is a limited liability company, a holder of an 

9 ownership interest, or a person otherwise admitted 

10 to membership in the limited liability company. 

11 ‘‘(9) OPERATIONAL ASSISTANCE.—The term 

12 ‘operational assistance’ means management, mar13 keting, and other technical assistance that assists a 

14 rural business concern with business development. 

15 ‘‘(10) PARTICIPATION AGREEMENT.—The term 

16 ‘participation agreement’ means an agreement, be17 tween the Secretary and a rural business investment 

18 company granted final approval under subsection 

19 (d)(5), that requires the rural business investment 

20 company to make investments in smaller enterprises 

21 in rural areas. 

22 ‘‘(11) PRIVATE CAPITAL.— 

23 ‘‘(A) IN GENERAL.—The term ‘private cap24 ital’ means the total of— 


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1 ‘‘(i)(I) the paid-in capital and paid-in 

2 surplus of a corporate rural business in3 vestment company; 

4 ‘‘(II) the contributed capital of the 

5 partners of a partnership rural business in6 vestment company; or 

7 ‘‘(III) the equity investment of the 

8 members of a limited liability company 

9 rural business investment company; and 

10 ‘‘(ii) unfunded binding commitments 

11 from investors that meet criteria estab12 lished by the Secretary to contribute cap13 ital to the rural business investment com14 pany, except that— 

15 ‘‘(I) unfunded commitments may 

16 be counted as private capital for pur17 poses of approval by the Secretary of 

18 any request for leverage; but 

19 ‘‘(II) leverage shall not be funded 

20 based on the commitments. 

21 ‘‘(B) EXCLUSIONS.—The term ‘private 

22 capital’ does not include— 

23 ‘‘(i) any funds borrowed by a rural 

24 business investment company from any 

25 source; 


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1 ‘‘(ii) any funds obtained through the 

2 issuance of leverage; or 

3 ‘‘(iii) any funds obtained directly or 

4 indirectly from the Federal Government or 

5 any State (including by a political subdivi6 sion, agency, or instrumentality of the 

7 Federal Government or a State), except 

8 for— 

9 ‘‘(I) funds obtained from the 

10 business revenues (excluding any gov11 ernmental appropriation) of any Fed12 erally chartered or government-spon13 sored enterprise established prior to 

14 the date of enactment of the Agri15 culture Reform, Food, and Jobs Act 

16 of 2012; 

17 ‘‘(II) funds invested by an em18 ployee welfare benefit plan or pension 

19 plan; and 

20 ‘‘(III) any qualified nonprivate 

21 funds (if the investors of the qualified 

22 nonprivate funds do not control, di23 rectly or indirectly, the management, 

24 board of directors, general partners, 


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1 or members of the rural business in2 vestment company). 

3 ‘‘(12) QUALIFIED NONPRIVATE FUNDS.—The 

4 term ‘qualified nonprivate funds’ means any— 

5 ‘‘(A) funds directly or indirectly invested in 

6 any applicant or rural business investment com7 pany on or before the date of enactment of the 

8 Agriculture Reform, Food, and Jobs Act of 

9 2012 by any Federal agency, other than the 

10 Department, under a provision of law explicitly 

11 mandating the inclusion of those funds in the 

12 definition of the term ‘private capital’; and 

13 ‘‘(B) funds invested in any applicant or 

14 rural business investment company by 1 or 

15 more entities of any State (including by a polit16 ical subdivision, agency, or instrumentality of 

17 the State and including any guarantee extended 

18 by those entities) in an aggregate amount that 

19 does not exceed 33 percent of the private cap20 ital of the applicant or rural business invest21 ment company. 

22 ‘‘(13) RURAL BUSINESS CONCERN.—The term 

23 ‘rural business concern’ means— 

24 ‘‘(A) a public, private, or cooperative for25 profit or nonprofit organization; 


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1 ‘‘(B) a for-profit or nonprofit business con2 trolled by an Indian tribe; or 

3 ‘‘(C) any other person or entity that pri4 marily operates in a rural area, as determined 

5 by the Secretary. 

6 ‘‘(14) RURAL BUSINESS INVESTMENT COM7 PANY.—The term ‘rural business investment com8 pany’ means a company that— 

9 ‘‘(A) has been granted final approval by 

10 the Secretary under subsection (d)(5); and 

11 ‘‘(B) has entered into a participation 

12 agreement with the Secretary. 

13 ‘‘(15) SMALLER ENTERPRISE.— 

14 ‘‘(A) IN GENERAL.—The term ‘smaller en15 terprise’ means any rural business concern that, 

16 together with its affiliates— 

17 ‘‘(i) has— 

18 ‘‘(I) a net financial worth of not 

19 more than $6,000,000, as of the date 

20 on which assistance is provided under 

21 this section to the rural business con22 cern; and 

23 ‘‘(II) except as provided in sub24 paragraph (B), an average net income 

25 for the 2-year period preceding the 


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1 date on which assistance is provided 

2 under this section to the rural busi3 ness concern, of not more than 

4 $2,000,000, after Federal income 

5 taxes (excluding any carryover losses); 

6 or 

7 ‘‘(ii) satisfies the standard industrial 

8 classification size standards established by 

9 the Administrator of the Small Business 

10 Administration for the industry in which 

11 the rural business concern is primarily en12 gaged. 

13 ‘‘(B) EXCEPTION.—For purposes of sub14 paragraph (A)(i)(II), if the rural business con15 cern is not required by law to pay Federal in16 come taxes at the enterprise level, but is re17 quired to pass income through to the share18 holders, partners, beneficiaries, or other equi19 table owners of the business concern, the net in20 come of the business concern shall be deter21 mined by allowing a deduction in an amount 

22 equal to the total of— 

23 ‘‘(i) if the rural business concern is 

24 not required by law to pay State (and 

25 local, if any) income taxes at the enterprise 


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1 level, the product obtained by multi2 plying— 

3 ‘‘(I) the net income (determined 

4 without regard to this subparagraph); 

5 by 

6 ‘‘(II) the marginal State income 

7 tax rate (or by the combined State 

8 and local income tax rates, as applica9 ble) that would have applied if the 

10 business concern were a corporation; 

11 and 

12 ‘‘(ii) the product obtained by multi13 plying— 

14 ‘‘(I) the net income (so deter15 mined) less any deduction for State 

16 (and local) income taxes calculated 

17 under clause (i); by 

18 ‘‘(II) the marginal Federal in19 come tax rate that would have applied 

20 if the rural business concern were a 

21 corporation. 

22 ‘‘(b) PURPOSES.—The purposes of the Rural Busi23 ness Investment Program established under this section 

24 are— 


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1 ‘‘(1) to promote economic development and the 

2 creation of wealth and job opportunities in rural 

3 areas and among individuals living in those areas by 

4 encouraging developmental venture capital invest5 ments in smaller enterprises primarily located in 

6 rural areas; and 

7 ‘‘(2) to establish a developmental venture cap8 ital program, with the mission of addressing the 

9 unmet equity investment needs of small enterprises 

10 located in rural areas, by authorizing the Sec11 retary— 

12 ‘‘(A) to enter into participation agreements 

13 with rural business investment companies; 

14 ‘‘(B) to guarantee debentures of rural 

15 business investment companies to enable each 

16 rural business investment company to make de17 velopmental venture capital investments in 

18 smaller enterprises in rural areas; and 

19 ‘‘(C) to make grants to rural business in20 vestment companies, and to other entities, for 

21 the purpose of providing operational assistance 

22 to smaller enterprises financed, or expected to 

23 be financed, by rural business investment com24 panies. 


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1 ‘‘(c) ESTABLISHMENT.—In accordance with this sub2 title, the Secretary shall establish a Rural Business Invest3 ment Program, under which the Secretary may— 

4 ‘‘(1) enter into participation agreements with 

5 companies granted final approval under subsection 

6 (d)(5) for the purposes described in subsection (b); 

7 ‘‘(2) guarantee the debentures issued by rural 

8 business investment companies as provided in sub9 section (e); and 

10 ‘‘(3) make grants to rural business investment 

11 companies, and to other entities, under subsection 

12 (h). 

13 ‘‘(d) SELECTION OF RURAL BUSINESS INVESTMENT

14 COMPANIES.— 

15 ‘‘(1) ELIGIBILITY.—A company shall be eligible 

16 to apply to participate, as a rural business invest17 ment company, in the program established under 

18 this section if— 

19 ‘‘(A) the company is a newly formed for20 profit entity or a newly formed for-profit sub21 sidiary of such an entity; 

22 ‘‘(B) the company has a management team 

23 with experience in community development fi24 nancing or relevant venture capital financing; 

25 and 


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1 ‘‘(C) the company will invest in enterprises 

2 that will create wealth and job opportunities in 

3 rural areas, with an emphasis on smaller enter4 prises. 

5 ‘‘(2) APPLICATION.—To participate, as a rural 

6 business investment company, in the program estab7 lished under this section, a company meeting the eli8 gibility requirements of paragraph (1) shall submit 

9 an application to the Secretary that includes— 

10 ‘‘(A) a business plan describing how the 

11 company intends to make successful develop12 mental venture capital investments in identified 

13 rural areas; 

14 ‘‘(B) information regarding the community 

15 development finance or relevant venture capital 

16 qualifications and general reputation of the 

17 management of the company; 

18 ‘‘(C) a description of how the company in19 tends to work with community-based organiza20 tions and local entities (including local economic 

21 development companies, local lenders, and local 

22 investors) and to seek to address the unmet eq23 uity capital needs of the communities served; 

24 ‘‘(D) a proposal describing how the com25 pany intends to use the grant funds provided 


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1 under this section to provide operational assist2 ance to smaller enterprises financed by the 

3 company, including information regarding 

4 whether the company intends to use licensed 

5 professionals, as necessary, on the staff of the 

6 company or from an outside entity; 

7 ‘‘(E) with respect to binding commitments 

8 to be made to the company under this section, 

9 an estimate of the ratio of cash to in-kind con10 tributions; 

11 ‘‘(F) a description of the criteria to be 

12 used to evaluate whether and to what extent the 

13 company meets the purposes of the program es14 tablished under this section; 

15 ‘‘(G) information regarding the manage16 ment and financial strength of any parent firm, 

17 affiliated firm, or any other firm essential to 

18 the success of the business plan of the com19 pany; and 

20 ‘‘(H) such other information as the Sec21 retary may require. 

22 ‘‘(3) STATUS.—Not later than 90 days after the 

23 initial receipt by the Secretary of an application 

24 under this subsection, the Secretary shall provide to 

25 the applicant a written report describing the status 


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1 of the application and any requirements remaining 

2 for completion of the application. 

3 ‘‘(4) MATTERS CONSIDERED.—In reviewing and 

4 processing any application under this subsection, the 

5 Secretary shall— 

6 ‘‘(A) determine whether— 

7 ‘‘(i) the applicant meets the require8 ments of paragraph (5); and 

9 ‘‘(ii) the management of the applicant 

10 is qualified and has the knowledge, experi11 ence, and capability necessary to comply 

12 with this section; 

13 ‘‘(B) take into consideration— 

14 ‘‘(i) the need for and availability of fi15 nancing for rural business concerns in the 

16 geographic area in which the applicant is 

17 to commence business; 

18 ‘‘(ii) the general business reputation 

19 of the owners and management of the ap20 plicant; and 

21 ‘‘(iii) the probability of successful op22 erations of the applicant, including ade23 quate profitability and financial soundness; 

24 and 


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1 ‘‘(C) not take into consideration any pro2 jected shortage or unavailability of grant funds 

3 or leverage. 

4 ‘‘(5) APPROVAL; LICENSE.— 

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

6 subparagraph (B), the Secretary may approve 

7 an applicant to operate as a rural business in8 vestment company under this subtitle and li9 cense the applicant as a rural business invest10 ment company, if— 

11 ‘‘(i) the Secretary determines that the 

12 application satisfies the requirements of 

13 paragraph (2); 

14 ‘‘(ii) the area in which the rural busi15 ness investment company is to conduct its 

16 operations, and establishment of branch of17 fices or agencies (if authorized by the arti18 cles), are approved by the Secretary; and 

19 ‘‘(iii) the applicant enters into a par20 ticipation agreement with the Secretary. 

21 ‘‘(B) CAPITAL REQUIREMENTS.— 

22 ‘‘(i) IN GENERAL.—Notwithstanding 

23 any other provision of this section, the Sec24 retary may approve an applicant to operate 

25 as a rural business investment company 


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1 under this section and designate the appli2 cant as a rural business investment com3 pany, if the Secretary determines that the 

4 applicant— 

5 ‘‘(I) has private capital as deter6 mined by the Secretary; 

7 ‘‘(II) would otherwise be ap8 proved under this section, except that 

9 the applicant does not satisfy the re10 quirements of subsection (i)(3); and 

11 ‘‘(III) has a viable business plan 

12 that— 

13 ‘‘(aa) reasonably projects 

14 profitable operations; and 

15 ‘‘(bb) has a reasonable time16 table for achieving a level of pri17 vate capital that satisfies the re18 quirements of subsection (i)(3). 

19 ‘‘(ii) LEVERAGE.—An applicant ap20 proved under clause (i) shall not be eligible 

21 to receive leverage under this section until 

22 the applicant satisfies the requirements of 

23 section 3602(i)(3). 

24 ‘‘(iii) GRANTS.—An applicant ap25 proved under clause (i) shall be eligible for 


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1 grants under subsection (h) in proportion 

2 to the private capital of the applicant, as 

3 determined by the Secretary. 

4 ‘‘(e) DEBENTURES.— 

5 ‘‘(1) IN GENERAL.—The Secretary may guar6 antee the timely payment of principal and interest, 

7 as scheduled, on debentures issued by any rural 

8 business investment company. 

9 ‘‘(2) TERMS AND CONDITIONS.—The Secretary 

10 may make guarantees under this subsection on such 

11 terms and conditions as the Secretary considers ap12 propriate, except that the term of any debenture 

13 guaranteed under this section shall not exceed 15 

14 years. 

15 ‘‘(3) FULL FAITH AND CREDIT OF THE UNITED

16 STATES.—Section 3901 shall apply to any guarantee 

17 under this subsection. 

18 ‘‘(4) MAXIMUM GUARANTEE.—Under this sub19 section, the Secretary may— 

20 ‘‘(A) guarantee the debentures issued by a 

21 rural business investment company only to the 

22 extent that the total face amount of out23 standing guaranteed debentures of the rural 

24 business investment company does not exceed 

25 the lesser of— 


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1 ‘‘(i) 300 percent of the private capital 

2 of the rural business investment company; 

3 or 

4 ‘‘(ii) $105,000,000; and 

5 ‘‘(B) provide for the use of discounted de6 bentures. 

7 ‘‘(f) ISSUANCE AND GUARANTEE OF TRUST CERTIFI8 CATES.— 

9 ‘‘(1) ISSUANCE.—The Secretary may issue trust 

10 certificates representing ownership of all or a frac11 tional part of debentures issued by a rural business 

12 investment company and guaranteed by the Sec13 retary under this section, if the certificates are 

14 based on and backed by a trust or pool approved by 

15 the Secretary and composed solely of guaranteed de16 bentures. 

17 ‘‘(2) GUARANTEE.— 

18 ‘‘(A) IN GENERAL.—The Secretary may, 

19 under such terms and conditions as the Sec20 retary considers appropriate, guarantee the 

21 timely payment of the principal of and interest 

22 on trust certificates issued by the Secretary or 

23 agents of the Secretary for purposes of this 

24 subsection. 


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1 ‘‘(B) LIMITATION.—Each guarantee under 

2 this paragraph shall be limited to the extent of 

3 principal and interest on the guaranteed deben4 tures that compose the trust or pool. 

5 ‘‘(C) PREPAYMENT OR DEFAULT.— 

6 ‘‘(i) IN GENERAL.— 

7 ‘‘(I) AUTHORITY TO PREPAY.—A 

8 debenture may be prepaid at any time 

9 without penalty. 

10 ‘‘(II) REDUCTION OF GUAR11 ANTEE.—Subject to subclause (I), if a 

12 debenture in a trust or pool is pre13 paid, or in the event of default of such 

14 a debenture, the guarantee of timely 

15 payment of principal and interest on 

16 the trust certificates shall be reduced 

17 in proportion to the amount of prin18 cipal and interest the prepaid deben19 ture represents in the trust or pool. 

20 ‘‘(ii) INTEREST.—Interest on prepaid 

21 or defaulted debentures shall accrue and be 

22 guaranteed by the Secretary only through 

23 the date of payment of the guarantee. 

24 ‘‘(iii) REDEMPTION.—At any time 

25 during the term of a trust certificate, the 


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1 trust certificate may be called for redemp2 tion due to prepayment or default of all 

3 debentures. 

4 ‘‘(3) FULL FAITH AND CREDIT OF THE UNITED

5 STATES.—Section 3901 shall apply to any guarantee 

6 of a trust certificate issued by the Secretary under 

7 this section. 

8 ‘‘(4) SUBROGATION AND OWNERSHIP RIGHTS.— 

9 ‘‘(A) SUBROGATION.—If the Secretary 

10 pays a claim under a guarantee issued under 

11 this section, the claim shall be subrogated fully 

12 to the rights satisfied by the payment. 

13 ‘‘(B) OWNERSHIP RIGHTS.—No Federal, 

14 State, or local law shall preclude or limit the ex15 ercise by the Secretary of the ownership rights 

16 of the Secretary in a debenture residing in a 

17 trust or pool against which 1 or more trust cer18 tificates are issued under this subsection. 

19 ‘‘(5) MANAGEMENT AND ADMINISTRATION.— 

20 ‘‘(A) REGISTRATION.—The Secretary shall 

21 provide for a central registration of all trust 

22 certificates issued under this subsection. 

23 ‘‘(B) CREATION OF POOLS.—The Secretary 

24 may— 


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1 ‘‘(i) maintain such commercial bank 

2 accounts or investments in obligations of 

3 the United States as may be necessary to 

4 facilitate the creation of trusts or pools 

5 backed by debentures guaranteed under 

6 this subtitle; and 

7 ‘‘(ii) issue trust certificates to facili8 tate the creation of those trusts or pools. 

9 ‘‘(C) FIDELITY BOND OR INSURANCE RE10 QUIREMENT.—Any agent performing functions 

11 on behalf of the Secretary under this paragraph 

12 shall provide a fidelity bond or insurance in 

13 such amount as the Secretary considers to be 

14 necessary to fully protect the interests of the 

15 United States. 

16 ‘‘(D) REGULATION OF BROKERS AND

17 DEALERS.—The Secretary may regulate brokers 

18 and dealers in trust certificates issued under 

19 this subsection. 

20 ‘‘(E) ELECTRONIC REGISTRATION.—Noth21 ing in this paragraph prohibits the use of a 

22 book-entry or other electronic form of registra23 tion for trust certificates issued under this sub24 section. 

25 ‘‘(g) FEES.— 


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1 ‘‘(1) IN GENERAL.—The Secretary may charge 

2 a fee that does not exceed $500 with respect to any 

3 guarantee or grant issued under this section. 

4 ‘‘(2) TRUST CERTIFICATE.—Notwithstanding 

5 paragraph (1), the Secretary shall not collect a fee 

6 for any guarantee of a trust certificate under sub7 section (f), except that any agent of the Secretary 

8 may collect a fee that does not exceed $500 for the 

9 functions described in subsection (f)(5)(B). 

10 ‘‘(3) LICENSE.— 

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

12 subparagraph (C), the Secretary may prescribe 

13 fees to be paid by each applicant for a license 

14 to operate as a rural business investment com15 pany under this section. 

16 ‘‘(B) USE OF AMOUNTS.—Fees collected 

17 under this paragraph— 

18 ‘‘(i) shall be deposited in the account 

19 for salaries and expenses of the Secretary; 

20 ‘‘(ii) are authorized to be appropriated 

21 solely to cover the costs of licensing exami22 nations; and 

23 ‘‘(iii) shall— 

24 ‘‘(I) in the case of a license 

25 issued before the date of enactment of 


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1 the Agriculture Reform, Food, and 

2 Jobs Act of 2012, not exceed $500 for 

3 any fee collected under this para4 graph; and 

5 ‘‘(II) in the case of a license 

6 issued after the date of enactment of 

7 the Agriculture Reform, Food, and 

8 Jobs Act of 2012, be a rate as deter9 mined by the Secretary. 

10 ‘‘(C) PROHIBITION ON COLLECTION OF

11 CERTAIN FEES.—In the case of a license de12 scribed in subparagraph (A) that was approved 

13 before July 1, 2007, the Secretary shall not col14 lect any fees due on or after the date of enact15 ment of the Agriculture Reform, Food, and 

16 Jobs Act of 2012. 

17 ‘‘(h) OPERATIONAL ASSISTANCE GRANTS.— 

18 ‘‘(1) IN GENERAL.—In accordance with this 

19 subsection, the Secretary may make grants to rural 

20 business investment companies and to other entities, 

21 as authorized by this section, to provide operational 

22 assistance to smaller enterprises financed, or ex23 pected to be financed, by the entities. 

24 ‘‘(2) TERMS.—Grants made under this sub25 section shall be made over a multiyear period (not 


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1 to exceed 10 years) under such terms as the Sec2 retary may require. 

3 ‘‘(3) USE OF FUNDS.—The proceeds of a grant 

4 made under this subsection may be used by the rural 

5 business investment company receiving the grant 

6 only to provide operational assistance in connection 

7 with an equity or prospective equity investment in a 

8 business located in a rural area. 

9 ‘‘(4) SUBMISSION OF PLANS.—A rural business 

10 investment company shall be eligible for a grant 

11 under this subsection only if the rural business in12 vestment company submits to the Secretary, in such 

13 form and manner as the Secretary may require, a 

14 plan for use of the grant. 

15 ‘‘(5) GRANT AMOUNT.— 

16 ‘‘(A) RURAL BUSINESS INVESTMENT COM17 PANIES.—The amount of a grant made under 

18 this subsection to a rural business investment 

19 company shall be equal to the lesser of— 

20 ‘‘(i) 10 percent of the private capital 

21 raised by the rural business investment 

22 company; or 

23 ‘‘(ii) $1,000,000. 

24 ‘‘(6) OTHER ENTITIES.—The amount of a 

25 grant made under this subsection to any entity other 


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1 than a rural business investment company shall be 

2 equal to the resources (in cash or in kind) raised by 

3 the entity in accordance with the requirements appli4 cable to rural business investment companies under 

5 this section. 

6 ‘‘(i) RURAL BUSINESS INVESTMENT COMPANIES.— 

7 ‘‘(1) ORGANIZATION.—For purposes of this 

8 subsection, a rural business investment company 

9 shall— 

10 ‘‘(A) be an incorporated body, a limited li11 ability company, or a limited partnership orga12 nized and chartered or otherwise existing under 

13 State law solely for the purpose of performing 

14 the functions and conducting the activities au15 thorized by this section; and 

16 ‘‘(B)(i) if incorporated, have succession for 

17 a period of not less than 30 years unless earlier 

18 dissolved by the shareholders of the rural busi19 ness investment company; and 

20 ‘‘(ii) if a limited partnership or a limited li21 ability company, have succession for a period of 

22 not less than 10 years; and 

23 ‘‘(iii) possess the powers reasonably nec24 essary to perform the functions and conduct the 

25 activities. 


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1 ‘‘(2) ARTICLES.—The articles of any rural busi2 ness investment company— 

3 ‘‘(A) shall specify in general terms— 

4 ‘‘(i) the purposes for which the rural 

5 business investment company is formed; 

6 ‘‘(ii) the name of the rural business 

7 investment company; 

8 ‘‘(iii) the 1 or more areas in which the 

9 operations of the rural business investment 

10 company are to be carried out; 

11 ‘‘(iv) the place where the principal of12 fice of the rural business investment com13 pany is to be located; and 

14 ‘‘(v) the amount and classes of the 

15 shares of capital stock of the rural busi16 ness investment company; 

17 ‘‘(B) may contain any other provisions 

18 consistent with this section that the rural busi19 ness investment company may determine appro20 priate to adopt for the regulation of the busi21 ness of the rural business investment company 

22 and the conduct of the affairs of the rural busi23 ness investment company; and 

24 ‘‘(C) shall be subject to the approval of the 

25 Secretary. 


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1 ‘‘(3) CAPITAL REQUIREMENTS.— 

2 ‘‘(A) IN GENERAL.—Each rural business 

3 investment company shall be required to meet 

4 the capital requirements as provided by the Sec5 retary. 

6 ‘‘(B) TIME FRAME.—Each rural business 

7 investment company shall have a period of 2 

8 years to meet the capital requirements of this 

9 paragraph. 

10 ‘‘(C) ADEQUACY.—In addition to the re11 quirements of subparagraph (A), the Secretary 

12 shall— 

13 ‘‘(i) determine whether the private 

14 capital of each rural business investment 

15 company is adequate to ensure a reason16 able prospect that the rural business in17 vestment company will be operated soundly 

18 and profitably, and managed actively and 

19 prudently in accordance with the articles of 

20 the rural business investment company; 

21 ‘‘(ii) determine that the rural business 

22 investment company will be able to comply 

23 with the requirements of this section; 

24 ‘‘(iii) require that at least 75 percent 

25 of the capital of each rural business investVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00632 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 ment company is invested in rural business 

2 concerns; 

3 ‘‘(iv) ensure that the rural business 

4 investment company is designed primarily 

5 to meet equity capital needs of the busi6 nesses in which the rural business invest7 ment company invests and not to compete 

8 with traditional small business financing 

9 by commercial lenders; and 

10 ‘‘(v) require that the rural business 

11 investment company makes short-term 

12 non-equity investments of less than 5 years 

13 only to the extent necessary to preserve an 

14 existing investment. 

15 ‘‘(4) DIVERSIFICATION OF OWNERSHIP.—The 

16 Secretary shall ensure that the management of each 

17 rural business investment company licensed after the 

18 date of enactment of the Agriculture Reform, Food, 

19 and Jobs Act of 2012 is sufficiently diversified from 

20 and unaffiliated with the ownership of the rural 

21 business investment company so as to ensure inde22 pendence and objectivity in the financial manage23 ment and oversight of the investments and oper24 ations of the rural business investment company. 

25 ‘‘(j) FINANCIAL INSTITUTION INVESTMENTS.— 


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1 ‘‘(1) IN GENERAL.—Except as otherwise pro2 vided in this subsection and notwithstanding any 

3 other provision of law, the following banks, associa4 tions, and institutions are eligible both to establish 

5 and invest in any rural business investment company 

6 or in any entity established to invest solely in rural 

7 business investment companies: 

8 ‘‘(A) Any bank or savings association the 

9 deposits of which are insured under the Federal 

10 Deposit Insurance Act (12 U.S.C. 1811 et 

11 seq.), including an investment pool created en12 tirely by such bank or savings association. 

13 ‘‘(B) Any Farm Credit System institution 

14 described in subsection 1.2(a) of the Farm 

15 Credit Act of 1971 (12 U.S.C. 2002(a)). 

16 ‘‘(2) LIMITATION.—No bank, association, or in17 stitution described in paragraph (1) may make in18 vestments described in paragraph (1) that are great19 er than 5 percent of the capital and surplus of the 

20 bank, association, or institution. 

21 ‘‘(3) LIMITATION ON RURAL BUSINESS INVEST22 MENT COMPANIES CONTROLLED BY FARM CREDIT

23 SYSTEM INSTITUTIONS.—If a Farm Credit System 

24 institution described in section 1.2(a) of the Farm 

25 Credit Act of 1971 (12 U.S.C. 2002(a)) holds more 


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1 than 25 percent of the shares of a rural business in2 vestment company, either alone or in conjunction 

3 with other System institutions (or affiliates), the 

4 rural business investment company shall not provide 

5 equity investments in, or provide other financial as6 sistance to, entities that are not otherwise eligible to 

7 receive financing from the Farm Credit System 

8 under that Act (12 U.S.C. 2001 et seq.). 

9 ‘‘(k) EXAMINATIONS.— 

10 ‘‘(1) IN GENERAL.—Each rural business invest11 ment company that participates in the program es12 tablished under this section shall be subject to ex13 aminations made at the direction of the Secretary in 

14 accordance with this subsection. 

15 ‘‘(2) ASSISTANCE OF PRIVATE SECTOR ENTI16 TIES.—An examination under this subsection may be 

17 conducted with the assistance of a private sector en18 tity that has the qualifications and the expertise nec19 essary to conduct such an examination. 

20 ‘‘(3) COSTS.— 

21 ‘‘(A) IN GENERAL.—The Secretary may 

22 assess the cost of an examination under this 

23 section, including compensation of the exam24 iners, against the rural business investment 

25 company examined. 


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1 ‘‘(B) PAYMENT.—Any rural business in2 vestment company against which the Secretary 

3 assesses costs under this subparagraph shall 

4 pay the costs. 

5 ‘‘(4) DEPOSIT OF FUNDS.—Funds collected 

6 under this subsection shall— 

7 ‘‘(A) be deposited in the account that in8 curred the costs for carrying out this sub9 section; 

10 ‘‘(B) be made available to the Secretary to 

11 carry out this subsection, without further ap12 propriation; and 

13 ‘‘(C) remain available until expended. 

14 ‘‘(l) REPORTING REQUIREMENTS.— 

15 ‘‘(1) RURAL BUSINESS INVESTMENT COMPA16 NIES.—Each entity that participates in a program 

17 established under this section shall provide to the 

18 Secretary such information as the Secretary may re19 quire, including— 

20 ‘‘(A) information relating to the measure21 ment criteria that the entity proposed in the 

22 program application of the rural business in23 vestment company; and 

24 ‘‘(B) in each case in which the entity 

25 under this section makes an investment in, or 


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1 a loan or grant to, a business that is not lo2 cated in a rural area, a report on the number 

3 and percentage of employees of the business 

4 who reside in those areas. 

5 ‘‘(2) PUBLIC REPORTS.— 

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

7 prepare and make available to the public an an8 nual report on the programs established under 

9 this section, including detailed information on— 

10 ‘‘(i) the number of rural business in11 vestment companies licensed by the Sec12 retary during the previous fiscal year; 

13 ‘‘(ii) the aggregate amount of leverage 

14 that rural business investment companies 

15 have received from the Federal Govern16 ment during the previous fiscal year; 

17 ‘‘(iii) the aggregate number of each 

18 type of leveraged instruments used by 

19 rural business investment companies dur20 ing the previous fiscal year and how each 

21 number compares to previous fiscal years; 

22 ‘‘(iv) the number of rural business in23 vestment company licenses surrendered 

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1 ing the previous fiscal year, identifying the 

2 amount of leverage each rural business in3 vestment company has received from the 

4 Federal Government and the type of lever5 age instruments each rural business invest6 ment company has used; 

7 ‘‘(v) the amount of losses sustained by 

8 the Federal Government as a result of op9 erations under this section during the pre10 vious fiscal year and an estimate of the 

11 total losses that the Federal Government 

12 can reasonably expect to incur as a result 

13 of the operations during the current fiscal 

14 year; 

15 ‘‘(vi) actions taken by the Secretary to 

16 maximize recoupment of funds of the Fed17 eral Government expended to implement 

18 and administer the Rural Business Invest19 ment Program under this section during 

20 the previous fiscal year and to ensure com21 pliance with the requirements of this sec22 tion (including regulations); 

23 ‘‘(vii) the amount of Federal Govern24 ment leverage that each licensee received 


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1 in the previous fiscal year and the types of 

2 leverage instruments each licensee used; 

3 ‘‘(viii) for each type of financing in4 strument, the sizes, types of geographic lo5 cations, and other characteristics of the 

6 small business investment companies using 

7 the instrument during the previous fiscal 

8 year, including the extent to which the in9 vestment companies have used the leverage 

10 from each instrument to make loans or eq11 uity investments in rural areas; and 

12 ‘‘(ix) the actions of the Secretary to 

13 carry out this section 

14 ‘‘(B) PROHIBITION.—In compiling the re15 port required under subparagraph (A), the Sec16 retary may not— 

17 ‘‘(i) compile the report in a manner 

18 that permits identification of any par19 ticular type of investment by an individual 

20 rural business investment company or 

21 small business concern in which a rural 

22 business investment company invests; or 

23 ‘‘(ii) release any information that is 

24 prohibited under section 1905 of title 18, 

25 United States Code. 


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1 ‘‘(m) AUTHORIZATION OF APPROPRIATIONS.—There 

2 is authorized to be appropriated to carry out this section 

3 $25,000,000 for the period of fiscal years 2008 through 

4 2017.’’. 

5 ‘‘CHAPTER 3—GENERAL RURAL 

6 DEVELOPMENT PROVISIONS 

7 ‘‘SEC. 3701. GENERAL PROVISIONS FOR LOANS AND 

8 GRANTS. 

9 ‘‘(a) PERIOD FOR REPAYMENT.—Unless otherwise 

10 specifically provided for in this subtitle, the period for re11 payment of a loan under this subtitle shall not exceed 40 

12 years. 

13 ‘‘(b) INTEREST RATES.— 

14 ‘‘(1) IN GENERAL.—Except as otherwise pro15 vided in this title, the interest rate on a loan under 

16 this subtitle shall be determined by the Secretary at 

17 a rate— 

18 ‘‘(A) not to exceed a sum obtained by add19 ing— 

20 ‘‘(i) the current average market yield 

21 on outstanding marketable obligations of 

22 the United States with remaining periods 

23 to maturity comparable to the average ma24 turity of the loan; and 


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1 ‘‘(ii) an amount not to exceed 1 per2 cent, as determined by the Secretary; and 

‘‘(B) adjusted to the nearest 1 3 ⁄8 of 1 per4 cent. 

5 ‘‘(2) WATER AND WASTE FACILITY LOANS AND

6 COMMUNITY FACILITIES LOANS.— 

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

8 provision of State law limiting the rate or 

9 amount of interest that may be charged, taken, 

10 received, or reserved, except as provided in sub11 paragraph (C) and paragraph (5), the interest 

12 rate on a loan (other than a guaranteed loan) 

13 to a public body or nonprofit association (in14 cluding an Indian tribe) for a water or waste 

15 disposal facility or essential community facility 

16 shall be determined by the Secretary at a rate 

17 not to exceed— 

18 ‘‘(i) the current market yield on out19 standing municipal obligations with re20 maining periods to maturity comparable to 

21 the average maturity for the loan, and adjusted to the nearest 1 22 ⁄8 of 1 percent; 

23 ‘‘(ii) 5 percent per year for a loan 

24 that is for the upgrading of a facility or 

25 construction of a new facility as required 


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1 to meet applicable health or sanitary 

2 standards in— 

3 ‘‘(I) an area in which the median 

4 family income of the persons to be 

5 served by the facility is below the pov6 erty line (as defined in section 673 of 

7 the Community Services Block Grant 

8 Act (42 U.S.C. 9902)); and 

9 ‘‘(II) any areas the Secretary 

10 may designate in which a significant 

11 percentage of the persons to be served 

12 by the facilities are low income per13 sons, as determined by the Secretary; 

14 and 

15 ‘‘(iii) 7 percent per year for a loan for 

16 a facility that does not qualify for the 5 

17 percent per year interest rate prescribed in 

18 clause (ii) but that is located in an area in 

19 a State in which the median household in20 come of the persons to be served by the fa21 cility does not exceed 100 percent of the 

22 statewide nonmetropolitan median house23 hold income for the State. 

24 ‘‘(B) HEALTH CARE AND RELATED FACILI25 TIES.—Notwithstanding subparagraph (A), the 


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1 Secretary shall establish a rate for a loan for a 

2 health care or related facility that is— 

3 ‘‘(i) based solely on the income of the 

4 area to be served; and 

5 ‘‘(ii) otherwise consistent with sub6 paragraph (A). 

7 ‘‘(C) INTEREST RATES FOR WATER AND

8 WASTE DISPOSAL FACILITIES LOANS.— 

9 ‘‘(i) IN GENERAL.—Except as pro10 vided in clause (ii) and notwithstanding 

11 subparagraph (A), in the case of a direct 

12 loan for a water or waste disposal facil13 ity— 

14 ‘‘(I) in the case of a loan that 

15 would be subject to the 5 percent in16 terest rate limitation under subpara17 graph (A), the Secretary shall estab18 lish the interest rate at a rate that is 

19 equal to 60 percent of the current 

20 market yield for outstanding munic21 ipal obligations with remaining peri22 ods to maturity comparable to the av23 erage maturity of the loan, adjusted 

to the nearest 1 24 ⁄8 of 1 percent; and 


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1 ‘‘(II) in the case of a loan that 

2 would be subject to the 7 percent limi3 tation under subparagraph (A), the 

4 Secretary shall establish the interest 

5 rate at a rate that is equal to 80 per6 cent of the current market yield for 

7 outstanding municipal obligations 

8 with remaining periods to maturity 

9 comparable to the average maturity of 

the loan, adjusted to the nearest 1 10 ⁄8 of 

11 1 percent. 

12 ‘‘(ii) EXCEPTION.—Clause (i) does not 

13 apply to a loan for a specific project that 

14 is the subject of a loan that has been ap15 proved, but not closed, as of the date of 

16 enactment of the Agriculture Reform, 

17 Food, and Jobs Act of 2012. 

18 ‘‘(3) INTEREST RATES ON BUSINESS AND

19 OTHER LOANS.— 

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

21 paragraph (4), the interest rates on loans under 

22 sections 3501(a)(1) (other than guaranteed 

23 loans and loans as described in paragraph 

24 (2)(A)) shall be as determined by the Secretary 

25 in accordance with subparagraph (B). 


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1 ‘‘(B) MINIMUM RATE.—The interest rates 

2 described in subparagraph (A) shall be not less 

3 than the sum obtained by adding— 

4 ‘‘(i) such rates as determined by the 

5 Secretary of the Treasury taking into con6 sideration the current average market yield 

7 on outstanding marketable obligations of 

8 the United States with remaining periods 

9 to maturity comparable to the average ma10 turities of such loans, adjusted in the judg11 ment of the Secretary of the Treasury to 

12 provide for rates comparable to the rates 

13 prevailing in the private market for similar 

14 loans and considering the insurance by the 

15 Secretary of the loans; and 

16 ‘‘(ii) an additional charge, prescribed 

17 by the Secretary, to cover the losses of the 

18 Secretary and cost of administration, 

19 which shall be deposited in the Rural De20 velopment Insurance Fund, and further 

adjusted to the nearest 1 21 ⁄8 of 1 percent. 

22 ‘‘(4) INTEREST RATES ADJUSTMENTS.— 

23 ‘‘(A) ADJUSTMENTS.—Notwithstanding 

24 any other provision of this subsection, in the 

25 case of loans (other than guaranteed loans) 


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1 made or guaranteed under the authorities of 

2 this title specified in subparagraph (C) for ac3 tivities that involve the use of prime farmland, 

4 the interest rates shall be the interest rates oth5 erwise applicable under this section increased 

6 by 2 percent per year. 

7 ‘‘(B) PRIME FARMLAND.— 

8 ‘‘(i) IN GENERAL.—Wherever prac9 ticable, construction by a State, munici10 pality, or other political subdivision of local 

11 government that is supported by loans de12 scribed in subparagraph (A) shall be 

13 placed on land that is not prime farmland, 

14 in order to preserve the maximum prac15 ticable quantity of prime farmlands for 

16 production of food and fiber. 

17 ‘‘(ii) INCREASED RATE.—In any case 

18 in which other options exist for the siting 

19 of construction described in clause (i) and 

20 the governmental authority still desires to 

21 carry out the construction on prime farm22 land, the 2-percent interest rate increase 

23 provided by this paragraph shall apply, but 

24 that increased interest rate shall not apply 

25 where such other options do not exist. 


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1 ‘‘(C) APPLICABLE AUTHORITIES.—The au2 thorities referred to in subparagraph (A) are— 

3 ‘‘(i) the provisions of section 3502(a) 

4 relating to loans for recreational develop5 ments and essential community facilities; 

6 ‘‘(ii) section 3601(e)(2)(A); and 

7 ‘‘(iii) section 3601(c). 

8 ‘‘(c) PAYMENT OF CHARGES.—A borrower of a loan 

9 made or guaranteed under this subtitle shall pay such fees 

10 and other charges as the Secretary may require, and pre11 pay to the Secretary such taxes and insurance as the Sec12 retary may require, on such terms and conditions as the 

13 Secretary may prescribe. 

14 ‘‘(d) SECURITY.— 

15 ‘‘(1) IN GENERAL.—The Secretary shall take as 

16 security for an obligation entered into in connection 

17 with a loan made under this subtitle such security 

18 as the Secretary may require. 

19 ‘‘(2) LIENS TO UNITED STATES.—An instru20 ment for security under paragraph (1) may con21 stitute a lien running to the United States notwith22 standing the fact that the note for the security may 

23 be held by a lender other than the United States. 

24 ‘‘(3) MULTIPLE LOANS.—A borrower may use 

25 the same collateral to secure 2 or more loans made 


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1 or guaranteed under this subtitle, except that the 

2 outstanding amount of the loans may not exceed the 

3 total value of the collateral. 

4 ‘‘(e) LEGAL COUNSEL FOR SMALL LOANS.—In the 

5 case of a loan of less than $500,000 made or guaranteed 

6 under section 3501 that is evidenced by a note or mort7 gage (as distinguished from a bond issue), the borrower 

8 shall not be required to appoint bond counsel to review 

9 the legal validity of the loan if the Secretary has available 

10 legal counsel to perform the review. 

11 ‘‘SEC. 3702. STRATEGIC ECONOMIC AND COMMUNITY DE12 VELOPMENT. 

13 ‘‘(a) PRIORITY.—In the case of any rural develop14 ment program authorized by this subtitle, the Secretary 

15 may give priority to applications that are otherwise eligible 

16 and support strategic community and economic develop17 ment plans on a multijurisdictional basis, as approved by 

18 the Secretary. 

19 ‘‘(b) EVALUATION.—In evaluating strategic applica20 tions, the Secretary shall give a higher priority to strategic 

21 applications for a plan described in subsection (a) that 

22 demonstrate— 

23 ‘‘(1) the plan was developed through the col24 laboration of multiple stakeholders in the service 

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1 binations of stakeholders such as State, local, and 

2 tribal governments, nonprofit institutions, institu3 tions of higher education, and private entities; 

4 ‘‘(2) an understanding of the applicable re5 gional resources that could support the plan, includ6 ing natural resources, human resources, infrastruc7 ture, and financial resources; 

8 ‘‘(3) investment from other Federal agencies; 

9 ‘‘(4) investment from philanthropic organiza10 tions; and 

11 ‘‘(5) clear objectives for the plan and the ability 

12 to establish measurable performance measures and 

13 to track progress toward meeting the objectives. 

14 ‘‘SEC. 3703. GUARANTEED RURAL DEVELOPMENT LOANS. 

15 ‘‘(a) IN GENERAL.—The Secretary may provide fi16 nancial assistance to a borrower for a purpose provided 

17 in this subtitle by guaranteeing a loan made by any Fed18 eral or State chartered bank, savings and loan association, 

19 cooperative lending agency, or other legally organized 

20 lending agency. 

21 ‘‘(b) INTEREST RATE.—The interest rate payable by 

22 a borrower on the portion of a guaranteed loan that is 

23 sold by a lender to the secondary market under this sub24 title may be lower than the interest rate charged on the 

25 portion retained by the lender. 


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1 ‘‘(c) MAXIMUM GUARANTEE OF 90 PERCENT.—Ex2 cept as provided in subsections (d) and (e), a loan guar3 antee under this subtitle shall be for not more than 90 

4 percent of the principal and interest due on the loan. 

5 ‘‘(d) REFINANCED LOANS GUARANTEED AT 95 PER6 CENT.—The Secretary shall guarantee 95 percent of— 

7 ‘‘(1) in the case of a loan that solely refinances 

8 a direct loan made under this subtitle, the principal 

9 and interest due on the loan on the date of the refi10 nancing; or 

11 ‘‘(2) in the case of a loan that is used for mul12 tiple purposes, the portion of the loan that refi13 nances the principal and interest due on a direct 

14 loan made under this subtitle that is outstanding on 

15 the date on which the loan is guaranteed. 

16 ‘‘(e) RISK OF LOSS.— 

17 ‘‘(1) IN GENERAL.—Subject to subsection (b), 

18 the Secretary may not make a loan under section 

19 3501 or 3601 unless the Secretary determines that 

20 no other lender is willing to make the loan and as21 sume 10 percent of the potential loss to be sustained 

22 from the loan. 

23 ‘‘(2) EXCEPTION FOR NONPROFIT GROUPS.— 

24 Paragraph (1) shall not apply to a public body or 

25 nonprofit association, including an Indian tribe. 


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1 ‘‘SEC. 3704. RURAL DEVELOPMENT INSURANCE FUND. 

2 ‘‘(a) DEFINITION OF RURAL DEVELOPMENT

3 LOAN.—In this section, the term ‘rural development loan’ 

4 means a loan provided for by section 3501 or 3601. 

5 ‘‘(b) ESTABLISHMENT.—There is established in the 

6 Treasury of the United States a fund to be known as the 

7 ‘Rural Development Insurance Fund’ that shall be used 

8 by the Secretary to discharge the obligations of the Sec9 retary under contracts making or guaranteeing rural de10 velopment loans. 

11 ‘‘SEC. 3705. RURAL ECONOMIC AREA PARTNERSHIP ZONES. 

12 ‘‘(a) IN GENERAL.—The Secretary may designate ad13 ditional areas as rural economic area partnership zones 

14 to be assisted under this chapter— 

15 ‘‘(1) through an open, competitive process; and 

16 ‘‘(2) with priority given to rural areas— 

17 ‘‘(A) with excessive unemployment or 

18 underemployment, a high percentage of low-in19 come residents, or high rates of outmigration, 

20 as determined by the Secretary; and 

21 ‘‘(B) that the Secretary determines have a 

22 substantial need for assistance. 

23 ‘‘(b) REQUIREMENTS.—The Secretary shall carry out 

24 those rural economic area partnership zones administra25 tively in effect on the date of enactment of the Agriculture 

26 Reform, Food, and Jobs Act of 2012 in accordance with 


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1 the terms and conditions contained in the memoranda of 

2 agreement entered into by the Secretary for the rural eco3 nomic area partnership zones. 

4 ‘‘SEC. 3706. STREAMLINING APPLICATIONS AND IMPROV5 ING ACCESSIBILITY OF RURAL DEVELOP6 MENT PROGRAMS. 

7 ‘‘The Secretary shall expedite the process of creating 

8 user-friendly and accessible application forms and proce9 dures prioritizing programs and applications at the indi10 vidual level with an emphasis on utilizing current tech11 nology including online applications and submission proc12 esses. 

13 ‘‘CHAPTER 4—DELTA REGIONAL 

14 AUTHORITY 

15 ‘‘SEC. 3801. DEFINITIONS. 

16 ‘‘In this chapter: 

17 ‘‘(1) AUTHORITY.—The term ‘Authority’ means 

18 the Delta Regional Authority established by section 

19 3802. 

20 ‘‘(2) FEDERAL GRANT PROGRAM.—The term 

21 ‘Federal grant program’ means a Federal grant pro22 gram to provide assistance in— 

23 ‘‘(A) acquiring or developing land; 

24 ‘‘(B) constructing or equipping a highway, 

25 road, bridge, or facility; or 


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1 ‘‘(C) carrying out other economic develop2 ment activities. 

3 ‘‘(3) REGION.—The term ‘region’ means the 

4 Lower Mississippi (as defined in section 4 of the 

5 Delta Development Act (42 U.S.C. 3121 note; Pub6 lic Law 100–460)). 

7 ‘‘SEC. 3802. DELTA REGIONAL AUTHORITY. 

8 ‘‘(a) ESTABLISHMENT.— 

9 ‘‘(1) IN GENERAL.—There is established the 

10 Delta Regional Authority. 

11 ‘‘(2) COMPOSITION.—The Authority shall be 

12 composed of— 

13 ‘‘(A) a Federal member, to be appointed 

14 by the President, with the advice and consent 

15 of the Senate; and 

16 ‘‘(B) the Governor (or a designee of the 

17 Governor) of each State in the region that 

18 elects to participate in the Authority. 

19 ‘‘(3) COCHAIRPERSONS.—The Authority shall 

20 be headed by— 

21 ‘‘(A) the Federal member, who shall serve 

22 as— 

23 ‘‘(i) the Federal cochairperson; and 

24 ‘‘(ii) a liaison between the Federal 

25 Government and the Authority; and 


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1 ‘‘(B) a State cochairperson, who shall be— 

2 ‘‘(i) a Governor of a participating 

3 State in the region; and 

4 ‘‘(ii) elected by the State members for 

5 a term of not less than 1 year. 

6 ‘‘(4) ALABAMA.—Notwithstanding any other 

7 provision of law, the State of Alabama shall be a full 

8 member of the Authority and shall be entitled to all 

9 rights and privileges that the membership affords to 

10 all other participating States in the Authority. 

11 ‘‘(b) ALTERNATE MEMBERS.— 

12 ‘‘(1) STATE ALTERNATES.—The State member 

13 of a participating State may have a single alternate, 

14 who shall be— 

15 ‘‘(A) a resident of that State; and 

16 ‘‘(B) appointed by the Governor of the 

17 State. 

18 ‘‘(2) ALTERNATE FEDERAL COCHAIRPERSON.— 

19 The President shall appoint an alternate Federal co20 chairperson. 

21 ‘‘(3) QUORUM.—A State alternate shall not be 

22 counted toward the establishment of a quorum of 

23 the Authority in any instance in which a quorum of 

24 the State members is required to be present. 


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1 ‘‘(4) DELEGATION OF POWER.—No power or 

2 responsibility of the Authority specified in para3 graphs (2) and (3) of subsection (c), and no voting 

4 right of any Authority member, shall be delegated to 

5 any person— 

6 ‘‘(A) who is not an Authority member; or 

7 ‘‘(B) who is not entitled to vote in Author8 ity meetings. 

9 ‘‘(c) VOTING.— 

10 ‘‘(1) IN GENERAL.—A decision by the Authority 

11 shall require a majority vote of the Authority (not 

12 including any member representing a State that is 

13 delinquent under subsection (g)(2)(C)) to be effec14 tive. 

15 ‘‘(2) QUORUM.—A quorum of State members 

16 shall be required to be present for the Authority to 

17 make any policy decision, including— 

18 ‘‘(A) a modification or revision of an Au19 thority policy decision; 

20 ‘‘(B) approval of a State or regional devel21 opment plan; and 

22 ‘‘(C) any allocation of funds among the 

23 States. 

24 ‘‘(3) PROJECT AND GRANT PROPOSALS.—The 

25 approval of project and grant proposals shall be— 


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1 ‘‘(A) a responsibility of the Authority; and 

2 ‘‘(B) conducted in accordance with section 

3 3809. 

4 ‘‘(4) VOTING BY ALTERNATE MEMBERS.—An 

5 alternate member shall vote in the case of the ab6 sence, death, disability, removal, or resignation of 

7 the Federal or State representative for which the al8 ternate member is an alternate. 

9 ‘‘(d) DUTIES.—The Authority shall— 

10 ‘‘(1) develop, on a continuing basis, comprehen11 sive and coordinated plans and programs to establish 

12 priorities and approve grants for the economic devel13 opment of the region, giving due consideration to 

14 other Federal, State, and local planning and devel15 opment activities in the region; 

16 ‘‘(2) review, and where appropriate amend, pri17 orities in a development plan for the region (includ18 ing 5-year regional outcome targets); 

19 ‘‘(3) assess the needs and assets of the region 

20 based on available research, demonstrations, inves21 tigations, assessments, and evaluations of the region 

22 prepared by Federal, State, and local agencies, uni23 versities, local development districts, and other non24 profit groups; 


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1 ‘‘(4) formulate and recommend to the Gov2 ernors and legislatures of States that participate in 

3 the Authority forms of interstate cooperation; 

4 ‘‘(5) work with State and local agencies in de5 veloping appropriate model legislation; 

6 ‘‘(6)(A) enhance the capacity of, and provide 

7 support for, local development districts in the region; 

8 or 

9 ‘‘(B) if no local development district exists in 

10 an area in a participating State in the region, foster 

11 the creation of a local development district; 

12 ‘‘(7) encourage private investment in industrial, 

13 commercial, and other economic development 

14 projects in the region; and 

15 ‘‘(8) cooperate with and assist State govern16 ments with economic development programs of par17 ticipating States. 

18 ‘‘(e) ADMINISTRATION.—In carrying out subsection 

19 (d), the Authority may— 

20 ‘‘(1) hold such hearings, sit and act at such 

21 times and places, take such testimony, receive such 

22 evidence, and print or otherwise reproduce and dis23 tribute a description of the proceedings and reports 

24 on actions by the Authority as the Authority con25 siders appropriate; 


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1 ‘‘(2) authorize, through the Federal or State co2 chairperson or any other member of the Authority 

3 designated by the Authority, the administration of 

4 oaths if the Authority determines that testimony 

5 should be taken or evidence received under oath; 

6 ‘‘(3) request from any Federal, State, or local 

7 department or agency such information as may be 

8 available to or procurable by the department or 

9 agency that may be of use to the Authority in car10 rying out duties of the Authority; 

11 ‘‘(4) adopt, amend, and repeal bylaws, rules, 

12 and regulations governing the conduct of Authority 

13 business and the performance of Authority duties; 

14 ‘‘(5) request the head of any Federal depart15 ment or agency to detail to the Authority such per16 sonnel as the Authority requires to carry out duties 

17 of the Authority, each such detail to be without loss 

18 of seniority, pay, or other employee status; 

19 ‘‘(6) request the head of any State department 

20 or agency or local government to detail to the Au21 thority such personnel as the Authority requires to 

22 carry out duties of the Authority, each such detail 

23 to be without loss of seniority, pay, or other em24 ployee status; 


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1 ‘‘(7) provide for coverage of Authority employ2 ees in a suitable retirement and employee benefit 

3 system by— 

4 ‘‘(A) making arrangements or entering 

5 into contracts with any participating State gov6 ernment; or 

7 ‘‘(B) otherwise providing retirement and 

8 other employee benefit coverage; 

9 ‘‘(8) accept, use, and dispose of gifts or dona10 tions of services or real, personal, tangible, or intan11 gible property; 

12 ‘‘(9) enter into and perform such contracts, 

13 leases, cooperative agreements, or other transactions 

14 as are necessary to carry out Authority duties, in15 cluding any contracts, leases, or cooperative agree16 ments with— 

17 ‘‘(A) any department, agency, or instru18 mentality of the United States; 

19 ‘‘(B) any State (including a political sub20 division, agency, or instrumentality of the 

21 State); or 

22 ‘‘(C) any person, firm, association, or cor23 poration; and 


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1 ‘‘(10) establish and maintain a central office 

2 and field offices at such locations as the Authority 

3 may select. 

4 ‘‘(f) FEDERAL AGENCY COOPERATION.—A Federal 

5 agency shall— 

6 ‘‘(1) cooperate with the Authority; and 

7 ‘‘(2) provide, on request of the Federal cochair8 person, appropriate assistance in carrying out this 

9 chapter, in accordance with applicable Federal laws 

10 (including regulations). 

11 ‘‘(g) ADMINISTRATIVE EXPENSES.— 

12 ‘‘(1) IN GENERAL.—Administrative expenses of 

13 the Authority (except for the expenses of the Fed14 eral cochairperson, including expenses of the alter15 nate and staff of the Federal cochairperson, which 

16 shall be paid solely by the Federal Government) 

17 shall be paid— 

18 ‘‘(A) by the Federal Government, in an 

19 amount equal to 50 percent of the administra20 tive expenses; and 

21 ‘‘(B) by the States in the region partici22 pating in the Authority, in an amount equal to 

23 50 percent of the administrative expenses. 

24 ‘‘(2) STATE SHARE.— 


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1 ‘‘(A) IN GENERAL.—The share of adminis2 trative expenses of the Authority to be paid by 

3 each State shall be determined by the Author4 ity. 

5 ‘‘(B) NO FEDERAL PARTICIPATION.—The 

6 Federal cochairperson shall not participate or 

7 vote in any decision under subparagraph (A). 

8 ‘‘(C) DELINQUENT STATES.—If a State is 

9 delinquent in payment of the State’s share of 

10 administrative expenses of the Authority under 

11 this subsection— 

12 ‘‘(i) no assistance under this chapter 

13 shall be furnished to the State (including 

14 assistance to a political subdivision or a 

15 resident of the State); and 

16 ‘‘(ii) no member of the Authority from 

17 the State shall participate or vote in any 

18 action by the Authority. 

19 ‘‘(h) COMPENSATION.— 

20 ‘‘(1) FEDERAL COCHAIRPERSON.—The Federal 

21 cochairperson shall be compensated by the Federal 

22 Government at level III of the Executive Schedule in 

23 subchapter II of chapter 53 of title 5, United States 

24 Code. 


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1 ‘‘(2) ALTERNATE FEDERAL COCHAIRPERSON.— 

2 The alternate Federal cochairperson— 

3 ‘‘(A) shall be compensated by the Federal 

4 Government at level V of the Executive Sched5 ule described in paragraph (1); and 

6 ‘‘(B) when not actively serving as an alter7 nate for the Federal cochairperson, shall per8 form such functions and duties as are delegated 

9 by the Federal cochairperson. 

10 ‘‘(3) STATE MEMBERS AND ALTERNATES.— 

11 ‘‘(A) IN GENERAL.—A State shall com12 pensate each member and alternate rep13 resenting the State on the Authority at the rate 

14 established by law of the State. 

15 ‘‘(B) NO ADDITIONAL COMPENSATION.— 

16 No State member or alternate member shall re17 ceive any salary, or any contribution to or sup18 plementation of salary from any source other 

19 than the State for services provided by the 

20 member or alternate to the Authority. 

21 ‘‘(4) DETAILED EMPLOYEES.— 

22 ‘‘(A) IN GENERAL.—No person detailed to 

23 serve the Authority under subsection (e)(6) 

24 shall receive any salary or any contribution to 


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1 or supplementation of salary for services pro2 vided to the Authority from— 

3 ‘‘(i) any source other than the State, 

4 local, or intergovernmental department or 

5 agency from which the person was detailed; 

6 or 

7 ‘‘(ii) the Authority. 

8 ‘‘(B) VIOLATION.—Any person that vio9 lates this paragraph shall be fined not more 

10 than $5,000, imprisoned not more than 1 year, 

11 or both. 

12 ‘‘(C) APPLICABLE LAW.—The Federal co13 chairperson, the alternate Federal cochair14 person, and any Federal officer or employee de15 tailed to duty on the Authority under sub16 section (e)(5) shall not be subject to subpara17 graph (A), but shall remain subject to sections 

18 202 through 209 of title 18, United States 

19 Code. 

20 ‘‘(5) ADDITIONAL PERSONNEL.— 

21 ‘‘(A) COMPENSATION.— 

22 ‘‘(i) IN GENERAL.—The Authority 

23 may appoint and fix the compensation of 

24 an executive director and such other per25 sonnel as are necessary to enable the AuVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00663 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 thority to carry out the duties of the Au2 thority. 

3 ‘‘(ii) EXCEPTION.—Compensation 

4 under clause (i) shall not exceed the max5 imum rate for the Senior Executive Service 

6 under section 5382 of title 5, United 

7 States Code, including any applicable local8 ity-based comparability payment that may 

9 be authorized under section 5304(h)(2)(C) 

10 of that title. 

11 ‘‘(B) EXECUTIVE DIRECTOR.—The execu12 tive director shall be responsible for— 

13 ‘‘(i) the carrying out of the adminis14 trative duties of the Authority; 

15 ‘‘(ii) direction of the Authority staff; 

16 and 

17 ‘‘(iii) such other duties as the Author18 ity may assign. 

19 ‘‘(C) NO FEDERAL EMPLOYEE STATUS.— 

20 No member, alternate, officer, or employee of 

21 the Authority (except the Federal cochairperson 

22 of the Authority, the alternate and staff for the 

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1 section (e)(5)) shall be considered to be a Fed2 eral employee for any purpose. 

3 ‘‘(i) CONFLICTS OF INTEREST.— 

4 ‘‘(1) IN GENERAL.—Except as provided under 

5 paragraph (2), no State member, alternate, officer, 

6 or employee of the Authority shall participate per7 sonally and substantially as a member, alternate, of8 ficer, or employee of the Authority, through decision, 

9 approval, disapproval, recommendation, the ren10 dering of advice, investigation, or otherwise, in any 

11 proceeding, application, request for a ruling or other 

12 determination, contract, claim, controversy, or other 

13 matter in which, to knowledge of the member, alter14 nate, officer, or employee, there is a financial inter15 est of— 

16 ‘‘(A) the member, alternate, officer, or em17 ployee; 

18 ‘‘(B) the spouse, minor child, partner, or 

19 organization (other than a State or political 

20 subdivision of the State) of the member, alter21 nate, officer, or employee, in which the member, 

22 alternate, officer, or employee is serving as offi23 cer, director, trustee, partner, or employee; or 

24 ‘‘(C) any person or organization with 

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1 ployee is negotiating or has any arrangement 

2 concerning prospective employment. 

3 ‘‘(2) DISCLOSURE.—Paragraph (1) shall not 

4 apply if the State member, alternate, officer, or em5 ployee— 

6 ‘‘(A) immediately advises the Authority of 

7 the nature and circumstances of the proceeding, 

8 application, request for a ruling or other deter9 mination, contract, claim, controversy, or other 

10 particular matter presenting a potential conflict 

11 of interest; 

12 ‘‘(B) makes full disclosure of the financial 

13 interest; and 

14 ‘‘(C) before the proceeding concerning the 

15 matter presenting the conflict of interest, re16 ceives a written determination by the Authority 

17 that the interest is not so substantial as to be 

18 likely to affect the integrity of the services that 

19 the Authority may expect from the State mem20 ber, alternate, officer, or employee. 

21 ‘‘(3) VIOLATION.—Any person that violates this 

22 subsection shall be fined not more than $10,000, im23 prisoned not more than 2 years, or both. 

24 ‘‘(j) VALIDITY OF CONTRACTS, LOANS, AND

25 GRANTS.—The Authority may declare void any contract, 


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1 loan, or grant of or by the Authority in relation to which 

2 the Authority determines that there has been a violation 

3 of any provision under subsection (h)(4), subsection (i), 

4 or sections 202 through 209 of title 18, United States 

5 Code. 

6 ‘‘SEC. 3803. ECONOMIC AND COMMUNITY DEVELOPMENT 

7 GRANTS. 

8 ‘‘(a) IN GENERAL.—The Authority may approve 

9 grants to States and public and nonprofit entities for 

10 projects, approved in accordance with section 3809— 

11 ‘‘(1) to develop the transportation infrastruc12 ture of the region for the purpose of facilitating eco13 nomic development in the region (except that grants 

14 for this purpose may only be made to a State or 

15 local government); 

16 ‘‘(2) to assist the region in obtaining the job 

17 training, employment-related education, and busi18 ness development (with an emphasis on entrepre19 neurship) that are needed to build and maintain 

20 strong local economies; 

21 ‘‘(3) to provide assistance to severely distressed 

22 and underdeveloped areas that lack financial re23 sources for improving basic public services; 

24 ‘‘(4) to provide assistance to severely distressed 

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1 sources for equipping industrial parks and related 

2 facilities; and 

3 ‘‘(5) to otherwise achieve the purposes of this 

4 chapter. 

5 ‘‘(b) FUNDING.— 

6 ‘‘(1) IN GENERAL.—Funds for grants under 

7 subsection (a) may be provided— 

8 ‘‘(A) entirely from appropriations to carry 

9 out this section; 

10 ‘‘(B) in combination with funds available 

11 under another Federal or Federal grant pro12 gram; or 

13 ‘‘(C) from any other source. 

14 ‘‘(2) PRIORITY OF FUNDING.—To best build the 

15 foundations for long-term economic development and 

16 to complement other Federal and State resources in 

17 the region, Federal funds available under this chap18 ter shall be focused on the activities in the following 

19 order or priority: 

20 ‘‘(A) Basic public infrastructure in dis21 tressed counties and isolated areas of distress. 

22 ‘‘(B) Transportation infrastructure for the 

23 purpose of facilitating economic development in 

24 the region. 


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1 ‘‘(C) Business development, with emphasis 

2 on entrepreneurship. 

3 ‘‘(D) Job training or employment-related 

4 education, with emphasis on use of existing 

5 public educational institutions located in the re6 gion. 

7 ‘‘SEC. 3804. SUPPLEMENTS TO FEDERAL GRANT PRO8 GRAMS. 

9 ‘‘(a) FINDING.—Congress finds that certain States 

10 and local communities of the region, including local devel11 opment districts, may be unable to take maximum advan12 tage of Federal grant programs for which the States and 

13 communities are eligible because— 

14 ‘‘(1) the States or communities lack the eco15 nomic resources to provide the required matching 

16 share; or 

17 ‘‘(2) there are insufficient funds available under 

18 the applicable Federal law authorizing the Federal 

19 grant program to meet pressing needs of the region. 

20 ‘‘(b) FEDERAL GRANT PROGRAM FUNDING.—Not21 withstanding any provision of law limiting the Federal 

22 share, the areas eligible for assistance, or the authoriza23 tions of appropriations of any Federal grant program, and 

24 in accordance with subsection (c), the Authority, with the 


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1 approval of the Federal cochairperson and with respect to 

2 a project to be carried out in the region— 

3 ‘‘(1) may increase the Federal share of the 

4 costs of a project under the Federal grant program 

5 to not more than 90 percent (except as provided in 

6 section 3806(b)); and 

7 ‘‘(2) shall use amounts made available to carry 

8 out this chapter to pay the increased Federal share. 

9 ‘‘(c) CERTIFICATIONS.— 

10 ‘‘(1) IN GENERAL.—In the case of any project 

11 for which all or any portion of the basic Federal 

12 share of the costs of the project is proposed to be 

13 paid under this section, no Federal contribution 

14 shall be made until the Federal official admin15 istering the Federal law that authorizes the Federal 

16 grant program certifies that the project— 

17 ‘‘(A) meets (except as provided in sub18 section (b)) the applicable requirements of the 

19 applicable Federal grant program; and 

20 ‘‘(B) could be approved for Federal con21 tribution under the Federal grant program if 

22 funds were available under the law for the 

23 project. 

24 ‘‘(2) CERTIFICATION BY AUTHORITY.— 


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1 ‘‘(A) IN GENERAL.—The certifications and 

2 determinations required to be made by the Au3 thority for approval of projects under this Act 

4 in accordance with section 3809 shall be— 

5 ‘‘(i) controlling; and 

6 ‘‘(ii) accepted by the Federal agencies. 

7 ‘‘(B) ACCEPTANCE BY FEDERAL COCHAIR8 PERSON.—In the case of any project described 

9 in paragraph (1), any finding, report, certifi10 cation, or documentation required to be sub11 mitted with respect to the project to the head 

12 of the department, agency, or instrumentality of 

13 the Federal Government responsible for the ad14 ministration of the Federal grant program 

15 under which the project is carried out shall be 

16 accepted by the Federal cochairperson. 

17 ‘‘SEC. 3805. LOCAL DEVELOPMENT DISTRICTS; CERTIFI18 CATION AND ADMINISTRATIVE EXPENSES. 

19 ‘‘(a) DEFINITION OF LOCAL DEVELOPMENT DIS20 TRICT.—In this section, the term ‘local development dis21 trict’ means an entity that— 

22 ‘‘(1) is— 

23 ‘‘(A) a planning district in existence on the 

24 date of enactment of the Agriculture Reform, 


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1 Food, and Jobs Act of 2012 that is recognized 

2 by the Secretary; or 

3 ‘‘(B) if an entity described in subpara4 graph (A) does not exist— 

5 ‘‘(i) organized and operated in a man6 ner that ensures broad-based community 

7 participation and an effective opportunity 

8 for other nonprofit groups to contribute to 

9 the development and implementation of 

10 programs in the region; 

11 ‘‘(ii) governed by a policy board with 

12 at least a simple majority of members con13 sisting of elected officials or employees of 

14 a general purpose unit of local government 

15 who have been appointed to represent the 

16 government; 

17 ‘‘(iii) certified to the Authority as hav18 ing a charter or authority that includes the 

19 economic development of counties or parts 

20 of counties or other political subdivisions 

21 within the region— 

22 ‘‘(I) by the Governor of each 

23 State in which the entity is located; or 


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1 ‘‘(II) by the State officer des2 ignated by the appropriate State law 

3 to make the certification; and 

4 ‘‘(iv)(I) a nonprofit incorporated body 

5 organized or chartered under the law of 

6 the State in which the entity is located; 

7 ‘‘(II) a nonprofit agency or instru8 mentality of a State or local government; 

9 ‘‘(III) a public organization estab10 lished before December 21, 2000, under 

11 State law for creation of multi-jurisdic12 tional, area-wide planning organizations; or 

13 ‘‘(IV) a nonprofit association or com14 bination of bodies, agencies, and instru15 mentalities described in subclauses (I) 

16 through (III); and 

17 ‘‘(2) has not, as certified by the Federal co18 chairperson— 

19 ‘‘(A) inappropriately used Federal grant 

20 funds from any Federal source; or 

21 ‘‘(B) appointed an officer who, during the 

22 period in which another entity inappropriately 

23 used Federal grant funds from any Federal 

24 source, was an officer of the other entity. 


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1 ‘‘(b) GRANTS TO LOCAL DEVELOPMENT DIS2 TRICTS.— 

3 ‘‘(1) IN GENERAL.—The Authority shall make 

4 grants for administrative expenses under this sec5 tion. 

6 ‘‘(2) CONDITIONS FOR GRANTS.— 

7 ‘‘(A) MAXIMUM AMOUNT.—The amount of 

8 any grant awarded under paragraph (1) shall 

9 not exceed 80 percent of the administrative ex10 penses of the local development district receiv11 ing the grant. 

12 ‘‘(B) MAXIMUM PERIOD.—No grant de13 scribed in paragraph (1) shall be awarded to a 

14 State agency certified as a local development 

15 district for a period greater than 3 years. 

16 ‘‘(C) LOCAL SHARE.—The contributions of 

17 a local development district for administrative 

18 expenses may be in cash or in kind, fairly evalu19 ated, including space, equipment, and services. 

20 ‘‘(c) DUTIES OF LOCAL DEVELOPMENT DIS21 TRICTS.—A local development district shall— 

22 ‘‘(1) operate as a lead organization serving 

23 multicounty areas in the region at the local level; 

24 and 


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1 ‘‘(2) serve as a liaison between State and local 

2 governments, nonprofit organizations (including 

3 community-based groups and educational institu4 tions), the business community, and citizens that— 

5 ‘‘(A) are involved in multijurisdictional 

6 planning; 

7 ‘‘(B) provide technical assistance to local 

8 jurisdictions and potential grantees; and 

9 ‘‘(C) provide leadership and civic develop10 ment assistance. 

11 ‘‘SEC. 3806. DISTRESSED COUNTIES AND AREAS AND NON12 DISTRESSED COUNTIES. 

13 ‘‘(a) DESIGNATIONS.—Each year, the Authority, in 

14 accordance with such criteria as the Authority may estab15 lish, shall designate— 

16 ‘‘(1) as distressed counties, counties in the re17 gion that are the most severely and persistently dis18 tressed and underdeveloped and have high rates of 

19 poverty or unemployment; 

20 ‘‘(2) as nondistressed counties, counties in the 

21 region that are not designated as distressed counties 

22 under paragraph (1); and 

23 ‘‘(3) as isolated areas of distress, areas located 

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1 graph (2)) that have high rates of poverty or unem2 ployment. 

3 ‘‘(b) DISTRESSED COUNTIES.— 

4 ‘‘(1) IN GENERAL.—The Authority shall allo5 cate at least 75 percent of the appropriations made 

6 available under section 3813 for programs and 

7 projects designed to serve the needs of distressed 

8 counties and isolated areas of distress in the region. 

9 ‘‘(2) FUNDING LIMITATIONS.—The funding lim10 itations under section 3804(b) shall not apply to a 

11 project providing transportation or basic public serv12 ices to residents of 1 or more distressed counties or 

13 isolated areas of distress in the region. 

14 ‘‘(c) NONDISTRESSED COUNTIES.— 

15 ‘‘(1) IN GENERAL.—Except as provided in this 

16 subsection, no funds shall be provided under this 

17 chapter for a project located in a county designated 

18 as a nondistressed county under subsection (a)(2). 

19 ‘‘(2) EXCEPTIONS.— 

20 ‘‘(A) IN GENERAL.—The funding prohibi21 tion under paragraph (1) shall not apply to 

22 grants to fund the administrative expenses of 

23 local development districts under section 

24 3805(b). 


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1 ‘‘(B) MULTICOUNTY PROJECTS.—The Au2 thority may waive the application of the fund3 ing prohibition under paragraph (1) to a multi4 county project that includes participation by a 

5 nondistressed county; or any other type of 

6 project if the Authority determines that the 

7 project could bring significant benefits to areas 

8 of the region outside a nondistressed county. 

9 ‘‘(C) ISOLATED AREAS OF DISTRESS.—For 

10 a designation of an isolated area of distress for 

11 assistance to be effective, the designation shall 

12 be supported— 

13 ‘‘(i) by the most recent Federal data 

14 available; or 

15 ‘‘(ii) if no recent Federal data are 

16 available, by the most recent data available 

17 through the government of the State in 

18 which the isolated area of distress is lo19 cated. 

20 ‘‘(d) TRANSPORTATION AND BASIC PUBLIC INFRA21 STRUCTURE.—The Authority shall allocate at least 50 per22 cent of any funds made available under section 3813 for 

23 transportation and basic public infrastructure projects au24 thorized under paragraphs (1) and (3) of section 3803(a). 


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1 ‘‘SEC. 3807. DEVELOPMENT PLANNING PROCESS. 

2 ‘‘(a) STATE DEVELOPMENT PLAN.—In accordance 

3 with policies established by the Authority, each State 

4 member shall submit a development plan for the area of 

5 the region represented by the State member. 

6 ‘‘(b) CONTENT OF PLAN.—A State development plan 

7 submitted under subsection (a) shall reflect the goals, ob8 jectives, and priorities identified in the regional develop9 ment plan developed under section 3802(d)(2). 

10 ‘‘(c) CONSULTATION WITH INTERESTED LOCAL PAR11 TIES.—In carrying out the development planning process 

12 (including the selection of programs and projects for as13 sistance), a State may— 

14 ‘‘(1) consult with— 

15 ‘‘(A) local development districts; and 

16 ‘‘(B) local units of government; and 

17 ‘‘(2) take into consideration the goals, objec18 tives, priorities, and recommendations of the entities 

19 described in paragraph (1). 

20 ‘‘(d) PUBLIC PARTICIPATION.— 

21 ‘‘(1) IN GENERAL.—The Authority and applica22 ble State and local development districts shall en23 courage and assist, to the maximum extent prac24 ticable, public participation in the development, revi25 sion, and implementation of all plans and programs 

26 under this chapter. 


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1 ‘‘(2) REGULATIONS.—The Authority shall de2 velop guidelines for providing public participation 

3 described in paragraph (1), including public hear4 ings. 

5 ‘‘SEC. 3808. PROGRAM DEVELOPMENT CRITERIA. 

6 ‘‘(a) IN GENERAL.—In considering programs and 

7 projects to be provided assistance under this chapter and 

8 in establishing a priority ranking of the requests for as9 sistance provided by the Authority, the Authority shall fol10 low procedures that ensure, to the maximum extent prac11 ticable, consideration of— 

12 ‘‘(1) the relationship of the project or class of 

13 projects to overall regional development; 

14 ‘‘(2) the per capita income and poverty and un15 employment rates in an area; 

16 ‘‘(3) the financial resources available to the ap17 plicants for assistance seeking to carry out the 

18 project, with emphasis on ensuring that projects are 

19 adequately financed to maximize the probability of 

20 successful economic development; 

21 ‘‘(4) the importance of the project or class of 

22 projects in relation to other projects or classes of 

23 projects that may be in competition for the same 

24 funds; 


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1 ‘‘(5) the prospects that the project for which as2 sistance is sought will improve, on a continuing rath3 er than a temporary basis, the opportunities for em4 ployment, the average level of income, or the eco5 nomic development of the area served by the project; 

6 and 

7 ‘‘(6) the extent to which the project design pro8 vides for detailed outcome measurements by which 

9 grant expenditures and the results of the expendi10 tures may be evaluated. 

11 ‘‘(b) NO RELOCATION ASSISTANCE.— 

12 ‘‘(1) IN GENERAL.—Except as provided in para13 graph (2), no financial assistance authorized by this 

14 chapter shall be used to assist a person or entity in 

15 relocating from 1 area to another. 

16 ‘‘(2) OUTSIDE BUSINESSES.—Financial assist17 ance under this chapter may be used as otherwise 

18 authorized by this title to attract businesses from 

19 outside the region to the region. 

20 ‘‘(c) REDUCTION OF FUNDS.—Funds may be pro21 vided for a program or project in a State under this chap22 ter only if the Authority determines that the level of Fed23 eral or State financial assistance provided under a law 

24 other than this chapter, for the same type of program or 

25 project in the same area of the State within the region, 


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1 will not be reduced as a result of funds made available 

2 by this chapter. 

3 ‘‘SEC. 3809. APPROVAL OF DEVELOPMENT PLANS AND 

4 PROJECTS. 

5 ‘‘(a) IN GENERAL.—A State or regional development 

6 plan or any multistate subregional plan that is proposed 

7 for development under this chapter shall be reviewed and 

8 approved by the Authority. 

9 ‘‘(b) EVALUATION BY STATE MEMBER.—An applica10 tion for a grant or any other assistance for a project under 

11 this chapter shall be made through and evaluated for ap12 proval by the State member of the Authority representing 

13 the applicant. 

14 ‘‘(c) CERTIFICATION.—An application for a grant or 

15 other assistance for a project shall be approved only on 

16 certification by the State member that the application for 

17 the project— 

18 ‘‘(1) describes ways in which the project com19 plies with any applicable State development plan; 

20 ‘‘(2) meets applicable criteria under section 

21 3808; 

22 ‘‘(3) provides adequate assurance that the pro23 posed project will be properly administered, oper24 ated, and maintained; and 


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1 ‘‘(4) otherwise meets the requirements of this 

2 chapter. 

3 ‘‘(d) APPROVAL OF GRANT APPLICATIONS.—On cer4 tification by a State member of the Authority of an appli5 cation for a grant or other assistance for a specific project 

6 under this section, an affirmative vote of the Authority 

7 under section 3802(c) shall be required for approval of 

8 the application. 

9 ‘‘SEC. 3810. CONSENT OF STATES. 

10 ‘‘Nothing in this chapter requires any State to engage 

11 in or accept any program under this chapter without the 

12 consent of the State. 

13 ‘‘SEC. 3811. RECORDS. 

14 ‘‘(a) RECORDS OF THE AUTHORITY.— 

15 ‘‘(1) IN GENERAL.—The Authority shall main16 tain accurate and complete records of all trans17 actions and activities of the Authority. 

18 ‘‘(2) AVAILABILITY.—All records of the Author19 ity shall be available for audit and examination by 

20 the Comptroller General of the United States and 

21 the Inspector General of the Department of Agri22 culture (including authorized representatives of the 

23 Comptroller General and the Inspector General of 

24 the Department of Agriculture). 


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1 ‘‘(b) RECORDS OF RECIPIENTS OF FEDERAL ASSIST2 ANCE.— 

3 ‘‘(1) IN GENERAL.—A recipient of Federal 

4 funds under this chapter shall, as required by the 

5 Authority, maintain accurate and complete records 

6 of transactions and activities financed with Federal 

7 funds and report on the transactions and activities 

8 to the Authority. 

9 ‘‘(2) AVAILABILITY.—All records required 

10 under paragraph (1) shall be available for audit by 

11 the Comptroller General of the United States, the 

12 Inspector General of the Department of Agriculture, 

13 and the Authority (including authorized representa14 tives of the Comptroller General, the Inspector Gen15 eral of the Department of Agriculture, and the Au16 thority). 

17 ‘‘SEC. 3812. ANNUAL REPORT. 

18 ‘‘Not later than 180 days after the end of each fiscal 

19 year, the Authority shall submit to the President and to 

20 Congress a report describing the activities carried out 

21 under this chapter. 

22 ‘‘SEC. 3813. AUTHORIZATION OF APPROPRIATIONS. 

23 ‘‘(a) IN GENERAL.—There is authorized to be appro24 priated to the Authority to carry out this chapter 


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1 $30,000,000 for each of fiscal years 2012 through 2017, 

2 to remain available until expended. 

3 ‘‘(b) ADMINISTRATIVE EXPENSES.—Not more than 5 

4 percent of the amount appropriated under subsection (a) 

5 for a fiscal year shall be used for administrative expenses 

6 of the Authority. 

7 ‘‘SEC. 3814. TERMINATION OF AUTHORITY. 

8 ‘‘This chapter and the authority provided under this 

9 chapter expire on October 1, 2017. 

10 ‘‘CHAPTER 5—NORTHERN GREAT PLAINS 

11 REGIONAL AUTHORITY 

12 ‘‘SEC. 3821. DEFINITIONS. 

13 ‘‘In this chapter: 

14 ‘‘(1) AUTHORITY.—The term ‘Authority’ means 

15 the Northern Great Plains Regional Authority estab16 lished by section 3822. 

17 ‘‘(2) FEDERAL GRANT PROGRAM.—The term 

18 ‘Federal grant program’ means a Federal grant pro19 gram to provide assistance in— 

20 ‘‘(A) implementing the recommendations of 

21 the Northern Great Plains Rural Development 

22 Commission established by the Northern Great 

23 Plains Rural Development Act (7 U.S.C. 2661 

24 note; Public Law 103–318); 

25 ‘‘(B) acquiring or developing land; 


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1 ‘‘(C) constructing or equipping a highway, 

2 road, bridge, or facility; 

3 ‘‘(D) carrying out other economic develop4 ment activities; or 

5 ‘‘(E) conducting research activities related 

6 to the activities described in subparagraphs (A) 

7 through (D). 

8 ‘‘(3) REGION.—The term ‘region’ means the 

9 States of Iowa, Minnesota, Missouri (other than 

10 counties included in the Delta Regional Authority), 

11 Nebraska, North Dakota, and South Dakota. 

12 ‘‘SEC. 3822. NORTHERN GREAT PLAINS REGIONAL AUTHOR13 ITY. 

14 ‘‘(a) ESTABLISHMENT.— 

15 ‘‘(1) IN GENERAL.—There is established the 

16 Northern Great Plains Regional Authority. 

17 ‘‘(2) COMPOSITION.—The Authority shall be 

18 composed of— 

19 ‘‘(A) a Federal member, to be appointed 

20 by the President, by and with the advice and 

21 consent of the Senate; 

22 ‘‘(B) the Governor (or a designee of the 

23 Governor) of each State in the region that 

24 elects to participate in the Authority; and 


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1 ‘‘(C) a member of an Indian tribe, who 

2 shall be a chairperson of an Indian tribe in the 

3 region or a designee of such a chairperson, to 

4 be appointed by the President, by and with the 

5 advice and consent of the Senate. 

6 ‘‘(3) COCHAIRPERSONS.—The Authority shall 

7 be headed by— 

8 ‘‘(A) the Federal member, who shall serve 

9 as— 

10 ‘‘(i) the Federal cochairperson; and 

11 ‘‘(ii) a liaison between the Federal 

12 Government and the Authority; 

13 ‘‘(B) a State cochairperson, who shall be— 

14 ‘‘(i) a Governor of a participating 

15 State in the region; and 

16 ‘‘(ii) elected by the State members for 

17 a term of not less than 1 year; and 

18 ‘‘(C) the member of an Indian tribe, who 

19 shall serve as— 

20 ‘‘(i) the tribal cochairperson; and 

21 ‘‘(ii) a liaison between the govern22 ments of Indian tribes in the region and 

23 the Authority. 

24 ‘‘(4) FAILURE TO CONFIRM.— 


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1 ‘‘(A) FEDERAL MEMBER.—Notwith2 standing any other provision of this section, if 

3 a Federal member described in paragraph 

4 (2)(A) has not been confirmed by the Senate by 

5 not later than 180 days after the date of enact6 ment of the Agriculture Reform, Food, and 

7 Jobs Act of 2012, the Authority may organize 

8 and operate without the Federal member. 

9 ‘‘(B) TRIBAL COCHAIRPERSON.—In the 

10 case of the tribal cochairperson, if no tribal co11 chairperson is confirmed by the Senate, the re12 gional authority shall consult and coordinate 

13 with the leaders of Indian tribes in the region 

14 concerning the activities of the Authority, as 

15 appropriate. 

16 ‘‘(b) ALTERNATE MEMBERS.— 

17 ‘‘(1) ALTERNATE FEDERAL COCHAIRPERSON.— 

18 The President shall appoint an alternate Federal co19 chairperson. 

20 ‘‘(2) STATE ALTERNATES.— 

21 ‘‘(A) IN GENERAL.—The State member of 

22 a participating State may have a single alter23 nate, who shall be— 

24 ‘‘(i) a resident of that State; and 


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1 ‘‘(ii) appointed by the Governor of the 

2 State. 

3 ‘‘(B) QUORUM.—A State alternate member 

4 shall not be counted toward the establishment 

5 of a quorum of the members of the Authority 

6 in any case in which a quorum of the State 

7 members is required to be present. 

8 ‘‘(3) ALTERNATE TRIBAL COCHAIRPERSON.— 

9 The President shall appoint an alternate tribal co10 chairperson, by and with the advice and consent of 

11 the Senate. 

12 ‘‘(4) DELEGATION OF POWER.—No power or 

13 responsibility of the Authority specified in para14 graphs (2) and (3) of subsection (c), and no voting 

15 right of any member of the Authority, shall be dele16 gated to any person who is not— 

17 ‘‘(A) a member of the Authority; or 

18 ‘‘(B) entitled to vote in Authority meet19 ings. 

20 ‘‘(c) VOTING.— 

21 ‘‘(1) IN GENERAL.—A decision by the Authority 

22 shall require a majority vote of the Authority (not 

23 including any member representing a State that is 

24 delinquent under subsection (g)(2)(D)) to be effec25 tive. 


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1 ‘‘(2) QUORUM.—A quorum of State members 

2 shall be required to be present for the Authority to 

3 make any policy decision, including— 

4 ‘‘(A) a modification or revision of an Au5 thority policy decision; 

6 ‘‘(B) approval of a State or regional devel7 opment plan; and 

8 ‘‘(C) any allocation of funds among the 

9 States. 

10 ‘‘(3) PROJECT AND GRANT PROPOSALS.—The 

11 approval of project and grant proposals shall be— 

12 ‘‘(A) a responsibility of the Authority; and 

13 ‘‘(B) conducted in accordance with section 

14 3830. 

15 ‘‘(4) VOTING BY ALTERNATE MEMBERS.—An 

16 alternate member shall vote in the case of the ab17 sence, death, disability, removal, or resignation of 

18 the Federal, State, or Indian tribe member for 

19 whom the alternate member is an alternate. 

20 ‘‘(d) DUTIES.—The Authority shall— 

21 ‘‘(1) develop, on a continuing basis, comprehen22 sive and coordinated plans and programs for 

23 multistate cooperation to advance the economic and 

24 social well-being of the region and to approve grants 

25 for the economic development of the region, giving 


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1 due consideration to other Federal, State, tribal, and 

2 local planning and development activities in the re3 gion; 

4 ‘‘(2) review, and when appropriate amend, pri5 orities in a development plan for the region (includ6 ing 5-year regional outcome targets); 

7 ‘‘(3) assess the needs and assets of the region 

8 based on available research, demonstrations, inves9 tigations, assessments, and evaluations of the region 

10 prepared by Federal, State, tribal, and local agen11 cies, universities, regional and local development dis12 tricts or organizations, and other nonprofit groups; 

13 ‘‘(4) formulate and recommend to the Gov14 ernors and legislatures of States that participate in 

15 the Authority forms of interstate cooperation for— 

16 ‘‘(A) renewable energy development and 

17 transmission; 

18 ‘‘(B) transportation planning and economic 

19 development; 

20 ‘‘(C) information technology; 

21 ‘‘(D) movement of freight and individuals 

22 within the region; 

23 ‘‘(E) federally-funded research at institu24 tions of higher education; and 

25 ‘‘(F) conservation land management; 


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1 ‘‘(5) work with State, tribal, and local agencies 

2 in developing appropriate model legislation; 

3 ‘‘(6) enhance the capacity of, and provide sup4 port for, multistate development and research orga5 nizations, local development organizations and dis6 tricts, and resource conservation districts in the re7 gion; 

8 ‘‘(7) encourage private investment in industrial, 

9 commercial, renewable energy, and other economic 

10 development projects in the region; and 

11 ‘‘(8) cooperate with and assist State govern12 ments with economic development programs of par13 ticipating States. 

14 ‘‘(e) ADMINISTRATION.—In carrying out subsection 

15 (d), the Authority may— 

16 ‘‘(1) hold such hearings, sit and act at such 

17 times and places, take such testimony, receive such 

18 evidence, and print or otherwise reproduce and dis19 tribute a description of the proceedings and reports 

20 on actions by the Authority as the Authority con21 siders appropriate; 

22 ‘‘(2) authorize, through the Federal, State, or 

23 tribal cochairperson or any other member of the Au24 thority designated by the Authority, the administra25 tion of oaths if the Authority determines that testiVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00691 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 mony should be taken or evidence received under 

2 oath; 

3 ‘‘(3) request from any Federal, State, tribal, or 

4 local agency such information as may be available to 

5 or procurable by the agency that may be of use to 

6 the Authority in carrying out the duties of the Au7 thority; 

8 ‘‘(4) adopt, amend, and repeal bylaws and rules 

9 governing the conduct of business and the perform10 ance of duties of the Authority; 

11 ‘‘(5) request the head of any Federal agency to 

12 detail to the Authority such personnel as the Au13 thority requires to carry out duties of the Authority, 

14 each such detail to be without loss of seniority, pay, 

15 or other employee status; 

16 ‘‘(6) request the head of any State agency, trib17 al government, or local government to detail to the 

18 Authority such personnel as the Authority requires 

19 to carry out duties of the Authority, each such detail 

20 to be without loss of seniority, pay, or other em21 ployee status; 

22 ‘‘(7) provide for coverage of Authority employ23 ees in a suitable retirement and employee benefit 

24 system by— 


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1 ‘‘(A) making arrangements or entering 

2 into contracts with any participating State gov3 ernment or tribal government; or 

4 ‘‘(B) otherwise providing retirement and 

5 other employee benefit coverage; 

6 ‘‘(8) accept, use, and dispose of gifts or dona7 tions of services or real, personal, tangible, or intan8 gible property; 

9 ‘‘(9) enter into and perform such contracts, 

10 leases, cooperative agreements, or other transactions 

11 as are necessary to carry out Authority duties, in12 cluding any contracts, leases, or cooperative agree13 ments with— 

14 ‘‘(A) any department, agency, or instru15 mentality of the United States; 

16 ‘‘(B) any State (including a political sub17 division, agency, or instrumentality of the 

18 State); 

19 ‘‘(C) any Indian tribe in the region; or 

20 ‘‘(D) any person, firm, association, or cor21 poration; and 

22 ‘‘(10) establish and maintain a central office 

23 and field offices at such locations as the Authority 

24 may select. 


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1 ‘‘(f) FEDERAL AGENCY COOPERATION.—A Federal 

2 agency shall— 

3 ‘‘(1) cooperate with the Authority; and 

4 ‘‘(2) provide, on request of a cochairperson, ap5 propriate assistance in carrying out this chapter, in 

6 accordance with applicable Federal laws (including 

7 regulations). 

8 ‘‘(g) ADMINISTRATIVE EXPENSES.— 

9 ‘‘(1) FEDERAL SHARE.—The Federal share of 

10 the administrative expenses of the Authority shall 

11 be— 

12 ‘‘(A) for each of fiscal years 2012 and 

13 2013, 100 percent; 

14 ‘‘(B) for fiscal year 2014, 75 percent; and 

15 ‘‘(C) for fiscal year 2015 and each fiscal 

16 year thereafter, 50 percent. 

17 ‘‘(2) NON-FEDERAL SHARE.— 

18 ‘‘(A) IN GENERAL.—The non-Federal 

19 share of the administrative expenses of the Au20 thority shall be paid by non-Federal sources in 

21 the States that participate in the Authority. 

22 ‘‘(B) SHARE PAID BY EACH STATE.—The 

23 share of administrative expenses of the Author24 ity to be paid by non-Federal sources in each 

25 State shall be determined by the Authority. 


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1 ‘‘(C) NO FEDERAL PARTICIPATION.—The 

2 Federal cochairperson shall not participate or 

3 vote in any decision under subparagraph (B). 

4 ‘‘(D) DELINQUENT STATES.—If a State is 

5 delinquent in payment of the State’s share of 

6 administrative expenses of the Authority under 

7 this subsection— 

8 ‘‘(i) no assistance under this chapter 

9 shall be provided to the State (including 

10 assistance to a political subdivision or a 

11 resident of the State); and 

12 ‘‘(ii) no member of the Authority from 

13 the State shall participate or vote in any 

14 action by the Authority. 

15 ‘‘(h) COMPENSATION.— 

16 ‘‘(1) FEDERAL AND TRIBAL COCHAIR17 PERSONS.—The Federal cochairperson and the tribal 

18 cochairperson shall be compensated by the Federal 

19 Government at the annual rate of basic pay pre20 scribed for level III of the Executive Schedule in 

21 subchapter II of chapter 53 of title 5, United States 

22 Code. 

23 ‘‘(2) ALTERNATE FEDERAL AND TRIBAL CO24 CHAIRPERSONS.—The alternate Federal cochair25 person and the alternate tribal cochairperson— 


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1 ‘‘(A) shall be compensated by the Federal 

2 Government at the annual rate of basic pay 

3 prescribed for level V of the Executive Schedule 

4 described in paragraph (1); and 

5 ‘‘(B) when not actively serving as an alter6 nate, shall perform such functions and duties as 

7 are delegated by the Federal cochairperson or 

8 the tribal cochairperson, respectively. 

9 ‘‘(3) STATE MEMBERS AND ALTERNATES.— 

10 ‘‘(A) IN GENERAL.—A State shall com11 pensate each member and alternate rep12 resenting the State on the Authority at the rate 

13 established by State law. 

14 ‘‘(B) NO ADDITIONAL COMPENSATION.— 

15 No State member or alternate member shall re16 ceive any salary, or any contribution to or sup17 plementation of salary from any source other 

18 than the State for services provided by the 

19 member or alternate member to the Authority. 

20 ‘‘(4) DETAILED EMPLOYEES.— 

21 ‘‘(A) IN GENERAL.—No person detailed to 

22 serve the Authority under subsection (e)(6) 

23 shall receive any salary or any contribution to 

24 or supplementation of salary for services pro25 vided to the Authority from— 


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1 ‘‘(i) any source other than the State, 

2 tribal, local, or intergovernmental agency 

3 from which the person was detailed; or 

4 ‘‘(ii) the Authority. 

5 ‘‘(B) VIOLATION.—Any person that vio6 lates this paragraph shall be fined not more 

7 than $5,000, imprisoned not more than 1 year, 

8 or both. 

9 ‘‘(C) APPLICABLE LAW.—The Federal co10 chairperson, the alternate Federal cochair11 person, and any Federal officer or employee de12 tailed to duty on the Authority under sub13 section (e)(5) shall not be subject to subpara14 graph (A), but shall remain subject to sections 

15 202 through 209 of title 18, United States 

16 Code. 

17 ‘‘(5) ADDITIONAL PERSONNEL.— 

18 ‘‘(A) COMPENSATION.— 

19 ‘‘(i) IN GENERAL.—The Authority 

20 may appoint and fix the compensation of 

21 an executive director and such other per22 sonnel as are necessary to enable the Au23 thority to carry out the duties of the Au24 thority. 


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1 ‘‘(ii) EXCEPTION.—Compensation 

2 under clause (i) shall not exceed the max3 imum rate for the Senior Executive Service 

4 under section 5382 of title 5, United 

5 States Code, including any applicable local6 ity-based comparability payment that may 

7 be authorized under section 5304(h)(2)(C) 

8 of that title. 

9 ‘‘(B) EXECUTIVE DIRECTOR.—The execu10 tive director shall be responsible for— 

11 ‘‘(i) the carrying out of the adminis12 trative duties of the Authority; 

13 ‘‘(ii) direction of the Authority staff; 

14 and 

15 ‘‘(iii) such other duties as the Author16 ity may assign. 

17 ‘‘(C) NO FEDERAL EMPLOYEE STATUS.— 

18 No member, alternate, officer, or employee of 

19 the Authority (except the Federal cochairperson 

20 of the Authority, the alternate and staff for the 

21 Federal cochairperson, and any Federal em22 ployee detailed to the Authority under sub23 section (e)(5)) shall be considered to be a Fed24 eral employee for any purpose. 

25 ‘‘(i) CONFLICTS OF INTEREST.— 


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1 ‘‘(1) IN GENERAL.—Except as provided under 

2 paragraph (2), no State member, Indian tribe mem3 ber, State alternate, officer, or employee of the Au4 thority shall participate personally and substantially 

5 as a member, alternate, officer, or employee of the 

6 Authority, through decision, approval, disapproval, 

7 recommendation, the rendering of advice, investiga8 tion, or otherwise, in any proceeding, application, re9 quest for a ruling or other determination, contract, 

10 claim, controversy, or other matter in which, to 

11 knowledge of the member, alternate, officer, or em12 ployee, there is a financial interest of— 

13 ‘‘(A) the member, alternate, officer, or em14 ployee; 

15 ‘‘(B) the spouse, minor child, partner, or 

16 organization (other than a State or political 

17 subdivision of the State or the Indian tribe) of 

18 the member, alternate, officer, or employee, in 

19 which the member, alternate, officer, or em20 ployee is serving as officer, director, trustee, 

21 partner, or employee; or 

22 ‘‘(C) any person or organization with 

23 whom the member, alternate, officer, or em24 ployee is negotiating or has any arrangement 

25 concerning prospective employment. 


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1 ‘‘(2) DISCLOSURE.—Paragraph (1) shall not 

2 apply if the State member, Indian tribe member, al3 ternate, officer, or employee— 

4 ‘‘(A) immediately advises the Authority of 

5 the nature and circumstances of the proceeding, 

6 application, request for a ruling or other deter7 mination, contract, claim, controversy, or other 

8 particular matter presenting a potential conflict 

9 of interest; 

10 ‘‘(B) makes full disclosure of the financial 

11 interest; and 

12 ‘‘(C) before the proceeding concerning the 

13 matter presenting the conflict of interest, re14 ceives a written determination by the Authority 

15 that the interest is not so substantial as to be 

16 likely to affect the integrity of the services that 

17 the Authority may expect from the State mem18 ber, Indian tribe member, alternate, officer, or 

19 employee. 

20 ‘‘(3) VIOLATION.—Any person that violates this 

21 subsection shall be fined not more than $10,000, im22 prisoned not more than 2 years, or both. 

23 ‘‘(j) VALIDITY OF CONTRACTS, LOANS, AND

24 GRANTS.—The Authority may declare void any contract, 

25 loan, or grant of or by the Authority in relation to which 


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1 the Authority determines that there has been a violation 

2 of any provision under subsection (h)(4) or subsection (i) 

3 of this chapter, or sections 202 through 209 of title 18, 

4 United States Code. 

5 ‘‘SEC. 3823. INTERSTATE COOPERATION FOR ECONOMIC 

6 OPPORTUNITY AND EFFICIENCY. 

7 ‘‘(a) IN GENERAL.—The Authority shall provide as8 sistance to States in developing regional plans to address 

9 multistate economic issues, including plans— 

10 ‘‘(1) to develop a regional transmission system 

11 for movement of renewable energy to markets out12 side the region; 

13 ‘‘(2) to address regional transportation con14 cerns, including the establishment of a Northern 

15 Great Plains Regional Transportation Working 

16 Group; 

17 ‘‘(3) to encourage and support interstate col18 laboration on federally-funded research that is in the 

19 national interest; and 

20 ‘‘(4) to establish a Regional Working Group on 

21 Agriculture Development and Transportation. 

22 ‘‘(b) ECONOMIC ISSUES.—The multistate economic 

23 issues referred to in subsection (a) shall include— 

24 ‘‘(1) renewable energy development and trans25 mission; 


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1 ‘‘(2) transportation planning and economic de2 velopment; 

3 ‘‘(3) information technology; 

4 ‘‘(4) movement of freight and individuals within 

5 the region; 

6 ‘‘(5) federally-funded research at institutions of 

7 higher education; and 

8 ‘‘(6) conservation land management. 

9 ‘‘SEC. 3824. ECONOMIC AND COMMUNITY DEVELOPMENT 

10 GRANTS. 

11 ‘‘(a) IN GENERAL.—The Authority may approve 

12 grants to States, Indian tribes, local governments, and 

13 public and nonprofit organizations for projects, approved 

14 in accordance with section 3830— 

15 ‘‘(1) to assist the region in obtaining the job 

16 training, employment-related education, and busi17 ness development (with an emphasis on entrepre18 neurship) that are needed to build and maintain 

19 strong local economies; 

20 ‘‘(2) to develop the transportation, renewable 

21 energy transmission, and telecommunication infra22 structure of the region for the purpose of facilitating 

23 economic development in the region (except that 

24 grants for this purpose may be made only to States, 


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1 Indian tribes, local governments, and nonprofit orga2 nizations); 

3 ‘‘(3) to provide assistance to severely distressed 

4 and underdeveloped areas that lack financial re5 sources for improving basic public services; 

6 ‘‘(4) to provide assistance to severely distressed 

7 and underdeveloped areas that lack financial re8 sources for equipping industrial parks and related 

9 facilities; and 

10 ‘‘(5) to otherwise achieve the purposes of this 

11 chapter. 

12 ‘‘(b) FUNDING.— 

13 ‘‘(1) IN GENERAL.—Funds for grants under 

14 subsection (a) may be provided— 

15 ‘‘(A) entirely from appropriations to carry 

16 out this section; 

17 ‘‘(B) in combination with funds available 

18 under another Federal grant program; or 

19 ‘‘(C) from any other source. 

20 ‘‘(2) PRIORITY OF FUNDING.—To best build the 

21 foundations for long-term economic development and 

22 to complement other Federal, State, and tribal re23 sources in the region, Federal funds available under 

24 this chapter shall be focused on the following activi25 ties: 


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1 ‘‘(A) Basic public infrastructure in dis2 tressed counties and isolated areas of distress. 

3 ‘‘(B) Transportation and telecommuni4 cation infrastructure for the purpose of facili5 tating economic development in the region. 

6 ‘‘(C) Business development, with emphasis 

7 on entrepreneurship. 

8 ‘‘(D) Job training or employment-related 

9 education, with emphasis on use of existing 

10 public educational institutions located in the re11 gion. 

12 ‘‘SEC. 3825. SUPPLEMENTS TO FEDERAL GRANT PRO13 GRAMS. 

14 ‘‘(a) FINDING.—Congress finds that certain States 

15 and local communities of the region may be unable to take 

16 maximum advantage of Federal grant programs for which 

17 the States and communities are eligible because— 

18 ‘‘(1) the States and communities lack the eco19 nomic resources to provide the required matching 

20 share; or 

21 ‘‘(2) there are insufficient funds available under 

22 the applicable Federal law authorizing the Federal 

23 grant program to meet pressing needs of the region. 

24 ‘‘(b) FEDERAL GRANT PROGRAM FUNDING.—Not25 withstanding any provision of law limiting the Federal 


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1 share, the areas eligible for assistance, or the authoriza2 tions of appropriations, under any Federal grant program, 

3 and in accordance with subsection (c), the Authority, with 

4 the approval of the Federal cochairperson and with respect 

5 to a project to be carried out in the region— 

6 ‘‘(1) may increase the Federal share of the 

7 costs of a project under any Federal grant program 

8 to not more than 90 percent (except as provided in 

9 section 3827(b)); and 

10 ‘‘(2) shall use amounts made available to carry 

11 out this chapter to pay the increased Federal share. 

12 ‘‘(c) CERTIFICATIONS.— 

13 ‘‘(1) IN GENERAL.—In the case of any project 

14 for which all or any portion of the basic Federal 

15 share of the costs of the project is proposed to be 

16 paid under this section, no Federal contribution 

17 shall be made until the Federal official admin18 istering the Federal law that authorizes the Federal 

19 grant program certifies that the project— 

20 ‘‘(A) meets (except as provided in sub21 section (b)) the applicable requirements of the 

22 applicable Federal grant program; and 

23 ‘‘(B) could be approved for Federal con24 tribution under the Federal grant program if 


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1 funds were available under the law for the 

2 project. 

3 ‘‘(2) CERTIFICATION BY AUTHORITY.— 

4 ‘‘(A) IN GENERAL.—The certifications and 

5 determinations required to be made by the Au6 thority for approval of projects under this Act 

7 in accordance with section 3830 shall be— 

8 ‘‘(i) controlling; and 

9 ‘‘(ii) accepted by the Federal agencies. 

10 ‘‘(B) ACCEPTANCE BY FEDERAL COCHAIR11 PERSON.—In the case of any project described 

12 in paragraph (1), any finding, report, certifi13 cation, or documentation required to be sub14 mitted with respect to the project to the head 

15 of the department, agency, or instrumentality of 

16 the Federal Government responsible for the ad17 ministration of the Federal grant program 

18 under which the project is carried out shall be 

19 accepted by the Federal cochairperson. 

20 ‘‘SEC. 3826. MULTISTATE AND LOCAL DEVELOPMENT DIS21 TRICTS AND ORGANIZATIONS AND NORTH22 ERN GREAT PLAINS INC. 

23 ‘‘(a) DEFINITION OF MULTISTATE AND LOCAL DE24 VELOPMENT DISTRICT OR ORGANIZATION.—In this secVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00706 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 tion, the term ‘multistate and local development district 

2 or organization’ means an entity— 

3 ‘‘(1) that— 

4 ‘‘(A) is a planning district that is recog5 nized by the Economic Development Adminis6 tration of the Department of Commerce; or 

7 ‘‘(B) is— 

8 ‘‘(i) organized and operated in a man9 ner that ensures broad-based community 

10 participation and an effective opportunity 

11 for other nonprofit groups to contribute to 

12 the development and implementation of 

13 programs in the region; 

14 ‘‘(ii) a nonprofit incorporated body or15 ganized or chartered under the law of the 

16 State in which the entity is located; 

17 ‘‘(iii) a nonprofit agency or instru18 mentality of a State or local government; 

19 ‘‘(iv) a public organization established 

20 before the date of enactment of the Agri21 culture Reform, Food, and Jobs Act of 

22 2012 under State law for creation of multi23 jurisdictional, area-wide planning organiza24 tions; 


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1 ‘‘(v) a nonprofit agency or instrumen2 tality of a State that was established for 

3 the purpose of assisting with multistate co4 operation; or 

5 ‘‘(vi) a nonprofit association or com6 bination of bodies, agencies, and instru7 mentalities described in clauses (ii) 

8 through (v); and 

9 ‘‘(2) that has not, as certified by the Authority 

10 (in consultation with the Federal cochairperson or 

11 Secretary, as appropriate)— 

12 ‘‘(A) inappropriately used Federal grant 

13 funds from any Federal source; or 

14 ‘‘(B) appointed an officer who, during the 

15 period in which another entity inappropriately 

16 used Federal grant funds from any Federal 

17 source, was an officer of the other entity. 

18 ‘‘(b) GRANTS TO MULTISTATE, LOCAL, OR REGIONAL

19 DEVELOPMENT DISTRICTS AND ORGANIZATIONS.— 

20 ‘‘(1) IN GENERAL.—The Authority may make 

21 grants for administrative expenses under this section 

22 to multistate, local, and regional development dis23 tricts and organizations. 

24 ‘‘(2) CONDITIONS FOR GRANTS.— 


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1 ‘‘(A) MAXIMUM AMOUNT.—The amount of 

2 any grant awarded under paragraph (1) shall 

3 not exceed 80 percent of the administrative ex4 penses of the multistate, local, or regional de5 velopment district or organization receiving the 

6 grant. 

7 ‘‘(B) MAXIMUM PERIOD.—No grant de8 scribed in paragraph (1) shall be awarded for a 

9 period of greater than 3 years. 

10 ‘‘(3) LOCAL SHARE.—The contributions of a 

11 multistate, local, or regional development district or 

12 organization for administrative expenses may be in 

13 cash or in kind, fairly evaluated, including space, 

14 equipment, and services. 

15 ‘‘(c) DUTIES.— 

16 ‘‘(1) IN GENERAL.—Except as provided in para17 graph (2), a local development district shall operate 

18 as a lead organization serving multicounty areas in 

19 the region at the local level. 

20 ‘‘(2) DESIGNATION.—The Federal cochair21 person may designate an Indian tribe or multijuris22 dictional organization to serve as a lead organization 

23 in such cases as the Federal cochairperson or Sec24 retary, as appropriate, determines appropriate. 


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1 ‘‘(d) NORTHERN GREAT PLAINS INC.—Northern 

2 Great Plains Inc., a nonprofit corporation incorporated in 

3 the State of Minnesota to implement the recommendations 

4 of the Northern Great Plains Rural Development Commis5 sion established by the Northern Great Plains Rural De6 velopment Act (7 U.S.C. 2661 note; Public Law 103– 

7 318)— 

8 ‘‘(1) shall serve as an independent, primary re9 source for the Authority on issues of concern to the 

10 region; 

11 ‘‘(2) shall advise the Authority on development 

12 of international trade; 

13 ‘‘(3) may provide research, education, training, 

14 and other support to the Authority; and 

15 ‘‘(4) may carry out other activities on its own 

16 behalf or on behalf of other entities. 

17 ‘‘SEC. 3827. DISTRESSED COUNTIES AND AREAS AND NON18 DISTRESSED COUNTIES. 

19 ‘‘(a) DESIGNATIONS.—Each year, the Authority, in 

20 accordance with such criteria as the Authority may estab21 lish, shall designate— 

22 ‘‘(1) as distressed counties, counties in the re23 gion that are the most severely and persistently dis24 tressed and underdeveloped and have high rates of 

25 poverty, unemployment, or outmigration; 


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1 ‘‘(2) as nondistressed counties, counties in the 

2 region that are not designated as distressed counties 

3 under paragraph (1); and 

4 ‘‘(3) as isolated areas of distress, areas located 

5 in nondistressed counties (as designated under para6 graph (2)) that have high rates of poverty, unem7 ployment, or outmigration. 

8 ‘‘(b) DISTRESSED COUNTIES.— 

9 ‘‘(1) IN GENERAL.—The Authority shall allo10 cate at least 50 percent of the appropriations made 

11 available under section 3834 for programs and 

12 projects designed to serve the needs of distressed 

13 counties and isolated areas of distress in the region. 

14 ‘‘(2) FUNDING LIMITATIONS.—The funding lim15 itations under section 3825(b) shall not apply to a 

16 project to provide transportation or telecommuni17 cation or basic public services to residents of 1 or 

18 more distressed counties or isolated areas of distress 

19 in the region. 

20 ‘‘(c) TRANSPORTATION, TELECOMMUNICATION, RE21 NEWABLE ENERGY, AND BASIC PUBLIC INFRASTRUC22 TURE.—The Authority shall allocate at least 50 percent 

23 of any funds made available under section 3834 for trans24 portation, telecommunication, renewable energy, and basic 


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1 public infrastructure projects authorized under para2 graphs (1) and (3) of section 3824(a). 

3 ‘‘SEC. 3828. DEVELOPMENT PLANNING PROCESS. 

4 ‘‘(a) STATE DEVELOPMENT PLAN.—In accordance 

5 with policies established by the Authority, each State 

6 member shall submit a development plan for the area of 

7 the region represented by the State member. 

8 ‘‘(b) CONTENT OF PLAN.—A State development plan 

9 submitted under subsection (a) shall reflect the goals, ob10 jectives, and priorities identified in the regional develop11 ment plan developed under section 3823(d)(2). 

12 ‘‘(c) CONSULTATION WITH INTERESTED LOCAL PAR13 TIES.—In carrying out the development planning process 

14 (including the selection of programs and projects for as15 sistance), a State may— 

16 ‘‘(1) consult with— 

17 ‘‘(A) multistate, regional, and local devel18 opment districts and organizations; and 

19 ‘‘(B) local units of government; and 

20 ‘‘(2) take into consideration the goals, objec21 tives, priorities, and recommendations of the entities 

22 described in paragraph (1). 

23 ‘‘(d) PUBLIC PARTICIPATION.— 

24 ‘‘(1) IN GENERAL.—The Authority and applica25 ble multistate, regional, and local development disVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00712 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 tricts and organizations shall encourage and assist, 

2 to the maximum extent practicable, public participa3 tion in the development, revision, and implementa4 tion of all plans and programs under this chapter. 

5 ‘‘(2) REGULATIONS.—The Authority shall de6 velop guidelines for providing public participation 

7 described in paragraph (1), including public hear8 ings. 

9 ‘‘SEC. 3829. PROGRAM DEVELOPMENT CRITERIA. 

10 ‘‘(a) IN GENERAL.—In considering programs and 

11 projects to be provided assistance under this chapter, and 

12 in establishing a priority ranking of the requests for as13 sistance provided to the Authority, the Authority shall fol14 low procedures that ensure, to the maximum extent prac15 ticable, consideration of— 

16 ‘‘(1) the relationship of the project or class of 

17 projects to overall multistate or regional develop18 ment; 

19 ‘‘(2) the per capita income and poverty and un20 employment and outmigration rates in an area; 

21 ‘‘(3) the financial resources available to the ap22 plicants for assistance seeking to carry out the 

23 project, with emphasis on ensuring that projects are 

24 adequately financed to maximize the probability of 

25 successful economic development; 


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1 ‘‘(4) the importance of the project or class of 

2 projects in relation to other projects or classes of 

3 projects that may be in competition for the same 

4 funds; 

5 ‘‘(5) the prospects that the project for which as6 sistance is sought will improve, on a continuing rath7 er than a temporary basis, the opportunities for em8 ployment, the average level of income, or the eco9 nomic development of the area to be served by the 

10 project; and 

11 ‘‘(6) the extent to which the project design pro12 vides for detailed outcome measurements by which 

13 grant expenditures and the results of the expendi14 tures may be evaluated. 

15 ‘‘(b) NO RELOCATION ASSISTANCE.— 

16 ‘‘(1) IN GENERAL.—Except as provided in para17 graph (2), no financial assistance authorized by this 

18 chapter shall be used to assist a person or entity in 

19 relocating from 1 area to another. 

20 ‘‘(2) OUTSIDE BUSINESSES.—Financial assist21 ance under this chapter may be used as otherwise 

22 authorized by this title to attract businesses from 

23 outside the region to the region. 

24 ‘‘(c) MAINTENANCE OF EFFORT.—Funds may be 

25 provided for a program or project in a State under this 


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1 chapter only if the Authority determines that the level of 

2 Federal or State financial assistance provided under a law 

3 other than this chapter, for the same type of program or 

4 project in the same area of the State within the region, 

5 will not be reduced as a result of funds made available 

6 by this chapter. 

7 ‘‘SEC. 3830. APPROVAL OF DEVELOPMENT PLANS AND 

8 PROJECTS. 

9 ‘‘(a) IN GENERAL.—A State or regional development 

10 plan or any multistate subregional plan that is proposed 

11 for development under this chapter shall be reviewed by 

12 the Authority. 

13 ‘‘(b) EVALUATION BY STATE MEMBER.—An applica14 tion for a grant or any other assistance for a project under 

15 this chapter shall be made through and evaluated for ap16 proval by the State member of the Authority representing 

17 the applicant. 

18 ‘‘(c) CERTIFICATION.—An application for a grant or 

19 other assistance for a project shall be approved only on 

20 certification by the State member that the application for 

21 the project— 

22 ‘‘(1) describes ways in which the project com23 plies with any applicable State development plan; 

24 ‘‘(2) meets applicable criteria under section 

25 3829; 


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1 ‘‘(3) provides adequate assurance that the pro2 posed project will be properly administered, oper3 ated, and maintained; and 

4 ‘‘(4) otherwise meets the requirements of this 

5 chapter. 

6 ‘‘(d) VOTES FOR DECISIONS.—On certification by a 

7 State member of the Authority of an application for a 

8 grant or other assistance for a specific project under this 

9 section, an affirmative vote of the Authority under section 

10 3822(c) shall be required for approval of the application. 

11 ‘‘SEC. 3831. CONSENT OF STATES. 

12 ‘‘ ‘‘Nothing in this chapter requires any State to en13 gage in or accept any program under this chapter without 

14 the consent of the State. 

15 ‘‘SEC. 3832. RECORDS. 

16 ‘‘(a) RECORDS OF THE AUTHORITY.— 

17 ‘‘(1) IN GENERAL.—The Authority shall main18 tain accurate and complete records of all trans19 actions and activities of the Authority. 

20 ‘‘(2) AVAILABILITY.—All records of the Author21 ity shall be available for audit and examination by 

22 the Comptroller General of the United States and 

23 the Inspector General of the Department of Agri24 culture (including authorized representatives of the 


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1 Comptroller General and the Inspector General of 

2 the Department of Agriculture). 

3 ‘‘(b) RECORDS OF RECIPIENTS OF FEDERAL ASSIST4 ANCE.— 

5 ‘‘(1) IN GENERAL.—A recipient of Federal 

6 funds under this chapter shall, as required by the 

7 Authority, maintain accurate and complete records 

8 of transactions and activities financed with Federal 

9 funds and report to the Authority on the trans10 actions and activities to the Authority. 

11 ‘‘(2) AVAILABILITY.—All records required 

12 under paragraph (1) shall be available for audit by 

13 the Comptroller General of the United States, the 

14 Inspector General of the Department of Agriculture, 

15 and the Authority (including authorized representa16 tives of the Comptroller General, the Inspector Gen17 eral of the Department of Agriculture, and the Au18 thority). 

19 ‘‘(c) ANNUAL AUDIT.—The Inspector General of the 

20 Department of Agriculture shall audit the activities, trans21 actions, and records of the Authority on an annual basis. 

22 ‘‘SEC. 3833. ANNUAL REPORT. 

23 ‘‘Not later than 180 days after the end of each fiscal 

24 year, the Authority shall submit to the President and to 


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1 Congress a report describing the activities carried out 

2 under this chapter. 

3 ‘‘SEC. 3834. AUTHORIZATION OF APPROPRIATIONS. 

4 ‘‘(a) IN GENERAL.—There is authorized to be appro5 priated to the Authority to carry out this chapter 

6 $30,000,000 for each of fiscal years 2012 through 2017, 

7 to remain available until expended. 

8 ‘‘(b) ADMINISTRATIVE EXPENSES.—Not more than 5 

9 percent of the amount appropriated under subsection (a) 

10 for a fiscal year shall be used for administrative expenses 

11 of the Authority. 

12 ‘‘(c) MINIMUM STATE SHARE OF GRANTS.—Notwith13 standing any other provision of this chapter, for any fiscal 

14 year, the aggregate amount of grants received by a State 

15 and all persons or entities in the State under this chapter 

shall be not less than 1 16 ⁄3 of the product obtained by multi17 plying— 

18 ‘‘(1) the aggregate amount of grants under this 

19 chapter for the fiscal year; and 

20 ‘‘(2) the ratio that— 

21 ‘‘(A) the population of the State (as deter22 mined by the Secretary of Commerce based on 

23 the most recent decennial census for which data 

24 are available); bears to 


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1 ‘‘(B) the population of the region (as so 

2 determined). 

3 ‘‘SEC. 3835. TERMINATION OF AUTHORITY. 

4 ‘‘The authority provided by this chapter terminates 

5 effective October 1, 2017. 

6 ‘‘Subtitle C—General Provisions 

7 ‘‘SEC. 3901. FULL FAITH AND CREDIT. 

8 ‘‘(a) IN GENERAL.—A contract of insurance or guar9 antee executed by the Secretary under this title shall be 

10 an obligation supported by the full faith and credit of the 

11 United States. 

12 ‘‘(b) CONTESTABILITY.—A contract of insurance or 

13 guarantee executed by the Secretary under this title shall 

14 be incontestable except for fraud or misrepresentation that 

15 the lender or any holder— 

16 ‘‘(1) has actual knowledge of at the time the 

17 contract of insurance or guarantee is executed; or 

18 ‘‘(2) participates in or condones. 

19 ‘‘SEC. 3902. PURCHASE AND SALE OF GUARANTEED POR20 TIONS OF LOANS. 

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

22 (c), the Secretary may purchase, on such terms and condi23 tions as the Secretary considers appropriate, the guaran24 teed portion of a loan guaranteed under this title, if the 


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1 Secretary determines that an adequate secondary market 

2 is not available in the private sector. 

3 ‘‘(b) MAXIMUM PAYMENT.—The Secretary may not 

4 pay for any guaranteed portion of a loan under subsection 

5 (a) in excess of an amount equal to the unpaid principal 

6 balance and accrued interest on the guaranteed portion 

7 of the loan. 

8 ‘‘(c) SOURCES OF FUNDING.—The Secretary may use 

9 for the purchases— 

10 ‘‘(1) funds from the Rural Development Insur11 ance Fund with respect to rural development loans 

12 (as defined in section 3704(a)); and 

13 ‘‘(2) funds from the Agricultural Credit Insur14 ance Fund with respect to all other loans under this 

15 title. 

16 ‘‘(d) SALE OF GUARANTEED LOANS.— 

17 ‘‘(1) SALES.— 

18 ‘‘(A) REGULATION.— 

19 ‘‘(i) IN GENERAL.—The guaranteed 

20 portion of any loan made under this title 

21 may be sold by the lender, and by any sub22 sequent holder, in accordance with such 

23 regulations governing the sales as the Sec24 retary shall establish, subject to clauses (ii) 

25 and (iii). 


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1 ‘‘(ii) FEES TO BE PAID IN FULL.—All 

2 fees due the Secretary with respect to a 

3 guaranteed loan shall be paid in full before 

4 any sale. 

5 ‘‘(iii) LOAN TO BE FULLY DIS6 BURSED.—The loan shall be fully dis7 bursed to the borrower before the sale. 

8 ‘‘(B) POST-SALE.—After a loan is sold in 

9 the secondary market, the lender shall— 

10 ‘‘(i) remain obligated under the guar11 antee agreement of the lender with the 

12 Secretary; and 

13 ‘‘(ii) continue to service the loan in 

14 accordance with the terms and conditions 

15 of that agreement. 

16 ‘‘(C) PROCEDURES.—The Secretary shall 

17 develop such procedures as are necessary for— 

18 ‘‘(i) the facilitation, administration, 

19 and promotion of secondary market oper20 ations; and 

21 ‘‘(ii) determining the increase of ac22 cess of farmers to capital at reasonable 

23 rates and terms as a result of secondary 

24 market operations. 


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1 ‘‘(D) RIGHTS TO PREPAY.—This sub2 section does not impede or extinguish— 

3 ‘‘(i) the right of the borrower or the 

4 successor in interest to the borrower to 

5 prepay (in whole or in part) any loan made 

6 under this title; or 

7 ‘‘(ii) the rights of any party under any 

8 provision of this title. 

9 ‘‘(2) ISSUE POOL CERTIFICATES.— 

10 ‘‘(A) IN GENERAL.—The Secretary may, 

11 directly or through a market maker approved 

12 by the Secretary, issue pool certificates rep13 resenting ownership of part or all of the guar14 anteed portion of any loan guaranteed by the 

15 Secretary under this title. 

16 ‘‘(B) APPROVAL.—Certificates under sub17 paragraph (A) shall be based on and backed by 

18 a pool established or approved by the Secretary 

19 and composed solely of the entire guaranteed 

20 portion of the loans. 

21 ‘‘(C) GUARANTEE OF POOL.—On such 

22 terms and conditions as the Secretary considers 

23 appropriate, the Secretary may guarantee the 

24 timely payment of the principal and interest on 

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1 retary by approved market makers for purposes 

2 of this subsection. 

3 ‘‘(D) LIMITATIONS.—A guarantee under 

4 subparagraph (C) shall be limited to the extent 

5 of principal and interest on the guaranteed por6 tions of loans that compose the pool. 

7 ‘‘(E) PREPAYMENT.—If a loan in a pool is 

8 prepaid, either voluntarily or by reason of de9 fault, the guarantee of timely payment of prin10 cipal and interest on the pool certificates shall 

11 be reduced in proportion to the amount of prin12 cipal and interest that the prepaid loan rep13 resents in the pool. 

14 ‘‘(F) INTEREST ACCRUAL.—Interest on 

15 prepaid or defaulted loans shall accrue and be 

16 guaranteed by the Secretary only through the 

17 date of payment on the guarantee. 

18 ‘‘(G) REDEMPTION.—During the term of 

19 the pool certificate, the certificate may be called 

20 for redemption due to prepayment or default of 

21 all loans constituting the pool. 

22 ‘‘(H) FULL FAITH AND CREDIT.—The full 

23 faith and credit of the United States is pledged 

24 to the payment of all amounts that may be re25 quired to be paid under any guarantee of the 


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1 pool certificates issued by approved market 

2 makers under this subsection. 

3 ‘‘(I) FEES.— 

4 ‘‘(i) IN GENERAL.—The Secretary 

5 shall not collect any fee for any guarantee 

6 under this subsection. 

7 ‘‘(ii) SECRETARIAL FUNCTIONS.— 

8 Clause (i) does not preclude the Secretary 

9 from collecting a fee for the functions de10 scribed in paragraph (3). 

11 ‘‘(J) DEFAULT.—Not later than 30 days 

12 after a borrower of a guaranteed loan is in de13 fault of any principal or interest payment due 

14 for 60 days or more, the Secretary shall— 

15 ‘‘(i) purchase the pool certificates rep16 resenting ownership of the guaranteed por17 tion of the loan; and 

18 ‘‘(ii) pay the registered holder of the 

19 certificates an amount equal to the guaran20 teed portion of the loan represented by the 

21 certificate. 

22 ‘‘(K) PAYMENT OF CLAIMS.—If the Sec23 retary pays a claim under a guarantee issued 

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1 rogated fully to the rights satisfied by the pay2 ment, as may be provided by the Secretary. 

3 ‘‘(L) APPLICATION OF LAWS.—No State or 

4 local law, and no Federal law, shall preclude or 

5 limit the exercise by the Secretary of the owner6 ship rights of the Secretary in the portions of 

7 loans constituting the pool against which the 

8 certificates are issued. 

9 ‘‘(3) DUTIES OF THE SECRETARY.— 

10 ‘‘(A) IN GENERAL.—On the adoption of 

11 final rules and regulations, the Secretary 

12 shall— 

13 ‘‘(i) provide for the central collection 

14 of registration information from all partici15 pating market makers for all loans and 

16 pool certificates sold under paragraphs (1) 

17 and (2), including, with respect to each 

18 original sale and any subsequent sale— 

19 ‘‘(I) identification of the interest 

20 rate paid by the borrower to the lend21 er; 

22 ‘‘(II) the servicing fee of the 

23 lender; 


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1 ‘‘(III) disclosure of whether in2 terest on the loan is at a fixed or vari3 able rate; 

4 ‘‘(IV) identification of each pur5 chaser of a pool certificate; 

6 ‘‘(V) the interest rate paid on the 

7 certificate; and 

8 ‘‘(VI) such other information as 

9 the Secretary considers appropriate. 

10 ‘‘(ii) before any sale, require the seller 

11 (as defined in subparagraph (B) to disclose 

12 to each prospective purchaser of the por13 tion of a loan guaranteed under this title 

14 and to each prospective purchaser of a pool 

15 certificate issued under paragraph (2) in16 formation on the terms, conditions, and 

17 yield of such instrument; 

18 ‘‘(iii) provide for adequate custody of 

19 any pooled guaranteed loans; 

20 ‘‘(iv) take such actions as are nec21 essary, in restructuring pools of the guar22 anteed portion of loans, to minimize the es23 timated costs of paying claims under guar24 antees issued under this subsection; 

25 ‘‘(v) require each market maker— 


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1 ‘‘(I) to service all pools formed, 

2 and participations sold, by the market 

3 maker; and 

4 ‘‘(II) to provide the Secretary 

5 with information relating to the collec6 tion and disbursement of all periodic 

7 payments, prepayments, and default 

8 funds from lenders, to or from the re9 serve fund that the Secretary shall es10 tablish to enable the timely payment 

11 guarantee to be self-funding, and 

12 from all beneficial holders; and 

13 ‘‘(vi) regulate market makers in pool 

14 certificates sold under this subsection. 

15 ‘‘(B) DEFINITION OF SELLER.—For pur16 poses of subparagraph (A)(ii), if the instrument 

17 being sold is a loan, the term ‘seller’ does not 

18 include— 

19 ‘‘(i) the person who made the loan; or 

20 ‘‘(ii) any person who sells 3 or fewer 

21 guaranteed loans per year. 

22 ‘‘(4) CONTRACT FOR SERVICES.—The Secretary 

23 may contract for goods and services to be used for 

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1 tles 5, 40, and 41, United States Code (including 

2 any regulations issued under those titles). 

3 ‘‘SEC. 3903. ADMINISTRATION. 

4 ‘‘(a) POWERS OF SECRETARY.—The Secretary 

5 may— 

6 ‘‘(1)(A) administer the powers and duties of the 

7 Secretary through such national, area, State, or 

8 local offices and employees in the United States as 

9 the Secretary determines to be necessary; and 

10 ‘‘(B) authorize an office to serve an area com11 posed of 2 or more States if the Secretary deter12 mines that the volume of business in the area is not 

13 sufficient to justify separate State offices; 

14 ‘‘(2)(A) accept and use voluntary and uncom15 pensated services; and 

16 ‘‘(B) with the consent of the agency concerned, 

17 use the officers, employees, equipment, and informa18 tion of any agency of the Federal Government, or of 

19 any State, territory, or political subdivision; 

20 ‘‘(3) subject to appropriations, make necessary 

21 expenditures for the purchase or hire of passenger 

22 vehicles, and such other facilities and services as the 

23 Secretary may from time to time find necessary for 

24 the proper administration of this title; 


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1 ‘‘(4) subject to subsection (b), compromise, ad2 just, reduce, or charge-off debts or claims (including 

3 debts and claims arising from loan guarantees), and 

4 adjust, modify, subordinate, or release the terms of 

5 security instruments, leases, contracts, and agree6 ments entered into or administered by the Farm 

7 Service Agency, the Rural Utilities Service, the 

8 Rural Housing Service, the Rural Business-Coopera9 tive Service, or successor agencies under this title, 

10 except for activities conducted under the Housing 

11 Act of 1949 (42 U.S.C. 1441 et seq.); 

12 ‘‘(5) release mortgage and other contract liens 

13 if it appears that the mortgage and liens have no 

14 present or prospective value or that the enforcement 

15 of the mortgage and liens likely would be ineffectual 

16 or uneconomical; 

17 ‘‘(6) obtain fidelity bonds protecting the Fed18 eral Government against fraud and dishonesty of of19 ficers and employees of the Farm Service Agency, 

20 the Rural Utilities Service, the Rural Housing Serv21 ice, or the Rural Business-Cooperative Service in 

22 lieu of faithful performance of duties bonds under 

23 section 14 of title 6, United States Code, but other24 wise in accordance with the section; 

25 ‘‘(7) consent to— 


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1 ‘‘(A) long-term leases of facilities financed 

2 under this title notwithstanding the failure of 

3 the lessee to meet any of the requirements of 

4 this title if the long-term leases are necessary to 

5 ensure the continuation of services for which fi6 nancing was extended to the lessor; and 

7 ‘‘(B) the transfer of property securing any 

8 loan or financed by any loan or grant made or 

9 guaranteed by the Farm Service Agency, the 

10 Rural Utilities Service, the Rural Housing Serv11 ice, or the Rural Business-Cooperative Service 

12 under this title, or any other law administered 

13 by the Secretary, on such terms as the Sec14 retary considers necessary to carry out the pur15 pose of the loan or grant or to protect the fi16 nancial interest of the Federal Government, 

17 provided that the Secretary shall document the 

18 consent of the Secretary for the transfer of the 

19 property of a borrower in the file of the bor20 rower; and 

21 ‘‘(8) notwithstanding that an area ceases, or 

22 has ceased, to be rural, in a rural area, or an eligible 

23 area, make loans and grants, and approve transfers 

24 and assumptions, under this title on the same basis 

25 as though the area still was rural in connection with 


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1 property securing any loan made or guaranteed by 

2 the Secretary under this title or in connection with 

3 any property held by the Secretary under this title. 

4 ‘‘(b) LOAN ADJUSTMENTS.— 

5 ‘‘(1) NO LIQUIDATION OF PROPERTY.—The 

6 Secretary may not require liquidation of property se7 curing any farmer program loan or acceleration of 

8 any payment required under any farmer program 

9 loan as a prerequisite to initiating an action author10 ized under subsection (a). 

11 ‘‘(2) RELEASE OF PERSONAL LIABILITY.— 

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

13 subparagraph (B), the Secretary may release a 

14 borrower or other person obligated on a debt 

15 (other than debt incurred under the Housing 

16 Act of 1949 (42 U.S.C. 1441 et seq.)) from 

17 personal liability with or without payment of 

18 any consideration at the time of the com19 promise, adjustment, reduction, or charge-off of 

20 any claim. 

21 ‘‘(B) EXCEPTION.—No compromise, ad22 justment, reduction, or charge-off of any claim 

23 may be made or carried out after the claim has 

24 been referred to the Attorney General, unless 

25 the Attorney General approves. 


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1 ‘‘(3) RURAL ELECTRIFICATION SECURITY IN2 STRUMENTS.—In the case of a security instrument 

3 entered into under the Rural Electrification Act of 

4 1936 (7 U.S.C. 901 et seq.), the Secretary shall no5 tify the Attorney General of the intent of the Sec6 retary to exercise the authority of the Secretary 

7 under paragraph (2). 

8 ‘‘(c) SIMPLIFIED APPLICATION FORMS FOR LOAN

9 GUARANTEES.— 

10 ‘‘(1) IN GENERAL.—The Secretary shall provide 

11 to lenders a short, simplified application form for 

12 guarantees under this title of— 

13 ‘‘(A) farmer program loans the principal 

14 amount of which is $125,000 or less; and 

15 ‘‘(B) business and industry guaranteed 

16 loans under section 3601(a)(2)(A) the principal 

17 amount of which is— 

18 ‘‘(i) in the case of a loan guarantee 

19 made during fiscal year 2002 or 2003, 

20 $400,000 or less; and 

21 ‘‘(ii) in the case of a loan guarantee 

22 made during any subsequent fiscal year— 

23 ‘‘(I) $400,000 or less; or 

24 ‘‘(II) if the Secretary determines 

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1 creased risk of a default on the loan, 

2 $600,000 or less. 

3 ‘‘(2) WATER AND WASTE DISPOSAL GRANTS

4 AND LOANS.—The Secretary shall develop an appli5 cation process that accelerates, to the maximum ex6 tent practicable, the processing of applications for 

7 water and waste disposal grants or direct or guaran8 teed loans under section 3501(a)(1) the grant award 

9 amount or principal loan amount, respectively, of 

10 which is $300,000 or less. 

11 ‘‘(3) ADMINISTRATION.—In developing an ap12 plication under this subsection, the Secretary shall— 

13 ‘‘(A) consult with commercial and coopera14 tive lenders; and 

15 ‘‘(B) ensure that— 

16 ‘‘(i) the form can be completed manu17 ally or electronically, at the option of the 

18 lender; 

19 ‘‘(ii) the form minimizes the docu20 mentation required to accompany the form; 

21 ‘‘(iii) the cost of completing and proc22 essing the form is minimal; and 

23 ‘‘(iv) the form can be completed and 

24 processed in an expeditious manner. 


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1 ‘‘(d) USE OF ATTORNEYS FOR PROSECUTION OR DE2 FENSE OF CLAIMS.—The Secretary may use for the pros3 ecution or defense of any claim or obligation described in 

4 subsection (a)(5) the Attorney General, the General Coun5 sel of the Department, or a private attorney who has en6 tered into a contract with the Secretary. 

7 ‘‘(e) PRIVATE COLLECTION AGENCY.—The Secretary 

8 may use a private collection agency to collect a claim or 

9 obligation described in subsection (a)(5). 

10 ‘‘(f) SECURITY SERVICING.— 

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

12 ‘‘(A) make advances, without regard to any 

13 loan or total indebtedness limitation, to pre14 serve and protect the security for, or the lien or 

15 priority of the lien securing any loan or other 

16 indebtedness owing to or acquired by the Sec17 retary under this title or under any other pro18 gram administered by the Farm Service Agen19 cy, the Rural Utilities Service, the Rural Hous20 ing Service, or the Rural Business-Cooperative 

21 Service applicable program, as determined by 

22 the Secretary; and 

23 ‘‘(B)(i) bid for and purchase at any execu24 tion, foreclosure, or other sale or otherwise ac25 quire property on which the United States has 


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1 a lien by reason of a judgment or execution 

2 arising from, or that is pledged, mortgaged, 

3 conveyed, attached, or levied on to secure the 

4 payment of, the indebtedness regardless of 

5 whether the property is subject to other liens; 

6 ‘‘(ii) accept title to any property so pur7 chased or acquired; and 

8 ‘‘(iii) sell, manage, or otherwise dispose of 

9 the property in accordance with this subsection. 

10 ‘‘(2) OPERATION OR LEASE OF REALTY.—Ex11 cept as provided in subsections (c) and (e), real 

12 property administered under this title may be oper13 ated or leased by the Secretary for such period as 

14 the Secretary may consider necessary to protect the 

15 investment of the Federal Government in the prop16 erty. 

17 ‘‘(g) PAYMENTS TO LENDERS.— 

18 ‘‘(1) REQUIREMENT.—Not later than 90 days 

19 after a court of competent jurisdiction confirms a 

20 plan of reorganization under chapter 12 of title 11, 

21 United States Code, for any borrower to whom a 

22 lender has made a loan guaranteed under this title, 

23 the Secretary shall pay the lender an amount esti24 mated by the Secretary to be equal to the loss in25 curred by the lender for purposes of the guarantee. 


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1 ‘‘(2) PAYMENT TOWARD LOAN GUARANTEE.— 

2 Any amount paid to a lender under this subsection 

3 with respect to a loan guaranteed under this title 

4 shall be treated as payment towards satisfaction of 

5 the loan guarantee. 

6 ‘‘SEC. 3904. LOAN MORATORIUM AND POLICY ON FORE7 CLOSURES. 

8 ‘‘(a) IN GENERAL.—In addition to any other author9 ity that the Secretary may have to defer principal and in10 terest and forgo foreclosure, the Secretary may permit, at 

11 the request of the borrower, the deferral of principal and 

12 interest on any outstanding loan made or guaranteed by 

13 the Secretary under this title, or under any other law ad14 ministered by the Farm Service Agency, the Rural Utili15 ties Service, the Rural Housing Service, or the Rural Busi16 ness-Cooperative Service, and may forgo foreclosure of the 

17 loan, for such period as the Secretary considers necessary 

18 on a showing by the borrower that, due to circumstances 

19 beyond the control of the borrower, the borrower is tempo20 rarily unable to continue making payments of the principal 

21 and interest when due without unduly impairing the 

22 standard of living of the borrower. 

23 ‘‘(b) INTEREST.— 

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1 ferred under this section to bear no interest during 

2 or after the deferral period. 

3 ‘‘(2) EXCEPTION.—If the security instrument 

4 securing the loan is foreclosed, such interest as is in5 cluded in the purchase price at the foreclosure shall 

6 become part of the principal and draw interest from 

7 the date of foreclosure at the rate prescribed by law. 

8 ‘‘(c) MORATORIUM REGARDING CIVIL RIGHTS

9 CLAIMS.— 

10 ‘‘(1) IN GENERAL.—Except as otherwise pro11 vided in this subsection, effective beginning on May 

12 22, 2008, there shall be in effect a moratorium, with 

13 respect to farmer program loans made under subtitle 

14 A, on all acceleration and foreclosure proceedings in15 stituted by the Department against any farmer 

16 who— 

17 ‘‘(A) has pending against the Department 

18 a claim of program discrimination that is ac19 cepted by the Department as valid; or 

20 ‘‘(B) files a claim of program discrimina21 tion that is accepted by the Department as 

22 valid. 

23 ‘‘(2) WAIVER OF INTEREST AND OFFSETS.— 

24 During the period of the moratorium, the Secretary 

25 shall waive the accrual of interest and offsets on all 


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1 farmer program loans made under subtitle A, B, or 

2 C for which loan acceleration or foreclosure pro3 ceedings have been suspended under paragraph (1). 

4 ‘‘(3) TERMINATION OF MORATORIUM.—The 

5 moratorium shall terminate with respect to a claim 

6 of discrimination by a farmer on the earlier of— 

7 ‘‘(A) the date the Secretary resolves the 

8 claim; or 

9 ‘‘(B) if the farmer appeals the decision of 

10 the Secretary on the claim to a court of com11 petent jurisdiction, the date that the court ren12 ders a final decision on the claim. 

13 ‘‘(4) FAILURE TO PREVAIL.—If a farmer does 

14 not prevail on a claim of discrimination described in 

15 paragraph (1), the farmer shall be liable for any in16 terest and offsets that accrued during the period 

17 that loan acceleration or foreclosure proceedings 

18 have been suspended under paragraph (1). 

19 ‘‘SEC. 3905. OIL AND GAS ROYALTY PAYMENTS ON LOANS. 

20 ‘‘(a) IN GENERAL.—The Secretary shall permit a 

21 borrower of a loan made or guaranteed under this title 

22 to make a prospective payment on the loan with proceeds 

23 from— 

24 ‘‘(1) the leasing of oil, gas, or other mineral 

25 rights to real property used to secure the loan; or 


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1 ‘‘(2) the sale of oil, gas, or other minerals re2 moved from real property used to secure the loan, if 

3 the value of the rights to the oil, gas, or other min4 erals has not been used to secure the loan. 

5 ‘‘(b) APPLICABILITY.—Subsection (a) shall not apply 

6 to a borrower of a loan made or guaranteed under this 

7 title with respect to which a liquidation or foreclosure pro8 ceeding was pending on December 23, 1985. 

9 ‘‘SEC. 3906. TAXATION. 

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

11 (b), all property subject to a lien held by the United States 

12 or the title to which is acquired or held by the Secretary 

13 under this title (other than property used for administra14 tive purposes) shall be subject to taxation by State, terri15 tory, district, and local political subdivisions in the same 

16 manner and to the same extent as other property is taxed. 

17 ‘‘(b) EXCEPTIONS.—No tax shall be imposed or col18 lected as described in subsection (a) if the tax (whether 

19 as a tax on the instrument or in connection with con20 veying, transferring, or recording the instrument) is based 

21 on— 

22 ‘‘(1) the value of any notes or mortgages or 

23 other lien instruments held by or transferred to the 

24 Secretary; 


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1 ‘‘(2) any notes or lien instruments administered 

2 under this title that are made, assigned, or held by 

3 a person otherwise liable for the tax; or 

4 ‘‘(3) the value of any property conveyed or 

5 transferred to the Secretary. 

6 ‘‘(c) FAILURE TO PAY OR COLLECT TAX.—The fail7 ure to pay or collect a tax under subsection (a) shall not— 

8 ‘‘(1) be a ground for— 

9 ‘‘(A) refusal to record or file an instru10 ment; or 

11 ‘‘(B) failure to provide notice; or 

12 ‘‘(2) prevent the enforcement of the instrument 

13 in any Federal or State court. 

14 ‘‘SEC. 3907. CONFLICTS OF INTEREST. 

15 ‘‘(a) ACCEPTANCE OF CONSIDERATION PROHIB16 ITED.—No officer, attorney, or other employee of the De17 partment shall, directly or indirectly, be the beneficiary 

18 of or receive any fee, commission, gift, or other consider19 ation for or in connection with any transaction or business 

20 under this title other than such salary, fee, or other com21 pensation as the officer, attorney, or employee may receive 

22 as the officer, attorney, or employee. 

23 ‘‘(b) ACQUISITION OF INTEREST IN LAND PROHIB24 ITED.— 


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1 ‘‘(1) IN GENERAL.—Except as provided in para2 graph (2), no officer or employee of the Department 

3 who acts on or reviews an application made by any 

4 person under this title for a loan to purchase land 

5 may acquire, directly or indirectly, any interest in 

6 the land for a period of 3 years after the date on 

7 which the action is taken or the review is made. 

8 ‘‘(2) FORMER COUNTY COMMITTEE MEM9 BERS.—Paragraph (1) shall not apply to a former 

10 member of a county committee on a determination 

11 by the Secretary, prior to the acquisition of the in12 terest, that the former member acted in good faith 

13 when acting on or reviewing the application. 

14 ‘‘(c) CERTIFICATIONS ON LOANS TO FAMILY MEM15 BERS PROHIBITED.—No member of a county committee 

16 shall knowingly make or join in making any certification 

17 with respect to— 

18 ‘‘(1) a loan to purchase any land in which the 

19 member, or any person related to the member within 

20 the second degree of consanguinity or affinity, has 

21 or may acquire any interest; or 

22 ‘‘(2) any applicant related to the member within 

23 the second degree of consanguinity or affinity. 

24 ‘‘(d) PENALTIES.—Any person violating this section 

25 shall, on conviction of the violation, be punished by a fine 


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1 of not more than $2,000 or imprisonment for not more 

2 than 2 years, or both. 

3 ‘‘SEC. 3908. LOAN SUMMARY STATEMENTS. 

4 ‘‘(a) DEFINITION OF SUMMARY PERIOD.—In this 

5 section, the term ‘summary period’ means the period be6 ginning on the date of issuance of the preceding loan sum7 mary statement and ending on the date of issuance of the 

8 current loan summary statement. 

9 ‘‘(b) ISSUANCE OF STATEMENTS.—On the request of 

10 a borrower of a loan made (but not guaranteed) under 

11 this title, the Secretary shall issue to the borrower a loan 

12 summary statement that reflects the account activity dur13 ing the summary period for each loan made under this 

14 title to the borrower, including— 

15 ‘‘(1) the outstanding amount of principal due 

16 on each loan at the beginning of the summary pe17 riod; 

18 ‘‘(2) the interest rate charged on each loan; 

19 ‘‘(3) the amount of payments made on, and the 

20 application of the payments to, each loan during the 

21 summary period and an explanation of the basis for 

22 the application of the payments; 

23 ‘‘(4) the amount of principal and interest due 

24 on each loan at the end of the summary period; 


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1 ‘‘(5) the total amount of unpaid principal and 

2 interest on all loans at the end of the summary pe3 riod; 

4 ‘‘(6) any delinquency in the repayment of any 

5 loan; 

6 ‘‘(7) a schedule of the amount and date of pay7 ments due on each loan; and 

8 ‘‘(8) the procedure the borrower may use to ob9 tain more information concerning the status of the 

10 loans. 

11 ‘‘SEC. 3909. CERTIFIED LENDERS PROGRAM. 

12 ‘‘(a) CERTIFIED LENDERS PROGRAM.— 

13 ‘‘(1) IN GENERAL.—The Secretary shall estab14 lish a program under which the Secretary shall 

15 guarantee loans under this title that are made by 

16 lending institutions certified by the Secretary. 

17 ‘‘(2) CERTIFICATION REQUIREMENTS.—The 

18 Secretary shall certify a lending institution that 

19 meets such criteria as the Secretary may prescribe 

20 in regulations, including the ability of the institution 

21 to properly make, service, and liquidate the loans of 

22 the institution. 

23 ‘‘(3) CONDITION OF CERTIFICATION.— 

24 ‘‘(A) IN GENERAL.—As a condition of the 

25 certification, the Secretary shall require the inVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00743 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 stitution to undertake to service the loans guar2 anteed by the Secretary under this section, 

3 using standards that are not less stringent than 

4 generally accepted banking standards con5 cerning loan servicing employed by prudent 

6 commercial or cooperative lenders. 

7 ‘‘(B) MONITORING.—The Secretary shall, 

8 at least annually, monitor the performance of 

9 each certified lender to ensure that the condi10 tions of the certification are being met. 

11 ‘‘(4) EFFECT OF CERTIFICATION.—Notwith12 standing any other provision of law: 

13 ‘‘(A) AMOUNT OF LOAN GUARANTEE.—In 

14 the case of a loan made or guaranteed under 

15 subtitle A, the Secretary shall guarantee 80 

16 percent of a loan made under this section by a 

17 certified lending institution as described in 

18 paragraph (1), subject to a determination that 

19 the borrower of the loan meets the eligibility re20 quirements and such other criteria as may be 

21 applicable to loans guaranteed by the Secretary 

22 under other provisions of this title. 

23 ‘‘(B) CERTIFICATIONS BY LENDING INSTI24 TUTIONS.—In the case of loans to be guaran25 teed by the Secretary under this section, the 


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1 Secretary shall permit certified lending institu2 tions to make appropriate certifications (as pro3 vided by regulations issued by the Secretary)— 

4 ‘‘(i) relating to issues such as credit5 worthiness, repayment ability, adequacy of 

6 collateral, and feasibility of farm operation; 

7 and 

8 ‘‘(ii) that the borrower is in compli9 ance with all requirements of law, includ10 ing regulations issued by the Secretary. 

11 ‘‘(C) APPROVAL PROCESS.— 

12 ‘‘(i) IN GENERAL.—The Secretary 

13 shall approve or disapprove a guarantee 

14 not later than 14 days after the date that 

15 the lending institution applies to the Sec16 retary for the guarantee. 

17 ‘‘(ii) DISAPPROVAL.—If the Secretary 

18 disapproves the loan application during the 

19 14-day period, the Secretary shall state, in 

20 writing, all of the reasons the application 

21 was disapproved. 

22 ‘‘(5) RELATIONSHIP TO OTHER REQUIRE23 MENTS.—Nothing in this section affects the respon24 sibility of the Secretary to certify eligibility, review 


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1 financial information, and otherwise assess an appli2 cation. 

3 ‘‘(b) PREFERRED CERTIFIED LENDERS PROGRAM.— 

4 ‘‘(1) IN GENERAL.—The Secretary shall estab5 lish a Preferred Certified Lenders Program for lend6 ers under this title who establish— 

7 ‘‘(A) knowledge of, and experience under, 

8 the program established under subsection (a); 

9 ‘‘(B) knowledge of the regulations con10 cerning the guaranteed loan program; and 

11 ‘‘(C) proficiency related to the certified 

12 lender program requirements. 

13 ‘‘(2) REVOCATION OF DESIGNATION.— 

14 ‘‘(A) IN GENERAL.—Subject to subpara15 graph (B), the designation of a lender as a Pre16 ferred Certified Lender shall be revoked at any 

17 time— 

18 ‘‘(i) that the Secretary determines 

19 that the lender is not adhering to the rules 

20 and regulations applicable to the program; 

21 or 

22 ‘‘(ii) if the loss experiences of a Pre23 ferred Certified Lender are excessive as 

24 compared to other Preferred Certified 

25 Lenders. 


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1 ‘‘(B) EFFECT.—A suspension or revocation 

2 under subparagraph (A) shall not affect any 

3 outstanding guarantee. 

4 ‘‘(3) CONDITION OF CERTIFICATION.—As a 

5 condition of preferred certification, the Secretary 

6 shall require the institution to undertake to service 

7 the loans guaranteed by the Secretary under this 

8 subsection using generally accepted banking stand9 ards concerning loan servicing employed by prudent 

10 commercial or cooperative lenders. 

11 ‘‘(4) MONITORING.—The Secretary shall, at 

12 least annually, monitor the performance of each Pre13 ferred Certified Lender to ensure that the conditions 

14 of certification are being met. 

15 ‘‘(5) EFFECT OF PREFERRED LENDER CERTIFI16 CATION.— 

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

18 other provision of law, the Secretary shall— 

19 ‘‘(i) guarantee 80 percent of an ap20 proved loan made by a certified lending in21 stitution as described in this subsection, 

22 subject to a determination that the bor23 rower meets the eligibility requirements or 

24 such other criteria as may be applicable to 


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1 loans guaranteed by the Secretary under 

2 other provisions of this title; 

3 ‘‘(ii) permit certified lending institu4 tions— 

5 ‘‘(I) to make all decisions, with 

6 respect to loans to be guaranteed by 

7 the Secretary under this subsection 

8 relating to credit worthiness, the clos9 ing, monitoring, collection and liquida10 tion of loans; and 

11 ‘‘(II) to accept appropriate cer12 tifications, as provided by regulations 

13 issued by the Secretary, that the bor14 rower is in compliance with all re15 quirements of law or regulations pro16 mulgated by the Secretary; and 

17 ‘‘(iii) be considered to have guaran18 teed 80 percent of a loan made by a pre19 ferred certified lending institution as de20 scribed in paragraph (1), if the Secretary 

21 fails to approve or reject the application of 

22 such institution within 14 calendar days 

23 after the date that the lending institution 

24 presented the application to the Secretary. 


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1 ‘‘(B) REQUIREMENT.—If the Secretary re2 jects an application under subparagraph (A)(iii) 

3 during the 14-day period, the Secretary shall 

4 state, in writing, the reasons the application 

5 was rejected. 

6 ‘‘(c) ADMINISTRATION OF CERTIFIED LENDERS AND

7 PREFERRED CERTIFIED LENDERS PROGRAMS.—The Sec8 retary may administer the loan guarantee programs under 

9 subsections (a) and (b) through central offices established 

10 in States or in multi-State areas 

11 ‘‘SEC. 3910. LOANS TO RESIDENT ALIENS. 

12 ‘‘(a) IN GENERAL.—Notwithstanding the provisions 

13 of this title limiting the making of a loan to a citizen of 

14 the United States, the Secretary may make a loan under 

15 this title to an alien lawfully admitted to the United States 

16 for permanent residence under the Immigration and Na17 tionality Act (8 U.S.C. 1101 et seq.). 

18 ‘‘(b) REGULATIONS.— 

19 ‘‘(1) IN GENERAL.—No loan may be made 

20 under this title to an alien referred to in subsection 

21 (a) until the Secretary issues regulations estab22 lishing the terms and conditions under which the 

23 alien may receive the loan. 

24 ‘‘(2) REQUIREMENT.—The Secretary shall sub25 mit the regulations to the Committee on Agriculture 


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1 of the House of Representatives and the Committee 

2 on Agriculture, Nutrition, and Forestry of the Sen3 ate at least 30 days prior to the date on which the 

4 regulations are published in the Federal Register. 

5 ‘‘SEC. 3911. EXPEDITED CLEARING OF TITLE TO INVENTORY 

6 PROPERTY. 

7 ‘‘(a) IN GENERAL.—The Secretary may employ local 

8 attorneys, on a case-by-case basis, to process all legal pro9 cedures necessary to clear the title to foreclosed properties 

10 in the inventory of the Department. 

11 ‘‘(b) COMPENSATION.—Attorneys shall be com12 pensated at not more than the usual and customary 

13 charges of the attorneys for the work. 

14 ‘‘SEC. 3912. PROHIBITION ON USE OF LOANS FOR CERTAIN 

15 PURPOSES. 

16 ‘‘(a) IN GENERAL.—Except as provided in sub17 sections (b) and (c), the Secretary may not approve a loan 

18 under this title to drain, dredge, fill, level, or otherwise 

19 manipulate a wetland (as defined in section 1201(a) of 

20 the Food Security Act of 1985 (16 U.S.C. 3801(a))), or 

21 to engage in any activity that results in impairing or re22 ducing the flow, circulation, or reach of water. 

23 ‘‘(b) PRIOR ACTIVITY.—Subsection (a) does not 

24 apply in the case of— 


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1 ‘‘(1) an activity related to the maintenance of 

2 a previously converted wetland; or 

3 ‘‘(2) in the case of an activity that had already 

4 commenced before November 28, 1990. 

5 ‘‘(c) EXCEPTION.—This section shall not apply to a 

6 loan made or guaranteed under this title for a utility line. 

7 ‘‘SEC. 3913. TRANSFER OF LAND TO SECRETARY. 

8 ‘‘The President may at any time, in the discretion 

9 of the President, transfer to the Secretary any right, inter10 est, or title held by the United States in any land acquired 

11 in the program of national defense and no longer needed 

12 for that purpose that the President finds suitable for the 

13 purposes of this title, and the Secretary shall dispose of 

14 the transferred land in the manner and subject to the 

15 terms and conditions of this title. 

16 ‘‘SEC. 3914. COMPETITIVE SOURCING LIMITATIONS. 

17 ‘‘The Secretary may not complete a study of, or enter 

18 into a contract with a private party to carry out, without 

19 specific authorization in a subsequent Act of Congress, a 

20 competitive sourcing activity of the Secretary, including 

21 support personnel of the Department, relating to rural de22 velopment or farmer program loans. 

23 ‘‘SEC. 3915. REGULATIONS. 

24 ‘‘The Secretary may issue such regulations, prescribe 

25 such terms and conditions for making or guaranteeing 


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1 loans, security instruments, and agreements, except as 

2 otherwise specified in this title, and make such delegations 

3 of authority as the Secretary considers necessary to carry 

4 out this title.’’. 

5 SEC. 6002. CONFORMING AMENDMENTS. 

6 (a) Section 17(c) of the Rural Electrification Act of 

7 1936 (7 U.S.C. 917(c)) is amended by striking paragraph 

8 (1) and inserting the following: 

9 ‘‘(1) Subtitle B of the Consolidated Farm and 

10 Rural Development Act.’’. 

11 (b) Section 305(c)(2)(B)(i)(I) of the Rural Elec12 trification Act of 1936 (7 U.S.C. 935(c)(2)(B)(i)(I)) is 

13 amended by striking ‘‘section 307(a)(3)(A) of the Consoli14 dated Farm and Rural Development Act (7 U.S.C. 

15 1927(a)(3)(A))’’ and inserting ‘‘section 3701(b)(2) of the 

16 Consolidated Farm and Rural Development Act’’. 

17 (c) Section 306F(a)(1) of the Rural Electrification 

18 Act of 1936 (7 U.S.C. 936f(a)(1)) is amended by striking 

19 subparagraph (B) and inserting the following: 

20 ‘‘(B) chapter 1 of subtitle B of the Con21 solidated Farm and Rural Development Act.’’. 

22 (d) Section 2333(d) of the Food, Agriculture, Con23 servation, and Trade Act of 1990 (7 U.S.C. 950aaa–2(d)) 

24 is amended— 


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1 (1) in paragraph (11), by adding ‘‘and’’ at the 

2 end; 

3 (2) by striking paragraph (12); and 

4 (3) by redesignating paragraph (13) as para5 graph (12). 

6 (e) Section 601(b) of the Rural Electrification Act 

7 of 1936 (7 U.S.C. 950bb(b)) is amended by striking para8 graph (3). 

9 (f) Section 602(5) of the Emergency Livestock Feed 

10 Assistance Act of 1988 (7 U.S.C. 1471(5)) is amended 

11 by striking ‘‘section 355(e)(1)(D)(ii) of the Consolidated 

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

13 1985(e)(1)(D)(ii))’’ and inserting ‘‘section 3409(c)(1)(A) 

14 of the Consolidated Farm and Rural Development Act)’’. 

15 (g) Section 508 of the Federal Crop Insurance Act 

16 (7 U.S.C. 1508) is amended— 

17 (1) in subsection (b)(7)(A), by striking ‘‘section 

18 371 of the Consolidated Farm and Rural Develop19 ment Act (7 U.S.C. 2008f)’’ and inserting ‘‘section 

20 3424 of the Consolidated Farm and Rural Develop21 ment Act’’; and 

22 (2) in subsection (n)(2), by striking ‘‘subtitle C 

23 of the Consolidated Farm and Rural Development 

24 Act (7 U.S.C. 1961 et seq.)’’ and inserting ‘‘chapter 


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1 3 of subtitle A of the Consolidated Farm and Rural 

2 Development Act’’. 

3 (h) Section 231(a) of the Agricultural Risk Protec4 tion Act of 2000 (7 U.S.C. 1632a(a)) is amended— 

5 (1) in paragraph (1), by striking ‘‘section 

6 343(a) of the Consolidated Farm and Rural Devel7 opment Act (7 U.S.C. 1991(a))’’ and inserting ‘‘sec8 tion 3002 of the Consolidated Farm and Rural De9 velopment Act’’; and 

10 (2) in paragraph (4), by striking ‘‘section 

11 355(e) of the Consolidated Farm and Rural Devel12 opment Act (7 U.S.C. 2003(e))’’ and inserting ‘‘sec13 tion 3002 of the Consolidated Farm and Rural De14 velopment Act’’. 

15 (i) Section 14204(a) of the Food, Conservation, and 

16 Energy Act of 2008 (7 U.S.C. 2008q–1(a)) is amended 

17 by striking ‘‘an entity described in section 379C(a) of the 

18 Consolidated Farm and Rural Development Act (7 U.S.C. 

19 2008q(a))’’ and inserting ‘‘an entity determined by the 

20 Secretary’’. 

21 (j) Section 607(c)(6) of the Rural Development Pol22 icy Act of 1972 (7 U.S.C. 2204b(c)(6)) is amended in the 

23 last sentence— 

24 (1) by striking ‘‘, and’’ and inserting ‘‘and 

25 any’’; and 


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1 (2) by striking ‘‘required under section 

2 306(a)(12) of the Consolidated Farm and Rural De3 velopment Act’’. 

4 (k) Section 901(b) of the Agricultural Act of 1970 

5 (7 U.S.C. 2204b–1(b)) is amended by striking ‘‘rural 

6 areas as defined in the private business enterprise excep7 tion in section 306(a)(7) of the Consolidated Farmers 

8 Home Administration Act of 1961, as amended (7 U.S.C. 

9 1926)’’ and inserting ‘‘rural areas, as defined in section 

10 3002 of the Consolidated Farm and Rural Development 

11 Act’’. 

12 (l) Section 14220 of the Food, Conservation, and En13 ergy Act of 2008 (7 U.S.C. 2206b) is amended by striking 

14 ‘‘section 343(a)(13)(A) of the Consolidated Farm and 

15 Rural Development Act)’’ and inserting ‘‘section 3002 of 

16 the Consolidated Farm and Rural Development Act)’’. 

17 (m) Section 2501(c)(2)(D) of the Food, Agriculture, 

18 Conservation, and Trade Act of 1990 (7 U.S.C. 

19 2279(c)(2)(D)) is amended by striking ‘‘sections 

20 355(a)(1) and 355(c) of the Consolidated Farm and Rural 

21 Development Act (7 U.S.C. 2003(a)(1))’’ and inserting 

22 ‘‘paragraphs (1) and (3) of section 3416(a) of the Consoli23 dated Farm and Rural Development Act’’. 

24 (n) Section 2501A(b) of the Food, Agriculture, Con25 servation, and Trade Act of 1990 (7 U.S.C. 2279–1(b)) 


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1 is amended by striking ‘‘section 355(e) of the Consolidated 

2 Farm and Rural Development Act (7 U.S.C. 2003(e))’’ 

3 and inserting ‘‘section 3002 of the Consolidated Farm and 

4 Rural Development Act’’. 

5 (o) Section 7405(c)(8)(B) of the Farm Security and 

6 Rural Investment Act of 2002 (7 U.S.C. 3319f(c)(8)(B)) 

7 is amended by striking ‘‘section 355(e) of the Consolidated 

8 Farm and Rural Development Act (7 U.S.C. 2003(e))’’ 

9 and inserting ‘‘section 3002 of the Consolidated Farm and 

10 Rural Development Act)’’. 

11 (p) Section 1101(d)(2)(A) of the Food, Conservation, 

12 and Energy Act of 2008 (7 U.S.C. 8711(d)(2)(A)) is 

13 amended by striking ‘‘section 355(e) of the Consolidated 

14 Farm and Rural Development Act (7 U.S.C. 2003(e))’’ 

15 and inserting ‘‘section 3002 of the Consolidated Farm and 

16 Rural Development Act)’’. 

17 (q) Section 1302(d)(2)(A) of the Food, Conservation, 

18 and Energy Act of 2008 (7 U.S.C. 8752(d)(2)(A)) is 

19 amended by striking ‘‘section 355(e) of the Consolidated 

20 Farm and Rural Development Act (7 U.S.C. 2003(e))’’ 

21 and inserting ‘‘section 3002 of the Consolidated Farm and 

22 Rural Development Act)’’. 

23 (r) Section 2375(g) of the Food, Agriculture, Con24 servation, and Trade Act of 1990 (7 U.S.C. 6613(g)) is 

25 amended by striking ‘‘section 304(b), 306(a), or 310B(e) 


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1 of the Consolidated Farm and Rural Development Act (7 

2 U.S.C. 1924(b), 1926(a), and 1932(e))’’ and inserting 

3 ‘‘subtitle B of the Consolidated Farm and Rural Develop4 ment Act’’. 

5 (s) Section 226B(a)(1) of the Department of Agri6 culture Reorganization Act of 1994 (7 U.S.C. 6934(a)(1)) 

7 is amended by striking ‘‘section 343(a) of the Consolidated 

8 Farm and Rural Development Act (7 U.S.C. 1991(a))’’ 

9 and inserting ‘‘section 3002 of the Consolidated Farm and 

10 Rural Development Act’’. 

11 (t) Section 196(i)(3)(B) of the Federal Agriculture 

12 Improvement and Reform Act of 1996 (7 U.S.C. 

13 7333(i)(3)(B)) is amended by striking ‘‘subtitle C of the 

14 Consolidated Farm and Rural Development Act (7 U.S.C. 

15 1961 et seq.)’’ and inserting ‘‘chapter 3 of subtitle A of 

16 the Consolidated Farm and Rural Development Act’’. 

17 (u) Section 9009(a)(1) of the Farm Security and 

18 Rural Investment Act of 2002 (7 U.S.C. 8109(a)(1)) is 

19 amended by striking ‘‘section 343(a)(13)(A) of the Con20 solidated Farm and Rural Development Act (7 U.S.C. 

21 1991(a)(13)(A)))’’ and inserting ‘‘section 3002 of the 

22 Consolidated Farm and Rural Development Act’’. 

23 (v) Section 9011(c)(2)(B)(v) of the Farm Security 

24 and Rural Investment Act of 2002 (7 U.S.C. 


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1 8111(c)(2)(B)(v)) is amended by striking subclause (I)and 

2 inserting the following: 

3 ‘‘(I) beginning farmers (as de4 fined in accordance with section 3002 

5 of the Consolidated Farm and Rural 

6 Development Act); or’’. 

7 (w) Section 7(b)(2)(B) of the Small Business Act (15 

8 U.S.C. 636(b)(2)(B)) is amended by striking ‘‘section 321 

9 of the Consolidated Farm and Rural Development Act (7 

10 U.S.C. 1961)’’ and inserting ‘‘section 3301 of the Consoli11 dated Farm and Rural Development Act’’. 

12 (x) Section 8(b)(5)(B)(iii)(III)(bb) of the Soil Con13 servation and Domestic Allotment Act (16 U.S.C. 

14 590h(b)(5)(B)(iii)(III)(bb)) is amended by striking ‘‘sec15 tion 355(e)(1) of the Consolidated Farm and Rural Devel16 opment Act (7 U.S.C.A. § 2003(e)(1))’’ and inserting 

17 ‘‘section 3002 of the Consolidated Farm and Rural Devel18 opment Act)’’. 

19 (y) Section 10(b)(3) of the Cooperative Forestry As20 sistance Act of 1978 (16 U.S.C. 2106(b)(3)) is amended 

21 in the last sentence by striking ‘‘set out in the first clause 

22 of section 306(a)(7) of the Consolidated Farm and Rural 

23 Development Act’’ and inserting ‘‘given the term in sec24 tion 3002 of the Consolidated Farm and Rural Develop25 ment Act’’. 


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1 (z) Section 1201(a)(2) of the Food Security Act of 

2 1985 (16 U.S.C. 3801(a)(2)) is amended by striking ‘‘sec3 tion 343(a)(8) of the Consolidated Farm and Rural Devel4 opment Act (7 U.S.C. 1991(a)(8))’’ and inserting ‘‘section 

5 3002 of the Consolidated Farm and Rural Development 

6 Act’’. 

7 (aa) Section 1238(2) of the Food Security Act of 

8 1985 (16 U.S.C. 3838(2)) is amended by striking ‘‘section 

9 343(a) of the Consolidated Farm and Rural Development 

10 Act (7 U.S.C. 1991(a))’’ and inserting ‘‘section 3002 of 

11 the Consolidated Farm and Rural Development Act’’. 

12 (bb) The first section of Public Law 91–229 (25 

13 U.S.C. 488) is amended in subsection (a) by striking 

14 ‘‘make loans from the Farmers Home Administration Di15 rect Loan Account created by section 338(c), and to make 

16 and insure loans as provided in sections 308 and 309, of 

17 the Consolidated Farmers Home Administration Act of 

18 1961, as amended (7 U.S.C. 1988(c), 1928, 1929),’’ and 

19 inserting ‘‘make loans under chapter 1 of subtitle A of 

20 the Consolidated Farm and Rural Development Act’’. 

21 (cc) Section 5 of Public Law 91–229 (25 U.S.C. 492) 

22 is amended by striking ‘‘section 307(a)(3)(B) of the Con23 solidated Farmers Home Administration Act of 1961, as 

24 amended, and to the provisions of subtitle D of that Act 

25 except sections 340, 341, 342, and 343’’ and inserting 


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1 ‘‘3105(b)(2) of the Consolidated Farm and Rural Develop2 ment Act’’. 

3 (dd) Section 6(c) of Public Law 91–229 (25 U.S.C. 

4 493(c)) is amended by striking ‘‘section 333B of the Con5 solidated Farm and Rural Development Act (7 U.S.C. 

6 1983b)’’ and inserting ‘‘subtitle H of the Department of 

7 Agriculture Reorganization Act of 1994 (7 U.S.C. 6991 

8 et seq.)’’. 

9 (ee) Section 181(a)(2)(B)(ii) of the Internal Revenue 

10 Code of 1986 is amended by striking ‘‘section 2009aa– 

11 1 of title 7, United States Code’’ and inserting ‘‘section 

12 3801 of the Consolidated Farm and Rural Development 

13 Act’’. 

14 (ff) Section 515(b)(3) of the Housing Act of 1949 

15 (42 U.S.C. 1485(b)(3)) is amended by striking ‘‘all the 

16 provisions of section 309 and the second and third sen17 tences of section 308 of the Consolidated Farmers Home 

18 Administration Act of 1961, including the authority in 

19 section 309(f)(1) of that Act’’ and inserting ‘‘section 3401 

20 of the Consolidated Farm and Rural Development Act’’. 

21 (gg) Section 517(b) of the Housing Act of 1949 (42 

22 U.S.C. 1487(b)) is amended in the third sentence by strik23 ing ‘‘(7 U.S.C. 1929)’’ and inserting ‘‘under section 3401 

24 of the Consolidated Farm and Rural Development Act’’. 


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1 (hh) Section 3(8) of the Public Works and Economic 

2 Development Act of 1965 (42 U.S.C. 3122(8)) is amend3 ed— 

4 (1) by striking subparagraph (B) and inserting 

5 the following: 

6 ‘‘(B) the Delta Regional Authority estab7 lished under chapter 4 of subtitle B of the Con8 solidated Farm and Rural Development Act;’’; 

9 and 

10 (2) by striking subparagraph (D) and inserting 

11 the following: 

12 ‘‘(D) the Northern Great Plains Regional 

13 Authority established under chapter 5 of sub14 title B of the Consolidated Farm and Rural De15 velopment Act.’’. 

16 (ii) Section 310(a) of the Robert T. Stafford Disaster 

17 Relief and Emergency Assistance Act (42 U.S.C. 5153(a)) 

18 is amended by striking paragraph (4) and inserting the 

19 following: 

20 ‘‘(4) Chapter 1 of subtitle B of the Consoli21 dated Farm and Rural Development Act.’’. 

22 (jj) Section 582(d)(1) of the National Flood Insur23 ance Reform Act of 1994 (42 U.S.C. 5154a(d)(1)) is 

24 amended by striking ‘‘section 321(a) of the Consolidated 

25 Farm and Rural Development Act (7 U.S.C. 1961(a))’’ 


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1 and inserting ‘‘section 3301(b) of the Consolidated Farm 

2 and Rural Development Act’’. 

3 (kk) Section 213(c)(1) of the Biomass Energy and 

4 Alcohol Fuels Act of 1980 (42 U.S.C. 8813(c)(1)) is 

5 amended in the first sentence by striking ‘‘section 309 of 

6 the Consolidated Farm and Rural Development Act or the 

7 Rural Development Insurance Fund in section 309A of 

8 such Act’’ and inserting ‘‘under section 3401 of the Con9 solidated Farm and Rural Development Act or the Rural 

10 Development Insurance Fund under section 3704 of that 

11 Act’’. 

12 (ll) Section 1323(b)(2) of the Food Security Act of 

13 1985 (Public Law 99–198; 7 U.S.C. 1932 note) is amend14 ed— 

15 (1) in subparagraph (A), by inserting ‘‘and’’ at 

16 the end; 

17 (2) in subparagraph (B), by striking ‘‘; and’’ at 

18 the end and inserting a period; and 

19 (3) by striking subparagraph (C). 

20 Subtitle B—Rural Electrification 

21 SEC. 6101. DEFINITION OF RURAL AREA. 

22 Section 13(3) of the Rural Electrification Act of 1936 

23 (7 U.S.C. 913(A)) is amended by striking subparagraph 

24 (A) and inserting the following: 


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1 ‘‘(A) any area described in section 

2 3002(28)(A)(i) of the Consolidated Farm and 

3 Rural Development Act; and’’. 

4 SEC. 6102. GUARANTEES FOR BONDS AND NOTES ISSUED 

5 FOR ELECTRIFICATION OR TELEPHONE PUR6 POSES. 

7 Section 313A(f) of the Rural Electrification Act of 

8 1936 (7 U.S.C. 940c–1(f)) is amended by striking ‘‘2012’’ 

9 and inserting ‘‘2017’’. 

10 SEC. 6103. EXPANSION OF 911 ACCESS. 

11 Section 315(d) of the Rural Electrification Act of 

12 1936 (7 U.S.C. 940e(d)) is amended by striking ‘‘2012’’ 

13 and inserting ‘‘2017’’. 

14 SEC. 6104. ACCESS TO BROADBAND TELECOMMUNICATIONS 

15 SERVICES IN RURAL AREAS. 

16 Section 601 of the Rural Electrification Act of 1936 

17 (7 U.S.C. 950bb) is amended— 

18 (1) in subsection (a), by striking ‘‘loans and’’ 

19 and inserting ‘‘grants, loans, and’’; 

20 (2) in subsection (b), by striking paragraph (3) 

21 and inserting the following: 

22 ‘‘(3) RURAL AREA.—The term ‘rural area’ 

23 means any area described in section 3002 of the 

24 Consolidated Farm and Rural Development Act.’’; 

25 (3) in subsection (c)— 


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1 (A) in the subsection heading, by striking 

2 ‘‘LOANS AND’’ and inserting ‘‘GRANTS, LOANS, 

3 AND’’; 

4 (B) in paragraph (1), by inserting ‘‘make 

5 grants and’’ after ‘‘Secretary shall’’; 

6 (C) by striking paragraph (2) and insert7 ing the following: 

8 ‘‘(2) PRIORITY.— 

9 ‘‘(A) IN GENERAL.—In making grants or 

10 guaranteeing loans under paragraph (1), the 

11 Secretary shall give the highest priority to ap12 plicants that offer to provide broadband service 

13 to the greatest proportion of households that, 

14 prior to the provision of the broadband service, 

15 had no incumbent service provider. 

16 ‘‘(B) OTHER.—After giving priority to the 

17 applicants described in subparagraph (A), the 

18 Secretary shall then give priority to projects 

19 that serve rural communities— 

20 ‘‘(i) with a population of less than 

21 20,000 permanent residents; 

22 ‘‘(ii) experiencing outmigration; 

23 ‘‘(iii) with a high percentage of low-in24 come residents; and 


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1 ‘‘(iv) that are isolated from other sig2 nificant population centers.’’; and 

3 (D) by adding at the end the following: 

4 ‘‘(3) GRANT AMOUNTS.— 

5 ‘‘(A) ELIGIBILITY.—To be eligible for a 

6 grant under this section, the project that is the 

7 subject of the grant shall be carried out in a 

8 rural area. 

9 ‘‘(B) MAXIMUM.—Except as provided in 

10 subparagraph (D), the amount of any grant 

11 made under this section shall not exceed 50 

12 percent of the development costs of the project 

13 for which the grant is provided. 

14 ‘‘(C) GRANT RATE.—The Secretary shall 

15 establish the grant rate for each project in ac16 cordance with regulations issued by the Sec17 retary that shall provide for a graduated scale 

18 of grant rates that establish higher rates for 

19 projects in communities that have— 

20 ‘‘(i) remote locations; 

21 ‘‘(ii) low community populations; 

22 ‘‘(iii) low income levels; and 

23 ‘‘(iv) developed the applications of the 

24 communities with the participation of com25 binations of stakeholders, including— 


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1 ‘‘(I) State, local, and tribal gov2 ernments; 

3 ‘‘(II) nonprofit institutions; 

4 ‘‘(III) institutions of higher edu5 cation; 

6 ‘‘(IV) private entities; and 

7 ‘‘(V) philanthropic organizations. 

8 ‘‘(D) SECRETARIAL AUTHORITY TO AD9 JUST.—The Secretary may make grants of up 

10 to 75 percent of the development costs of the 

11 project for which the grant is provided to an el12 igible entity if the Secretary determines that 

13 the project serves a remote or low income area 

14 that does not have access to broadband service 

15 from any provider of broadband service (includ16 ing the applicant).’’; 

17 (4) in subsection (d)— 

18 (A) in paragraph (1)(A)— 

19 (i) in the matter preceding clause (i), 

20 by striking ‘‘loan or’’ and inserting ‘‘grant, 

21 loan, or’’; 

22 (ii) in clause (ii), by striking ‘‘a loan 

23 application’’ and inserting ‘‘an applica24 tion’’; and 

25 (iii) in clause (iii)— 


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1 (I) by striking ‘‘the loan applica2 tion’’ and inserting ‘‘the application’’; 

3 and 

4 (II) by striking ‘‘proceeds from 

5 the loan made or guaranteed under 

6 this section are’’ and inserting ‘‘as7 sistance under this section is’’; 

8 (B) in paragraph (2)(A), in the matter 

9 preceding clause (i)— 

10 (i) by striking ‘‘the proceeds of a loan 

11 made or guaranteed’’ and inserting ‘‘as12 sistance’’; and 

13 (ii) by striking ‘‘for the loan or loan 

14 guarantee’’ and inserting ‘‘of the eligible 

15 entity’’; 

16 (C) by striking ‘‘loan or’’ each place it ap17 pears in paragraphs (2)(B), (3)(A), (4), (5), 

18 and (6) and inserting ‘‘grant, loan, or’’; 

19 (D) in paragraph (7), by striking ‘‘a loan 

20 application’’ and inserting ‘‘an application’’; 

21 and 

22 (E) by adding at the end the following: 

23 ‘‘(8) TRANSPARENCY AND REPORTING.—The 

24 Secretary— 


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1 ‘‘(A) shall require any entity receiving as2 sistance under this section to submit quarterly, 

3 in a format specified by the Secretary, a report 

4 that describes— 

5 ‘‘(i) the use by the entity of the assist6 ance; and 

7 ‘‘(ii) the progress towards fulfilling 

8 the objectives for which the assistance was 

9 granted; 

10 ‘‘(B) shall maintain a fully searchable 

11 database, accessible on the Internet at no cost 

12 to the public, that contains, at a minimum— 

13 ‘‘(i) a list of each entity that has ap14 plied for assistance under this section; 

15 ‘‘(ii) a description of each application, 

16 including the status of each application; 

17 ‘‘(iii) for each entity receiving assist18 ance under this section— 

19 ‘‘(I) the name of the entity; 

20 ‘‘(II) the type of assistance being 

21 received; 

22 ‘‘(III) the purpose for which the 

23 entity is receiving the assistance; and 

24 ‘‘(IV) each quarterly report sub25 mitted under subparagraph (A); and 


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1 ‘‘(iv) such other information as is suf2 ficient to allow the public to understand 

3 and monitor assistance provided under this 

4 section; 

5 ‘‘(C) may, in addition to other authority 

6 under applicable law, deobligate awards to 

7 grantees that demonstrate an insufficient level 

8 of performance, or wasteful or fraudulent 

9 spending, as defined in advance by the Sec10 retary, and award those funds competitively to 

11 new or existing applicants consistent with this 

12 section; and 

13 ‘‘(D) may establish additional reporting 

14 and information requirements for any recipient 

15 of any assistance under this section so as to en16 sure compliance with this section.’’; 

17 (5) in subsection (f), by striking ‘‘make a loan 

18 or loan guarantee’’ and inserting ‘‘provide assist19 ance’’; 

20 (6) in subsection (j)— 

21 (A) in the matter preceding paragraph (1), 

22 by striking ‘‘loan and loan guarantee’’; 

23 (B) in paragraph (1), by inserting ‘‘grants 

24 and’’ after ‘‘number of’’; 

25 (C) in paragraph (2)— 


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

2 ‘‘loan’’; and 

3 (ii) in subparagraph (B), by striking 

4 ‘‘loans and’’ and inserting ‘‘grants, loans, 

5 and’’; and 

6 (D) in paragraph (3), by striking ‘‘loan’’; 

7 (7) in subsection (k)(1)— 

8 (A) by striking ‘‘$25,000,000’’ and insert9 ing ‘‘$50,000,000’’; and 

10 (B) by striking ‘‘2012’’ and inserting 

11 ‘‘2017’’; and 

12 (8) in subsection (l)— 

13 (A) by striking ‘‘loan or’’ and inserting 

14 ‘‘grant, loan, or’’; and 

15 (B) by striking ‘‘2012’’ and inserting 

16 ‘‘2017’’. 

17 Subtitle C—Miscellaneous 

18 SEC. 6201. DISTANCE LEARNING AND TELEMEDICINE. 

19 (a) AUTHORIZATION OF APPROPRIATIONS.—Section 

20 2335A of the Food, Agriculture, Conservation, and Trade 

21 Act of 1990 (7 U.S.C. 950aaa-5) is amended by striking 

22 ‘‘2012’’ and inserting ‘‘2017’’. 

23 (b) CONFORMING AMENDMENT.—Section 1(b) of 

24 Public Law 102–551 (7 U.S.C. 950aaa note) is amended 

25 by striking ‘‘2012’’ and inserting ‘‘2017’’. 


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1 SEC. 6202. RURAL ENERGY SAVINGS PROGRAM. 

2 Subtitle E of title VI of the Farm Security and Rural 

3 Investment Act of 2002 (Public Law 107–171; 116 Stat. 

4 424) is amended by adding at the end the following: 

5 ‘‘SEC. 6407. RURAL ENERGY SAVINGS PROGRAM. 

6 ‘‘(a) PURPOSE.—The purpose of this section is to cre7 ate jobs, promote rural development, and help rural fami8 lies and small businesses achieve cost savings by providing 

9 loans to qualified consumers to implement durable cost10 effective energy efficiency measures. 

11 ‘‘(b) DEFINITIONS.—In this section: 

12 ‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible en13 tity’ means— 

14 ‘‘(A) any public power district, public util15 ity district, or similar entity, or any electric co16 operative described in section 501(c)(12) or 

17 1381(a)(2) of the Internal Revenue Code of 

18 1986, that borrowed and repaid, prepaid, or is 

19 paying an electric loan made or guaranteed by 

20 the Rural Utilities Service (or any predecessor 

21 agency); 

22 ‘‘(B) any entity primarily owned or con23 trolled by 1 or more entities described in sub24 paragraph (A); or 

25 ‘‘(C) any other entity that is an eligible 

26 borrower of the Rural Utility Service, as deterVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00771 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 mined under section 1710.101 of title 7, Code 

2 of Federal Regulations (or a successor regula3 tion). 

4 ‘‘(2) ENERGY EFFICIENCY MEASURES.—The 

5 term ‘energy efficiency measures’ means, for or at 

6 property served by an eligible entity, structural im7 provements and investments in cost-effective, com8 mercial technologies to increase energy efficiency. 

9 ‘‘(3) QUALIFIED CONSUMER.—The term ‘quali10 fied consumer’ means a consumer served by an eligi11 ble entity that has the ability to repay a loan made 

12 under subsection (d), as determined by the eligible 

13 entity. 

14 ‘‘(4) SECRETARY.—The term ‘Secretary’ means 

15 the Secretary of Agriculture, acting through the Ad16 ministrator of the Rural Utilities Service. 

17 ‘‘(c) LOANS TO ELIGIBLE ENTITIES.— 

18 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

19 the Secretary shall make loans to eligible entities 

20 that agree to use the loan funds to make loans to 

21 qualified consumers for the purpose of implementing 

22 energy efficiency measures. 

23 ‘‘(2) REQUIREMENTS.— 


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1 ‘‘(A) IN GENERAL.—As a condition of re2 ceiving a loan under this subsection, an eligible 

3 entity shall— 

4 ‘‘(i) establish a list of energy effi5 ciency measures that is expected to de6 crease energy use or costs of qualified con7 sumers; 

8 ‘‘(ii) prepare an implementation plan 

9 for use of the loan funds, including use of 

10 any interest to be received pursuant to 

11 subsection (d)(1)(A); 

12 ‘‘(iii) provide for appropriate measure13 ment and verification to ensure— 

14 ‘‘(I) the effectiveness of the en15 ergy efficiency loans made by the eli16 gible entity; and 

17 ‘‘(II) that there is no conflict of 

18 interest in carrying out this section; 

19 and 

20 ‘‘(iv) demonstrate expertise in effec21 tive use of energy efficiency measures at 

22 an appropriate scale. 

23 ‘‘(B) REVISION OF LIST OF ENERGY EFFI24 CIENCY MEASURES.—Subject to the approval of 

25 the Secretary, an eligible entity may update the 


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1 list required under subparagraph (A)(i) to ac2 count for newly available efficiency technologies. 

3 ‘‘(C) EXISTING ENERGY EFFICIENCY PRO4 GRAMS.—An eligible entity that, at any time be5 fore the date that is 60 days after the date of 

6 enactment of this section, has established an 

7 energy efficiency program for qualified con8 sumers may use an existing list of energy effi9 ciency measures, implementation plan, or meas10 urement and verification system of that pro11 gram to satisfy the requirements of subpara12 graph (A) if the Secretary determines the list, 

13 plan, or systems are consistent with the pur14 poses of this section. 

15 ‘‘(3) NO INTEREST.—A loan under this sub16 section shall bear no interest. 

17 ‘‘(4) REPAYMENT.—With respect to a loan 

18 under paragraph (1)— 

19 ‘‘(A) the term shall not exceed 20 years 

20 from the date on which the loan is closed; and 

21 ‘‘(B) except as provided in paragraph (6), 

22 the repayment of each advance shall be amor23 tized for a period not to exceed 10 years. 

24 ‘‘(5) AMOUNT OF ADVANCES.—Any advance of 

25 loan funds to an eligible entity in any single year 


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1 shall not exceed 50 percent of the approved loan 

2 amount. 

3 ‘‘(6) SPECIAL ADVANCE FOR START-UP ACTIVI4 TIES.— 

5 ‘‘(A) IN GENERAL.—In order to assist an 

6 eligible entity in defraying the appropriate 

7 start-up costs (as determined by the Secretary) 

8 of establishing new programs or modifying ex9 isting programs to carry out subsection (d), the 

10 Secretary shall allow an eligible entity to re11 quest a special advance. 

12 ‘‘(B) AMOUNT.—No eligible entity may re13 ceive a special advance under this paragraph 

14 for an amount that is greater than 4 percent of 

15 the loan amount received by the eligible entity 

16 under paragraph (1). 

17 ‘‘(C) REPAYMENT.—Repayment of the spe18 cial advance— 

19 ‘‘(i) shall be required during the 10- 

20 year period beginning on the date on which 

21 the special advance is made; and 

22 ‘‘(ii) at the election of the eligible en23 tity, may be deferred to the end of the 10- 

24 year period. 


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1 ‘‘(7) LIMITATION.—All special advances shall be 

2 made under a loan described in paragraph (1) dur3 ing the first 10 years of the term of the loan. 

4 ‘‘(d) LOANS TO QUALIFIED CONSUMERS.— 

5 ‘‘(1) TERMS OF LOANS.—Loans made by an eli6 gible entity to qualified consumers using loan funds 

7 provided by the Secretary under subsection (c)— 

8 ‘‘(A) may bear interest, not to exceed 3 

9 percent, to be used for purposes that include— 

10 ‘‘(i) to establish a loan loss reserve; 

11 and 

12 ‘‘(ii) to offset personnel and program 

13 costs of eligible entities to provide the 

14 loans; 

15 ‘‘(B) shall finance energy efficiency meas16 ures for the purpose of decreasing energy usage 

17 or costs of the qualified consumer by an 

18 amount that ensures, to the maximum extent 

19 practicable, that a loan term of not more than 

20 10 years will not pose an undue financial bur21 den on the qualified consumer, as determined 

22 by the eligible entity; 

23 ‘‘(C) shall not be used to fund purchases 

24 of, or modifications to, personal property unless 

25 the personal property is or becomes attached to 


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1 real property (including a manufactured home) 

2 as a fixture; 

3 ‘‘(D) shall be repaid through charges 

4 added to the electric bill for the property for, or 

5 at which, energy efficiency measures are or will 

6 be implemented, on the condition that this re7 quirement does not prohibit— 

8 ‘‘(i) the voluntary prepayment of a 

9 loan by the owner of the property; or 

10 ‘‘(ii) the use of any additional repay11 ment mechanisms that are— 

12 ‘‘(I) demonstrated to have appro13 priate risk mitigation features, as de14 termined by the eligible entity; or 

15 ‘‘(II) required if the qualified 

16 consumer is no longer a customer of 

17 the eligible entity; and 

18 ‘‘(E) shall require an energy audit by an 

19 eligible entity to determine the impact of pro20 posed energy efficiency measures on the energy 

21 costs and consumption of the qualified con22 sumer. 

23 ‘‘(2) CONTRACTORS.—In addition to any other 

24 qualified general contractor, eligible entities may 

25 serve as general contractors. 


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1 ‘‘(e) CONTRACT FOR MEASUREMENT AND

2 VERIFICATION, TRAINING, AND TECHNICAL ASSIST3 ANCE.— 

4 ‘‘(1) IN GENERAL.—Not later than 90 days 

5 after the date of enactment of this section, the Sec6 retary— 

7 ‘‘(A) shall establish a plan for measure8 ment and verification, training, and technical 

9 assistance of the program; and 

10 ‘‘(B) may enter into 1 or more contracts 

11 with a qualified entity for the purposes of— 

12 ‘‘(i) providing measurement and 

13 verification activities; and 

14 ‘‘(ii) developing a program to provide 

15 technical assistance and training to the 

16 employees of eligible entities to carry out 

17 this section. 

18 ‘‘(2) USE OF SUBCONTRACTORS AUTHOR19 IZED.—A qualified entity that enters into a contract 

20 under paragraph (1) may use subcontractors to as21 sist the qualified entity in carrying out the contract. 

22 ‘‘(f) FAST START DEMONSTRATION PROJECTS.— 

23 ‘‘(1) IN GENERAL.—The Secretary shall offer to 

24 enter into agreements with eligible entities (or 

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1 ciency programs described in subsection (c)(2)(C) to 

2 establish an energy efficiency loan demonstration 

3 projects consistent with the purposes of this section. 

4 ‘‘(2) EVALUATION CRITERIA.—In determining 

5 which eligible entities to award loans under this sec6 tion, the Secretary shall take into consideration eligi7 ble entities that— 

8 ‘‘(A) implement approaches to energy au9 dits and investments in energy efficiency meas10 ures that yield measurable and predictable sav11 ings; 

12 ‘‘(B) use measurement and verification 

13 processes to determine the effectiveness of en14 ergy efficiency loans made by eligible entities; 

15 ‘‘(C) include training for employees of eli16 gible entities, including any contractors of such 

17 entities, to implement or oversee the activities 

18 described in subparagraphs (A) and (B); 

19 ‘‘(D) provide for the participation of a ma20 jority of eligible entities in a State; 

21 ‘‘(E) reduce the need for generating capac22 ity; 

23 ‘‘(F) provide efficiency loans to— 

24 ‘‘(i) in the case of a single eligible en25 tity, not fewer than 20,000 consumers; or 


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1 ‘‘(ii) in the case of a group of eligible 

2 entities, not fewer than 80,000 consumers; 

3 and 

4 ‘‘(G) serve areas in which, as determined 

5 by the Secretary, a large percentage of con6 sumers reside— 

7 ‘‘(i) in manufactured homes; or 

8 ‘‘(ii) in housing units that are more 

9 than 50 years old. 

10 ‘‘(3) DEADLINE FOR IMPLEMENTATION.—To 

11 the maximum extent practicable, the Secretary shall 

12 enter into agreements described in paragraph (1) by 

13 not later than 90 days after the date of enactment 

14 of this section. 

15 ‘‘(4) EFFECT ON AVAILABILITY OF LOANS NA16 TIONALLY.—Nothing in this subsection shall delay 

17 the availability of loans to eligible entities on a na18 tional basis beginning not later than 180 days after 

19 the date of enactment of this section. 

20 ‘‘(5) ADDITIONAL DEMONSTRATION PROJECT

21 AUTHORITY.— 

22 ‘‘(A) IN GENERAL.—The Secretary may 

23 conduct demonstration projects in addition to 

24 the project required by paragraph (1). 


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1 ‘‘(B) INAPPLICABILITY OF CERTAIN CRI2 TERIA.—The additional demonstration projects 

3 may be carried out without regard to subpara4 graphs (D), (F), or (G) of paragraph (2). 

5 ‘‘(g) ADDITIONAL AUTHORITY.—The authority pro6 vided in this section is in addition to any other authority 

7 of the Secretary to offer loans under any other law. 

8 ‘‘(h) EFFECTIVE PERIOD.—Subject to the availability 

9 of funds and except as otherwise provided in this section, 

10 the loans and other expenditures required to be made 

11 under this section shall be available until expended, with 

12 the Secretary authorized to make new loans as loans are 

13 repaid. 

14 ‘‘(i) REGULATIONS.— 

15 ‘‘(1) IN GENERAL.—Except as otherwise pro16 vided in this subsection, not later than 180 days 

17 after the date of enactment of this section, the Sec18 retary shall promulgate such regulations as are nec19 essary to implement this section. 

20 ‘‘(2) PROCEDURE.—The promulgation of the 

21 regulations and administration of this section shall 

22 be made without regard to— 

23 ‘‘(A) the Statement of Policy of the Sec24 retary of Agriculture effective July 24, 1971 

25 (36 Fed. Reg. 13804), relating to notices of 


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1 proposed rulemaking and public participation in 

2 rulemaking; and 

3 ‘‘(B) chapter 35 of title 44, United States 

4 Code (commonly known as the ‘Paperwork Re5 duction Act’). 

6 ‘‘(3) CONGRESSIONAL REVIEW OF AGENCY

7 RULEMAKING.—In carrying out this section, the Sec8 retary shall use the authority provided under section 

9 808 of title 5, United States Code. 

10 ‘‘(4) INTERIM REGULATIONS.—Notwithstanding 

11 paragraphs (1) and (2), to the extent regulations are 

12 necessary to carry out any provision of this section, 

13 the Secretary shall implement such regulations 

14 through the promulgation of an interim rule.’’. 

15 TITLE VII—RESEARCH, EXTEN16 SION, AND RELATED MAT17 TERS 

18 Subtitle A—National Agricultural 

19 Research, Extension, and Teach20 ing Policy Act of 1977 

21 SEC. 7101. NATIONAL AGRICULTURAL RESEARCH, EXTEN22 SION, EDUCATION, AND ECONOMICS ADVI23 SORY BOARD. 

24 (a) AUTHORIZATION OF APPROPRIATIONS.—Section 

25 1408(h) of the National Agricultural Research, Extension, 


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1 and Teaching Policy Act of 1977 (7 U.S.C. 3123(h)) is 

2 amended by striking ‘‘2012’’ and inserting ‘‘2017’’. 

3 (b) DUTIES OF NATIONAL AGRICULTURAL RE4 SEARCH, EXTENSION, EDUCATION, AND ECONOMICS AD5 VISORY BOARD.—Section 1408(c) of the National Agricul6 tural Research, Extension, and Teaching Policy Act of 

7 1977 (7 U.S.C. 3123(c)) is amended— 

8 (1) in paragraph (3), by striking ‘‘and’’ at the 

9 end; 

10 (2) in paragraph (4)(C), by striking the period 

11 at the end and inserting ‘‘; and’’; and 

12 (3) by adding at the end the following: 

13 ‘‘(5) consult with industry groups on agricul14 tural research, extension, education, and economics, 

15 and make recommendations to the Secretary based 

16 on that consultation.’’. 

17 SEC. 7102. SPECIALTY CROP COMMITTEE. 

18 Section 1408A of the National Agricultural Research, 

19 Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

20 3123a) is amended— 

21 (1) in subsection (b)— 

22 (A) by striking ‘‘Individuals’’ and inserting 

23 the following: 

24 ‘‘(1) ELIGIBILITY.—Individuals’’; 


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1 (B) by striking ‘‘Members’’ and inserting 

2 the following: 

3 ‘‘(2) SERVICE.—Members’’; and 

4 (C) by adding at the end the following: 

5 ‘‘(3) DIVERSITY.—Membership of the specialty 

6 crops committee shall reflect diversity in the spe7 cialty crops represented.’’; 

8 (2) in subsection (c), by adding at the end the 

9 following: 

10 ‘‘(6) Analysis of alignment of specialty crop 

11 committee recommendations with specialty crop re12 search initiative grants awarded under section 

13 412(d) of the Agricultural Research, Extension, and 

14 Education Reform Act of 1998 (7 U.S.C. 7632).’’; 

15 (3) by redesignating subsections (d) and (e) as 

16 subsections (e) and (f), respectively; 

17 (4) by inserting after subsection (c) the fol18 lowing: 

19 ‘‘(d) CONSULTATION WITH SPECIALTY CROP INDUS20 TRY.—In studying the scope and effectiveness of programs 

21 under subsection (a), the specialty crops committee shall 

22 consult on an ongoing basis with diverse sectors of the 

23 specialty crop industry.’’; and 


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1 (5) in subsection (f) (as redesignated by para2 graph (3)), by striking ‘‘subsection (d)’’ and insert3 ing ‘‘subsection (e)’’. 

4 SEC. 7103. VETERINARY SERVICES GRANT PROGRAM. 

5 The National Agricultural Research, Extension, and 

6 Teaching Policy Act of 1977 is amended by inserting after 

7 section 1415A (7 U.S.C. 3151a) the following: 

8 ‘‘SEC. 1415B. VETERINARY SERVICES GRANT PROGRAM. 

9 ‘‘(a) DEFINITIONS.—In this section: 

10 ‘‘(1) QUALIFIED ENTITY.—The term ‘qualified 

11 entity’ means— 

12 ‘‘(A) a for-profit or nonprofit entity located 

13 in the United States that operates a veterinary 

14 clinic providing veterinary services— 

15 ‘‘(i) in a rural area, as defined in sec16 tion 343(a) of the Consolidated Farm and 

17 Rural Development Act (7 U.S.C. 

18 1991(a)); and 

19 ‘‘(ii) in response to a veterinarian 

20 shortage situation; 

21 ‘‘(B) a State, national, allied, or regional 

22 veterinary organization or specialty board rec23 ognized by the American Veterinary Medical 

24 Association; 


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1 ‘‘(C) a college or school of veterinary medi2 cine accredited by the American Veterinary 

3 Medical Association; 

4 ‘‘(D) a university research foundation or 

5 veterinary medical foundation; 

6 ‘‘(E) a department of veterinary science or 

7 department of comparative medicine accredited 

8 by the Department of Education; 

9 ‘‘(F) a State agricultural experiment sta10 tion; and 

11 ‘‘(G) a State, local, or tribal government 

12 agency. 

13 ‘‘(2) VETERINARIAN SHORTAGE SITUATION.— 

14 The term ‘veterinarian shortage situation’ means a 

15 veterinarian shortage situation determined by the 

16 Secretary under section 1415A(b). 

17 ‘‘(b) ESTABLISHMENT OF PROGRAM.— 

18 ‘‘(1) COMPETITIVE GRANTS.—The Secretary 

19 shall carry out a program to make competitive 

20 grants to qualified entities that carry out programs 

21 or activities described in paragraph (2) for the pur22 pose of developing, implementing, and sustaining 

23 veterinary services. 

24 ‘‘(2) ELIGIBILITY REQUIREMENTS.—To be eligi25 ble to receive a grant described in paragraph (1), a 


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1 qualified entity shall carry out programs or activities 

2 that the Secretary determines will— 

3 ‘‘(A) substantially relieve veterinarian 

4 shortage situations; 

5 ‘‘(B) support or facilitate private veteri6 nary practices engaged in public health activi7 ties; or 

8 ‘‘(C) support or facilitate the practices of 

9 veterinarians who are participating in or have 

10 successfully completed a service requirement 

11 under section 1415A(a)(2). 

12 ‘‘(c) AWARD PROCESSES AND PREFERENCES.— 

13 ‘‘(1) APPLICATION, EVALUATION, AND INPUT

14 PROCESSES.—In administering the grant program 

15 under this section, the Secretary shall— 

16 ‘‘(A) use an appropriate application and 

17 evaluation process, as determined by the Sec18 retary; and 

19 ‘‘(B) seek the input of interested persons. 

20 ‘‘(2) GRANT PREFERENCES.—In selecting re21 cipients of grants to be used for any of the purposes 

22 described in paragraphs (2) through (6) of sub23 section (d), the Secretary shall give a preference to 

24 qualified entities that provide documentation of coVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00787 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 ordination with other qualified entities, with respect 

2 to any such purpose. 

3 ‘‘(3) ADDITIONAL PREFERENCES.—In awarding 

4 grants under this section, the Secretary may develop 

5 additional preferences by taking into account the 

6 amount of funds available for grants and the pur7 poses for which the grant funds will be used. 

8 ‘‘(4) APPLICABILITY OF OTHER PROVISIONS.— 

9 Sections 1413B, 1462(a), 1469(a)(3), 1469(c), and 

10 1470 apply to the administration of the grant pro11 gram under this section. 

12 ‘‘(d) USE OF GRANTS TO RELIEVE VETERINARIAN

13 SHORTAGE SITUATIONS AND SUPPORT VETERINARY

14 SERVICES.—A qualified entity may use funds provided by 

15 grants under this section to relieve veterinarian shortage 

16 situations and support veterinary services for the following 

17 purposes: 

18 ‘‘(1) To assist veterinarians with establishing or 

19 expanding practices for the purpose of— 

20 ‘‘(A) equipping veterinary offices; 

21 ‘‘(B) sharing in the reasonable overhead 

22 costs of the practices, as determined by the Sec23 retary; or 


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1 ‘‘(C) establishing mobile veterinary facili2 ties in which a portion of the facilities will ad3 dress education or extension needs. 

4 ‘‘(2) To promote recruitment (including for pro5 grams in secondary schools), placement, and reten6 tion of veterinarians, veterinary technicians, stu7 dents of veterinary medicine, and students of veteri8 nary technology. 

9 ‘‘(3) To allow veterinary students, veterinary in10 terns, externs, fellows, and residents, and veterinary 

11 technician students to cover expenses (other than 

12 the types of expenses described in 1415A(c)(5)) to 

13 attend training programs in food safety or food ani14 mal medicine. 

15 ‘‘(4) To establish or expand accredited veteri16 nary education programs (including faculty recruit17 ment and retention), veterinary residency and fellow18 ship programs, or veterinary internship and 

19 externship programs carried out in coordination with 

20 accredited colleges of veterinary medicine. 

21 ‘‘(5) To assess veterinarian shortage situations 

22 and the preparation of applications submitted to the 

23 Secretary for designation as a veterinarian shortage 

24 situation under section 1415A(b). 


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1 ‘‘(6) To provide continuing education and ex2 tension, including veterinary telemedicine and other 

3 distance-based education, for veterinarians, veteri4 nary technicians, and other health professionals 

5 needed to strengthen veterinary programs and en6 hance food safety. 

7 ‘‘(e) SPECIAL REQUIREMENTS FOR CERTAIN

8 GRANTS.— 

9 ‘‘(1) TERMS OF SERVICE REQUIREMENTS.— 

10 ‘‘(A) IN GENERAL.—Grants provided 

11 under this section for the purpose specified in 

12 subsection (d)(1) shall be subject to an agree13 ment between the Secretary and the grant re14 cipient that includes a required term of service 

15 for the recipient, as established by the Sec16 retary. 

17 ‘‘(B) CONSIDERATIONS.—In establishing a 

18 term of service under subparagraph (A), the 

19 Secretary shall consider only— 

20 ‘‘(i) the amount of the grant awarded; 

21 and 

22 ‘‘(ii) the specific purpose of the grant. 

23 ‘‘(2) BREACH REMEDIES.— 

24 ‘‘(A) IN GENERAL.—An agreement under 

25 paragraph (1) shall provide remedies for any 


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1 breach of the agreement by the grant recipient, 

2 including repayment or partial repayment of the 

3 grant funds, with interest. 

4 ‘‘(B) WAIVER.—The Secretary may grant 

5 a wavier of the repayment obligation for breach 

6 of contract if the Secretary determines that the 

7 grant recipient demonstrates extreme hardship 

8 or extreme need. 

9 ‘‘(C) TREATMENT OF AMOUNTS RECOV10 ERED.—Funds recovered under this paragraph 

11 shall— 

12 ‘‘(i) be credited to the account avail13 able to carry out this section; and 

14 ‘‘(ii) remain available until expended. 

15 ‘‘(f) COST-SHARING REQUIREMENTS.— 

16 ‘‘(1) RECIPIENT SHARE.—Subject to paragraph 

17 (2), to be eligible to receive a grant under this sec18 tion, a qualified entity shall provide matching non19 Federal funds, either in cash or in-kind support, in 

20 an amount equal to not less than 25 percent of the 

21 Federal funds provided by the grant. 

22 ‘‘(2) WAIVER.—The Secretary may establish, by 

23 regulation, conditions under which the cost-sharing 

24 requirements of paragraph (1) may be reduced or 

25 waived. 


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1 ‘‘(g) PROHIBITION ON USE OF GRANT FUNDS FOR

2 CONSTRUCTION.—Funds made available for grants under 

3 this section may not be used— 

4 ‘‘(1) to construct a new building or facility; or 

5 ‘‘(2) to acquire, expand, remodel, or alter an ex6 isting building or facility, including site grading and 

7 improvement and architect fees. 

8 ‘‘(h) REGULATIONS.—Not later than 1 year after the 

9 date of enactment of this section, the Secretary shall pro10 mulgate regulations to carry out this section. 

11 ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There is 

12 authorized to be appropriated to the Secretary to carry 

13 out this section $10,000,000 for fiscal year 2013 and each 

14 fiscal year thereafter, to remain available until ex15 pended.’’. 

16 SEC. 7104. GRANTS AND FELLOWSHIPS FOR FOOD AND AG17 RICULTURE SCIENCES EDUCATION. 

18 Section 1417(m) of the National Agricultural Re19 search, Extension, and Teaching Policy Act of 1977 (7 

20 U.S.C. 3152(m)) is amended by striking ‘‘section 

21 $60,000,000’’ and all that follows and inserting the fol22 lowing: ‘‘section— 

23 ‘‘(1) $60,000,000 for each of fiscal years 1990 

24 through 2012; and 


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1 ‘‘(2) $40,000,000 for each of fiscal years 2013 

2 through 2017.’’. 

3 SEC. 7105. AGRICULTURAL AND FOOD POLICY RESEARCH 

4 CENTERS. 

5 Section 1419A of the National Agricultural Research, 

6 Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

7 3155) is amended— 

8 (1) in the section heading, by inserting ‘‘AGRI9 CULTURAL AND FOOD’’ before ‘‘POLICY’’; 

10 (2) in subsection (a), in the matter preceding 

11 paragraph (1)— 

12 (A) by striking ‘‘Secretary may’’ and in13 serting ‘‘Secretary shall, acting through the Of14 fice of the Chief Economist,’’; and 

15 (B) by inserting ‘‘with a history of pro16 viding unbiased, nonpartisan economic analysis 

17 to Congress’’ after ‘‘subsection (b)’’; 

18 (3) in subsection (b), by striking ‘‘other re19 search institutions’’ and all that follows through 

20 ‘‘shall be eligible’’ and inserting ‘‘other public re21 search institutions and organizations shall be eligi22 ble’’; 

23 (4) in subsection (c)— 

24 (A) in the matter preceding paragraph (1), 

25 by inserting ‘‘, with preference given to policy 


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1 research centers having extensive databases, 

2 models, and demonstrated experience in pro3 viding Congress with agricultural market pro4 jections, rural development analysis, agricul5 tural policy analysis, and baseline projections at 

6 the farm, multiregional, national, and inter7 national levels,’’ after ‘‘with this section’’; and 

8 (B) in paragraph (2) by inserting ‘‘ap9 plied’’ after ‘‘theoretical’’; and 

10 (5) by striking subsection (d) and inserting the 

11 following: ‘‘ 

12 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 

13 is authorized to be appropriated to carry out this section 

14 $5,000,000 for fiscal year 2012 and each fiscal year there15 after.’’. 

16 SEC. 7106. EDUCATION GRANTS TO ALASKA NATIVE SERV17 ING INSTITUTIONS AND NATIVE HAWAIIAN 

18 SERVING INSTITUTIONS. 

19 Section 1419B of the National Agricultural Research, 

20 Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

21 3156) is amended— 

22 (1) in subsection (a)— 

23 (A) in paragraph (1), by striking ‘‘(or 

24 grants without regard to any requirement for 

25 competition)’’; and 


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1 (B) in paragraph (3), by striking ‘‘2012’’ 

2 and inserting ‘‘2017’’; and 

3 (2) in subsection (b)(1), by striking ‘‘(or grants 

4 without regard to any requirement for competi5 tion)’’; and 

6 (3) in paragraph (3), by striking ‘‘2012’’ and 

7 inserting ‘‘2017’’. 

8 SEC. 7107. NUTRITION EDUCATION PROGRAM. 

9 Section 1425(f) of the National Agricultural Re10 search, Extension, and Teaching Policy Act of 1977 (7 

11 U.S.C. 3175(f)) is amended by striking ‘‘2012’’ and in12 serting ‘‘2017’’. 

13 SEC. 7108. CONTINUING ANIMAL HEALTH AND DISEASE RE14 SEARCH PROGRAMS. 

15 Section 1433 of the National Agricultural Research, 

16 Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

17 3195) is amended by striking the section designation and 

18 heading and all that follows through subsection (a) and 

19 inserting the following: 

20 ‘‘SEC. 1433. APPROPRIATIONS FOR CONTINUING ANIMAL 

21 HEALTH AND DISEASE RESEARCH PRO22 GRAMS. 

23 ‘‘(a) AUTHORIZATION OF APPROPRIATIONS.— 

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

25 appropriated to support continuing animal health 


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1 and disease research programs at eligible institutions 

2 such sums as are necessary, but not to exceed 

3 $25,000,000 for each of fiscal years 1991 through 

4 2017. 

5 ‘‘(2) USE OF FUNDS.—Funds made available 

6 under this section shall be used— 

7 ‘‘(A) to meet the expenses of conducting 

8 animal health and disease research, publishing 

9 and disseminating the results of such research, 

10 and contributing to the retirement of employees 

11 subject to the Act of March 4, 1940 (7 U.S.C. 

12 331); 

13 ‘‘(B) for administrative planning and di14 rection; and 

15 ‘‘(C) to purchase equipment and supplies 

16 necessary for conducting research described in 

17 subparagraph (A).’’. 

18 SEC. 7109. GRANTS TO UPGRADE AGRICULTURAL AND 

19 FOOD SCIENCES FACILITIES AT 1890 LAND20 GRANT COLLEGES, INCLUDING TUSKEGEE 

21 UNIVERSITY. 

22 Section 1447(b) of the National Agricultural Re23 search, Extension, and Teaching Policy Act of 1977 (7 

24 U.S.C. 3222b(b)) is amended by striking ‘‘2012’’ and in25 serting ‘‘2017’’. 


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1 SEC. 7110. GRANTS TO UPGRADE AGRICULTURAL AND 

2 FOOD SCIENCES FACILITIES AND EQUIP3 MENT AT INSULAR AREA LAND-GRANT INSTI4 TUTIONS. 

5 Section 1447B(d) of the National Agricultural Re6 search, Extension, and Teaching Policy Act of 1977 (7 

7 U.S.C. 3222b–2(d)) is amended by striking ‘‘2012’’ and 

8 inserting ‘‘2017’’. 

9 SEC. 7111. HISPANIC-SERVING INSTITUTIONS. 

10 Section 1455(c) of the National Agricultural Re11 search, Extension, and Teaching Policy Act of 1977 (7 

12 U.S.C. 3241(c)) is amended by striking ‘‘2012’’ and in13 serting ‘‘2017’’. 

14 SEC. 7112. COMPETITIVE GRANTS FOR INTERNATIONAL AG15 RICULTURAL SCIENCE AND EDUCATION PRO16 GRAMS. 

17 Section 1459A of the National Agricultural Research, 

18 Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

19 3292b) is amended by striking subsection (c) and insert20 ing the following: ‘‘ 

21 ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There 

22 are authorized to be appropriated to carry out this sec23 tion— 

24 ‘‘(1) such sums as are necessary for each of fis25 cal years 1999 through 2012; and 


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1 ‘‘(2) $5,000,000 for each of fiscal years 2013 

2 through 2017.’’. 

3 SEC. 7113. UNIVERSITY RESEARCH. 

4 Section 1463 of the National Agricultural Research, 

5 Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

6 3311) is amended in each of subsections (a) and (b) by 

7 striking ‘‘2012’’ each place it appears and inserting 

8 ‘‘2017’’. 

9 SEC. 7114. EXTENSION SERVICE. 

10 Section 1464 of the National Agricultural Research, 

11 Extension, and Teaching Policy Act of 1977 (7 U.S.C. 

12 3312) is amended by striking ‘‘2012’’ and inserting 

13 ‘‘2017’’. 

14 SEC. 7115. SUPPLEMENTAL AND ALTERNATIVE CROPS. 

15 (a) AUTHORIZATION OF APPROPRIATIONS AND TER16 MINATION.—Section 1473D of the National Agricultural 

17 Research, Extension, and Teaching Policy Act of 1977 (7 

18 U.S.C. 3319d) is amended— 

19 (1) in subsection (a), by striking ‘‘2012’’ and 

20 inserting ‘‘2017’’; and 

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

22 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There 

23 are authorized to be appropriated to carry out this sec24 tion— 


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1 ‘‘(1) such sums as are necessary for fiscal year 

2 2012; and 

3 ‘‘(2) $1,000,000 for each of fiscal years 2013 

4 through 2017.’’. 

5 (b) COMPETITIVE GRANTS.—Section 1473D(c)(1) of 

6 the National Agricultural Research, Extension, and 

7 Teaching Policy Act of 1977 (7 U.S.C. 3319d(c)(1)) is 

8 amended by striking ‘‘use such research funding, special 

9 or competitive grants, or other means, as the Secretary 

10 determines,’’ and inserting ‘‘make competitive grants’’. 

11 SEC. 7116. CAPACITY BUILDING GRANTS FOR NLGCA INSTI12 TUTIONS. 

13 Section 1473F(b) of the National Agricultural Re14 search, Extension, and Teaching Policy Act of 1977 (7 

15 U.S.C. 3319i(b)) is amended by striking ‘‘2012’’ and in16 serting ‘‘2017’’. 

17 SEC. 7117. AQUACULTURE ASSISTANCE PROGRAMS. 

18 (a) COMPETITIVE GRANTS.—Section 1475(b) of the 

19 National Agricultural Research, Extension, and Teaching 

20 Policy Act of 1977 (7 U.S.C. 3322(b)) is amended in the 

21 matter preceding paragraph (1) by inserting ‘‘competi22 tive’’ before ‘‘grants’’. 

23 (b) AUTHORIZATION OF APPROPRIATIONS.—Section 

24 1477 of the National Agricultural Research, Extension, 


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1 and Teaching Policy Act of 1977 (7 U.S.C. 3324) is 

2 amended to read as follows: ‘‘ 

3 ‘‘SEC. 1477. AUTHORIZATION OF APPROPRIATIONS. 

4 ‘‘(a) IN GENERAL.—There are authorized to be ap5 propriated to carry out this subtitle— 

6 ‘‘(1) $7,500,000 for each of fiscal years 1991 

7 through 2012; and 

8 ‘‘(2) $5,000,000 for each of fiscal years 2013 

9 through 2017. 

10 ‘‘(b) PROHIBITION ON USE.—Funds made available 

11 under this section may not be used to acquire or construct 

12 a building.’’. 

13 SEC. 7118. RANGELAND RESEARCH PROGRAMS. 

14 Section 1483(a) of the National Agricultural Re15 search, Extension, and Teaching Policy Act of 1977 (7 

16 U.S.C. 3336(a)) is amended by striking ‘‘subtitle’’ and all 

17 that follows and inserting the following: ‘‘subtitle— 

18 ‘‘(1) $10,000,000 for each of fiscal years 1991 

19 through 2012; and 

20 ‘‘(2) $2,000,000 for each of fiscal years 2013 

21 through 2017.’’. 

22 SEC. 7119. SPECIAL AUTHORIZATION FOR BIOSECURITY 

23 PLANNING AND RESPONSE. 

24 Section 1484(a) of the National Agricultural Re25 search, Extension, and Teaching Policy Act of 1977 (7 


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1 U.S.C. 3351(a)) is amended by striking ‘‘response such 

2 sums as are necessary’’ and all that follows and inserting 

3 the following: ‘‘response— 

4 ‘‘(1) such sums as are necessary for each of fis5 cal years 2002 through 2012; and 

6 ‘‘(2) $20,000,000 for each of fiscal years 2013 

7 through 2017.’’. 

8 SEC. 7120. DISTANCE EDUCATION AND RESIDENT INSTRUC9 TION GRANTS PROGRAM FOR INSULAR AREA 

10 INSTITUTIONS OF HIGHER EDUCATION. 

11 (a) DISTANCE EDUCATION GRANTS FOR INSULAR

12 AREAS.— 

13 (1) COMPETITIVE GRANTS.—Section 1490(a) of 

14 the National Agricultural Research, Extension, and 

15 Teaching Policy Act of 1977 (7 U.S.C. 3362(a)) is 

16 amended by striking ‘‘or noncompetitive’’. 

17 (2) AUTHORIZATION OF APPROPRIATIONS.— 

18 Section 1490(f) of the National Agricultural Re19 search, Extension, and Teaching Policy Act of 1977 

20 (7 U.S.C. 3362(f)) is amended by striking ‘‘section’’ 

21 and all that follows and inserting the following: ‘‘sec22 tion— 

23 ‘‘(1) such sums as are necessary for each of fis24 cal years 2002 through 2012; and 


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1 ‘‘(2) $2,000,000 for each of fiscal years 2013 

2 through 2017.’’. 

3 (b) RESIDENT INSTRUCTION GRANTS FOR INSULAR

4 AREAS.—Section 1491(c) of the National Agricultural Re5 search, Extension, and Teaching Policy Act of 1977 (7 

6 U.S.C. 3363(c)) is amended by striking ‘‘such sums as 

7 are necessary’’ and all that follows and inserting the fol8 lowing: ‘‘to carry out this section— 

9 ‘‘(1) such sums as are necessary for each of fis10 cal years 2002 through 2012; and 

11 ‘‘(2) $2,000,000 for each of fiscal years 2013 

12 through 2017.’’. 

13 Subtitle B—Food, Agriculture, Con14 servation, and Trade Act of 1990 

15 SEC. 7201. BEST UTILIZATION OF BIOLOGICAL APPLICA16 TIONS. 

17 Section 1624 of the Food, Agriculture, Conservation, 

18 and Trade Act of 1990 (7 U.S.C. 5814) is amended— 

19 (1) by striking ‘‘$40,000,000 for each fiscal 

20 year’’; and 

21 (2) by inserting ‘‘$40,000,000 for each of fiscal 

22 years 2012 through 2017’’ after ‘‘chapter’’. 


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1 SEC. 7202. INTEGRATED MANAGEMENT SYSTEMS. 

2 Section 1627 of the Food, Agriculture, Conservation, 

3 and Trade Act of 1990 (7 U.S.C. 5821) is amended by 

4 striking subsection (d) and inserting the following: 

5 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 

6 is authorized to be appropriated to carry out this section 

7 through the National Institute of Food and Agriculture 

8 $20,000,000 for each of fiscal years 2012 through 2017.’’. 

9 SEC. 7203. SUSTAINABLE AGRICULTURE TECHNOLOGY DE10 VELOPMENT AND TRANSFER PROGRAM. 

11 Section 1628 of the Food, Agriculture, Conservation, 

12 and Trade Act of 1990 (7 U.S.C. 5831) is amended by 

13 striking subsection (f) and inserting the following: 

14 ‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There 

15 are authorized to be appropriated to carry out this section 

16 such sums as are necessary for each of fiscal years 2012 

17 through 2017.’’. 

18 SEC. 7204. NATIONAL TRAINING PROGRAM. 

19 Section 1629 of the Food, Agriculture, Conservation, 

20 and Trade Act of 1990 (7 U.S.C. 5832) is amended by 

21 striking subsection (i) and inserting the following: 

22 ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There is 

23 authorized to be appropriated to carry out the National 

24 Training Program $20,000,000 for each of fiscal years 

25 2012 through 2017.’’. 


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1 SEC. 7205. NATIONAL GENETICS RESOURCES PROGRAM. 

2 Section 1635(b) of the Food, Agriculture, Conserva3 tion, and Trade Act of 1990 (7 U.S.C. 5844(b)) is amend4 ed— 

5 (1) by striking ‘‘such funds as may be nec6 essary’’; and 

7 (2) by striking ‘‘subtitle’’ and all that follows 

8 and inserting the following: ‘‘subtitle— 

9 ‘‘(1) such sums as are necessary for each of fis10 cal years 1991 through 2012; and 

11 ‘‘(2) $1,000,000 for each of fiscal years 2013 

12 through 2017.’’. 

13 SEC. 7206. NATIONAL AGRICULTURAL WEATHER INFORMA14 TION SYSTEM. 

15 Section 1641(c) of the Food, Agriculture, Conserva16 tion, and Trade Act of 1990 (7 U.S.C. 5855(c)) is amend17 ed by inserting ‘‘and $1,000,000 for each of fiscal years 

18 2013 through 2017’’ before the period at the end. 

19 SEC. 7207. HIGH-PRIORITY RESEARCH AND EXTENSION INI20 TIATIVES. 

21 Section 1672 of the Food, Agriculture, Conservation, 

22 and Trade Act of 1990 (7 U.S.C. 5925) is amended— 

23 (1) in the first sentence of subsection (a), by 

24 striking ‘‘subsections (e) through (i) of’’; 

25 (2) in subsection (b)(2)— 


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1 (A) by striking the first sentence and in2 serting the following: 

3 ‘‘(A) IN GENERAL.—To facilitate the mak4 ing of research and extension grants under sub5 section (d), the Secretary may appoint a task 

6 force to make recommendations to the Sec7 retary.’’; and 

8 (B) in the second sentence, by striking 

9 ‘‘The Secretary may not incur costs in excess of 

10 $1,000 for any fiscal year in connection with 

11 each’’ and inserting the following: 

12 ‘‘(B) COSTS.—The Secretary may not 

13 incur costs in excess of $1,000 for any fiscal 

14 year in connection with a’’; 

15 (3) in subsection (e)— 

16 (A) by striking paragraphs (1) through 

17 (5), (7), (8), (11) through (39), (41) through 

18 (43), (47), (48), (51), and (52); and 

19 (B) by redesignating paragraphs (6), (9), 

20 (10), (40), (44), (45), (46), (49), and (50) as 

21 paragraphs (1), (2), (3), (4), (5), (6), (7), (8), 

22 and (9), respectively; 

23 (4) by striking subsections (f), (g), and (i); 

24 (5) by inserting after subsection (e) the fol25 lowing: 


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1 ‘‘(f) PULSE HEALTH INITIATIVE.— 

2 ‘‘(1) DEFINITIONS.—In this subsection; 

3 ‘‘(A) INITIATIVE.—The term ‘Initiative’ 

4 means the pulse health initiative established by 

5 paragraph (2). 

6 ‘‘(B) PULSE.—The term ‘pulse’ means dry 

7 beans, dry peas, lentils, and chickpeas or 

8 garbanzo beans. 

9 ‘‘(2) ESTABLISHMENT.—Notwithstanding any 

10 other provision of law, during the period beginning 

11 on the date of enactment of the Agriculture Reform, 

12 Food, and Jobs Act of 2012 and ending on Sep13 tember 30, 2017, the Secretary shall carry out a 

14 pulse crop health and extension initiative to address 

15 the critical needs of the pulse crop industry by devel16 oping and disseminating science-based tools and in17 formation, including— 

18 ‘‘(A) research in health and nutrition, such 

19 as— 

20 ‘‘(i) identifying global dietary patterns 

21 of pulse crops in relation to population 

22 health; 

23 ‘‘(ii) researching pulse crop diets and 

24 the ability of the diets to reduce obesity 

25 and associated chronic disease (including 


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1 cardiovascular disease, type 2 diabetes, 

2 and cancer); and 

3 ‘‘(iii) identifying the underlying mech4 anisms of the health benefits of pulse crop 

5 consumption (including disease biomarkers, 

6 bioactive components, and relevant plant 

7 genetic components to enhance the health 

8 promoting value of pulse crops); 

9 ‘‘(B) research in functionality, such as— 

10 ‘‘(i) improving the functional prop11 erties of pulse crops and pulse fractions; 

12 ‘‘(ii) developing new and innovative 

13 technologies to improve pulse crops as an 

14 ingredient in food products; and 

15 ‘‘(iii) developing nutrient-dense food 

16 product solutions to ameliorate chronic dis17 ease and enhance food security worldwide; 

18 ‘‘(C) research in sustainability to enhance 

19 global food security, such as— 

20 ‘‘(i) plant breeding, genetics and 

21 genomics to improve productivity, nutrient 

22 density, and phytonutrient content for a 

23 growing world population; 

24 ‘‘(ii) pest and disease management, 

25 including resistance to pests and diseases 


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1 resulting in reduced application manage2 ment strategies; and 

3 ‘‘(iii) improving nitrogen fixation to 

4 reduce the carbon and energy footprint of 

5 agriculture; 

6 ‘‘(D) optimizing pulse cropping systems to 

7 reduce water usage; and 

8 ‘‘(E) education and technical service, such 

9 as— 

10 ‘‘(i) providing technical expertise to 

11 help food companies include nutrient-dense 

12 pulse crops in innovative and healthy 

13 foods; and 

14 ‘‘(ii) establishing an educational pro15 gram to encourage the consumption and 

16 production of pulse crops in the United 

17 States and other countries. 

18 ‘‘(3) ELIGIBLE ENTITIES.—The Secretary may 

19 carry out the Initiative through— 

20 ‘‘(A) Federal agencies, including the Agri21 cultural Research Service and the National In22 stitute of Food and Agriculture; 

23 ‘‘(B) National Laboratories; 

24 ‘‘(C) institutions of higher education; 

25 ‘‘(D) research institutions or organizations; 


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1 ‘‘(E) private organizations or corporations; 

2 ‘‘(F) State agricultural experiment sta3 tions; 

4 ‘‘(G) individuals; or 

5 ‘‘(H) groups consisting of 2 or more enti6 ties or individuals described in subparagraphs 

7 (A) through (G). 

8 ‘‘(4) RESEARCH PROJECT GRANTS.— 

9 ‘‘(A) IN GENERAL.—In carrying out this 

10 subsection, the Secretary shall award grants on 

11 a competitive basis. 

12 ‘‘(B) IN GENERAL.—The Secretary shall— 

13 ‘‘(i) seek and accept proposals for 

14 grants; 

15 ‘‘(ii) determine the relevance and 

16 merit of proposals through a system of 

17 peer review, in consultation with the pulse 

18 crop industry; and 

19 ‘‘(iii) award grants on the basis of 

20 merit, quality, and relevance. 

21 ‘‘(C) PRIORITIES.—In making grants 

22 under this subsection, the Secretary shall pro23 vide a higher priority to projects that— 

24 ‘‘(i) are multistate, multiinstitutional, 

25 and multidisciplinary; and 


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1 ‘‘(ii) include explicit mechanisms to 

2 communicate results to the pulse crop in3 dustry and the public. 

4 ‘‘(5) AUTHORIZATION OF APPROPRIATIONS.— 

5 There is authorized to be appropriated to carry out 

6 this subsection $25,000,000 for each of fiscal years 

7 2013 through 2017. 

8 ‘‘(g) TRAINING COORDINATION FOR FOOD AND AGRI9 CULTURE PROTECTION.— 

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

11 grants and enter into contracts or cooperative agree12 ments with eligible entities described in paragraph 

13 (2) for the purposes of establishing a Comprehensive 

14 Food Safety Training Network. 

15 ‘‘(2) ELIGIBILITY.— 

16 ‘‘(A) IN GENERAL.—For purposes of this 

17 subsection, an eligible entity is a multiinstitu18 tional consortium that includes— 

19 ‘‘(i) a nonprofit institution that pro20 vides administering food protection train21 ing; and 

22 ‘‘(ii) 1 or more training centers in in23 stitutions of higher education that have 

24 demonstrated expertise in developing and 


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1 delivering community-based training in 

2 food and agricultural safety and defense. 

3 ‘‘(B) REQUIREMENTS.—To ensure that co4 ordination and administration is provided 

5 across all the disciplines and provide com6 prehensive food protection training, the Sec7 retary may only consider an entire consortium 

8 collectively rather than on an institution-by-in9 stitution basis. 

10 ‘‘(C) MEMBERSHIP.—An eligible entity 

11 may alter the consortium membership to meet 

12 specific training expertise needs. 

13 ‘‘(3) DUTIES OF ELIGIBLE ENTITY.—As a con14 dition of the receipt of assistance under this sub15 section, an eligible entity, in cooperation with the 

16 Secretary, shall establish and maintain the network 

17 for an internationally integrated training system to 

18 enhance protection of the United States food supply, 

19 including, at a minimum— 

20 ‘‘(A) developing curricula and a training 

21 network to provide basic, technical, manage22 ment, and leadership training to regulatory and 

23 public health officials, producers, processors, 

24 and other agrifood businesses; 


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1 ‘‘(B) serving as the hub for the adminis2 tration of an open training network; 

3 ‘‘(C) implementing standards to ensure the 

4 delivery of quality training through a national 

5 curricula; 

6 ‘‘(D) building and overseeing a nationally 

7 recognized instructor cadre to ensure the avail8 ability of highly qualified instructors; 

9 ‘‘(E) reviewing training proposed through 

10 the National Institute of Food and Agriculture 

11 and other relevant Federal agencies that report 

12 to the Secretary on the quality and content of 

13 proposed and existing courses; 

14 ‘‘(F) assisting Federal agencies in the im15 plementation of food protection training re16 quirements including requirements contained in 

17 the Agriculture Reform, Food, and Jobs Act of 

18 2012, the FDA Food Safety Modernization Act 

19 (Public Law 111–353; 124 Stat. 3885), and 

20 amendments made by those Acts; and 

21 ‘‘(G) performing evaluation and outcome22 based studies to provide to the Secretary feed23 back on the effectiveness and impact of training 

24 and metrics on jurisdictions and sectors within 

25 the food safety system. 


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1 ‘‘(4) AUTHORIZATION OF APPROPRIATIONS.— 

2 There is authorized to be appropriated to carry out 

3 this section $20,000,000 for each of fiscal years 

4 2013 through 2017, to remain available until ex5 pended.’’; 

6 (6) in subsection (h), by striking ‘‘2012’’ each 

7 place it appears and inserting ‘‘2017’’; 

8 (7) by redesignating subsection (j) as sub9 section (i); and 

10 (8) in subsection (i) (as so redesignated), by 

11 striking ‘‘2012’’ and inserting ‘‘2017’’. 

12 SEC. 7208. ORGANIC AGRICULTURE RESEARCH AND EXTEN13 SION INITIATIVE. 

14 Section 1672B of the Food, Agriculture, Conserva15 tion, and Trade Act of 1990 (7 U.S.C. 5925b) is amend16 ed— 

17 (1) in subsection (a)— 

18 (A) in the matter preceding paragraph (1), 

19 by inserting ‘‘, education,’’ after ‘‘support re20 search’’; 

21 (B) in paragraph (1), by inserting ‘‘and 

22 improvement’’ after ‘‘development’’; 

23 (C) in paragraph (2), by striking ‘‘to pro24 ducers and processors who use organic meth25 ods’’ and inserting ‘‘of organic agricultural proVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00813 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 duction and methods to producers, processors, 

2 and rural communities’’; 

3 (D) in paragraph (5), by inserting ‘‘and 

4 researching solutions to’’ after ‘‘identifying’’; 

5 and 

6 (E) in paragraph (6), by striking ‘‘and 

7 marketing’’ and inserting ‘‘, marketing, and 

8 food safety’’; 

9 (2) by striking subsection (e); 

10 (3) by redesignating subsection (f) as sub11 section (e); and 

12 (4) in subsection (e) (as so redesignated)— 

13 (A) in paragraph (1)— 

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

15 ‘‘and’’ at the end; 

16 (ii) in subparagraph (B), by striking 

17 the period at the end and inserting ‘‘; 

18 and’’; and 

19 (iii) by adding at the end the fol20 lowing: 

21 ‘‘(C) $16,000,000 for each of fiscal years 

22 2013 through 2017.’’; and 

23 (B) in paragraph (2), by striking ‘‘2012’’ 

24 and inserting ‘‘2017’’. 


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1 SEC. 7209. FARM BUSINESS MANAGEMENT. 

2 Section 1672D(d) of the Food, Agriculture, Con3 servation, and Trade Act of 1990 (7 U.S.C. 5925f(d)) is 

4 amended by striking ‘‘such sums as are necessary to carry 

5 out this section.’’ and inserting the following: ‘‘to carry 

6 out this section— 

7 ‘‘(1) such sums as are necessary for fiscal year 

8 2012; and 

9 ‘‘(2) $5,000,000 for each of fiscal years 2013 

10 through 2017.’’. 

11 SEC. 7210. REGIONAL CENTERS OF EXCELLENCE. 

12 Subtitle H of the Food, Agriculture, Conservation, 

13 and Trade Act of 1990 is amended by inserting after sec14 tion 1672D (7 U.S.C. 5925) the following: 

15 ‘‘SEC. 1673. REGIONAL CENTERS OF EXCELLENCE. 

16 ‘‘(a) ESTABLISHMENT.—The Secretary may 

17 prioritize regional centers of excellence established for spe18 cific agricultural commodities for the receipt of funding. 

19 ‘‘(b) COMPOSITION.—A regional center of excellence 

20 shall be composed of 1 or more colleges and universities 

21 (including land-grant institutions, schools of forestry, 

22 schools of veterinary medicine, or NLGCA Institutions (as 

23 defined in section 1404 of the National Agricultural Re24 search, Extension, and Teaching Policy Act of 1977 (7 

25 U.S.C. 3103))) that provide financial support to the re26 gional center of excellence. 


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1 ‘‘(c) CRITERIA FOR REGIONAL CENTERS OF EXCEL2 LENCE.—The criteria for consideration to be a regional 

3 center of excellence shall include efforts— 

4 ‘‘(1) to ensure coordination and cost-effective5 ness by reducing unnecessarily duplicative efforts re6 garding research, teaching, and extension; 

7 ‘‘(2) to leverage available resources by using 

8 public/private partnerships among agricultural in9 dustry groups, institutions of higher education, and 

10 the Federal Government; 

11 ‘‘(3) to implement teaching initiatives to in12 crease awareness and effectively disseminate solu13 tions to target audiences through extension activi14 ties; 

15 ‘‘(4) to increase the economic returns to rural 

16 communities by identifying, attracting, and directing 

17 funds to high-priority agricultural issues; and 

18 ‘‘(5) to improve teaching capacity and infra19 structure at colleges and universities (including land20 grant institutions, schools of forestry, and schools of 

21 veterinary medicine, and NLGCA Institutions). 

22 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 

23 is authorized to be appropriated to carry out this section 

24 $10,000,000 for each of fiscal years 2013 through 2017.’’. 


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1 SEC. 7211. ASSISTIVE TECHNOLOGY PROGRAM FOR FARM2 ERS WITH DISABILITIES. 

3 Section 1680(c)(1) of the Food, Agriculture, Con4 servation, and Trade Act of 1990 (7 U.S.C. 5933(c)(1)) 

5 is amended— 

6 (1) by striking ‘‘is’’ and inserting ‘‘are’’; and 

7 (2) by striking ‘‘section’’ and all that follows 

8 and inserting the following: ‘‘section— 

9 ‘‘(A) $6,000,000 for each of fiscal years 

10 1999 through 2012; and 

11 ‘‘(B) $5,000,000 for each of fiscal years 

12 2013 through 2017.’’. 

13 SEC. 7212. NATIONAL RURAL INFORMATION CENTER 

14 CLEARINGHOUSE. 

15 Section 2381(e) of the Food, Agriculture, Conserva16 tion, and Trade Act of 1990 (7 U.S.C. 3125b(e)) is 

17 amended by striking ‘‘2012’’ and inserting ‘‘2017’’. 

18 Subtitle C—Agricultural Research, 

19 Extension, and Education Re20 form Act of 1998 

21 SEC. 7301. RELEVANCE AND MERIT OF AGRICULTURAL RE22 SEARCH, EXTENSION, AND EDUCATION FUND23 ED BY THE DEPARTMENT. 

24 Section 103(a)(2) of the Agricultural Research, Ex25 tension, and Education Reform Act of 1998 (7 U.S.C. 

26 7613(a)(2)) is amended— 


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1 (1) by striking the paragraph designation and 

2 heading and inserting the following: 

3 ‘‘(2) RELEVANCE AND MERIT REVIEW OF RE4 SEARCH, EXTENSION, AND EDUCATION GRANTS.—’’; 

5 (2) in subparagraph (A)— 

6 (A) by inserting ‘‘relevance and’’ before 

7 ‘‘merit’’; and 

8 (B) by striking ‘‘extension or education’’ 

9 and inserting, ‘‘research, extension, or edu10 cation’’; and 

11 (3) in subparagraph (B) by inserting ‘‘on a con12 tinuous basis’’ after ‘‘procedures’’. 

13 SEC. 7302. INTEGRATED RESEARCH, EDUCATION, AND EX14 TENSION COMPETITIVE GRANTS PROGRAM. 

15 Section 406(f) of the Agricultural Research, Exten16 sion, and Education Reform Act of 1998 (7 U.S.C. 

17 7626(f)) is amended by striking ‘‘2012’’ and inserting 

18 ‘‘2017’’. 

19 SEC. 7303. SUPPORT FOR RESEARCH REGARDING DISEASES 

20 OF WHEAT, TRITICALE, AND BARLEY CAUSED 

21 BY FUSARIUM GRAMINEARUM OR BY 

22 TILLETIA INDICA. 

23 Section 408(e) of the Agricultural Research, Exten24 sion, and Education Reform Act of 1998 (7 U.S.C. 

25 7628(e)) is amended by striking ‘‘such sums as may be 


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1 necessary for each of fiscal years 1999 through 2012’’ and 

2 inserting ‘‘$10,000,000 for each of fiscal years 2013 

3 through 2017’’. 

4 SEC. 7304. GRANTS FOR YOUTH ORGANIZATIONS. 

5 Section 410(d) of the Agricultural Research, Exten6 sion, and Education Reform Act of 1998 (7 U.S.C. 

7 7630(d)) is amended by striking ‘‘section such sums as 

8 are necessary’’ and all that follows and inserting the fol9 lowing: ‘‘section— 

10 ‘‘(1) such sums as are necessary for each of fis11 cal years 2008 through 2012; and 

12 ‘‘(2) $3,000,000 for each of fiscal years 2013 

13 through 2017.’’. 

14 SEC. 7305. SPECIALTY CROP RESEARCH INITIATIVE. 

15 Section 412 of the Agricultural Research, Extension, 

16 and Education Reform Act of 1998 (7 U.S.C. 7632) is 

17 amended— 

18 (1) in subsection (b)(3), by inserting ‘‘handling 

19 and processing,’’ after ‘‘production efficiency,’’; 

20 (2) in subsection (e)— 

21 (A) in paragraph (1)— 

22 (i) in subparagraph (B), by striking 

23 ‘‘and’’ at the end; 


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1 (ii) in subparagraph (C), by striking 

2 the period at the end and inserting ‘‘; 

3 and’’; and 

4 (iii) by inserting after subparagraph 

5 (C) the following: 

6 ‘‘(D) consult with the specialty crops com7 mittee authorized under section 1408A of the 

8 National Agricultural Research, Extension, and 

9 Teaching Policy Act of 1977 (7 U.S.C. 3123a) 

10 during the peer and merit review process.’’; and 

11 (B) in paragraph (3), by striking ‘‘non12 Federal’’ and all that follows through the end 

13 of the paragraph and inserting ‘‘other sources 

14 in an amount that is at least equal to the 

15 amount provided by a grant received under this 

16 section.’’; and 

17 (3) in subsection (h)— 

18 (A) in paragraph (1)— 

19 (i) by striking ‘‘(1) IN GENERAL.—Of 

20 the funds’’ and inserting the following: 

21 ‘‘(1) MANDATORY FUNDING.— 

22 ‘‘(A) IN GENERAL.—Of the funds’’; and 

23 (ii) by adding at the end the fol24 lowing: 


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1 ‘‘(B) SUBSEQUENT FUNDING.—Of the 

2 funds of the Commodity Credit Corporation, the 

3 Secretary shall make available to carry out this 

4 section— 

5 ‘‘(i) $25,000,000 for fiscal year 2013; 

6 ‘‘(ii) $30,000,000 for each of fiscal 

7 years 2014 and 2015; 

8 ‘‘(iii) $65,000,000 for fiscal year 

9 2016; and 

10 ‘‘(iv) $50,000,000 for fiscal year 2017 

11 and each fiscal year thereafter.’’; and 

12 (B) in paragraph (2), by striking ‘‘2012’’ 

13 and inserting ‘‘2017’’. 

14 SEC. 7306. FOOD ANIMAL RESIDUE AVOIDANCE DATABASE 

15 PROGRAM. 

16 Section 604(e) of the Agricultural Research, Exten17 sion, and Education Reform Act of 1998 (7 U.S.C. 

18 7642(e)) is amended by striking ‘‘2012’’ and inserting 

19 ‘‘2017’’. 

20 SEC. 7307. OFFICE OF PEST MANAGEMENT POLICY. 

21 Section 614(f) of the Agricultural Research, Exten22 sion, and Education Reform Act of 1998 (7 U.S.C. 

23 7653(f)) is amended— 

24 (1) by striking ‘‘such sums as are necessary’’; 

25 and 


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1 (2) by striking ‘‘section’’ and all that follows 

2 and inserting the following: ‘‘section— 

3 ‘‘(1) such sums as are necessary for each of fis4 cal years 1999 through 2012; and 

5 ‘‘(2) $3,000,000 for each of fiscal years 2013 

6 through 2017.’’. 

7 SEC. 7308. AUTHORIZATION OF REGIONAL INTEGRATED 

8 PEST MANAGEMENT CENTERS. 

9 Subtitle B of title VI of the Agricultural Research, 

10 Extension, and Education Reform Act of 1998 (7 U.S.C. 

11 7651 et seq.) is amended by adding at the end the fol12 lowing: 

13 ‘‘SEC. 621. AUTHORIZATION OF REGIONAL INTEGRATED 

14 PEST MANAGEMENT CENTERS. 

15 ‘‘(a) IN GENERAL.—There are established 4 regional 

16 integrated pest management centers (referred to in this 

17 section as the ‘Centers’), which shall be located at such 

18 specific locations in the north central, northeastern, south19 ern, and western regions of the United States as the Sec20 retary shall specify. 

21 ‘‘(b) PURPOSES.—The purposes of the Centers shall 

22 be— 

23 ‘‘(1) to strengthen the connection of the De24 partment with production agriculture, research, and 


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1 extension programs, and agricultural stakeholders 

2 throughout the United States; 

3 ‘‘(2) to increase the effectiveness of providing 

4 pest management solutions for the private and pub5 lic sectors; 

6 ‘‘(3) to quickly respond to information needs of 

7 the public and private sectors; and 

8 ‘‘(4) to improve communication among the rel9 evant stakeholders. 

10 ‘‘(c) DUTIES.—In meeting the purposes described in 

11 subsection (b) and otherwise carrying out this section, the 

12 Centers shall— 

13 ‘‘(1) develop regional strategies to address pest 

14 management needs; 

15 ‘‘(2) assist the Department and partner institu16 tions of the Department in identifying, prioritizing, 

17 and coordinating a national pest management re18 search, extension, and education program imple19 mented on a regional basis; 

20 ‘‘(3) establish a national pest management com21 munication network that includes— 

22 ‘‘(A) the agencies of the Department and 

23 other government agencies; 

24 ‘‘(B) scientists at institutions of higher 

25 education; and 


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1 ‘‘(C) stakeholders focusing on pest man2 agement issues; 

3 ‘‘(4) serve as regional hubs responsible for en4 suring efficient access to pest management expertise 

5 and data available through institutions of higher 

6 education; and 

7 ‘‘(5) on behalf of the Department, manage 

8 grants that can be most effectively and efficiently 

9 delivered at the regional level, as determined by the 

10 Secretary.’’. 

11 Subtitle D—Other Laws 

12 SEC. 7401. CRITICAL AGRICULTURAL MATERIALS ACT. 

13 Section 16(a) of the Critical Agricultural Materials 

14 Act (7 U.S.C. 178n(a)) is amended— 

15 (1) by striking ‘‘such sums as are necessary’’; 

16 and 

17 (2) by striking ‘‘Act’’ and all that follows and 

18 inserting the following: ‘‘Act— 

19 ‘‘(1) such sums as are necessary for each of fis20 cal years 1991 through 2012; and 

21 ‘‘(2) $2,000,000 for each of fiscal years 2013 

22 through 2017.’’. 


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1 SEC. 7402. EQUITY IN EDUCATIONAL LAND-GRANT STATUS 

2 ACT OF 1994. 

3 (a) DEFINITION OF 1994 INSTITUTIONS.—Section 

4 532 of the Equity in Educational Land-Grant Status Act 

5 of 1994 (7 U.S.C. 301 note; Public Law 103–382) is 

6 amended to read as follows: 

7 ‘‘SEC. 532. DEFINITION OF 1994 INSTITUTIONS. 

8 ‘‘In this part, the term ‘1994 Institutions’ means any 

9 1 of the following: 

10 ‘‘(1) Aaniiih Nakoda College. 

11 ‘‘(2) Bay Mills Community College. 

12 ‘‘(3) Blackfeet Community College. 

13 ‘‘(4) Cankdeska Cikana Community College. 

14 ‘‘(5) Chief Dull Knife Memorial College. 

15 ‘‘(6) College of Menominee Nation. 

16 ‘‘(7) College of the Muscogee Nation. 

17 ‘‘(8) Comanche Nation College. 

18 ‘‘(9) D-Q University. 

19 ‘‘(10) Dine College. 

20 ‘‘(11) Fond du Lac Tribal and Community Col21 lege. 

22 ‘‘(12) Fort Berthold Community College. 

23 ‘‘(13) Fort Peck Community College. 

24 ‘‘(14) Haskell Indian Nations University. 

25 ‘‘(15) Ilisagvik College. 


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1 ‘‘(16) Institute of American Indian and Alaska 

2 Native Culture and Arts Development. 

3 ‘‘(17) Keweenaw Bay Ojibwa Community Col4 lege. 

5 ‘‘(18) Lac Courte Oreilles Ojibwa Community 

6 College. 

7 ‘‘(19) Leech Lake Tribal College. 

8 ‘‘(20) Little Big Horn College. 

9 ‘‘(21) Little Priest Tribal College. 

10 ‘‘(22) Navajo Technical College. 

11 ‘‘(23) Nebraska Indian Community College. 

12 ‘‘(24) Northwest Indian College. 

13 ‘‘(25) Oglala Lakota College. 

14 ‘‘(26) Saginaw Chippewa Tribal College. 

15 ‘‘(27) Salish Kootenai College. 

16 ‘‘(28) Sinte Gleska University. 

17 ‘‘(29) Sisseton Wahpeton College. 

18 ‘‘(30) Sitting Bull College. 

19 ‘‘(31) Southwestern Indian Polytechnic Insti20 tute. 

21 ‘‘(32) Stone Child College. 

22 ‘‘(33) Tohono O’odham Community College. 

23 ‘‘(34) Turtle Mountain Community College. 

24 ‘‘(35) United Tribes Technical College. 


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1 ‘‘(36) White Earth Tribal and Community Col2 lege.’’. 

3 (b) ENDOWMENT FOR 1994 INSTITUTIONS.— 

4 (1) IN GENERAL.—Section 533 of the Equity in 

5 Educational Land-Grant Status Act of 1994 (7 

6 U.S.C. 301 note; Public Law 103–382) is amend7 ed— 

8 (A) in subsection (a)(2)(A)(ii), by striking 

9 ‘‘of such Act as added by section 534(b)(1) of 

10 this part’’ and inserting ‘‘of that Act (7 U.S.C. 

11 343(b)(3)) and for programs for children, 

12 youth, and families at risk and for Federally 

13 recognized tribes implemented under section 

14 3(d) of that Act (7 U.S.C. 343(d))’’; and 

15 (B) in subsection (b), in the first sentence 

16 by striking ‘‘2012’’ and inserting ‘‘2017’’. 

17 (2) CONFORMING AMENDMENT.—Section 3(d) 

18 of the Smith-Lever Act (7 U.S.C. 343(d)) is amend19 ed in the second sentence by inserting ‘‘and, in the 

20 case of programs for children, youth, and families at 

21 risk and for Federally recognized tribes, the 1994 

22 Institutions (as defined in section 532 of the Equity 

23 in Educational Land-Grant Status Act of 1994 (7 

24 U.S.C. 301 note; Public Law 103–382)),’’ before 

25 ‘‘may compete for’’. 


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1 (c) INSTITUTIONAL CAPACITY BUILDING GRANTS.— 

2 Section 535 of the Equity in Educational Land-Grant Sta3 tus Act of 1994 (7 U.S.C. 301 note; Public Law 103– 

4 382) is amended by striking ‘‘2012’’ each place it appears 

5 in subsections (b)(1) and (c) and inserting ‘‘2017’’. 

6 (d) RESEARCH GRANTS.—— 

7 (1) AUTHORIZATION OF APPROPRIATIONS.— 

8 Section 536(c) of the Equity in Educational Land9 Grant Status Act of 1994 (7 U.S.C. 301 note; Pub10 lic Law 103–382) is amended in the first sentence 

11 by striking ‘‘2012’’ and inserting ‘‘2017’’. 

12 (2) RESEARCH GRANT REQUIREMENTS.—Sec13 tion 536(b) of the Equity in Educational Land14 Grant Status Act of 1994 (7 U.S.C. 301 note; Pub15 lic Law 103–382) is amended by striking ‘‘with at 

16 least 1 other land-grant college or university’’ and 

17 all that follows and inserting the following: ‘‘with— 

18 ‘‘ 

19 ‘‘(1) the Agricultural Research Service of the 

20 Department of Agriculture; or 

21 ‘‘(2) at least 1— 

22 ‘‘(A) other land-grant college or university 

23 (exclusive of another 1994 Institution); 

24 ‘‘(B) non-land-grant college of agriculture 

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1 ricultural Research, Extension, and Teaching 

2 Policy Act of 1977 (7 U.S.C. 3103)); or 

3 ‘‘(C) cooperating forestry school (as de4 fined in that section).’’. 

5 (e) EFFECTIVE DATE.—The amendments made by 

6 subsections (a), (b), and (d)(2) take effect on October 1, 

7 2012. 

8 SEC. 7403. RESEARCH FACILITIES ACT. 

9 Section 6(a) of the Research Facilities Act (7 U.S.C. 

10 390d(a)) is amended by striking ‘‘2012’’ and inserting 

11 ‘‘2017’’. 

12 SEC. 7404. COMPETITIVE, SPECIAL, AND FACILITIES RE13 SEARCH GRANT ACT. 

14 Section 2 of the Competitive, Special, and Facilities 

15 Research Grant Act (7 U.S.C. 450i) is amended— 

16 (1) in subsection (b)(11)(A), in the matter pre17 ceding clause (i), by striking ‘‘2012’’ and inserting 

18 ‘‘2017’’; and 

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

20 ‘‘(l) STREAMLINING GRANT APPLICATION PROC21 ESS.—Not later than 1 year after the date of enactment 

22 of this subsection, the Secretary shall submit to Congress 

23 a report that includes— 

24 ‘‘(1) an analysis of barriers that exist in the 

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1 tional Institute of Food and Agriculture that prevent 

2 eligible institutions and organizations with limited 

3 institutional capacity from successfully applying and 

4 competing for competitive grants; and 

5 ‘‘(2) specific recommendations for future steps 

6 that the Department can take to streamline the 

7 competitive grants application process so as to re8 move the barriers and increase the success rates of 

9 applicants described in paragraph (1).’’. 

10 SEC. 7405. ENHANCED USE LEASE AUTHORITY PILOT PRO11 GRAM UNDER DEPARTMENT OF AGRI12 CULTURE REORGANIZATION ACT OF 1994. 

13 Section 308(b)(6) of the Department of Agriculture 

14 Reorganization Act of 1994 (7 U.S.C. 3125a note; Public 

15 Law 103–354) is amended by striking subparagraph (A) 

16 and inserting the following: 

17 ‘‘(A) on September 30, 2017; or’’. 

18 SEC. 7406. RENEWABLE RESOURCES EXTENSION ACT OF 

19 1978. 

20 (a) AUTHORIZATION OF APPROPRIATIONS.—Section 

21 6 of the Renewable Resources Extension Act of 1978 (16 

22 U.S.C. 1675) is amended in the first sentence by striking 

23 ‘‘2012’’ and inserting ‘‘2017’’. 

24 (b) TERMINATION DATE.—Section 8 of the Renew25 able Resources Extension Act of 1978 (16 U.S.C. 1671 


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1 note; Public Law 95–306) is amended by striking ‘‘2012’’ 

2 and inserting ‘‘2017’’. 

3 SEC. 7407. NATIONAL AQUACULTURE ACT OF 1980. 

4 Section 10 of the National Aquaculture Act of 1980 

5 (16 U.S.C. 2809) is amended by striking ‘‘2012’’ each 

6 place it appears and inserting ‘‘2017’’. 

7 SEC. 7408. BEGINNING FARMER AND RANCHER DEVELOP8 MENT PROGRAM UNDER FARM SECURITY 

9 AND RURAL INVESTMENT ACT OF 2002. 

10 Section 7405 of the Farm Security and Rural Invest11 ment Act of 2002 (7 U.S.C. 3319f) is amended— 

12 (1) in subsection (c)(8)— 

13 (A) in subparagraph (B), by striking 

14 ‘‘and’’ at the end; 

15 (B) in subparagraph (C), by striking the 

16 period at the end and inserting ‘‘; and’’; and 

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

18 ‘‘(D) beginning farmers and ranchers who 

19 are veterans (as defined in section 101 of title 

20 38, United States Code).’’; and 

21 (2) in subsection (h)— 

22 (A) in paragraph (1)— 

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

24 ‘‘and’’ at the end; 


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1 (ii) in subparagraph (B), by striking 

2 the period at the end and inserting ‘‘; 

3 and’’; and 

4 (iii) by adding at the end the fol5 lowing: 

6 ‘‘(C) $50,000,000 for fiscal year 2013, to 

7 remain available until expended.’’; and 

8 (B) in paragraph (2), by striking ‘‘2012’’ 

9 and inserting ‘‘2017’’. 

10 Subtitle E—Food, Conservation, 

11 and Energy Act of 2008 

12 PART I—AGRICULTURAL SECURITY 

13 SEC. 7501. AGRICULTURAL BIOSECURITY COMMUNICATION 

14 CENTER. 

15 Section 14112 of the Food, Conservation, and En16 ergy Act of 2008 (7 U.S.C. 8912) is amended by striking 

17 subsection (c) and inserting the following: 

18 ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There 

19 are authorized to be appropriated to carry out this sec20 tion— 

21 ‘‘(1) such sums as are necessary for each of fis22 cal years 2008 through 2012; and 

23 ‘‘(2) $2,000,000 for each of fiscal years 2013 

24 through 2017.’’. 


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1 SEC. 7502. ASSISTANCE TO BUILD LOCAL CAPACITY IN AG2 RICULTURAL BIOSECURITY PLANNING, PREP3 ARATION, AND RESPONSE. 

4 Section 14113 of the Food, Conservation, and En5 ergy Act of 2008 (7 U.S.C. 8913) is amended— 

6 (1) in subsection (a)(2)— 

7 (A) by striking ‘‘such sums as may be nec8 essary’’; and 

9 (B) by striking ‘‘subsection’’ and all that 

10 follows and inserting the following: ‘‘sub11 section— 

12 ‘‘(1) such sums as are necessary for each of fis13 cal years 2008 through 2012; and 

14 ‘‘(2) $15,000,000 for each of fiscal years 2013 

15 through 2017.’’; and 

16 (2) in subsection (b)(2), by striking ‘‘is author17 ized to be appropriated to carry out this subsection’’ 

18 and all that follows and inserting the following: ‘‘are 

19 authorized to be appropriated to carry out this sub20 section— 

21 ‘‘(1) $25,000,000 for each of fiscal years 2008 

22 through 2012; and 

23 ‘‘(2) $15,000,000 for each of fiscal years 2013 

24 through 2017.’’. 


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1 SEC. 7503. RESEARCH AND DEVELOPMENT OF AGRICUL2 TURAL COUNTERMEASURES. 

3 Section 14121(b) of the Food, Conservation, and En4 ergy Act of 2008 (7 U.S.C. 8921(b)) is amended by strik5 ing ‘‘is authorized to be appropriated to carry out this sec6 tion’’ and all that follows and inserting the following: ‘‘are 

7 authorized to be appropriated to carry out this section— 

8 ‘‘(1) $50,000,000 for each of fiscal years 2008 

9 through 2012; and 

10 ‘‘(2) $15,000,000 for each of fiscal years 2013 

11 through 2017.’’. 

12 SEC. 7504. AGRICULTURAL BIOSECURITY GRANT PROGRAM. 

13 Section 14122(e) of the Food, Conservation, and En14 ergy Act of 2008 (7 U.S.C. 8922(e)) is amended— 

15 (1) by striking ‘‘such sums as are necessary’’; 

16 and 

17 (2) by striking ‘‘section’’ and all that follows 

18 and inserting the following: ‘‘section— 

19 ‘‘(1) such sums as are necessary for each of fis20 cal years 2008 through 2012, to remain available 

21 until expended; and 

22 ‘‘(2) $5,000,000 for each of fiscal years 2013 

23 through 2017, to remain available until expended.’’. 


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1 PART II—MISCELLANEOUS 

2 SEC. 7511. GRAZINGLANDS RESEARCH LABORATORY. 

3 Section 7502 of the Food, Conservation, and Energy 

4 Act of 2008 (Public Law 110–246; 112 Stat. 2019) is 

5 amended by striking ‘‘for the 5-year period beginning on 

6 the date of enactment of this Act’’ and inserting ‘‘until 

7 September 30, 2017’’. 

8 SEC. 7512. BUDGET SUBMISSION AND FUNDING. 

9 Section 7506 of the Food, Conservation, and Energy 

10 Act of 2008 (7 U.S.C. 7614c) is amended— 

11 (1) in subsection (a)— 

12 (A) by striking ‘‘(a) DEFINITION OF COM13 PETITIVE PROGRAMS.—In this section, the 

14 term’’; and inserting the following: 

15 ‘‘(a) DEFINITIONS.—In this section: 

16 ‘‘(1) COMPETITIVE PROGRAMS.—The term’’; 

17 and 

18 (B) by adding at the end the following: 

19 ‘‘(2) COVERED PROGRAM.—The term ‘covered 

20 program’ means— 

21 ‘‘(A) each research program carried out by 

22 the Agricultural Research Service or the Eco23 nomic Research Service for which annual appro24 priations are requested in the annual budget 

25 submission of the President; and 


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1 ‘‘(B) each competitive program (as defined 

2 in section 251(f)(1) of the Department of Agri3 culture Reorganization Act of 1994 (7 U.S.C. 

4 6971(f)(1))) carried out by the National Insti5 tute of Food and Agriculture for which annual 

6 appropriations are requested in the annual 

7 budget submission of the President. 

8 ‘‘(3) REQUEST FOR AWARDS.—The term ‘re9 quest for awards’ means a funding announcement 

10 published by the National Institute of Food and Ag11 riculture that provides detailed information on fund12 ing opportunities at the Institute, including the pur13 pose, eligibility, restriction, focus areas, evaluation 

14 criteria, regulatory information, and instructions on 

15 how to apply for such opportunities.’’; and 

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

17 ‘‘(e) ADDITIONAL PRESIDENTIAL BUDGET SUBMIS18 SION REQUIREMENT.— 

19 ‘‘(1) IN GENERAL.—Each year, the President 

20 shall submit to Congress, together with the annual 

21 budget submission of the President, the information 

22 described in paragraph (2) for each funding request 

23 for a covered program. 

24 ‘‘(2) INFORMATION DESCRIBED.—The informa25 tion described in this paragraph includes— 


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1 ‘‘(A) baseline information, including with 

2 respect to each covered program— 

3 ‘‘(i) the funding level for the program 

4 for the fiscal year preceding the year the 

5 annual budget submission of the President 

6 is submitted; 

7 ‘‘(ii) the funding level requested in the 

8 annual budget submission of the President, 

9 including any increase or decrease in the 

10 funding level; and 

11 ‘‘(iii) an explanation justifying any 

12 change from the funding level specified in 

13 clause (i) to the level specified in clause 

14 (ii); 

15 ‘‘(B) with respect to each covered program 

16 that is carried out by the Economic Research 

17 Service or the Agricultural Research Service, 

18 the location and staff years of the program; 

19 ‘‘(C) the proposed funding levels to be allo20 cated to, and the expected publication date, 

21 scope, and allocation level for, each request for 

22 awards to be published under— 

23 ‘‘(i) each priority area specified in sec24 tion 2(b)(2) of the Competitive, Special, 


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1 and Facilities Research Grant Act (7 

2 U.S.C. 450i(b)(2)); 

3 ‘‘(ii) each research and extension 

4 project carried out under section 1621(a) 

5 of the Food, Agriculture, Conservation, 

6 and Trade Act of 1990 (7 U.S.C. 

7 5811(a)); 

8 ‘‘(iii) each grant awarded under sec9 tion 1672B(a) of the Food, Agriculture, 

10 Conservation, and Trade Act of 1990 (7 

11 U.S.C. 5925b(a)); 

12 ‘‘(iv) each grant awarded under sec13 tion 412(b) of the Agricultural Research, 

14 Extension, and Education Reform Act of 

15 1998 (7 U.S.C. 7632(b)); and 

16 ‘‘(v) each grant awarded under 

17 7405(c)(1) of the Farm Security and 

18 Rural Investment Act of 2002 (7 U.S.C. 

19 3319f(c)(1)); or 

20 ‘‘(D) any other information the Secretary 

21 determines will increase congressional oversight 

22 with respect to covered programs. 

23 ‘‘(3) PROHIBITION.—Unless the President sub24 mits the information described in paragraph (2)(C) 

25 for a fiscal year, the President may not carry out 


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1 any program during the fiscal year that is author2 ized under— 

3 ‘‘(A) section 2(b) of the Competitive, Spe4 cial, and Facilities Research Grant Act (7 

5 U.S.C. 450i(b)); 

6 ‘‘(B) section 1621 of the Food, Agri7 culture, Conservation, and Trade Act of 1990 

8 (7 U.S.C. 5811); 

9 ‘‘(C) section 1672B of the Food, Agri10 culture, Conservation, and Trade Act of 1990 

11 (7 U.S.C. 5925b); 

12 ‘‘(D) section 411 of the Agricultural Re13 search, Extension, and Education Reform Act 

14 of 1998 (7 U.S.C. 7631); or 

15 ‘‘(E) section 7405 of the Farm Security 

16 and Rural Investment Act of 2002 (7 U.S.C. 

17 3319f). 

18 ‘‘(f) REPORT OF THE SECRETARY OF AGRI19 CULTURE.—Each year on a date that is not later than 

20 the date on which the President submits the annual budg21 et submission, the Secretary shall submit to Congress a 

22 report containing a description of the agricultural re23 search, extension, and education activities carried out by 

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1 diately precedes the year for which the report is submitted, 

2 including— 

3 ‘‘(1) a review of the extent to which those ac4 tivities— 

5 ‘‘(A) are duplicative or overlap within the 

6 Department of Agriculture; or 

7 ‘‘(B) are similar to activities carried out 

8 by— 

9 ‘‘(i) other Federal agencies; 

10 ‘‘(ii) the States (including the District 

11 of Columbia, the Commonwealth of Puerto 

12 Rico and other territories or possessions of 

13 the United States); 

14 ‘‘(iii) institutions of higher education 

15 (as defined in section 101 of the Higher 

16 Education Act of 1965 (20 U.S.C. 1001)); 

17 or 

18 ‘‘(iv) the private sector; and 

19 ‘‘(2) for each report submitted under this sec20 tion on or after January 1, 2013, a 5-year projection 

21 of national priorities with respect to agricultural re22 search, extension, and education, taking into account 

23 both domestic and international needs.’’. 


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1 SEC. 7513. NATURAL PRODUCTS RESEARCH PROGRAM. 

2 Section 7525 of the Food, Conservation, and Energy 

3 Act of 2008 (7 U.S.C. 5937) is amended by striking sub4 section (e) and inserting the following: 

5 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There 

6 is authorized to be appropriated to carry out this section 

7 $7,000,000 for each of fiscal years 2013 through 2017.’’. 

8 SEC. 7514. SUN GRANT PROGRAM. 

9 (a) IN GENERAL.—Section 7526 of the Food, Con10 servation, and Energy Act of 2008 (7 U.S.C. 8114) is 

11 amended— 

12 (1) in subsection (a)(4)(B), by striking ‘‘the 

13 Department of Energy’’ and inserting ‘‘other appro14 priate Federal agencies (as determined by the Sec15 retary)’’; 

16 (2) in subsection (b)(1)— 

17 (A) in subparagraph (A), by striking ‘‘at 

18 South Dakota State University’’; 

19 (B) in subparagraph (B), by striking ‘‘at 

20 the University of Tennessee at Knoxville’’; 

21 (C) in subparagraph (C), by striking ‘‘at 

22 Oklahoma State University’’; 

23 (D) in subparagraph (D), by striking ‘‘at 

24 Oregon State University’’; 

25 (E) in subparagraph (E), by striking ‘‘at 

26 Cornell University’’; and 


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1 (F) in subparagraph (F), by striking ‘‘at 

2 the University of Hawaii’’; 

3 (3) in subsection (c)(1)— 

4 (A) in subparagraph (B), by striking 

5 ‘‘multistate’’ and all that follows through ‘‘tech6 nology implementation’’ and inserting ‘‘inte7 grated, multistate research, extension, and edu8 cation programs on technology development and 

9 technology implementation’’; 

10 (B) by striking subparagraph (C); and 

11 (C) by redesignating subparagraph (D) as 

12 subparagraph (C); 

13 (4) in subsection (d)— 

14 (A) in paragraph (1)— 

15 (i) by striking ‘‘gasification’’ and in16 serting ‘‘bioproducts’’; and 

17 (ii) by striking ‘‘the Department of 

18 Energy’’ and inserting ‘‘other appropriate 

19 Federal agencies’’; 

20 (B) by striking paragraph (2); 

21 (C) by redesignating paragraphs (3) and 

22 (4) as paragraphs (2) and (3), respectively; and 

23 (D) in paragraph (1), by striking ‘‘in ac24 cordance with paragraph (2)’’; and 


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1 (5) in subsection (g), by striking ‘‘2012’’ and 

2 inserting ‘‘2017’’. 

3 (b) CONFORMING AMENDMENTS.—Section 7526(f) of 

4 the Food, Conservation, and Energy Act of 2008 (7 

5 U.S.C. 8114(f)) is amended— 

6 (1) in paragraph (1), by striking ‘‘subsection 

7 (c)(1)(D)(i)’’ and inserting ‘‘subsection (c)(1)(C)(i)’’; 

8 and 

9 (2) in paragraph (2), by striking ‘‘subsection 

10 (d)(1)’’ and inserting ‘‘subsection (d)’’. 

11 Subtitle F—Miscellaneous 

12 SEC. 7601. FOUNDATION FOR FOOD AND AGRICULTURE RE13 SEARCH. 

14 (a) DEFINITIONS.—In this section: 

15 (1) BOARD.—The term ‘‘Board’’ means the 

16 Board of Directors described in subsection (e). 

17 (2) DEPARTMENT.—The term ‘‘Department’’ 

18 means the Department of Agriculture. 

19 (3) FOUNDATION.—The term ‘‘Foundation’’ 

20 means the Foundation for Food and Agriculture Re21 search established under subsection (b). 

22 (4) SECRETARY.—The term ‘‘Secretary’’ means 

23 the Secretary of Agriculture. 

24 (b) ESTABLISHMENT.— 


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1 (1) IN GENERAL.—The Secretary shall establish 

2 a nonprofit corporation to be known as the ‘‘Foun3 dation for Food and Agriculture Research’’. 

4 (2) STATUS.— 

5 (A) TAX-EXEMPT STATUS.—The Founda6 tion shall be considered to be an entity de7 scribed in section 501(c)(3) of the Internal Rev8 enue Code of 1986 and exempt from taxation 

9 under section 501(a) of such Code. 

10 (B) LIMITATION.—The Foundation shall 

11 not be an agency or instrumentality of the 

12 United States Government. 

13 (c) PURPOSES.—The purposes of the Foundation 

14 shall be— 

15 (1) to advance the research mission of the De16 partment by supporting agricultural research activi17 ties focused on addressing key problems of national 

18 and international significance including— 

19 (A) plant health, production, and plant 

20 products; 

21 (B) animal health, production, and prod22 ucts; 

23 (C) food safety, nutrition, and health; 

24 (D) renewable energy, natural resources, 

25 and the environment; 


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1 (E) agricultural and food security; 

2 (F) agriculture systems and technology; 

3 and 

4 (G) agriculture economics and rural com5 munities; and 

6 (2) to foster collaboration with agricultural re7 searchers from the Federal Government, institutions 

8 of higher education, industry, and nonprofit organi9 zations. 

10 (d) DUTIES.— 

11 (1) IN GENERAL.—The Foundation shall— 

12 (A) award grants to, or enter into con13 tracts, memoranda of understanding, or cooper14 ative agreements with, scientists and entities, 

15 which may include agricultural research agen16 cies in the Department, university consortia, 

17 public-private partnerships, institutions of high18 er education, nonprofit organizations, and in19 dustry, to efficiently and effectively advance the 

20 goals and priorities of the Foundation; 

21 (B) in consultation with the Secretary— 

22 (i) identify existing and proposed Fed23 eral intramural and extramural research 

24 and development programs relating to the 


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1 purposes of the Foundation described in 

2 subsection (c); and 

3 (ii) coordinate Foundation activities 

4 with those programs so as to minimize du5 plication of existing efforts; 

6 (C) identify unmet and emerging agricul7 tural research needs after reviewing the Road8 map for Agricultural Research, Education and 

9 Extension as required by section 7504 of the 

10 Food, Conservation, and Energy Act of 2008 (7 

11 U.S.C. 7614a); 

12 (D) facilitate technology transfer and re13 lease of information and data gathered from the 

14 activities of the Foundation to the agricultural 

15 research community; 

16 (E) promote and encourage the develop17 ment of the next generation of agricultural re18 search scientists; and 

19 (F) carry out such other activities as the 

20 Board determines to be consistent with the pur21 poses of the Foundation. 

22 (2) AUTHORITY.—The Foundation shall be the 

23 sole entity responsible for carrying out the activities 

24 described in this subsection. 


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1 (3) RELATIONSHIP TO OTHER ACTIVITIES.— 

2 The activities described in paragraph (1) shall be 

3 supplemental to any other activities at the Depart4 ment and shall not preempt any authority or respon5 sibility of the Department under another provision 

6 of law. 

7 (e) BOARD OF DIRECTORS.— 

8 (1) ESTABLISHMENT.—The Foundation shall 

9 be governed by a Board of Directors. 

10 (2) COMPOSITION.— 

11 (A) IN GENERAL.—The Board shall be 

12 composed of appointed and ex-officio, nonvoting 

13 members. 

14 (B) EX-OFFICIO MEMBERS.—The ex-officio 

15 members of the Board shall be the following in16 dividuals or designees: 

17 (i) The Secretary. 

18 (ii) The Under Secretary of Agri19 culture for Research, Education, and Eco20 nomics. 

21 (iii) The Administrator of the Agricul22 tural Research Service. 

23 (iv) The Director of the National In24 stitute of Food and Agriculture. 


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1 (v) The Director of the National 

2 Science Foundation. 

3 (C) APPOINTED MEMBERS.— 

4 (i) IN GENERAL.—The ex-officio mem5 bers of the Board under subparagraph (B) 

6 shall, by majority vote, appoint to the 

7 Board 15 individuals, of whom— 

8 (I) 8 shall be selected from a list 

9 of candidates to be provided by the 

10 National Academy of Sciences; and 

11 (II) 7 shall be selected from lists 

12 of candidates provided by industry. 

13 (ii) REQUIREMENTS.— 

14 (I) EXPERTISE.—The ex-officio 

15 members shall ensure that a majority 

16 of the members of the Board have ac17 tual experience in agricultural re18 search and, to the extent practicable, 

19 represent diverse sectors of agri20 culture. 

21 (II) LIMITATION.—No employee 

22 of the Federal Government may serve 

23 as an appointed member of the Board 

24 under this subparagraph. 


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1 (III) NOT FEDERAL EMPLOY2 MENT.—Appointment to the Board 

3 under this subparagraph shall not 

4 constitute Federal employment. 

5 (iii) AUTHORITY.—All appointed 

6 members of the Board shall be voting 

7 members. 

8 (D) CHAIR.—The Board shall, from among 

9 the members of the Board, designate an indi10 vidual to serve as Chair of the Board. 

11 (3) INITIAL MEETING.—Not later than 60 days 

12 after the date of enactment of this Act, the Sec13 retary shall convene a meeting of the ex-officio mem14 bers of the Board— 

15 (A) to incorporate the Foundation; and 

16 (B) to appoint the members of the Board 

17 in accordance with paragraph (2)(C)(i). 

18 (4) DUTIES.— 

19 (A) IN GENERAL.—The Board shall— 

20 (i) establish bylaws for the Founda21 tion that, at a minimum, include— 

22 (I) policies for the selection of fu23 ture Board members, officers, employ24 ees, agents, and contractors of the 

25 Foundation; 


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1 (II) policies, including ethical 

2 standards, for— 

3 (aa) the acceptance, solicita4 tion, and disposition of donations 

5 and grants to the Foundation; 

6 and 

7 (bb) the disposition of assets 

8 of the Foundation, including ap9 propriate limits on the ability of 

10 donors to designate, by stipula11 tion or restriction, the use or re12 cipient of donated funds; 

13 (III) policies that would subject 

14 all employees, fellows, trainees, and 

15 other agents of the Foundation (in16 cluding members of the Board) to the 

17 conflict of interest standards under 

18 section 208 of title 18, United States 

19 Code; 

20 (IV) policies for writing, editing, 

21 printing, publishing, and vending of 

22 books and other materials; 

23 (V) policies for the conduct of 

24 the general operations of the Founda25 tion, including a cap on administrative 


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1 expenses for recipients of a grant, 

2 contract, or cooperative agreement 

3 from the Foundation; and 

4 (VI) specific duties for the Exec5 utive Director; 

6 (ii) prioritize and provide overall di7 rection for the activities of the Foundation; 

8 (iii) evaluate the performance of the 

9 Executive Director; and 

10 (iv) carry out any other necessary ac11 tivities regarding the Foundation. 

12 (B) ESTABLISHMENT OF BYLAWS.—In es13 tablishing bylaws under subparagraph (A)(i), 

14 the Board shall ensure that the bylaws do 

15 not— 

16 (i) reflect unfavorably on the ability of 

17 the Foundation to carry out the duties of 

18 the Foundation in a fair and objective 

19 manner; or 

20 (ii) compromise, or appear to com21 promise, the integrity of any governmental 

22 agency or program, or any officer or em23 ployee employed by or involved in a govern24 mental agency or program. 

25 (5) TERMS AND VACANCIES.— 


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1 (A) TERMS.— 

2 (i) IN GENERAL.—The term of each 

3 member of the Board appointed under 

4 paragraph (2)(C) shall be 5 years. 

5 (ii) PARTIAL TERMS.—If a member of 

6 the Board does not serve the full term ap7 plicable under clause (i), the individual ap8 pointed to fill the resulting vacancy shall 

9 be appointed for the remainder of the term 

10 of the predecessor of the individual. 

11 (iii) TRANSITION.—A member of the 

12 Board may continue to serve after the ex13 piration of the term of the member until a 

14 successor is appointed. 

15 (B) VACANCIES.—Any vacancy in the 

16 membership of the Board shall be filled in the 

17 manner in which the original position was made 

18 and shall not affect the power of the remaining 

19 members to execute the duties of the Board. 

20 (6) COMPENSATION.—Members of the Board 

21 may not receive compensation for service on the 

22 Board but may be reimbursed for travel, subsist23 ence, and other necessary expenses incurred in car24 rying out the duties of the Board. 


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1 (7) MEETINGS AND QUORUM.—A majority of 

2 the members of the Board shall constitute a quorum 

3 for purposes of conducting business of the Board. 

4 (f) ADMINISTRATION.— 

5 (1) EXECUTIVE DIRECTOR.— 

6 (A) IN GENERAL.—The Board shall hire 

7 an Executive Director who shall carry out such 

8 duties and responsibilities as the Board may 

9 prescribe. 

10 (B) SERVICE.—The Executive Director 

11 shall serve at the pleasure of the Board. 

12 (2) ADMINISTRATIVE POWERS.— 

13 (A) IN GENERAL.—In carrying out this 

14 section, the Board, acting through the Execu15 tive Director, may— 

16 (i) adopt, alter, and use a corporate 

17 seal, which shall be judicially noticed; 

18 (ii) hire, promote, compensate, and 

19 discharge 1 or more officers, employees, 

20 and agents, as may be necessary, and de21 fine the duties of the officers, employees, 

22 and agents; 

23 (iii) solicit and accept any funds, 

24 gifts, grants, devises, or bequests of real or 

25 personal property made to the Foundation, 


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1 including such support from private enti2 ties; 

3 (iv) prescribe the manner in which— 

4 (I) real or personal property of 

5 the Foundation is acquired, held, and 

6 transferred; 

7 (II) general operations of the 

8 Foundation are to be conducted; and 

9 (III) the privileges granted to the 

10 Board by law are exercised and en11 joyed; 

12 (v) with the consent of the applicable 

13 executive department or independent agen14 cy, use the information, services, and facili15 ties of the department or agency in car16 rying out this section; 

17 (vi) enter into contracts with public 

18 and private organizations for the writing, 

19 editing, printing, and publishing of books 

20 and other material; 

21 (vii) hold, administer, invest, and 

22 spend any gift, devise, or bequest of real or 

23 personal property made to the Foundation; 

24 (viii) enter into such contracts, leases, 

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1 actions as the Board considers appropriate 

2 to conduct the activities of the Foundation; 

3 (ix) modify or consent to the modifica4 tion of any contract or agreement to which 

5 the Foundation is a party or in which the 

6 Foundation has an interest; 

7 (x) take such action as may be nec8 essary to obtain patents and licenses for 

9 devices and procedures developed by the 

10 Foundation and employees of the Founda11 tion; 

12 (xi) sue and be sued in the corporate 

13 name of the Foundation, and complain and 

14 defend in courts of competent jurisdiction; 

15 (xii) appoint other groups of advisors 

16 as may be determined necessary to carry 

17 out the functions of the Foundation; and 

18 (xiii) exercise such other incidental 

19 powers as are necessary to carry out the 

20 duties and functions of the Foundation in 

21 accordance with this section 

22 (B) LIMITATION.—No appointed member 

23 of the Board or officer or employee of the 

24 Foundation or of any program established by 

25 the Foundation (other than ex-officio members 


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1 of the Board) shall exercise administrative con2 trol over any Federal employee 

3 (3) RECORDS.— 

4 (A) AUDITS.—The Foundation shall— 

5 (i) provide for annual audits of the fi6 nancial condition of the Foundation; and 

7 (ii) make the audits, and all other 

8 records, documents, and other papers of 

9 the Foundation, available to the Secretary 

10 and the Comptroller General of the United 

11 States for examination or audit. 

12 (B) REPORTS.— 

13 (i) ANNUAL REPORT ON FOUNDA14 TION.— 

15 (I) IN GENERAL.—Not later than 

16 5 months following the end of each 

17 fiscal year, the Foundation shall pub18 lish a report for the preceding fiscal 

19 year that includes— 

20 (aa) a description of Foun21 dation activities, including ac22 complishments; and 

23 (bb) a comprehensive state24 ment of the operations and finan25 cial condition of the Foundation. 


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1 (II) FINANCIAL CONDITION.— 

2 Each report under subclause (I) shall 

3 include a description of all gifts or 

4 grants to the Foundation of real or 

5 personal property or money, which 

6 shall include— 

7 (aa) the source of the gifts 

8 or grants; and 

9 (bb) any restrictions on the 

10 purposes for which the gift or 

11 grant may be used. 

12 (III) AVAILABILITY.—The Foun13 dation shall— 

14 (aa) make copies of each re15 port submitted under subclause 

16 (I) available for public inspection; 

17 and 

18 (bb) on request, provide a 

19 copy of the report to any indi20 vidual. 

21 (IV) PUBLIC MEETING.—The 

22 Board shall hold an annual public 

23 meeting to summarize the activities of 

24 the Foundation. 


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1 (ii) GRANT REPORTING.—Any recipi2 ent of a grant under subsection (d)(1)(A) 

3 shall provide the Foundation with a report 

4 at the conclusion of any research or studies 

5 conducted the describes the results of the 

6 research or studies, including any data 

7 generated. 

8 (4) INTEGRITY.— 

9 (A) IN GENERAL.—To ensure integrity in 

10 the operations of the Foundation, the Board 

11 shall develop and enforce procedures relating to 

12 standards of conduct, financial disclosure state13 ments, conflict of interest (including recusal 

14 and waiver rules), audits, and any other mat15 ters determined appropriate by the Board. 

16 (B) FINANCIAL CONFLICTS OF INTER17 EST.—Any individual who is an officer, em18 ployee, or member of the Board is prohibited 

19 from any participation in deliberations by the 

20 Foundation of a matter that would directly or 

21 predictably affect any financial interest of— 

22 (i) the individual; 

23 (ii) a relative (as defined in section 

24 109 of the Ethics in Government Act of 


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1 1978 (5 U.S.C. App.)) of that individual; 

2 or 

3 (iii) a business organization or other 

4 entity in which the individual has an inter5 est, including an organization or other en6 tity with which the individual is negoti7 ating employment. 

8 (5) INTELLECTUAL PROPERTY.—The Board 

9 shall adopt written standards to govern ownership of 

10 any intellectual property rights derived from the col11 laborative efforts of the Foundation. 

12 (6) LIABILITY.—The United States shall not be 

13 liable for any debts, defaults, acts, or omissions of 

14 the Foundation nor shall the full faith and credit of 

15 the United States extend to any obligations of the 

16 Foundation. 

17 (g) FUNDS.— 

18 (1) MANDATORY FUNDING.— 

19 (A) IN GENERAL.—On October 1, 2012, of 

20 the funds of the Commodity Credit Corporation, 

21 the Secretary shall transfer to the Foundation 

22 to carry out this section $100,000,000, to re23 main available until expended under the condi24 tions described in subparagraph (B). 


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1 (B) CONDITIONS ON EXPENDITURE.—The 

2 Foundation may use the funds made available 

3 under subparagraph (A) to carry out the pur4 poses of the Foundation only to the extent that 

5 the Foundation secures an equal amount of 

6 non-Federal matching funds for each expendi7 ture. 

8 (C) PROHIBITION ON CONSTRUCTION.— 

9 None of the funds made available under sub10 paragraph (A) may be used for construction. 

11 (2) SEPARATION OF FUNDS.—The Executive 

12 Director shall ensure that any funds received under 

13 paragraph (1) or (2) are held in separate accounts 

14 from funds received from nongovernmental entities 

15 as described in subsection (f)(2)(A)(iii). 

16 TITLE VIII—FORESTRY 

17 Subtitle A—Repeal of Certain 

18 Forestry Programs 

19 SEC. 8001. FOREST LAND ENHANCEMENT PROGRAM. 

20 (a) REPEAL.—Section 4 of the Cooperative Forestry 

21 Assistance Act of 1978 (16 U.S.C. 2103) is repealed. 

22 (b) CONFORMING AMENDMENT.—Section 8002 of the 

23 Farm Security and Rural Investment Act of 2002 (Public 

24 Law 107–171; 16 U.S.C. 2103 note) is amended by strik25 ing subsection (a). 


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1 (c) EFFECTIVE DATE.—The amendments made by 

2 this section shall take effect on October 1, 2012. 

3 SEC. 8002. WATERSHED FORESTRY ASSISTANCE PROGRAM. 

4 (a) REPEAL.—Section 6 of the Cooperative Forestry 

5 Assistance Act of 1978 (16 U.S.C. 2103b) is repealed. 

6 (b) EFFECTIVE DATE.—The amendment made by 

7 this section shall take effect on October 1, 2012. 

8 SEC. 8003. EXPIRED COOPERATIVE NATIONAL FOREST 

9 PRODUCTS MARKETING PROGRAM. 

10 Section 18 of the Cooperative Forestry Assistance 

11 Act of 1978 (16 U.S.C. 2112) is repealed. 

12 SEC. 8004. HISPANIC-SERVING INSTITUTION AGRICUL13 TURAL LAND NATIONAL RESOURCES LEAD14 ERSHIP PROGRAM. 

15 (a) REPEAL.—Section 8402 of the Food, Conserva16 tion, and Energy Act of 2008 (16 U.S.C. 1649a) is re17 pealed. 

18 (b) EFFECTIVE DATE.—The amendment made by 

19 this section shall take effect on October 1, 2012. 

20 SEC. 8005. TRIBAL WATERSHED FORESTRY ASSISTANCE 

21 PROGRAM. 

22 (a) REPEAL.—Section 303 of the Healthy Forests 

23 Restoration Act of 2003 (16 U.S.C. 6542) is repealed. 

24 (b) EFFECTIVE DATE.—The amendment made by 

25 this section shall take effect on October 1, 2012. 


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1 Subtitle B—Reauthorization of Co2 operative Forestry Assistance 

3 Act of 1978 Programs 

4 SEC. 8101. STATE-WIDE ASSESSMENT AND STRATEGIES FOR 

5 FOREST RESOURCES. 

6 Section 2A(f)(1) of the Cooperative Forestry Assist7 ance Act of 1978 (16 U.S.C. 2101a(f)(1)) is amended by 

8 striking ‘‘2012’’ and inserting ‘‘2017’’. 

9 SEC. 8102. FOREST STEWARDSHIP PROGRAM. 

10 Section 5(h) of the Cooperative Forestry Assistance 

11 Act of 1978 (16 U.S.C. 2103a(h)) is amended by striking 

12 ‘‘such sums as may be necessary thereafter’’ and inserting 

13 ‘‘$50,000,000 for each of fiscal years 2013 through 

14 2017’’. 

15 SEC. 8103. FOREST LEGACY PROGRAM. 

16 Section 7 of the Cooperative Forestry Assistance Act 

17 of 1978 (16 U.S.C. 2103c) is amended by striking sub18 section (m) and inserting the following: 

19 ‘‘(m) FUNDING.— 

20 ‘‘(1) AUTHORIZATION OF APPROPRIATIONS.— 

21 There is authorized to be appropriated to carry out 

22 this section $200,000,000 for each of fiscal years 

23 2013 through 2017. 

24 ‘‘(2) ADDITIONAL FUNDING SOURCES.—In ad25 dition to any funds appropriated for each fiscal year 


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1 to carry out this section, the Secretary may use any 

2 other Federal funds available to the Secretary.’’. 

3 SEC. 8104. COMMUNITY FOREST AND OPEN SPACE CON4 SERVATION PROGRAM. 

5 Section 7A of the Cooperative Forestry Assistance 

6 Act of 1978 (16 U.S.C. 2103d) is amended by striking 

7 subsection (g) and inserting the following: 

8 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There 

9 is authorized to be appropriated to carry out this section 

10 $50,000,000 for each of fiscal years 2013 through 2017.’’. 

11 SEC. 8105. URBAN AND COMMUNITY FORESTRY ASSIST12 ANCE. 

13 Section 9(i) of the Cooperative Forestry Assistance 

14 Act of 1978 (16 U.S.C. 2105(i)) is amended by striking 

15 ‘‘such sums as may be necessary for each fiscal year there16 after’’ and inserting ‘‘$50,000,000 for each of fiscal years 

17 2013 through 2017’’. 

18 Subtitle C—Reauthorization of 

19 Other Forestry-related Laws 

20 SEC. 8201. RURAL REVITALIZATION TECHNOLOGIES. 

21 Section 2371(d)(2) of the Food, Agriculture, Con22 servation, and Trade Act of 1990 (7 U.S.C. 6601(d)(2)) 

23 is amended by striking ‘‘2012’’ and inserting ‘‘2017’’. 


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1 SEC. 8202. OFFICE OF INTERNATIONAL FORESTRY. 

2 Section 2405 of the Global Climate Change Preven3 tion Act of 1990 (7 U.S.C. 6704) is amended by striking 

4 subsection (d) and inserting the following: 

5 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—To 

6 carry out this section, there are authorized to be appro7 priated— 

8 ‘‘(1) such sums as are necessary for each of fis9 cal years 1996 through 2012; and 

10 ‘‘(2) $10,000,000 for each of fiscal years 2013 

11 through 2017.’’. 

12 SEC. 8203. INSECT INFESTATIONS AND RELATED DISEASES. 

13 (a) FINDINGS AND PURPOSES.—Section 401 of the 

14 Healthy Forests Restoration Act of 2003 (16 U.S.C. 

15 6551) is amended— 

16 (1) in subsection (a)— 

17 (A) by redesignating paragraphs (3) 

18 through (12) as paragraphs (4) through (13), 

19 respectively; and 

20 (B) by inserting after paragraph (2) the 

21 following: 

22 ‘‘(3) the mountain pine beetle is— 

23 ‘‘(A) threatening and ravaging forests 

24 throughout the Western region of the United 

25 States, including Arizona, California, Colorado, 


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1 Idaho, Montana, Nevada, New Mexico, Oregon, 

2 and South Dakota; 

3 ‘‘(B) reaching epidemic populations and se4 verely impacting over 41,000,000 acres in west5 ern forests; and 

6 ‘‘(C) deteriorating forest health in national 

7 forests and, when combined with drought, dis8 ease, and storm damage, is resulting in extreme 

9 fire hazards in national forests across the West10 ern United States and endangering the eco11 nomic stability of surrounding adjacent commu12 nities, ranches, and parks;’’; and 

13 (2) in subsection (b)— 

14 (A) in paragraph (2), by striking ‘‘and’’ at 

15 the end; 

16 (B) in paragraph (3), by striking the pe17 riod at the end and inserting ‘‘; and’’; and 

18 (C) by adding at the end the following: 

19 ‘‘(4) to provide for designation of treatment 

20 areas pursuant to section 405.’’. 

21 (b) DESIGNATION OF TREATMENT AREAS.—Title IV 

22 of the Healthy Forests Restoration Act of 2003 (16 

23 U.S.C. 6551 et seq.) is amended— 


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1 (1) by redesignating sections 405 and 406 (16 

2 U.S.C. 6555, 6556) as sections 406 and 407, respec3 tively; and 

4 (2) by inserting after section 404 (16 U.S.C. 

5 6554) the following: 

6 ‘‘SEC. 405. DESIGNATION OF TREATMENT AREAS. 

7 ‘‘(a) DESIGNATION OF TREATMENT AREAS.—Not 

8 later than 60 days after the date of enactment of the Agri9 culture Reform, Food, and Jobs Act of 2012, the Sec10 retary shall designate treatment areas on at least 1 na11 tional forest in each State, if requested by the Governor 

12 of the State, that the Secretary determines, based on an13 nual forest health surveys, are experiencing declining for14 est health due to insect or disease infestation. 

15 ‘‘(b) TREATMENT OF AREAS.—The Secretary may 

16 carry out treatments to address the insect or disease infes17 tation in the areas designated under subsection (a) in ac18 cordance with sections 104, 105, 106, and 401. 

19 ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There 

20 is authorized to be appropriated to carry out this section 

21 $100,000,000 for each of fiscal years 2013 through 

22 2017.’’. 

23 (c) AUTHORIZATION OF APPROPRIATIONS.—Section 

24 407 of the Healthy Forests Restoration Act of 2003 (as 


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1 redesignated by subsection (b)(1)) is amended by striking 

2 ‘‘2008’’ and inserting ‘‘2017’’. 

3 SEC. 8204. STEWARDSHIP END RESULT CONTRACTING 

4 PROJECTS. 

5 (a) IN GENERAL.—Title VI of the Healthy Forests 

6 Restoration Act of 2003 (16 U.S.C. 6591) is amended by 

7 adding at the end the following: 

8 ‘‘SEC. 602. STEWARDSHIP END RESULT CONTRACTING 

9 PROJECTS. 

10 ‘‘(a) DEFINITIONS.—In this section: 

11 ‘‘(1) CHIEF.—The term ‘Chief’ means the Chief 

12 of the Forest Service. 

13 ‘‘(2) DIRECTOR.—The term ‘Director’ means 

14 the Director of the Bureau of Land Management. 

15 ‘‘(b) PROJECTS.—The Chief and the Director, via 

16 agreement or contract as appropriate, may enter into 

17 stewardship contracting projects with private persons or 

18 other public or private entities to perform services to 

19 achieve land management goals for the national forests 

20 and the public lands that meet local and rural community 

21 needs. 

22 ‘‘(c) LAND MANAGEMENT GOALS.—The land man23 agement goals of a project under subsection (b) may in24 clude— 


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1 ‘‘(1) road and trail maintenance or obliteration 

2 to restore or maintain water quality; 

3 ‘‘(2) soil productivity, habitat for wildlife and 

4 fisheries, or other resource values; 

5 ‘‘(3) setting of prescribed fires to improve the 

6 composition, structure, condition, and health of 

7 stands or to improve wildlife habitat; 

8 ‘‘(4) removing vegetation or other activities to 

9 promote healthy forest stands, reduce fire hazards, 

10 or achieve other land management objectives; 

11 ‘‘(5) watershed restoration and maintenance; 

12 ‘‘(6) restoration and maintenance of wildlife 

13 and fish; or 

14 ‘‘(7) control of noxious and exotic weeds and re15 establishing. 

16 ‘‘(d) AGREEMENTS OR CONTRACTS.— 

17 ‘‘(1) PROCUREMENT PROCEDURE.—A source 

18 for performance of an agreement or contract under 

19 subsection (b) shall be selected on a best-value basis, 

20 including consideration of source under other public 

21 and private agreements or contracts. 

22 ‘‘(2) CONTRACT FOR SALE OF PROPERTY.—A 

23 contract entered into under this section may, at the 

24 discretion of the Secretary of Agriculture, be consid25 ered a contract for the sale of property under such 


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1 terms as the Secretary may prescribe without regard 

2 to any other provision of law. 

3 ‘‘(3) TERM.— 

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

5 subparagraph (B), the Chief and the Director 

6 may enter into a contract under subsection (b) 

7 in accordance with section 3903 of title 41, 

8 United States Code. 

9 ‘‘(B) MAXIMUM.—The period of the con10 tract under subsection (b) may exceed 5 years 

11 but may not exceed 10 years. 

12 ‘‘(4) OFFSETS.— 

13 ‘‘(A) IN GENERAL.—The Chief and the Di14 rector may apply the value of timber or other 

15 forest products removed as an offset against the 

16 cost of services received under the agreement or 

17 contract described in subsection (b). 

18 ‘‘(B) METHODS OF APPRAISAL.—The value 

19 of timber or other forest products used as an 

20 offset under subparagraph (A)— 

21 ‘‘(i) shall be determined using appro22 priate methods of appraisal commensurate 

23 with the quantity of products to be re24 moved; and 

25 ‘‘(ii) may— 


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1 ‘‘(I) be determined using a unit 

2 of measure appropriate to the con3 tracts; and 

4 ‘‘(II) may include valuing prod5 ucts on a per-acre basis. 

6 ‘‘(5) RELATION TO OTHER LAWS.—Notwith7 standing subsections (d) and (g) of section 14 of the 

8 National Forest Management Act of 1976 (16 

9 U.S.C. 472a), the Chief may enter into an agree10 ment or contract under subsection (b). 

11 ‘‘(6) CONTRACTING OFFICER.—Notwithstanding 

12 any other provision of law, the Secretary or the Sec13 retary of the Interior may determine the appropriate 

14 contracting officer to enter into and administer an 

15 agreement or contract under subsection (b). 

16 ‘‘(e) RECEIPTS.— 

17 ‘‘(1) IN GENERAL.—The Chief and the Director 

18 may collect monies from an agreement or contract 

19 under subsection (b) if the collection is a secondary 

20 objective of negotiating the contract that will best 

21 achieve the purposes of this section. 

22 ‘‘(2) USE.—Monies from an agreement or con23 tract under subsection (b)— 

24 ‘‘(A) may be retained by the Chief and the 

25 Director; and 


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1 ‘‘(B) shall be available for expenditure 

2 without further appropriation at the project site 

3 from which the monies are collected or at an4 other project site. 

5 ‘‘(3) RELATION TO OTHER LAWS.— 

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

7 other provision of law, the value of services re8 ceived by the Chief or the Director under a 

9 stewardship contract project conducted under 

10 this section, and any payments made or re11 sources provided by the contractor, Chief, or 

12 Director shall not be considered monies received 

13 from the National Forest System or the public 

14 lands. 

15 ‘‘(B) KNUTSON-VANDERBERG ACT.—The 

16 Act of June 9, 1930 (commonly known as the 

17 ‘Knutson-Vanderberg Act’) (16 U.S.C. 576 et 

18 seq.) shall not apply to any agreement or con19 tract under subsection (b). 

20 ‘‘(f) COSTS OF REMOVAL.—Notwithstanding the fact 

21 that a contractor did not harvest the timber, the Chief 

22 may collect deposits from a contractor covering the costs 

23 of removal of timber or other forest products under— 

24 ‘‘(1) the Act of August 11, 1916 (16 U.S.C. 

25 490); and 


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1 ‘‘(2) and the Act of June 30, 1914 (16 U.S.C. 

2 498). 

3 ‘‘(g) PERFORMANCE AND PAYMENT GUARANTEES.— 

4 ‘‘(1) IN GENERAL.—The Chief and the Director 

5 may require performance and payment bonds under 

6 sections 28.103–2 and 28.103–3 of the Federal Ac7 quisition Regulation, in an amount that the con8 tracting officer considers sufficient to protect the in9 vestment in receipts by the Federal Government 

10 generated by the contractor from the estimated 

11 value of the forest products to be removed under a 

12 contract under subsection (b). 

13 ‘‘(2) EXCESS OFFSET VALUE.—If the offset 

14 value of the forest products exceeds the value of the 

15 resource improvement treatments, the Chief and the 

16 Director may— 

17 ‘‘(A) collect any residual receipts under the 

18 Act of June 9, 1930 (commonly known as the 

19 ‘Knutson-Vanderberg Act’) (16 U.S.C. 576 et 

20 seq.); and 

21 ‘‘(B) apply the excess to other authorized 

22 stewardship projects. 

23 ‘‘(h) MONITORING AND EVALUATION.— 

24 ‘‘(1) IN GENERAL.—The Chief and the Director 

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1 tion process that accesses the stewardship con2 tracting projects conducted under this section. 

3 ‘‘(2) PARTICIPANTS.—Other than the Chief and 

4 Director, participants in the process described in 

5 paragraph (1) may include— 

6 ‘‘(A) any cooperating governmental agen7 cies, including tribal governments; and 

8 ‘‘(B) any other interested groups or indi9 viduals. 

10 ‘‘(i) REPORTING.—Not later than 1 year after the 

11 date of enactment of this section, and annually thereafter, 

12 the Chief and the Director shall report to the Committee 

13 on Agriculture, Nutrition, and Forestry of the Senate and 

14 the Committee on Agriculture of the House of Representa15 tives on— 

16 ‘‘(1) the status of development, execution, and 

17 administration of agreements or contracts under 

18 subsection (b); 

19 ‘‘(2) the specific accomplishments that have re20 sulted; and 

21 ‘‘(3) the role of local communities in the devel22 opment of agreements or contract plans.’’. 

23 (b) CONFORMING AMENDMENT.—Section 347 of the 

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1 priations Act, 1999 (16 U.S.C. 2104 note; Public Law 

2 105–277) is repealed. 

3 SEC. 8205. HEALTHY FORESTS RESERVE PROGRAM. 

4 (a) DEFINITION OF ACREAGE OWNED BY INDIAN

5 TRIBES.—Section 502(e)(3) of the Healthy Forests Res6 toration Act (16 U.S.C. 6572(e)(3)) is amended— 

7 (1) in subparagraph (C), by striking ‘‘subpara8 graphs (A) and (B)’’ and inserting ‘‘clauses (i) and 

9 (ii)’’; 

10 (2) by redesignating subparagraphs (A) through 

11 (C) as clauses (i) through (iii), respectively, and in12 denting appropriately; and 

13 (3) by striking ‘‘In the case of’’ and inserting 

14 the following: 

15 ‘‘(A) DEFINITION OF ACREAGE OWNED BY

16 INDIAN TRIBES.—In this paragraph, the term 

17 ‘acreage owned by Indian tribes’ includes— 

18 ‘‘(i) land that is held in trust by the 

19 United States for Indian tribes or indi20 vidual Indians; 

21 ‘‘(ii) land, the title to which is held by 

22 Indian tribes or individual Indians subject 

23 to Federal restrictions against alienation 

24 or encumbrance; 


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1 ‘‘(iii) land that is subject to rights of 

2 use, occupancy, and benefit of certain In3 dian tribes; 

4 ‘‘(iv) land that is held in fee title by 

5 an Indian tribe; or 

6 ‘‘(v) land that is owned by a native 

7 corporation formed under section 17 of the 

8 Act of June 18, 1934 (commonly known as 

9 the ‘Indian Reorganization Act’) (25 

10 U.S.C. 477) or section 8 of the Alaska Na11 tive Claims Settlement Act (43 U.S.C. 

12 1607); or 

13 ‘‘(vi) a combination of 1 or more 

14 types of land described in clauses (i) 

15 through (v). 

16 ‘‘(B) ENROLLMENT OF ACREAGE.—In the 

17 case of’’. 

18 (b) CHANGE IN FUNDING SOURCE FOR HEALTHY

19 FORESTS RESERVE PROGRAM.—Section 508 of the 

20 Healthy Forests Restoration Act of 2003 (16 U.S.C. 

21 6578) is amended— 

22 (1) in subsection (a), by striking ‘‘IN GEN23 ERAL’’ and inserting ‘‘FISCAL YEARS 2009 

24 THROUGH 2012’’; 


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1 (2) by redesignating subsection (b) as sub2 section (d); and 

3 (3) by inserting after subsection (a) the fol4 lowing: 

5 ‘‘(b) FISCAL YEARS 2013 THROUGH 2017.—There is 

6 authorized to be appropriated to the Secretary of Agri7 culture to carry out this section $9,750,000 for each of 

8 fiscal years 2013 through 2017. 

9 ‘‘(c) ADDITIONAL SOURCE OF FUNDS.—In addition 

10 to funds appropriated pursuant to the authorization of ap11 propriations in subsection (b) for a fiscal year, the Sec12 retary may use such amount of the funds appropriated 

13 for that fiscal year to carry out the Soil Conservation and 

14 Domestic Allotment Act (16 U.S.C. 590a et seq.) as the 

15 Secretary determines necessary to cover the cost of tech16 nical assistance, management, and enforcement respon17 sibilities for land enrolled in the healthy forests reserve 

18 program pursuant to subsections (a) and (b) of section 

19 504.’’. 

20 Subtitle D—Miscellaneous 

21 Provisions 

22 SEC. 8301. MCINTIRE-STENNIS COOPERATIVE FORESTRY 

23 ACT. 

24 (a) 1890 WAIVERS.—Section 4 of Public Law 87– 

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1 tive Forestry Act’’) (16 U.S.C. 582a–3) is amended by 

2 inserting ‘‘The matching funds requirement shall not be 

3 applicable to eligible 1890 Institutions (as defined in sec4 tion 2 of the Agricultural Research, Extension, and Edu5 cation Reform Act of 1998 (7 U.S.C. 7601)) if the alloca6 tion is below $200,000.’’ before ‘‘The Secretary is author7 ized’’ in the second sentence. 

8 (b) PARTICIPATION.—Section 8 of Public Law 87– 

9 788 (commonly known as the ‘‘ ‘McIntire-Stennis Cooper10 ative Forestry Act’’) (16 U.S.C. 582a–7) is amended by 

11 inserting ‘the Federated States of Micronesia, American 

12 Samoa, the Northern Mariana Islands,’ before ‘and 

13 Guam’ ’’. 

14 (c) EFFECTIVE DATE.—The amendments made by 

15 this section take effect on October 1, 2012. 

16 SEC. 8302. REVISION OF STRATEGIC PLAN FOR FOREST IN17 VENTORY AND ANALYSIS. 

18 (a) REVISION REQUIRED.—Not later than 180 days 

19 after the date of enactment of this Act, the Secretary of 

20 Agriculture shall revise the strategic plan for forest inven21 tory and analysis initially prepared pursuant to section 

22 3(e) of the Forest and Rangeland Renewable Resources 

23 Research Act of 1978 (16 U.S.C. 1642(e)) to address the 

24 requirements imposed by subsection (b). 


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1 (b) ELEMENTS OF REVISED STRATEGIC PLAN.—In 

2 revising the strategic plan, the Secretary of Agriculture 

3 shall describe in detail the organization, procedures, and 

4 funding needed to achieve each of the following: 

5 (1) Complete the transition to a fully 

6 annualized forest inventory program and include in7 ventory and analysis of interior Alaska. 

8 (2) Implement an annualized inventory of trees 

9 in urban settings, including the status and trends of 

10 trees and forests, and assessments of their eco11 system services, values, health, and risk to pests and 

12 diseases. 

13 (3) Report information on renewable biomass 

14 supplies and carbon stocks at the local, State, re15 gional, and national level, including by ownership 

16 type. 

17 (4) Engage State foresters and other users of 

18 information from the forest inventory and analysis 

19 in reevaluating the list of core data variables col20 lected on forest inventory and analysis plots with an 

21 emphasis on demonstrated need. 

22 (5) Improve the timeliness of the timber prod23 uct output program and accessibility of the 

24 annualized information on that database. 


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1 (6) Foster greater cooperation among the forest 

2 inventory and analysis program, research station 

3 leaders, and State foresters and other users of infor4 mation from the forest inventory and analysis. 

5 (7) Availability of and access to non-Federal re6 sources to improve information analysis and infor7 mation management. 

8 (8) Collaborate with the Natural Resources 

9 Conservation Service, National Aeronautics and 

10 Space Administration, National Oceanic and Atmos11 pheric Administration, and United States Geological 

12 Survey to integrate remote sensing, spatial analysis 

13 techniques, and other new technologies in the forest 

14 inventory and analysis program. 

15 (9) Understand and report on changes in land 

16 cover and use. 

17 (10) Expand existing programs to promote sus18 tainable forest stewardship through increased under19 standing, in partnership with other Federal agencies, 

20 of the over 10 million family forest owners, their de21 mographics, and the barriers to forest stewardship. 

22 (11) Implement procedures to improve the sta23 tistical precision of estimates at the sub-State level. 

24 (c) SUBMISSION OF REVISED STRATEGIC PLAN.— 

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1 tegic plan to the Committee on Agriculture of the House 

2 of Representatives and the Committee on Agriculture, Nu3 trition, and Forestry of the Senate. 

4 TITLE IX—ENERGY 

5 SEC. 9001. DEFINITION OF RENEWABLE CHEMICAL. 

6 Section 9001 of the Farm Security and Rural Invest7 ment Act of 2002 (7 U.S.C. 8101) is amended— 

8 (1) by redesignating paragraphs (13) and (14) 

9 as paragraphs (14) and (15) respectively; and 

10 (2) by inserting after paragraph (12) the fol11 lowing: 

12 ‘‘(13) RENEWABLE CHEMICAL.—The term ‘re13 newable chemical’ means a monomer, polymer, plas14 tic, formulated product, or chemical substance pro15 duced from renewable biomass.’’. 

16 SEC. 9002. BIOBASED MARKETS PROGRAM. 

17 (a) IN GENERAL.—Section 9002 of the Farm Secu18 rity and Rural Investment Act of 2002 (7 U.S.C. 8102) 

19 is amended— 

20 (1) in subsection (a)— 

21 (A) in paragraph (2)(A)(i)— 

22 (i) in subclause (I), by striking ‘‘and’’ 

23 at the end; 


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1 (ii) in subclause (II)(bb), by striking 

2 the period at the end and inserting ‘‘; 

3 and’’; and 

4 (iii) by adding at the end the fol5 lowing: 

6 ‘‘(III) establish a targeted 

7 biobased-only procurement require8 ment under which the procuring agen9 cy shall issue a certain number of 

10 biobased-only contracts when the pro11 curing agency is purchasing products, 

12 or purchasing services that include the 

13 use of products, that are included in 

14 a biobased product category des15 ignated by the Secretary.’’; and 

16 (B) in paragraph (3)— 

17 (i) in subparagraph (B)— 

18 (I) in clause (v), by inserting ‘‘as 

19 determined to be necessary by the 

20 Secretary based on the availability of 

21 data,’’ before ‘‘provide information’’; 

22 (II) by redesignating clauses (v) 

23 and (vi) as clauses (vii) and (viii), re24 spectively; and 


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1 (III) by inserting after clause (iv) 

2 the following: 

3 ‘‘(v) require reporting of quantities 

4 and types of biobased products purchased 

5 by procuring agencies; 

6 ‘‘(vi) focus on products that apply an 

7 innovative approach to growing, har8 vesting, procuring, processing, or manufac9 turing biobased products regardless of the 

10 date of entry of the products into the mar11 ketplace;’’; and 

12 (ii) by adding at the end the fol13 lowing: 

14 ‘‘(F) REQUIRED DESIGNATIONS.—Not 

15 later than 1 year after the date of enactment of 

16 this subparagraph, the Secretary shall begin to 

17 designate intermediate ingredients or feedstocks 

18 and assembled and finished biobased products 

19 in the guidelines issued under this paragraph.’’; 

20 (2) in subsection (b)— 

21 (A) in paragraph (3)— 

22 (i) by striking ‘‘The Secretary’’ and 

23 inserting the following: 

24 ‘‘(A) IN GENERAL.—The Secretary’’; and 


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1 (ii) by adding at the end the fol2 lowing: 

3 ‘‘(B) AUDITING AND COMPLIANCE.—The 

4 Secretary may carry out such auditing and 

5 compliance activities as the Secretary deter6 mines to be necessary to ensure compliance 

7 with subparagraph (A).’’; and 

8 (B) by adding at the end the following: 

9 ‘‘(4) ASSEMBLED AND FINISHED PRODUCTS.— 

10 Not later than 1 year after the date of enactment 

11 of this paragraph, the Secretary shall begin issuing 

12 criteria for determining which assembled and fin13 ished products may qualify to receive the label under 

14 paragraph (1).’’; 

15 (3) by redesignating subsections (d), (e), (f), 

16 (g), and (h) as subsections (e), (f), (g), (i), and (j), 

17 respectively; 

18 (4) by inserting after subsection (c) the fol19 lowing: 

20 ‘‘(d) OUTREACH, EDUCATION, AND PROMOTION.— 

21 ‘‘(1) IN GENERAL.—The Secretary may engage 

22 in outreach, educational, and promotional activities 

23 intended to increase knowledge, awareness, and ben24 efits of biobased products. 


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1 ‘‘(2) AUTHORIZED ACTIVITIES.—In carrying 

2 out this subsection, the Secretary may— 

3 ‘‘(A) conduct consumer education and out4 reach (including consumer and awareness sur5 veys); 

6 ‘‘(B) conduct outreach to and support for 

7 State and local governments interested in im8 plementing biobased purchasing programs; 

9 ‘‘(C) partner with industry and nonprofit 

10 groups to produce educational and outreach 

11 materials and conduct educational and outreach 

12 events; 

13 ‘‘(D) sponsor special conferences and 

14 events to bring together buyers and sellers of 

15 biobased products; and 

16 ‘‘(E) support pilot and demonstration 

17 projects.’’; 

18 (5) in subsection (h) (as redesignated by para19 graph (3))— 

20 (A) in paragraph (2)— 

21 (i) in the matter preceding subpara22 graph (A) by striking ‘‘The report’’ and in23 serting ‘‘Each report under paragraph 

24 (1)’’; 


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1 (ii) in subparagraph (A), by striking 

2 ‘‘and’’ at the end; 

3 (iii) in subparagraph (B)(ii), by strik4 ing the period at the end and inserting a 

5 semicolon; and 

6 (iv) by adding at the end the fol7 lowing: 

8 ‘‘(C) the progress made by other Federal 

9 agencies in compliance with the biobased pro10 curement requirements, including the quantity 

11 of purchases made; and 

12 ‘‘(D) the status of outreach, educational, 

13 and promotional activities carried out by the 

14 Secretary under subsection (d), including the 

15 attainment of specific milestones and overall re16 sults.’’; and 

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

18 ‘‘(3) ECONOMIC IMPACT STUDY AND REPORT.— 

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

20 conduct a study to assess the economic impact 

21 of the biobased products industry, including— 

22 ‘‘(i) the quantity of biobased products 

23 sold; 

24 ‘‘(ii) the value of the biobased prod25 ucts; 


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1 ‘‘(iii) the quantity of jobs created; 

2 ‘‘(iv) the quantity of petroleum dis3 placed; 

4 ‘‘(v) other environmental benefits; and 

5 ‘‘(vi) areas in which the use or manu6 facturing of biobased products could be 

7 more effectively used, including identifying 

8 any technical and economic obstacles and 

9 recommending how those obstacles can be 

10 overcome. 

11 ‘‘(B) REPORT.—Not later than 180 days 

12 after the date of enactment of this subpara13 graph, the Secretary shall submit to Congress a 

14 report describing the results of the study con15 ducted under subparagraph (A).’’. 

16 (6) by inserting after subsection (g) (as redesig17 nated by paragraph (3)) the following: 

18 ‘‘(h) FOREST PRODUCTS LABORATORY COORDINA19 TION.—In determining whether products are eligible for 

20 the ‘USDA Certified Biobased Product’ label, the Sec21 retary (acting through the Forest Products Laboratory) 

22 shall— 

23 ‘‘(1) review and approve forest-related products 

24 for which an application is submitted for the pro25 gram; 


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1 ‘‘(2) expedite the approval of innovative prod2 ucts resulting from technology developed by the For3 est Products Laboratory or partners of the Labora4 tory; and 

5 ‘‘(3) provide appropriate technical assistance to 

6 applicants, as determined by the Secretary.’’; and 

7 (7) in subsection (j) (as redesignated by para8 graph (3))— 

9 (A) in the heading of paragraph (1), by in10 serting ‘‘FOR FISCAL YEARS 2008 THROUGH

11 2012’’ after ‘‘FUNDING’’; 

12 (B) in the heading of paragraph (2), by in13 serting ‘‘FOR FISCAL YEARS 2009 THROUGH

14 2012’’ after ‘‘FUNDING’’; and 

15 (C) by adding at the end the following: 

16 ‘‘(3) FISCAL YEARS 2013 THROUGH 2017.— 

17 There is authorized to be appropriated to carry out 

18 this section $2,000,000 for each of fiscal years 2013 

19 through 2017. 

20 ‘‘(4) MANDATORY FUNDING FOR FISCAL YEARS

21 2013 THROUGH 2017.—Of the funds of the Com22 modity Credit Corporation, the Secretary shall use 

23 to carry out this section $3,000,000 for each of fis24 cal years 2013 through 2017.’’. 


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1 (b) CONFORMING AMENDMENT.—Section 

2 944(c)(2)(A) of the Energy Policy Act of 2005 (42 U.S.C. 

3 16253(c)(2)(A)) is amended by striking ‘‘section 

4 9002(h)(1)’’ and inserting ‘‘section 9002(b)’’. 

5 SEC. 9003. BIOREFINERY, RENEWABLE CHEMICAL, AND 

6 BIOBASED PRODUCT MANUFACTURING AS7 SISTANCE. 

8 (a) PROGRAM ADJUSTMENTS.— 

9 (1) IN GENERAL.—Section 9003 of the Farm 

10 Security and Rural Investment Act of 2002 (7 

11 U.S.C. 8103) is amended— 

12 (A) in the section heading, by inserting ‘‘, 

13 RENEWABLE CHEMICAL, AND BIOBASED

14 PRODUCT MANUFACTURING’’ after ‘‘BIO15 REFINERY’’; 

16 (B) in subsection (a), in the matter pre17 ceding paragraph (1), by inserting ‘‘renewable 

18 chemicals, and biobased product manufac19 turing’’ after ‘‘advanced biofuels,’’; 

20 (C) in subsection (b)— 

21 (i) by redesignating paragraphs (1) 

22 and (2) as paragraphs (2) and (3), respec23 tively; and 

24 (ii) by inserting before paragraph (2) 

25 (as so redesignated) the following: 


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1 ‘‘(1) BIOBASED PRODUCT MANUFACTURING.— 

2 The term ‘biobased product manufacturing’ means 

3 development, construction, and retrofitting of tech4 nologically new commercial-scale processing and 

5 manufacturing equipment and required facilities that 

6 will be used to convert renewable chemicals and 

7 other biobased outputs of biorefineries into end-user 

8 products on a commercial scale.’’; and 

9 (D) in subsection (c)— 

10 (i) in paragraph (1), by striking 

11 ‘‘and’’ at the end; 

12 (ii) in paragraph (2), by striking the 

13 period at the end and inserting ‘‘; and’’; 

14 and 

15 (iii) by adding at the end the fol16 lowing: 

17 ‘‘(3) grants and loan guarantees to fund the de18 velopment and construction of renewable chemical 

19 and biobased product manufacturing facilities.’’. 

20 (2) EFFECTIVE DATE.—The amendments made 

21 by paragraph (1) shall take effect on October 1, 

22 2012. 

23 (b) FUNDING.—Section 9003(h) of the Farm Secu24 rity and Rural Investment Act of 2002 (7 U.S.C. 8103(b)) 

25 is amended— 


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1 (1) by striking paragraph (1) and inserting the 

2 following: 

3 ‘‘(1) MANDATORY FUNDING.— 

4 ‘‘(A) IN GENERAL.—Subject to subpara5 graph (B), of the funds of the Commodity 

6 Credit Corporation, the Secretary shall use for 

7 the cost of loan guarantees under this section, 

8 to remain available until expended— 

9 ‘‘(i) $100,000,000 for fiscal year 

10 2013; and 

11 ‘‘(ii) $58,000,000 for each of fiscal 

12 years 2014 and 2015. 

13 ‘‘(B) BIOBASED PRODUCT MANUFAC14 TURING.—Of the total amount of funds made 

15 available for the period of fiscal years 2013 

16 through 2015 under subparagraph (A), the Sec17 retary use for the cost of loan guarantees under 

18 this section not more than $25,000,000 to pro19 mote biobased product manufacturing.’’; and 

20 (2) in paragraph (2), by striking ‘‘2012’’ and 

21 inserting ‘‘2017’’. 


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1 SEC. 9004. REPEAL OF REPOWERING ASSISTANCE PRO2 GRAM AND TRANSFER OF REMAINING FUNDS. 

3 (a) REPEAL.—Subject to subsection (b), section 9004 

4 of the Farm Security and Rural Investment Act of 2002 

5 (7 U.S.C. 8104) is repealed. 

6 (b) USE OF REMAINING FUNDING FOR RURAL EN7 ERGY FOR AMERICA PROGRAM.—Funds made available 

8 pursuant to subsection (d) of section 9004 of the Farm 

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

10 8104) that are unobligated on the day before the date of 

11 enactment of this section shall— 

12 (1) remain available until expended; 

13 (2) be used by the Secretary of Agriculture to 

14 carry out financial assistance for energy efficiency 

15 improvements and renewable energy systems under 

16 section 9007(a)(2) of the Farm Security and Rural 

17 Investment Act of 2002 (7 U.S.C. 8107(a)(2)); and 

18 (3) be in addition to any other funds made 

19 available to carry out that program. 

20 SEC. 9005. BIOENERGY PROGRAM FOR ADVANCED 

21 BIOFUELS. 

22 Section 9005(g) of the Farm Security and Rural In23 vestment Act of 2002 (7 U.S.C. 8105(c)) is amended— 

24 (1) in the heading of paragraph (1), by insert25 ing ‘‘FOR FISCAL YEARS 2009 THROUGH 2012’’ after 

26 ‘‘FUNDING’’; 


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1 (2) in the heading of paragraph (2), by insert2 ing ‘‘FOR FISCAL YEARS 2009 THROUGH 2012’’ after 

3 ‘‘FUNDING’’; 

4 (3) by redesignating paragraph (3) as para5 graph (4); and 

6 (4) by inserting after paragraph (2) the fol7 lowing: 

8 ‘‘(3) FISCAL YEARS 2013 THROUGH 2017.— 

9 There is authorized to be appropriated to carry out 

10 this section $20,000,000 for each of fiscal years 

11 2013 through 2017.’’. 

12 SEC. 9006. BIODIESEL FUEL EDUCATION PROGRAM. 

13 Section 9006(d) of the Farm Security and Rural In14 vestment Act of 2002 (7 U.S.C. 8106(d)) is amended— 

15 (1) by striking ‘‘(d) FUNDING.—Of the funds’’ 

16 and inserting ‘‘(d) FUNDING.— 

17 ‘‘(1) FISCAL YEARS 2008 THROUGH 2012.—Of 

18 the funds’’; and 

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

20 ‘‘(2) FISCAL YEARS 2013 THROUGH 2017.— 

21 There is authorized to be appropriated to carry out 

22 this section $1,000,000 for each of fiscal years 2013 

23 through 2017. 

24 ‘‘(3) MANDATORY FUNDING FOR FISCAL YEARS

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1 modity Credit Corporation, the Secretary shall use 

2 to carry out this section $1,000,000 for each of fis3 cal years 2013 through 2017.’’. 

4 SEC. 9007. RURAL ENERGY FOR AMERICA PROGRAM. 

5 (a) PROGRAM ADJUSTMENTS.— 

6 (1) IN GENERAL.—Section 9007 of the Farm 

7 Security and Rural Investment Act of 2002 (7 

8 U.S.C. 8107) is amended— 

9 (A) in subsection (b)(2)— 

10 (i) in subparagraph (C), by striking 

11 ‘‘and’’ at the end; 

12 (ii) by redesignating subparagraph 

13 (D) as subparagraph (E); and 

14 (iii) by inserting after subparagraph 

15 (C) the following: 

16 ‘‘(D) a council (as defined in section 1528 

17 of the Agriculture and Food Act of 1981 (16 

18 U.S.C. 3451)); and’’; and 

19 (B) in subsection (c)— 

20 (i) in paragraph (1)(A), by inserting 

21 ‘‘, such as for agricultural and associated 

22 residential purposes’’ after ‘‘electricity’’; 

23 (ii) by striking paragraph (3); 

24 (iii) by redesignating paragraph (4) as 

25 paragraph (3); 


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1 (iv) in paragraph (3) (as so redesig2 nated), by striking subparagraph (A) and 

3 inserting the following: 

4 ‘‘(A) GRANTS.—The amount of a grant 

5 under this subsection shall not exceed the lesser 

6 of— 

7 ‘‘(i) $500,000; and 

8 ‘‘(ii) 25 percent of the cost of the ac9 tivity carried out using funds from the 

10 grant.’’; and 

11 (v) by adding at the end the following: 

12 ‘‘(4) TIERED APPLICATION PROCESS.— 

13 ‘‘(A) IN GENERAL.—In providing loan 

14 guarantees and grants under this subsection, 

15 the Secretary shall use a 3-tiered application 

16 process that reflects the size of proposed 

17 projects in accordance with this paragraph. 

18 ‘‘(B) TIER 1.—The Secretary shall estab19 lish a separate application process for projects 

20 for which the cost of the activity funded under 

21 this subsection is not more than $80,000. 

22 ‘‘(C) TIER 2.—The Secretary shall estab23 lish a separate application process for projects 

24 for which the cost of the activity funded under 


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1 this subsection is greater than $80,000 but less 

2 than $200,000. 

3 ‘‘(D) TIER 3.—The Secretary shall estab4 lish a separate application process for projects 

5 for which the cost of the activity funded under 

6 this subsection is equal to or greater than 

7 $200,000. 

8 ‘‘(E) APPLICATION PROCESS.—The Sec9 retary shall establish an application, evaluation, 

10 and oversight process that is the most sim11 plified for tier I projects and more comprehen12 sive for each subsequent tier.’’. 

13 (2) EFFECTIVE DATE.—The amendments made 

14 by paragraph (1) shall take effect on October 1, 

15 2012. 

16 (b) FUNDING.—Section 9007(g) of the Farm Secu17 rity and Rural Investment Act of 2002 (7 U.S.C. 8107(g)) 

18 is amended— 

19 (1) in the heading of paragraph (1), by insert20 ing ‘‘FOR FISCAL YEARS 2009 THROUGH 2012’’ after 

21 ‘‘FUNDING’’; 

22 (2) in the heading of paragraph (2), by insert23 ing ‘‘FOR FISCAL YEARS 2009 THROUGH 2012’’ after 

24 ‘‘FUNDING’’; 


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1 (3) in the heading of paragraph (3), by insert2 ing ‘‘FOR FISCAL YEARS 2009 THROUGH 2012’’ after 

3 ‘‘FUNDING’’; and 

4 (4) by adding at the end the following: 

5 ‘‘(4) FISCAL YEARS 2013 THROUGH 2017.— 

6 There is authorized to be appropriated to carry out 

7 this section $20,000,000 for each of fiscal years 

8 2013 through 2017. 

9 ‘‘(5) MANDATORY FUNDING FOR FISCAL YEARS

10 2013 THROUGH 2017.—Of the funds of the Com11 modity Credit Corporation, the Secretary shall use 

12 to carry out this section $48,200,000 for each of fis13 cal years 2013 through 2017.’’. 

14 SEC. 9008. BIOMASS RESEARCH AND DEVELOPMENT. 

15 Section 9008(h) of the Farm Security and Rural In16 vestment Act of 2002 (7 U.S.C. 8108(h)) is amended— 

17 (1) in the heading of paragraph (1), by insert18 ing ‘‘FOR FISCAL YEARS 2009 THROUGH 2012’’ after 

19 ‘‘FUNDING’’; 

20 (2) in the heading of paragraph (2), by insert21 ing ‘‘FOR FISCAL YEARS 2009 THROUGH 2012’’ after 

22 ‘‘FUNDING’’; and 

23 (3) by adding at the end the following: 

24 ‘‘(3) FISCAL YEARS 2013 THROUGH 2017.— 

25 There is authorized to be appropriated to carry out 


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1 this section $30,000,000 for each of fiscal years 

2 2013 through 2017. 

3 ‘‘(4) MANDATORY FUNDING FOR FISCAL YEARS

4 2013 THROUGH 2017.—Of the funds of the Com5 modity Credit Corporation, the Secretary shall use 

6 to carry out this section $26,000,000 for each of fis7 cal years 2013 through 2017.’’. 

8 SEC. 9009. FEEDSTOCK FLEXIBILITY PROGRAM FOR BIO9 ENERGY PRODUCERS. 

10 Section 9010(b) of the Farm Security and Rural In11 vestment Act of 2002 (7 U.S.C. 8110(b)) is amended— 

12 (1) in paragraph (1)(A), by striking ‘‘2012’’ 

13 and inserting ‘‘2017’’; and 

14 (2) in paragraph (2)(A), by striking ‘‘2012’’ 

15 and inserting ‘‘2017’’. 

16 SEC. 9010. BIOMASS CROP ASSISTANCE PROGRAM. 

17 Section 9011 of the Farm Security and Rural Invest18 ment Act of 2002 (7 U.S.C. 8111) is amended to read 

19 as follows: 

20 ‘‘SEC. 9011. BIOMASS CROP ASSISTANCE PROGRAM. 

21 ‘‘(a) DEFINITIONS.—In this section: 

22 ‘‘(1) BCAP.—The term ‘BCAP’ means the Bio23 mass Crop Assistance Program established under 

24 this section. 


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1 ‘‘(2) BCAP PROJECT AREA.—The term ‘BCAP 

2 project area’ means an area that— 

3 ‘‘(A) has specified boundaries that are sub4 mitted to the Secretary by the project sponsor 

5 and subsequently approved by the Secretary; 

6 ‘‘(B) includes producers with contract 

7 acreage that will supply a portion of the renew8 able biomass needed by a biomass conversion 

9 facility; and 

10 ‘‘(C) is physically located within an eco11 nomically practicable distance from the biomass 

12 conversion facility. 

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

14 acreage’ means eligible land that is covered by a 

15 BCAP contract entered into with the Secretary. 

16 ‘‘(4) ELIGIBLE CROP.— 

17 ‘‘(A) IN GENERAL.—The term ‘eligible 

18 crop’ means a crop of renewable biomass. 

19 ‘‘(B) EXCLUSIONS.—The term ‘eligible 

20 crop’ does not include— 

21 ‘‘(i) any crop that is eligible to receive 

22 payments under title I of the Food, Con23 servation, and Energy Act of 2008 (7 

24 U.S.C. 8702 et seq.) or an amendment 

25 made by that title; 


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1 ‘‘(ii) any plant that is invasive or nox2 ious or species or varieties of plants that 

3 credible risk assessment tools or other 

4 credible sources determine are potentially 

5 invasive, as determined by the Secretary in 

6 consultation with other appropriate Fed7 eral or State departments and agencies; or 

8 ‘‘(iii) algae. 

9 ‘‘(5) ELIGIBLE LAND.— 

10 ‘‘(A) IN GENERAL.—The term ‘eligible 

11 land’ includes— 

12 ‘‘(i) agricultural and nonindustrial 

13 private forest lands (as defined in section 

14 5(c) of the Cooperative Forestry Assistance 

15 Act of 1978 (16 U.S.C. 2103a(c))); and 

16 ‘‘(ii) land enrolled in the agricultural 

17 conservation easement program established 

18 under subtitle H of title XII of the Food 

19 Security Act of 1985. 

20 ‘‘(B) EXCLUSIONS.—The term ‘eligible 

21 land’ does not include— 

22 ‘‘(i) Federal- or State-owned land; 

23 ‘‘(ii) land that is native sod, as of the 

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1 tion, and Energy Act of 2008 (7 U.S.C. 

2 8701 et seq.); 

3 ‘‘(iii) land enrolled in the conservation 

4 reserve program established under sub5 chapter B of chapter 1 of subtitle D of 

6 title XII of the Food Security Act of 1985 

7 (16 U.S.C. 3831 et seq.); 

8 ‘‘(iv) land enrolled in the Agricultural 

9 Conservation Easement Program estab10 lished under subtitle H of title XII of that 

11 Act; or 

12 ‘‘(v) land enrolled in the conservation 

13 reserve program or the Agricultural Con14 servation Easement Program under a con15 tract that will expire at the end of the cur16 rent fiscal year. 

17 ‘‘(6) ELIGIBLE MATERIAL.— 

18 ‘‘(A) IN GENERAL.—The term ‘eligible ma19 terial’ means renewable biomass harvested di20 rectly from the land, including crop residue 

21 from any crop that is eligible to receive pay22 ments under title I of the Agriculture Reform, 

23 Food, and Jobs Act of 2012 or an amendment 

24 made by that title. 


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1 ‘‘(B) INCLUSIONS.—The term ‘eligible ma2 terial’ shall only include— 

3 ‘‘(i) eligible material that is collected 

4 or harvested by the eligible material 

5 owner— 

6 ‘‘(I) directly from— 

7 ‘‘(aa) National Forest Sys8 tem; 

9 ‘‘(bb) Bureau of Land Man10 agement land; 

11 ‘‘(cc) non-Federal land; or 

12 ‘‘(dd) land owned by an in13 dividual Indian or Indian tribe 

14 that is held in trust by the 

15 United States for the benefit of 

16 the individual Indian or Indian 

17 tribe or subject to a restriction 

18 against alienation imposed by the 

19 United States; 

20 ‘‘(II) in a manner that is con21 sistent with— 

22 ‘‘(aa) a conservation plan; 

23 ‘‘(bb) a forest stewardship 

24 plan; or 


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1 ‘‘(cc) a plan that the Sec2 retary determines is equivalent to 

3 a plan described in item (aa) or 

4 (bb) and consistent with Execu5 tive Order 13112 (42 U.S.C. 

6 4321 note; relating to invasive 

7 species); 

8 ‘‘(ii) if woody eligible material, woody 

9 eligible material that is produced on land 

10 other than contract acreage that— 

11 ‘‘(I) is a byproduct of a preventa12 tive treatment that is removed to re13 duce hazardous fuel or to reduce or 

14 contain disease or insect infestation; 

15 and 

16 ‘‘(II) if harvested from Federal 

17 land, is harvested in accordance with 

18 section 102(e) of the Healthy Forests 

19 Restoration Act of 2003 (16 U.S.C. 

20 6512(e)); and 

21 ‘‘(iii) eligible material that is delivered 

22 to a qualified biomass conversion facility to 

23 be used for heat, power, biobased products, 

24 research, or advanced biofuels. 


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1 ‘‘(C) EXCLUSIONS.—The term ‘eligible ma2 terial’ does not include— 

3 ‘‘(i) material that is whole grain from 

4 any crop that is eligible to receive pay5 ments under title I of the Agriculture Re6 form, Food, and Jobs Act of 2012 or an 

7 amendment made by that title, including— 

8 ‘‘(I) barley, corn, grain sorghum, 

9 oats, rice, or wheat; 

10 ‘‘(II) honey; 

11 ‘‘(III) mohair; 

12 ‘‘(IV) oilseeds, including canola, 

13 crambe, flaxseed, mustard seed, 

14 rapeseed, safflower seed, soybeans, 

15 sesame seed, and sunflower seed; 

16 ‘‘(V) peanuts; 

17 ‘‘(VI) pulse; 

18 ‘‘(VII) chickpeas, lentils, and dry 

19 peas; 

20 ‘‘(VIII) dairy products; 

21 ‘‘(IX) sugar; and 

22 ‘‘(X) wool and cotton boll fiber; 

23 ‘‘(ii) animal waste and byproducts, in24 cluding fat, oil, grease, and manure; 

25 ‘‘(iii) food waste and yard waste; 


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1 ‘‘(iv) algae; 

2 ‘‘(v) woody eligible material that— 

3 ‘‘(I) is removed outside contract 

4 acreage; and 

5 ‘‘(II) is not a byproduct of a pre6 ventative treatment to reduce haz7 ardous fuel or to reduce or contain 

8 disease or insect infestation; 

9 ‘‘(vi) any woody eligible material col10 lected or harvested outside contract acre11 age that would otherwise be used for exist12 ing market products; or 

13 ‘‘(vii) bagasse. 

14 ‘‘(7) PRODUCER.—The term ‘producer’ means 

15 an owner or operator of contract acreage that is 

16 physically located within a BCAP project area. 

17 ‘‘(8) PROJECT SPONSOR.—The term ‘project 

18 sponsor’ means— 

19 ‘‘(A) a group of producers; or 

20 ‘‘(B) a biomass conversion facility. 

21 ‘‘(9) SOCIALLY DISADVANTAGED FARMER OR

22 RANCHER.—The term ‘socially disadvantaged farmer 

23 or rancher’ has the meaning given the term in sec24 tion 2501(e) of the Food, Agriculture, Conservation, 

25 and Trade Act of 1990 (7 U.S.C. 2279(e)). 


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1 ‘‘(b) ESTABLISHMENT AND PURPOSE.—The Sec2 retary shall establish and administer a Biomass Crop As3 sistance Program to— 

4 ‘‘(1) support the establishment and production 

5 of eligible crops for conversion to bioenergy in se6 lected BCAP project areas; and 

7 ‘‘(2) assist agricultural and forest land owners 

8 and operators with the collection, harvest, storage, 

9 and transportation of eligible material for use in a 

10 biomass conversion facility. 

11 ‘‘(c) BCAP PROJECT AREA.— 

12 ‘‘(1) IN GENERAL.—The Secretary shall provide 

13 financial assistance to a producer of an eligible crop 

14 in a BCAP project area. 

15 ‘‘(2) SELECTION OF PROJECT AREAS.— 

16 ‘‘(A) IN GENERAL.—To be considered for 

17 selection as a BCAP project area, a project 

18 sponsor shall submit to the Secretary a pro19 posal that, at a minimum, includes— 

20 ‘‘(i) a description of the eligible land 

21 and eligible crops of each producer that 

22 will participate in the proposed BCAP 

23 project area; 

24 ‘‘(ii) a letter of commitment from a 

25 biomass conversion facility that the facility 


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1 will use the eligible crops intended to be 

2 produced in the proposed BCAP project 

3 area; 

4 ‘‘(iii) evidence that the biomass con5 version facility has sufficient equity avail6 able, as determined by the Secretary, if the 

7 biomass conversion facility is not oper8 ational at the time the proposal is sub9 mitted to the Secretary; and 

10 ‘‘(iv) any other information about the 

11 biomass conversion facility or proposed bio12 mass conversion facility that the Secretary 

13 determines necessary for the Secretary to 

14 be reasonably assured that the plant will 

15 be in operation by the date on which the 

16 eligible crops are ready for harvest. 

17 ‘‘(B) BCAP PROJECT AREA SELECTION CRI18 TERIA.—In selecting BCAP project areas, the 

19 Secretary shall consider— 

20 ‘‘(i) the volume of the eligible crops 

21 proposed to be produced in the proposed 

22 BCAP project area and the probability 

23 that those crops will be used for the pur24 poses of the BCAP; 


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1 ‘‘(ii) the volume of renewable biomass 

2 projected to be available from sources 

3 other than the eligible crops grown on con4 tract acres; 

5 ‘‘(iii) the anticipated economic impact 

6 in the proposed BCAP project area; 

7 ‘‘(iv) the opportunity for producers 

8 and local investors to participate in the 

9 ownership of the biomass conversion facil10 ity in the proposed BCAP project area; 

11 ‘‘(v) the participation rate by— 

12 ‘‘(I) beginning farmers or ranch13 ers (as defined in accordance with sec14 tion 343(a) of the Consolidated Farm 

15 and Rural Development Act (7 U.S.C. 

16 1991(a))); or 

17 ‘‘(II) socially disadvantaged 

18 farmers or ranchers; 

19 ‘‘(vi) the impact on soil, water, and 

20 related resources; 

21 ‘‘(vii) the variety in biomass produc22 tion approaches within a project area, in23 cluding (as appropriate)— 

24 ‘‘(I) agronomic conditions; 


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1 ‘‘(II) harvest and postharvest 

2 practices; and 

3 ‘‘(III) monoculture and 

4 polyculture crop mixes; 

5 ‘‘(viii) the range of eligible crops 

6 among project areas; and 

7 ‘‘(ix) any additional information that 

8 the Secretary determines to be necessary. 

9 ‘‘(3) CONTRACT.— 

10 ‘‘(A) IN GENERAL.—On approval of a 

11 BCAP project area by the Secretary, each pro12 ducer in the BCAP project area shall enter into 

13 a contract directly with the Secretary. 

14 ‘‘(B) MINIMUM TERMS.—At a minimum, a 

15 contract under this subsection shall include 

16 terms that cover— 

17 ‘‘(i) an agreement to make available 

18 to the Secretary, or to an institution of 

19 higher education or other entity designated 

20 by the Secretary, such information as the 

21 Secretary considers to be appropriate to 

22 promote the production of eligible crops 

23 and the development of biomass conversion 

24 technology; 


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1 ‘‘(ii) compliance with the highly erod2 ible land conservation requirements of sub3 title B of title XII of the Food Security 

4 Act of 1985 (16 U.S.C. 3811 et seq.) and 

5 the wetland conservation requirements of 

6 subtitle C of title XII of that Act (16 

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

8 ‘‘(iii) the implementation of (as deter9 mined by the Secretary)— 

10 ‘‘(I) a conservation plan; 

11 ‘‘(II) a forest stewardship plan; 

12 or 

13 ‘‘(III) a plan that is equivalent to 

14 a conservation or forest stewardship 

15 plan; and 

16 ‘‘(iv) any additional requirements that 

17 Secretary determines to be necessary. 

18 ‘‘(C) DURATION.—A contract under this 

19 subsection shall have a term of not more 

20 than— 

21 ‘‘(i) 5 years for annual and perennial 

22 crops; or 

23 ‘‘(ii) 15 years for woody biomass. 

24 ‘‘(4) RELATIONSHIP TO OTHER PROGRAMS.—In 

25 carrying out this subsection, the Secretary shall proVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00909 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 vide for the preservation of cropland base and yield 

2 history applicable to the land enrolled in a BCAP 

3 contract. 

4 ‘‘(5) PAYMENTS.— 

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

6 make establishment and annual payments di7 rectly to producers to support the establishment 

8 and production of eligible crops on contract 

9 acreage. 

10 ‘‘(B) AMOUNT OF ESTABLISHMENT PAY11 MENTS.— 

12 ‘‘(i) IN GENERAL.—Subject to clause 

13 (ii), the amount of an establishment pay14 ment under this subsection shall be not 

15 more than 50 percent of the costs of estab16 lishing an eligible perennial crop covered 

17 by the contract but not to exceed $500 per 

18 acre, including— 

19 ‘‘(I) the cost of seeds and stock 

20 for perennials; 

21 ‘‘(II) the cost of planting the pe22 rennial crop, as determined by the 

23 Secretary; and 


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1 ‘‘(III) in the case of nonindus2 trial private forestland, the costs of 

3 site preparation and tree planting. 

4 ‘‘(ii) SOCIALLY DISADVANTAGES

5 FARMERS OR RANCHERS.—In the case of 

6 socially disadvantaged farmers or ranchers, 

7 the costs of establishment may not exceed 

8 $750 per acre. 

9 ‘‘(C) AMOUNT OF ANNUAL PAYMENTS.— 

10 ‘‘(i) IN GENERAL.—Subject to clause 

11 (ii), the amount of an annual payment 

12 under this subsection shall be determined 

13 by the Secretary. 

14 ‘‘(ii) REDUCTION.—The Secretary 

15 shall reduce an annual payment by an 

16 amount determined to be appropriate by 

17 the Secretary, if— 

18 ‘‘(I) an eligible crop is used for 

19 purposes other than the production of 

20 energy at the biomass conversion fa21 cility; 

22 ‘‘(II) an eligible crop is delivered 

23 to the biomass conversion facility; 

24 ‘‘(III) the producer receives a 

25 payment under subsection (d); 


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1 ‘‘(IV) the producer violates a 

2 term of the contract; or 

3 ‘‘(V) the Secretary determines a 

4 reduction is necessary to carry out 

5 this section. 

6 ‘‘(d) ASSISTANCE WITH COLLECTION, HARVEST, 

7 STORAGE, AND TRANSPORTATION.— 

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

9 payment for the delivery of eligible material to a bio10 mass conversion facility to— 

11 ‘‘(A) a producer of an eligible crop that is 

12 produced on BCAP contract acreage; or 

13 ‘‘(B) a person with the right to collect or 

14 harvest eligible material, regardless of whether 

15 the eligible material is produced on contract 

16 acreage. 

17 ‘‘(2) PAYMENTS.— 

18 ‘‘(A) COSTS COVERED.—A payment under 

19 this subsection shall be in an amount described 

20 in subparagraph (B) for— 

21 ‘‘(i) collection; 

22 ‘‘(ii) harvest; 

23 ‘‘(iii) storage; and 

24 ‘‘(iv) transportation to a biomass con25 version facility. 


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1 ‘‘(B) AMOUNT.—Subject to paragraph (3), 

2 the Secretary may provide matching payments 

3 at a rate of up to $1 for each $1 per ton pro4 vided by the biomass conversion facility, in an 

5 amount not to exceed $20 per dry ton for a pe6 riod of 4 years. 

7 ‘‘(3) LIMITATION ON ASSISTANCE FOR BCAP

8 CONTRACT ACREAGE.—As a condition of the receipt 

9 of an annual payment under subsection (c), a pro10 ducer receiving a payment under this subsection for 

11 collection, harvest, storage, or transportation of an 

12 eligible crop produced on BCAP acreage shall agree 

13 to a reduction in the annual payment. 

14 ‘‘(e) REPORT.—Not later than 4 years after the date 

15 of enactment of the Agriculture Reform, Food, and Jobs 

16 Act of 2012, the Secretary shall submit to the Committee 

17 on Agriculture of the House of Representatives and the 

18 Committee on Agriculture, Nutrition, and Forestry of the 

19 Senate a report on the dissemination by the Secretary of 

20 the best practice data and information gathered from par21 ticipants receiving assistance under this section. 

22 ‘‘(f) FUNDING.— 

23 ‘‘(1) IN GENERAL.—Of the funds of the Com24 modity Credit Corporation, the Secretary shall use 


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1 to carry out this section $38,600,000 for each of fis2 cal years 2013 through 2017. 

3 ‘‘(2) COLLECTION, HARVEST, STORAGE, AND

4 TRANSPORTATION PAYMENTS.—Of the amount made 

5 available under paragraph (1) for each fiscal year, 

6 the Secretary shall use not less than 10 percent, nor 

7 more than 50 percent, of the amount to make collec8 tion, harvest, transportation, and storage payments 

9 under subsection (d)(2).’’. 

10 SEC. 9011. REPEAL OF FOREST BIOMASS FOR ENERGY. 

11 Section 9012 of the Farm Security and Rural Invest12 ment Act of 2002 (7 U.S.C. 8112) is repealed. 

13 SEC. 9012. COMMUNITY WOOD ENERGY PROGRAM. 

14 Section 9013(e) of the Farm Security and Rural In15 vestment Act of 2002 (7 U.S.C. 8113(e)) is amended by 

16 inserting before the period at the end ‘‘and $5,000,000 

17 for each of fiscal years 2013 through 2017’’. 

18 SEC. 9013. REPEAL OF RENEWABLE FERTILIZER STUDY. 

19 Section 9003 of the Food, Conservation, and Energy 

20 Act of 2008 (Public Law 110–246; 122 Stat. 2096) is re21 pealed. 


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1 TITLE X—HORTICULTURE 

2 SEC. 10001. SPECIALTY CROPS MARKET NEWS ALLOCATION. 

3 Section 10107(b) of the Food, Conservation, and En4 ergy Act of 2008 (7 U.S.C. 1622b(b)) is amended by strik5 ing ‘‘2012’’ and inserting ‘‘2017’’. 

6 SEC. 10002. REPEAL OF GRANT PROGRAM TO IMPROVE 

7 MOVEMENT OF SPECIALTY CROPS. 

8 Section 10403 of the Food, Conservation, and En9 ergy Act of 2008 (7 U.S.C. 1622c) is repealed. 

10 SEC. 10003. FARMERS MARKET AND LOCAL FOOD PRO11 MOTION PROGRAM. 

12 Section 6 of the Farmer-to-Consumer Direct Mar13 keting Act of 1976 (7 U.S.C. 3005) is amended— 

14 (1) in the section heading, by adding ‘‘AND

15 LOCAL FOOD’’ after ‘‘MARKET’’; 

16 (2) in subsection (a)— 

17 (A) by inserting ‘‘and Local Food’’ after 

18 ‘‘Market’’; 

19 (B) by striking ‘‘farmers’ markets and to 

20 promote’’; and 

21 (C) by inserting ‘‘and local food capacity 

22 development’’ before the period at the end; 

23 (3) in subsection (b), by striking paragraph (1) 

24 and inserting the following: 


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1 ‘‘(1) IN GENERAL.—The purposes of the Pro2 gram are to increase domestic consumption of and 

3 access to locally and regionally produced agricultural 

4 products by developing, improving, expanding, and 

5 providing outreach, training, and technical assist6 ance to, or assisting in the development, improve7 ment and expansion of— 

8 ‘‘(A) domestic farmers’ markets, roadside 

9 stands, community-supported agriculture pro10 grams, agritourism activities, and other direct 

11 producer-to-consumer market opportunities; and 

12 ‘‘(B) local and regional food enterprises 

13 that are not direct producer-to-consumer mar14 kets but process, distribute, aggregate, store, 

15 and market locally or regionally produced food 

16 products.’’; 

17 (4) in subsection (c)(1)— 

18 (A) by inserting ‘‘or other business entity’’ 

19 after ‘‘cooperative’’; and 

20 (B) by inserting ‘‘, including a community 

21 supported agriculture network or association’’ 

22 after ‘‘association’’; 

23 (5) by redesignating subsection (e) as sub24 section (f); 


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1 (6) by inserting after subsection (d) the fol2 lowing: 

3 ‘‘(e) PRIORITIES.—In providing grants under the 

4 Program, priority shall be given to applications that in5 clude projects that— 

6 ‘‘(1) benefit underserved communities; 

7 ‘‘(2) develop market opportunities for small and 

8 mid-sized farm and ranch operations; and 

9 ‘‘(3) include a strategic plan to maximize the 

10 use of funds to build capacity for local and regional 

11 food systems in a community.’’; 

12 (7) in subsection (f) (as redesignated by para13 graph (5))— 

14 (A) in paragraph (1)— 

15 (i) in subparagraph (B), by striking 

16 ‘‘and’’ after the semicolon at the end; 

17 (ii) in subparagraph (C), by striking 

18 the period at the end and inserting ‘‘; 

19 and’’; and 

20 (iii) by adding at the end the fol21 lowing: 

22 ‘‘(D) $20,000,000 for each of fiscal years 

23 2013 through 2017.’’; 

24 (B) by striking paragraphs (2) and (4); 


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1 (C) by redesignating paragraph (3) as 

2 paragraph (4); 

3 (D) by inserting after paragraph (1) the 

4 following: 

5 ‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—In 

6 addition to funds made available under paragraph 

7 (1), there is authorized to be appropriated to carry 

8 out this section $20,000,000 for each of fiscal years 

9 2013 through 2017. 

10 ‘‘(3) USE OF FUNDS.— 

11 ‘‘(A) IN GENERAL.—Of the funds made 

12 available to carry out the Program for each fis13 cal year, 50 percent shall be used for the pur14 poses described in subsection (b)(1)(A) and 50 

15 percent shall be used for the purposes described 

16 in subsection (b)(1)(B). 

17 ‘‘(B) COST SHARE.—To be eligible to re18 ceive a grant for a project described in sub19 section (b)(1)(B), a recipient shall provide a 

20 match in the form of cash or in-kind contribu21 tions in an amount equal to 25 percent of the 

22 total cost of the project.’’; and 

23 (E) by adding at the end the following: 

24 ‘‘(5) ADMINISTRATIVE EXPENSES.—Not more 

25 than 10 percent of the total amount made available 


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1 to carry out this section for a fiscal year may be 

2 used for administrative expenses. 

3 ‘‘(6) LIMITATIONS.—An eligible entity may not 

4 use a grant or other assistance provided under the 

5 Program for the purchase, construction, or rehabili6 tation of a building or structure.’’. 

7 SEC. 10004. STUDY ON LOCAL FOOD PRODUCTION AND PRO8 GRAM EVALUATION. 

9 (a) IN GENERAL.—The Secretary shall— 

10 (1) collect data on the production and mar11 keting of locally or regionally produced agricultural 

12 food products; 

13 (2) facilitate interagency collaboration and data 

14 sharing on programs related to local and regional 

15 food systems; and 

16 (3) monitor the effectiveness of programs de17 signed to expand or facilitate local food systems. 

18 (b) REQUIREMENTS.—In carrying out this section, 

19 the Secretary shall, at a minimum— 

20 (1) collect and distribute comprehensive report21 ing of prices of locally or regionally produced agri22 cultural food products; 

23 (2) conduct surveys and analysis and publish 

24 reports relating to the production, handling, dis25 tribution, retail sales, and trend studies (including 


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1 consumer purchasing patterns) of or on locally or re2 gionally produced agricultural food products; 

3 (3) evaluate the effectiveness of existing pro4 grams in growing local and regional food systems, 

5 including— 

6 (A) the impact of local food systems on job 

7 creation and economic development; 

8 (B) the level of participation in the Farm9 ers’ Market and Local Food Promotion Pro10 gram established under section 6 of the Farm11 er-to-Consumer Direct Marketing Act of 1976 

12 (7 U.S.C. 3005), including the percentage of 

13 projects funded in comparison to applicants and 

14 the types of eligible entities receiving funds; 

15 (C) the ability for participants to leverage 

16 private capital and a synopsis of the places 

17 from which non-Federal funds are derived; and 

18 (D) any additional resources required to 

19 aid in the development or expansion of local 

20 and regional food systems; 

21 (4) expand the Agricultural Resource Manage22 ment Survey to include questions on locally or re23 gionally produced agricultural food products; and 

24 (5) seek to establish or expand private-public 

25 partnerships to facilitate, to the maximum extent 


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1 practicable, the collection of data on locally or re2 gionally produced agricultural food products, includ3 ing the development of a nationally coordinated and 

4 regionally balanced evaluation of the redevelopment 

5 of locally or regionally produced food systems. 

6 (c) REPORT.—Not later than 1 year after the date 

7 of enactment of this Act and annually thereafter, the Sec8 retary shall submit to the Committee on Agriculture of 

9 the House of Representatives and the Committee on Agri10 culture, Nutrition, and Forestry of the Senate a report 

11 describing the progress that has been made in imple12 menting this section and identifying any additional needs 

13 related to developing local and regional food systems. 

14 SEC. 10005. ORGANIC AGRICULTURE. 

15 (a) ORGANIC PRODUCTION AND MARKET DATA INI16 TIATIVES.—Section 7407 of the Farm Security and Rural 

17 Investment Act of 2002 (7 U.S.C. 5925c) is amended— 

18 (1) in subsection (c)— 

19 (A) in the matter preceding paragraph (1), 

20 by inserting ‘‘and annually thereafter’’ after 

21 ‘‘this subsection’’; 

22 (B) in paragraph (1), by striking ‘‘and’’ at 

23 the end; 

24 (C) by redesignating paragraph (2) as 

25 paragraph (3); and 


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1 (D) by inserting after paragraph (1) the 

2 following: 

3 ‘‘(2) describes how data collection agencies 

4 (such as the Agricultural Marketing Service and the 

5 National Agricultural Statistics Service) are coordi6 nating with data user agencies (such as the Risk 

7 Management Agency) to ensure that data collected 

8 under this section can be used by data user agencies, 

9 including by the Risk Management Agency to offer 

10 price elections for all organic crops; and’’; and 

11 (2) in subsection (d)— 

12 (A) by redesignating paragraph (2) as 

13 paragraph (3); 

14 (B) by inserting after paragraph (1) the 

15 following: 

16 ‘‘(2) MANDATORY FUNDING.—In addition to 

17 any funds available under paragraph (1), of the 

18 funds of the Commodity Credit Corporation, the 

19 Secretary shall use to carry out this section 

20 $5,000,000, to remain available until expended.’’; 

21 and 

22 (C) in paragraph (3) (as redesignated by 

23 subparagraph (A))— 

24 (i) by striking ‘‘paragraph (1)’’ and 

25 inserting ‘‘paragraphs (1) and (2)’’; and 


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1 (ii) by striking ‘‘2012’’ and inserting 

2 ‘‘2017’’. 

3 (b) MODERNIZATION AND TECHNOLOGY UPGRADE

4 FOR NATIONAL ORGANIC PROGRAM.—Section 2123 of the 

5 Organic Foods Production Act of 1990 (7 U.S.C. 6522) 

6 is amended— 

7 (1) in subsection (b)— 

8 (A) in paragraph (5), by striking ‘‘and’’ at 

9 the end; 

10 (B) by redesignating paragraph (6) as 

11 paragraph (7); and 

12 (C) by inserting after paragraph (5) the 

13 following: 

14 ‘‘(6) $15,000,000 for each of fiscal years 2013 

15 through 2017; and’’; and 

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

17 ‘‘(c) MODERNIZATION AND TECHNOLOGY UPGRADE

18 FOR NATIONAL ORGANIC PROGRAM.— 

19 ‘‘(1) IN GENERAL.—The Secretary shall mod20 ernize database and technology systems of the na21 tional organic program. 

22 ‘‘(2) FUNDING.—Of the funds of the Com23 modity Credit Corporation and in addition to any 

24 other funds made available for that purpose, the 

25 Secretary shall make available to carry out this subVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00923 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 section $5,000,000 in fiscal year 2013, to remain 

2 available until expended. 

3 ‘‘(d) REPORT.—Not later than 180 days after the 

4 date of enactment of this subsection, the Secretary shall 

5 submit to the Committee on Agriculture of the House of 

6 Representatives and the Committee on Agriculture, Nutri7 tion, and Forestry of the Senate a report that— 

8 ‘‘(1) describes the efforts of the Secretary to 

9 ensure that activities conducted through commodity 

10 research and promotion programs adequately reflect 

11 the priorities of all members of the applicable orders; 

12 and 

13 ‘‘(2) includes an assessment of the feasibility of 

14 establishing an organic research and promotion pro15 gram, including any current barriers to establish16 ment and challenges related to implementation.’’. 

17 SEC. 10006. FOOD SAFETY EDUCATION INITIATIVES. 

18 Section 10105(c) of the Food, Conservation, and En19 ergy Act of 2008 (7 U.S.C. 7655a(c)) is amended by strik20 ing ‘‘2012’’ and inserting ‘‘2017’’. 

21 SEC. 10007. COORDINATED PLANT MANAGEMENT PRO22 GRAM. 

23 (a) IN GENERAL.—Section 420 of the Plant Protec24 tion Act (7 U.S.C. 7721) is amended— 


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1 (1) by striking the section heading and insert2 ing ‘‘COORDINATED PLANT MANAGEMENT PRO3 GRAM.’’; 

4 (2) by redesignating subsection (e) as sub5 section (f); and 

6 (3) by inserting after subsection (d) the fol7 lowing: 

8 ‘‘(e) NATIONAL CLEAN PLANT NETWORK.— 

9 ‘‘(1) IN GENERAL.—The Secretary shall estab10 lish a program to be known as the ‘National Clean 

11 Plant Network’ (referred to in this subsection as the 

12 ‘Program’). 

13 ‘‘(2) REQUIREMENTS.—Under the Program, the 

14 Secretary shall establish a network of clean plant 

15 centers for diagnostic and pathogen elimination serv16 ices— 

17 ‘‘(A) to produce clean propagative plant 

18 material; and 

19 ‘‘(B) to maintain blocks of pathogen-tested 

20 plant material in sites located throughout the 

21 United States. 

22 ‘‘(3) AVAILABILITY OF CLEAN PLANT SOURCE

23 MATERIAL.—Clean plant source material produced 

24 or maintained under the Program may be made 

25 available to— 


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1 ‘‘(A) a State for a certified plant program 

2 of the State; and 

3 ‘‘(B) private nurseries and producers. 

4 ‘‘(4) CONSULTATION AND COLLABORATION.—In 

5 carrying out the Program, the Secretary shall— 

6 ‘‘(A) consult with— 

7 ‘‘(i) State departments of agriculture; 

8 and 

9 ‘‘(ii) land-grant colleges and univer10 sities and NLGCA Institutions (as those 

11 terms are defined in section 1404 of the 

12 National Agricultural Research, Extension, 

13 and Teaching Policy Act of 1977 (7 U.S.C. 

14 3103)); and 

15 ‘‘(B) to the extent practicable and with 

16 input from the appropriate State officials and 

17 industry representatives, use existing Federal or 

18 State facilities to serve as clean plant centers.’’. 

19 (b) FUNDING.—Subsection (f) of section 420 of the 

20 Plant Protection Act (7 U.S.C. 7721) (as redesignated by 

21 subsection (a)(1)) is amended— 

22 (1) in paragraph (3), by striking ‘‘and’’ at the 

23 end; 

24 (2) in paragraph (4), by striking ‘‘and each fis25 cal year thereafter.’’ and inserting a semicolon; and 


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1 (3) by adding at the end the following: 

2 ‘‘(5) $60,000,000 for each of fiscal years 2013 

3 through 2016; and 

4 ‘‘(6) $65,000,000 for fiscal year 2017 and each 

5 fiscal year thereafter.’’. 

6 (c) REPEAL OF EXISTING PROVISION.—Section 

7 10202 of the Food, Conservation, and Energy Act of 2008 

8 (7 U.S.C. 7761) is repealed. 

9 (d) CLARIFICATION OF USE OF FUNDS FOR TECH10 NICAL ASSISTANCE.—Section 420 of the Plant Protection 

11 Act (7 U.S.C. 7721) (as amended by subsection (a)) is 

12 amended by adding at the end the following: 

13 ‘‘(g) RELATIONSHIP TO OTHER LAW.—The use of 

14 Commodity Credit Corporation funds under this section 

15 to provide technical assistance shall not be considered an 

16 allotment or fund transfer from the Commodity Credit 

17 Corporation for purposes of the limit on expenditures for 

18 technical assistance imposed by section 11 of the Com19 modity Credit Corporation Charter Act (15 U.S.C. 

20 714i).’’. 

21 SEC. 10008. SPECIALTY CROP BLOCK GRANTS. 

22 Section 101 of the Specialty Crops Competitiveness 

23 Act of 2004 (7 U.S.C. 1621 note; Public Law 108–465) 

24 is amended— 

25 (1) in subsection (a)— 


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1 (A) by striking ‘‘subsection (j)’’ and insert2 ing ‘‘subsection (l)’’; and 

3 (B) by striking ‘‘2012’’ and inserting 

4 ‘‘2017’’; 

5 (2) by striking subsection (b) and inserting the 

6 following: 

7 ‘‘(b) GRANTS BASED ON VALUE AND ACREAGE.— 

8 Subject to subsection (c), in the case of each State with 

9 an application for a grant for a fiscal year that is accepted 

10 by the Secretary of Agriculture under subsection (f), the 

11 amount of a grant for a fiscal year to a State under this 

12 section shall bear the same ratio to the total amount made 

13 available under subsection (l) for that fiscal year as— 

14 ‘‘(1) the average of the most recent available 

15 value of specialty crop production in the State and 

16 the acreage of specialty crop production in the State, 

17 as demonstrated in the most recent Census of Agri18 culture data; bears to 

19 ‘‘(2) the average of the most recent available 

20 value of specialty crop production in all States and 

21 the acreage of specialty crop production in all 

22 States, as demonstrated in the most recent Census 

23 of Agriculture data.’’; 

24 (3) by redesignating subsection (j) as sub25 section (l); 


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1 (4) by inserting after subsection (i) the fol2 lowing: 

3 ‘‘(j) MULTISTATE PROJECTS.— 

4 ‘‘(1) IN GENERAL.—Not later than 180 days 

5 after the date of enactment of the Agriculture Re6 form, Food, and Jobs Act of 2012, the Secretary of 

7 Agriculture shall issue guidance for the purpose of 

8 making grants to multistate projects under this sec9 tion for projects involving— 

10 ‘‘(A) food safety; 

11 ‘‘(B) plant pests and disease; 

12 ‘‘(C) crop-specific projects addressing com13 mon issues; and 

14 ‘‘(D) any other area that furthers the pur15 poses of this section, as determined by the Sec16 retary. 

17 ‘‘(2) FUNDING.—Of the funds provided under 

18 subsection (l), the Secretary of Agriculture may allo19 cate for grants under this subsection, to remain 

20 available until expended— 

21 ‘‘(A) $1,000,000 for fiscal year 2013; 

22 ‘‘(B) $2,000,000 for fiscal year 2014; 

23 ‘‘(C) $3,000,000 for fiscal year 2015; 

24 ‘‘(D) $4,000,000 for fiscal year 2016; and 

25 ‘‘(E) $5,000,000 for fiscal year 2017. 


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1 ‘‘(k) ADMINISTRATION.— 

2 ‘‘(1) DEPARTMENT.—The Secretary of Agri3 culture may not use more than 3 percent of the 

4 funds made available to carry out this section for a 

5 fiscal year for administrative expenses. 

6 ‘‘(2) STATES.—A State receiving a grant under 

7 this section may not use more than 8 percent of the 

8 funds received under the grant for a fiscal year for 

9 administrative expenses.’’; and 

10 (5) in subsection (l) (as redesignated by para11 graph (3))— 

12 (A) in paragraph (2), by striking ‘‘and’’ at 

13 the end; 

14 (B) in paragraph (3), by striking the pe15 riod at the end and inserting ‘‘; and’’; and 

16 (C) by adding at the end the following: 

17 ‘‘(4) $70,000,000 for fiscal year 2013 and each 

18 fiscal year thereafter.’’. 

19 SEC. 10009. RECORDKEEPING, INVESTIGATIONS, AND EN20 FORCEMENT. 

21 The Organic Foods Production Act of 1990 is amend22 ed by inserting after section 2120 (7 U.S.C. 6519) the 

23 following: 


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1 ‘‘SEC. 2120A. RECORDKEEPING, INVESTIGATIONS, AND EN2 FORCEMENT. 

3 ‘‘(a) RECORDKEEPING.— 

4 ‘‘(1) IN GENERAL.—Except as otherwise pro5 vided in this title, all persons, including producers, 

6 handlers, and certifying agents, required to report 

7 information to the Secretary under this title shall 

8 maintain, and make available to the Secretary on 

9 the request of the Secretary, all contracts, agree10 ments, receipts, and other records associated with 

11 the organic certification program established by the 

12 Secretary under this title. 

13 ‘‘(2) DURATION OF RECORDKEEPING REQUIRE14 MENT.—A record covered by paragraph (1) shall be 

15 maintained— 

16 ‘‘(A) by a person covered by this title, ex17 cept for a certifying agent, for a period of 5 

18 years beginning on the date of the creation of 

19 the record; and 

20 ‘‘(B) by a certifying agent, for a period of 

21 10 years beginning on the date of the creation 

22 of the record. 

23 ‘‘(b) CONFIDENTIALITY.— 

24 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

25 and except as otherwise directed by the Secretary or 

26 the Attorney General for enforcement purposes, no 


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1 officer, employee, or agent of the United States shall 

2 make available to the public information, statistics, 

3 or documents obtained from or made available by 

4 any person under this title, other than in a manner 

5 that ensures that confidentiality is preserved regard6 ing the identity of persons, including parties to a 

7 contract, and proprietary business information. 

8 ‘‘(2) ALLEGED VIOLATORS AND NATURE OF AC9 TIONS.—The Secretary may release the name of the 

10 alleged violator and the nature of the actions trig11 gering an order, suspension, or revocation under 

12 subsection (e). 

13 ‘‘(c) INVESTIGATION.— 

14 ‘‘(1) IN GENERAL.—The Secretary may take 

15 such investigative actions as the Secretary considers 

16 to be necessary to carry out this title— 

17 ‘‘(A) to verify the accuracy of any informa18 tion reported or made available under this title; 

19 and 

20 ‘‘(B) to determine, with regard to actions, 

21 practices, or information required under this 

22 title, whether a person covered by this title has 

23 committed, or will commit, a violation of any 

24 provision of this title, including an order or reg25 ulation promulgated by the Secretary. 


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1 ‘‘(2) INVESTIGATIVE POWERS.—The Secretary 

2 may administer oaths and affirmations, subpoena 

3 witnesses, compel attendance of witnesses, take evi4 dence, and require the production of any books, pa5 pers, and documents that are relevant to the inves6 tigation. 

7 ‘‘(d) UNLAWFUL ACT.—It shall be unlawful and a 

8 violation of this title for any person covered by this title— 

9 ‘‘(1) to fail or refuse to provide, or delay the 

10 timely provision of, accurate information required by 

11 the Secretary under this section; 

12 ‘‘(2) to violate— 

13 ‘‘(A) an order of the Secretary; 

14 ‘‘(B) a suspension or revocation of the or15 ganic certification of a producer or handler; or 

16 ‘‘(C) a suspension or revocation of the ac17 creditation of a certifying agent; or 

18 ‘‘(3) to sell, or attempt to sell, a product that 

19 is represented as being organically produced under 

20 this title if in fact the product has been produced or 

21 handled by an operation that is not yet a certified 

22 organic producer or handler under this title. 

23 ‘‘(e) ENFORCEMENT.— 

24 ‘‘(1) ORDER.—The Secretary may issue an 

25 order to stop the sale of an agricultural product that 


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1 is labeled or otherwise represented as being organi2 cally produced— 

3 ‘‘(A) until the product can be verified— 

4 ‘‘(i) as meeting the national and State 

5 standards for organic production and han6 dling as provided in sections 2105 through 

7 2114; 

8 ‘‘(ii) as having been produced or han9 dled without the use of a prohibited sub10 stance listed under section 2118; and 

11 ‘‘(iii) as being produced and handled 

12 by a certified organic operation; and 

13 ‘‘(B) if a person has committed an unlaw14 ful act with respect to the product under sub15 section (d). 

16 ‘‘(2) CERTIFICATION OR ACCREDITATION.— 

17 ‘‘(A) SUSPENSION.— 

18 ‘‘(i) IN GENERAL.—The Secretary 

19 may suspend the organic certification of a 

20 producer or handler, or accreditation of a 

21 certifying agent, for a period not to exceed 

22 30 days, and may renew the suspension for 

23 an additional period, under the cir24 cumstances described in clause (ii). 


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1 ‘‘(ii) ACTIONS TRIGGERING SUSPEN2 SION.—The Secretary may take the sus3 pension or renewal actions described in 

4 clause (i), if the Secretary has reason to 

5 believe that a person producing or han6 dling an agricultural product, or a certi7 fying agent, has violated or is violating any 

8 provision of this title, including an order or 

9 regulation promulgated under this title. 

10 ‘‘(iii) CONTINUATION OF SUSPENSION

11 THROUGH APPEAL.—If the Secretary de12 termines subsequent to an investigation 

13 that a violation of this title by a person 

14 covered by this title has occurred, the sus15 pension shall remain in effect until the 

16 Secretary issues a revocation of the certifi17 cation of the person or of the accreditation 

18 of the certifying agent, covered by this 

19 title, after an expedited administrative ap20 peal under section 2121 has been com21 pleted. 

22 ‘‘(B) REVOCATION.—After notice and op23 portunity for an administrative appeal under 

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1 curred and is an unlawful act under subsection 

2 (d), the Secretary shall revoke the organic cer3 tification of the producer or handler, or the ac4 creditation of the certifying agent. 

5 ‘‘(3) VIOLATION OF ORDER OR REVOCATION.— 

6 A person who violates an order to stop the sale of 

7 a product as an organically produced product under 

8 paragraph (1), or a revocation of certification or ac9 creditation under paragraph (2)(B), shall be subject 

10 to 1 or more of the penalties provided in subsections 

11 (a) and (b) of section 2120. 

12 ‘‘(f) APPEAL.— 

13 ‘‘(1) IN GENERAL.—An order under subsection 

14 (e)(1), or a revocation of certification or accredita15 tion under subsection (e)(2)(B) shall be final and 

16 conclusive unless the affected person files an appeal 

17 of the order— 

18 ‘‘(A) first, to the administrative appeals 

19 process established under section 2121(a); and 

20 ‘‘(B) second, if the affected person so 

21 elects, to a United States district court as pro22 vided in section 2121(b) not later than 30 days 

23 after the date of the determination under sub24 paragraph (A). 


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1 ‘‘(2) STANDARD.—An order under subsection 

2 (e)(1), or a revocation of certification or accredita3 tion under subsection (e)(2)(B), shall be set aside 

4 only if the order, or the revocation of certification or 

5 accreditation, is not supported by substantial evi6 dence. 

7 ‘‘(g) NONCOMPLIANCE.— 

8 ‘‘(1) IN GENERAL.—If a person covered by this 

9 title fails to obey an order, or a revocation of certifi10 cation or accreditation, described in subsection (f)(2) 

11 after the order or revocation has become final and 

12 conclusive or after the appropriate United States 

13 district court has entered a final judgment in favor 

14 of the Secretary, the United States may apply to the 

15 appropriate United States district court for enforce16 ment of the order, or the revocation of certification 

17 or accreditation. 

18 ‘‘(2) ENFORCEMENT.—If the court determines 

19 that the order or revocation was lawfully made and 

20 duly served and that the person violated the order 

21 or revocation, the court shall enforce the order or 

22 revocation. 

23 ‘‘(3) CIVIL PENALTY.—If the court finds that 

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1 son shall be subject to a civil penalty of not more 

2 than $10,000 for each offense.’’. 

3 SEC. 10010. REPORT ON HONEY. 

4 (a) IN GENERAL.—Not later than 180 days after the 

5 date of enactment of this Act, the Secretary, in consulta6 tion with affected stakeholders, shall submit to the Com7 missioner of Food and Drugs a report describing how an 

8 appropriate Federal standard for the identity of honey 

9 would promote honesty and fair dealing and would be in 

10 the interest of consumers, the honey industry, and United 

11 States agriculture. 

12 (b) CONTENTS.—In preparing the report under sub13 section (a), the Secretary shall take into consideration the 

14 March 2006 Standard of Identity citizens petition filed 

15 with the Food and Drug Administration, including any 

16 current industry amendments or clarifications necessary 

17 to update that 2006 petition. 

18 SEC. 10011. EFFECTIVE DATE. 

19 This title and the amendments made by this title take 

20 effect on October 1, 2012. 

21 TITLE XI—CROP INSURANCE 

22 SEC. 11001. SUPPLEMENTAL COVERAGE OPTION. 

23 (a) AVAILABILITY OF SUPPLEMENTAL COVERAGE

24 OPTION.—Section 508(c) of the Federal Crop Insurance 


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1 Act (7 U.S.C. 1508(c)) is amended by striking paragraph 

2 (3) and inserting the following: 

3 ‘‘(3) YIELD AND LOSS BASIS OPTIONS.—A pro4 ducer shall have the option of purchasing additional 

5 coverage based on— 

6 ‘‘(A)(i) an individual yield and loss basis; 

7 or 

8 ‘‘(ii) an area yield and loss basis; 

9 ‘‘(B) an individual yield and loss basis, 

10 supplemented with coverage based on an area 

11 yield and loss basis to cover all or a part of the 

12 deductible under the individual yield and loss 

13 policy, as authorized in paragraph (4)(C); or 

14 ‘‘(C) a margin basis alone or in combina15 tion with— 

16 ‘‘(i) individual yield and loss coverage; 

17 or 

18 ‘‘(ii) area yield and loss coverage.’’. 

19 (b) LEVEL OF COVERAGE.—Section 508(c) of the 

20 Federal Crop Insurance Act (7 U.S.C. 1508(c)) is amend21 ed by striking paragraph (4) and inserting the following: 

22 ‘‘(4) LEVEL OF COVERAGE.— 

23 ‘‘(A) DOLLAR DENOMINATION AND PER24 CENTAGE OF YIELD.—Except as provided in 

25 subparagraph (C), the level of coverage— 


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1 ‘‘(i) shall be dollar denominated; and 

2 ‘‘(ii) may be purchased at any level 

3 not to exceed 85 percent of the individual 

4 yield or 95 percent of the area yield (as de5 termined by the Corporation). 

6 ‘‘(B) INFORMATION.—The Corporation 

7 shall provide producers with information on cat8 astrophic risk and additional coverage in terms 

9 of dollar coverage (within the allowable limits of 

10 coverage provided in this paragraph). 

11 ‘‘(C) SUPPLEMENTAL COVERAGE OP12 TION.— 

13 ‘‘(i) IN GENERAL.—Notwithstanding 

14 subparagraph (A), in the case of the sup15 plemental coverage option described in 

16 paragraph (3)(B), the Corporation shall 

17 offer producers the opportunity to pur18 chase coverage in combination with a pol19 icy or plan of insurance offered under this 

20 subtitle that would allow indemnities to be 

21 paid to a producer equal to all or part of 

22 the deductible under the policy or plan of 

23 insurance, if sufficient area data is avail24 able (as determined by the Corporation). 


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1 ‘‘(ii) TRIGGER.—Coverage offered 

2 under this subparagraph shall be triggered 

3 only if the losses in the area exceed 10 per4 cent of normal levels (as determined by the 

5 Corporation). 

6 ‘‘(iii) COVERAGE.—Subject to the trig7 ger described in clause (ii) and the deduct8 ible imposed by clause (iv), coverage of9 fered under this subparagraph shall cover 

10 the first loss incurred by the producer, not 

11 to exceed the difference between— 

12 ‘‘(I) 100 percent; and 

13 ‘‘(II) the coverage level selected 

14 by the producer for the underlying 

15 policy or plan of insurance. 

16 ‘‘(iv) DEDUCTIBLE.—Coverage offered 

17 under this subparagraph shall be subject to 

18 a deductible in an amount equal to— 

19 ‘‘(I) in the case of a producer 

20 who participates in the agriculture 

21 risk coverage program under section 

22 1105(c) of the Agriculture Reform, 

23 Food, and Jobs Act of 2012, 21 per24 cent of the expected value of the crop 

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1 lying policy or plan of insurance, as 

2 determined by the Corporation; and 

3 ‘‘(II) in the case of all other pro4 ducers, 10 percent of the expected 

5 value of the crop of the producer cov6 ered by the underlying policy or plan 

7 of insurance, as determined by the 

8 Corporation. 

9 ‘‘(v) CALCULATION OF PREMIUM.— 

10 Notwithstanding subsection (d), the pre11 mium shall— 

12 ‘‘(I) be sufficient to cover antici13 pated losses and a reasonable reserve; 

14 and 

15 ‘‘(II) include an amount for oper16 ating and administrative expenses es17 tablished in accordance with sub18 section (k)(4)(F).’’. 

19 (c) PAYMENT OF PORTION OF PREMIUM BY COR20 PORATION.—Section 508(e)(2) of the Federal Crop Insur21 ance Act (7 U.S.C. 1508(e)(2)) is amended by adding at 

22 the end the following: 

23 ‘‘(H) In the case of the supplemental cov24 erage option authorized in subsection (c)(4)(C), 

25 the amount shall be equal to the sum of— 


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1 ‘‘(i) 70 percent of the additional pre2 mium associated with the coverage; and 

3 ‘‘(ii) the amount determined under 

4 subsection (c)(4)(C)(v)(II) for the coverage 

5 to cover operating and administrative ex6 penses.’’. 

7 (d) CONFORMING AMENDMENT.—Section 

8 508(k)(4)(F) of the Federal Crop Insurance Act (7 U.S.C. 

9 1508(k)(4)(F)) is amended by inserting ‘‘or authorized 

10 under subsection (c)(4)(C)’’ after ‘‘of this subparagraph’’. 

11 (e) EFFECTIVE DATE.—The Federal Crop Insurance 

12 Corporation shall begin to provide additional coverage 

13 based on an individual yield and loss basis, supplemented 

14 with coverage based on an area yield and loss basis, not 

15 later than for the 2013 crop year. 

16 SEC. 11002. PREMIUM AMOUNTS FOR CATASTROPHIC RISK 

17 PROTECTION. 

18 Section 508(d)(2) of the Federal Crop Insurance Act 

19 (7 U.S.C. 1508(d)(2)) is amended by striking subpara20 graph (A) and inserting the following: 

21 ‘‘(A) In the case of catastrophic risk pro22 tection, the amount of the premium established 

23 by the Corporation for each crop for which cat24 astrophic risk protection is available shall be re25 duced by the percentage equal to the difference 


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1 between the average loss ratio for the crop and 

2 100 percent, plus a reasonable reserve, as de3 termined by the Corporation.’’. 

4 SEC. 11003. PERMANENT ENTERPRISE UNIT. 

5 Section 508(e)(5) of the Federal Crop Insurance Act 

6 (7 U.S.C. 1508(e)(5)) is amended by striking subpara7 graph (A) and inserting the following: 

8 ‘‘(A) IN GENERAL.—The Corporation may 

9 pay a portion of the premiums for plans or poli10 cies of insurance for which the insurable unit is 

11 defined on a whole farm or enterprise unit basis 

12 that is higher than would otherwise be paid in 

13 accordance with paragraph (2).’’. 

14 SEC. 11004. ENTERPRISE UNITS FOR IRRIGATED AND NON15 IRRIGATED CROPS. 

16 Section 508(e)(5) of the Federal Crop Insurance Act 

17 (7 U.S.C. 1508(e)(5)) is amended by adding at the end 

18 the following: 

19 ‘‘(D) NONIRRIGATED CROPS.—Beginning 

20 with the 2013 crop year, the Corporation shall 

21 make available separate enterprise units for ir22 rigated and nonirrigated acreages of crops in 

23 counties.’’. 


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1 SEC. 11005. DATA COLLECTION. 

2 Section 508(g)(2) of the Federal Crop Insurance Act 

3 (7 U.S.C. 1508(g)(2)) is amended by adding at the end 

4 the following: 

5 ‘‘(E) SOURCES OF YIELD DATA.—To deter6 mine yields under this paragraph, the Corpora7 tion— 

8 ‘‘(i) shall use county data collected by 

9 the Risk Management Agency or the Na10 tional Agricultural Statistics Service, or 

11 both; or 

12 ‘‘(ii) if sufficient county data is not 

13 available, may use other data considered 

14 appropriate by the Secretary.’’. 

15 SEC. 11006. ADJUSTMENT IN ACTUAL PRODUCTION HIS16 TORY TO ESTABLISH INSURABLE YIELDS. 

17 Section 508(g)(4)(B) of the Federal Crop Insurance 

18 Act (7 U.S.C. 1508(g)(4)(B)) is amended— 

19 (1) in the matter preceding clause (i), by insert20 ing ‘‘for the 2012 crop year or any prior crop year, 

21 or 70 percent of the applicable transitional yield for 

22 the 2013 or any subsequent crop year,’’ after ‘‘tran23 sitional yield’’; and 

24 (2) in clause (ii), by striking ‘‘60 percent of the 

25 applicable transitional yield’’ and inserting ‘‘the apVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00945 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 plicable percentage of the transitional yield described 

2 in this subparagraph’’. 

3 SEC. 11007. SUBMISSION AND REVIEW OF POLICIES. 

4 Section 508(h)(1) of the Federal Crop Insurance Act 

5 (7 U.S.C. 1508(h)(1)) is amended— 

6 (1) by redesignating subparagraphs (A) and 

7 (B) as clauses (i) and (ii), respectively, and indent8 ing appropriately; 

9 (2) by striking ‘‘(1) IN GENERAL.—’’ and in10 serting the following: 

11 ‘‘(1) SUBMISSION AND REVIEW OF POLICIES.— 

12 ‘‘(A) SUBMISSIONS.—In addition’’; and 

13 (3) by adding at the end the following: 

14 ‘‘(B) REVIEW.—The Corporation shall re15 view any policy developed under section 522(c) 

16 or any pilot program developed under section 

17 523 and submit the policy or program to the 

18 Board under this subsection if the Corporation, 

19 at the sole discretion of the Corporation, finds 

20 that the policy or program— 

21 ‘‘(i) will likely result in a viable and 

22 marketable policy consistent with this sub23 section; 


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1 ‘‘(ii) would provide crop insurance 

2 coverage in a significantly improved form; 

3 and 

4 ‘‘(iii) adequately protects the interests 

5 of producers.’’. 

6 SEC. 11008. BOARD REVIEW AND APPROVAL. 

7 (a) REVIEW AND APPROVAL BY THE BOARD.—Sec8 tion 508(h) of the Federal Crop Insurance Act (7 U.S.C. 

9 1508(h)) is amended by striking paragraph (3) and insert10 ing the following: 

11 ‘‘(3) REVIEW AND APPROVAL BY THE BOARD.— 

12 ‘‘(A) IN GENERAL.—A policy, plan of in13 surance, or other material submitted to the 

14 Board under this subsection shall be reviewed 

15 by the Board and shall be approved by the 

16 Board for reinsurance and for sale by approved 

17 insurance providers to producers at actuarially 

18 appropriate rates and under appropriate terms 

19 and conditions if the Board, at the sole discre20 tion of the Board, determines that— 

21 ‘‘(i) the interests of producers are 

22 adequately protected; 

23 ‘‘(ii) the rates of premium and price 

24 election methodology are actuarially appro25 priate; 


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1 ‘‘(iii) the terms and conditions for the 

2 proposed policy or plan of insurance are 

3 appropriate and would not unfairly dis4 criminate among producers; 

5 ‘‘(iv) the proposed policy or plan of in6 surance will, at the sole discretion of the 

7 Board— 

8 ‘‘(I) likely result in a viable and 

9 marketable policy that can reasonably 

10 attain levels of participation similar to 

11 other like policies or plans of insur12 ance; 

13 ‘‘(II) provide crop insurance cov14 erage in a significantly improved form 

15 or in a manner that addresses a rec16 ognized flaw or problem in an existing 

17 policy; or 

18 ‘‘(III) provide a new kind of cov19 erage for a commodity that previously 

20 had no available crop insurance, or 

21 has demonstrated a low level of par22 ticipation under existing coverage; 

23 ‘‘(v) the proposed policy or plan of in24 surance will, at the sole discretion of the 

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1 pact on the crop insurance delivery system; 

2 and 

3 ‘‘(vi) the proposed policy or plan of in4 surance meets such other requirements as 

5 are determined appropriate by the Board. 

6 ‘‘(B) PRIORITIES.— 

7 ‘‘(i) ESTABLISHMENT.—The Board, 

8 at the sole discretion of the Board, may— 

9 ‘‘(I) annually establish priorities 

10 under this subsection that specify 

11 types of submissions needed to fulfill 

12 the portfolio of policies or plans of in13 surance to be reviewed and approved 

14 under this subsection; and 

15 ‘‘(II) make the priorities avail16 able on the website of the Corpora17 tion. 

18 ‘‘(ii) PROCESS.— 

19 ‘‘(I) IN GENERAL.—Policies or 

20 plans of insurance that satisfy the pri21 orities established by the Board under 

22 this subsection shall be considered by 

23 the Board for approval prior to other 

24 submissions. 


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1 ‘‘(II) CONSIDERATIONS.—In ap2 proving policies or plans of insurance, 

3 the Board shall— 

4 ‘‘(aa) consider providing the 

5 highest priorities for policies or 

6 plans of insurance that address 

7 underserved commodities, includ8 ing commodities for which there 

9 is no insurance; and 

10 ‘‘(bb) consider providing the 

11 highest priorities for existing 

12 policies for which there is inad13 equate coverage or there exists 

14 low levels of participation. 

15 ‘‘(iii) OTHER CRITERIA.—The Board 

16 may establish such other criteria as the 

17 Board determines to meet the needs of 

18 producers and the priorities of this sub19 section, consistent with the purposes of 

20 this subtitle.’’. 

21 SEC. 11009. CONSULTATION. 

22 Section 508(h)(4) of the Federal Crop Insurance Act 

23 (7 U.S.C. 1508(h)) is amended by adding at the end the 

24 following: 

25 ‘‘(E) CONSULTATION.— 


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1 ‘‘(i) REQUIREMENT.—As part of the 

2 feasibility and research associated with the 

3 development of a policy or other material 

4 conducted prior to making a submission to 

5 the Board under this subsection, the sub6 mitter shall consult with groups rep7 resenting producers of agricultural com8 modities in all major producing areas for 

9 the commodities to be served or potentially 

10 impacted, either directly or indirectly. 

11 ‘‘(ii) SUBMISSION TO THE BOARD.— 

12 Any submission made to the Board under 

13 this subsection shall contain a summary 

14 and analysis of the feasibility and research 

15 findings from the impacted groups de16 scribed in clause (i), including a summary 

17 assessment of the support for or against 

18 development of the policy and an assess19 ment on the impact of the proposed policy 

20 to the general marketing and production of 

21 the crop from both a regional and national 

22 perspective. 

23 ‘‘(iii) EVALUATION BY THE BOARD.— 

24 In evaluating whether the interests of pro25 ducers are adequately protected pursuant 


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1 to paragraph (3) with respect to an sub2 mission made under this subsection, the 

3 Board shall review the information pro4 vided pursuant to clause (ii) to determine 

5 if the submission will create adverse mar6 ket distortions with respect to the produc7 tion of commodities that are the subject of 

8 the submission.’’. 

9 SEC. 11010. BUDGET LIMITATIONS ON RENEGOTIATION OF 

10 THE STANDARD REINSURANCE AGREEMENT. 

11 Section 508(k)(8) of the Federal Crop Insurance Act 

12 (7 U.S.C. 1508(k)(8)) is amended by adding at the end 

13 the following: 

14 ‘‘(F) BUDGET.— 

15 ‘‘(i) IN GENERAL.—The Board shall 

16 ensure that any Standard Reinsurance 

17 Agreement negotiated under subparagraph 

18 (A)(ii), as compared to the previous Stand19 ard Reinsurance Agreement— 

20 ‘‘(I) to the maximum extent prac21 ticable, shall be budget neutral; and 

22 ‘‘(II) in no event, may signifi23 cantly depart from budget neutrality. 

24 ‘‘(ii) USE OF SAVINGS.—To the extent 

25 that any budget savings is realized in the 


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1 renegotiation of a Standard Reinsurance 

2 Agreement under subparagraph (A)(ii), 

3 and the savings are determined not to be 

4 a significant departure from budget neu5 trality under clause (i), the savings shall 

6 be used for programs administered or 

7 managed by the Risk Management Agen8 cy.’’. 

9 SEC. 11011. STACKED INCOME PROTECTION PLAN FOR PRO10 DUCERS OF UPLAND COTTON. 

11 (a) AVAILABILITY OF STACKED INCOME PROTECTION

12 PLAN.—The Federal Crop Insurance Act is amended by 

13 inserting after section 508A (7 U.S.C. 1508a) the fol14 lowing: 

15 ‘‘SEC. 508B. STACKED INCOME PROTECTION PLAN FOR 

16 PRODUCERS OF UPLAND COTTON. 

17 ‘‘(a) AVAILABILITY.—Beginning not later than the 

18 2013 crop of upland cotton, if practicable, the Corporation 

19 shall make available to producers of maximum eligible 

20 acres of upland cotton an additional policy (to be known 

21 as the ‘Stacked Income Protection Plan’), which shall pro22 vide coverage consistent with the Group Risk Income Pro23 tection Plan (and the associated Harvest Revenue Option 

24 Endorsement) offered by the Corporation for the 2011 

25 crop year. 


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1 ‘‘(b) REQUIRED TERMS.—The Corporation may mod2 ify the Stacked Income Protection Plan on a program-wide 

3 basis, except that the Stacked Income Protection Plan 

4 shall comply with the following requirements: 

5 ‘‘(1)(A) Provide coverage for revenue loss of not 

6 more than 30 percent of expected county revenue, 

7 specified in increments of 5 percent. 

8 ‘‘(B) The deductible is the minimum percent of 

9 revenue loss at which indemnities are triggered 

10 under the plan, not to be less than 10 percent of the 

11 expected county revenue. 

12 ‘‘(C) Once the deductible is met, any losses in 

13 excess of the deductible will be paid up to the cov14 erage selected by the producer. 

15 ‘‘(2) Be offered to producers of upland cotton 

16 in all counties with upland cotton production— 

17 ‘‘(A) at a county-wide level to the fullest 

18 extent practicable; or 

19 ‘‘(B) in counties that lack sufficient data, 

20 on the basis of such larger geographical area as 

21 the Corporation determines to provide sufficient 

22 data for purposes of providing the coverage. 

23 ‘‘(3) Be purchased in addition to any other in24 dividual or area coverage in effect on the producer’s 

25 acreage or as a stand-alone policy, except that if a 


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1 producer has an individual or area coverage for the 

2 same acreage, the maximum coverage available 

3 under the Stacked Income Protection Plan shall not 

4 exceed the deductible for the individual or area cov5 erage. 

6 ‘‘(4) Establish coverage based on— 

7 ‘‘(A) an expected price that is the expected 

8 price established under existing Group Risk In9 come Protection or area wide policy offered by 

10 the Corporation for the applicable county (or 

11 area) and crop year; and 

12 ‘‘(B) an expected county yield that is the 

13 higher of— 

14 ‘‘(i) the expected county yield estab15 lished for the existing area-wide plans of16 fered by the Corporation for the applicable 

17 county (or area) and crop year (or, in geo18 graphic areas where area-wide plans are 

19 not offered, an expected yield determined 

20 in a manner consistent with those of area21 wide plans); or 

22 ‘‘(ii)(I) the average of the applicable 

23 yield data for the county (or area) for the 

24 most recent 5 years, excluding the highest 

25 and lowest observations, from the Risk 


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1 Management Agency or the National Agri2 cultural Statistics, or both; or 

3 ‘‘(II) if sufficient county data is not 

4 available, such other data considered ap5 propriate by the Secretary. 

6 ‘‘(5) Use a multiplier factor to establish max7 imum protection per acre (referred to as a ‘protec8 tion factor’) of not more than 120 percent. 

9 ‘‘(6) Pay an indemnity based on the amount 

10 that the expected county revenue exceeds the actual 

11 county revenue, as applied to the individual coverage 

12 of the producer. Indemnities under the Stacked In13 come Protection Plan shall not include or overlap 

14 the amount of the deductible selected under para15 graph (1). 

16 ‘‘(7) To the maximum extent practicable, in all 

17 counties for which data are available, establish sepa18 rate coverage for irrigated and nonirrigated prac19 tices. 

20 ‘‘(8) Notwithstanding section 508(d), include a 

21 premium that— 

22 ‘‘(A) is sufficient to cover anticipated 

23 losses and a reasonable reserve; and 


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1 ‘‘(B) includes an amount for operating and 

2 administrative expenses established in accord3 ance with section 508(k)(4)(F). 

4 ‘‘(c) RELATION TO OTHER COVERAGES.— 

5 ‘‘(1) IN GENERAL.—Except as provided in para6 graph (2), the Stacked Income Protection Plan is in 

7 addition to all other coverages available to producers 

8 of upland cotton. 

9 ‘‘(2) LIMITATION.—Acreage of upland cotton 

10 insured under the Supplemental Coverage Option 

11 shall not be eligible for the Stacked Income Protec12 tion Plan. 

13 ‘‘(d) PAYMENT OF PORTION OF PREMIUM BY COR14 PORATION.—Subject to section 508(e)(4), the amount of 

15 premium paid by the Corporation for all qualifying cov16 erage levels of the Stacked Income Protection Plan shall 

17 be— 

18 ‘‘(1) 80 percent of the amount of the premium 

19 established under subsection (b)(8)(A) for the cov20 erage level selected; and 

21 ‘‘(2) the amount determined under subsection 

22 (b)(8)(B) to cover administrative and operating ex23 penses.’’. 

24 (b) CONFORMING AMENDMENT.—Section 

25 508(k)(4)(F) of the Federal Crop Insurance Act (7 U.S.C. 


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1 1508(k)(4)(F)) (as amended by section 11001(d)) is 

2 amended by inserting ‘‘or under section 508B’’ after ‘‘sub3 section (c)(4)(C)’’. 

4 SEC. 11012. PEANUT REVENUE CROP INSURANCE. 

5 The Federal Crop Insurance Act is amended by in6 serting after section 508B (as added by section 11011(a)) 

7 the following: 

8 ‘‘SEC. 508C. PEANUT REVENUE CROP INSURANCE. 

9 ‘‘(a) IN GENERAL.—Effective beginning with the 

10 2013 crop year, the Risk Management Agency and the 

11 Corporation shall make available to producers of peanuts 

12 a revenue crop insurance program for peanuts. 

13 ‘‘(b) EFFECTIVE PRICE.— 

14 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

15 for purposes of the policies and plans of insurance 

16 offered under subsections (a) and (b) of section 508, 

17 the effective price for peanuts shall be equal to the 

18 Rotterdam price index for peanuts, as adjusted to 

19 reflect the farmer stock price of peanuts in the 

20 United States. 

21 ‘‘(2) ADJUSTMENTS.— 

22 ‘‘(A) IN GENERAL.—The effective price for 

23 peanuts established under paragraph (1) may 

24 be adjusted by the Risk Management Agency 

25 and the Corporation to correct distortions. 


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1 ‘‘(B) ADMINISTRATION.—If an adjustment 

2 is made under subparagraph (A), the Risk 

3 Management Agency and the Corporation 

4 shall— 

5 ‘‘(i) make the adjustment in an open 

6 and transparent manner; and 

7 ‘‘(ii) submit to the Committee on Ag8 riculture of the House of Representatives 

9 and the Committee on Agriculture, Nutri10 tion, and Forestry of the Senate a report 

11 that describes the reasons for the adjust12 ment.’’. 

13 SEC. 11013. AUTHORITY TO CORRECT ERRORS. 

14 Section 515(c) of the Federal Crop Insurance Act (7 

15 U.S.C. 1515(c)) is amended— 

16 (1) in the first sentence, by striking ‘‘The Sec17 retary’’ and inserting the following: 

18 ‘‘(1) IN GENERAL.—The Secretary’’; 

19 (2) in the second sentence, by striking ‘‘Begin20 ning with’’ and inserting the following: 

21 ‘‘(2) FREQUENCY.—Beginning with’’; and 

22 (3) by adding at the end the following: 

23 ‘‘(3) CORRECTIONS.— 

24 ‘‘(A) IN GENERAL.—The Corporation shall 

25 establish procedures that allow an agent and 


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1 approved insurance provider within a reasonable 

2 amount of time following the applicable sales 

3 closing date to correct information regarding 

4 the entity name, social security number, tax 

5 identification number, or such other eligibility 

6 information as determined by the Corporation 

7 that is provided by a producer for the purpose 

8 of obtaining coverage under any policy or plan 

9 of insurance made available under this subtitle 

10 to ensure that the eligibility information is con11 sistent with the information reported by the 

12 producer to the Farm Service Agency. 

13 ‘‘(B) LIMITATION.—In accordance with the 

14 procedures of the Corporation, procedures 

15 under subparagraph (A) may include any subse16 quent correction to the eligibility information 

17 described in that subparagraph made by the 

18 Farm Service Agency if the corrections do not 

19 allow the producer— 

20 ‘‘(i) to obtain a disproportionate ben21 efit under the crop insurance program or 

22 any related program of the Department of 

23 Agriculture; 

24 ‘‘(ii) to avoid ineligibility requirements 

25 for insurance; or 


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1 ‘‘(iii) to avoid an obligation or re2 quirement under any Federal or State 

3 law.’’. 

4 SEC. 11014. IMPLEMENTATION. 

5 Section 515 of the Federal Crop Insurance Act (7 

6 U.S.C. 1515) is amended— 

7 (1) in subsection (j), by striking paragraph (1) 

8 and inserting the following: 

9 ‘‘(1) SYSTEMS MAINTENANCE AND UP10 GRADES.— 

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

12 maintain and upgrade the information manage13 ment systems of the Corporation used in the 

14 administration and enforcement of this subtitle. 

15 ‘‘(B) REQUIREMENT.— 

16 ‘‘(i) IN GENERAL.—In maintaining 

17 and upgrading the systems, the Secretary 

18 shall ensure that new hardware and soft19 ware are compatible with the hardware and 

20 software used by other agencies of the De21 partment to maximize data sharing and 

22 promote the purposes of this section. 

23 ‘‘(ii) ACREAGE REPORT STREAM24 LINING INITIATIVE PROJECT.—As soon as 

25 practicable, the Secretary shall develop and 


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1 implement an acreage report streamlining 

2 initiative project to allow producers to re3 port acreage and other information directly 

4 to the Department.’’; and 

5 (2) in subsection (k), by striking paragraph (1) 

6 and inserting the following: 

7 ‘‘(1) INFORMATION TECHNOLOGY.— 

8 ‘‘(A) IN GENERAL.—For purposes of sub9 section (j)(1), the Corporation may use, from 

10 amounts made available from the insurance 

11 fund established under section 516(c), not more 

12 than— 

13 ‘‘(i)(I) for fiscal year 2013, 

14 $25,000,000; and 

15 ‘‘(II) for each of fiscal years 2014 

16 through 2017, $10,000,000; or 

17 ‘‘(ii) if the Acreage Crop Reporting 

18 Streamlining Initiative (ACRSI) project is 

19 substantially completed by September 30, 

20 2013, not more than $15,000,000 for each 

21 of fiscal years 2014 through 2017. 

22 ‘‘(B) NOTIFICATION.—Not later than July 

23 1, 2013, the Secretary shall notify the Com24 mittee on Agriculture of the House of Rep25 resentatives and the Committee on Agriculture, 


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1 Nutrition, and Forestry of the Senate on the 

2 status of the substantial completion of the 

3 Acreage Crop Reporting Streamlining Initiative 

4 (ACRSI) project.’’. 

5 SEC. 11015. APPROVAL OF COSTS FOR RESEARCH AND DE6 VELOPMENT. 

7 Section 522(b)(2) of the Federal Crop Insurance Act 

8 (7 U.S.C. 1522(b)(2)) is amended by striking subpara9 graph (E) and inserting the following: 

10 ‘‘(E) APPROVAL.— 

11 ‘‘(i) IN GENERAL.—The Board may 

12 approve up to 50 percent of the projected 

13 total research and development costs to be 

14 paid in advance to an applicant, in accord15 ance with the procedures developed by the 

16 Board for the making of the payments, if, 

17 after consideration of the reviewer reports 

18 described in subparagraph (D) and such 

19 other information as the Board determines 

20 appropriate, the Board determines that— 

21 ‘‘(I) the concept, in good faith, 

22 will likely result in a viable and mar23 ketable policy consistent with section 

24 508(h); 


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1 ‘‘(II) at the sole discretion of the 

2 Board, the concept, if developed into a 

3 policy and approved by the Board, 

4 would provide crop insurance cov5 erage— 

6 ‘‘(aa) in a significantly im7 proved form or that addresses a 

8 unique need of agricultural pro9 ducers; 

10 ‘‘(bb) to a crop or region not 

11 traditionally served by the Fed12 eral crop insurance program; or 

13 ‘‘(cc) in a form that ad14 dresses a recognized flaw or 

15 problem in the program; 

16 ‘‘(III) the applicant agrees to 

17 provide such reports as the Corpora18 tion determines are necessary to mon19 itor the development effort; 

20 ‘‘(IV) the proposed budget and 

21 timetable are reasonable, as deter22 mined by the Board; and 

23 ‘‘(V) the concept proposal meets 

24 any other requirements that the 

25 Board determines appropriate. 


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1 ‘‘(ii) WAIVER.—The Board may waive 

2 the 50-percent limitation and, upon re3 quest of the submitter after the submitter 

4 has begun research and development activi5 ties, the Board may approve an additional 

6 25 percent advance payment to the sub7 mitter for research and development costs, 

8 if, at the sole discretion of the Board, the 

9 Board determines that— 

10 ‘‘(I) the intended policy or plan 

11 of insurance developed by the sub12 mitter will provide coverage for a re13 gion or crop that is underserved by 

14 the Federal crop insurance program, 

15 including specialty crops; 

16 ‘‘(II) the submitter is making 

17 satisfactory progress towards devel18 oping a viable and marketable policy 

19 or plan of insurance consistent with 

20 section 508(h); and 

21 ‘‘(III) the submitter does not 

22 have sufficient financial resources to 

23 complete the development of the sub24 mission into a viable and marketable 


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1 policy or plan of insurance consistent 

2 with section 508(h).’’. 

3 SEC. 11016. WHOLE FARM RISK MANAGEMENT INSURANCE. 

4 Section 522(c) of the Federal Crop Insurance Act (7 

5 U.S.C. 1522(c)) is amended by adding at the end the fol6 lowing: 

7 ‘‘(18) WHOLE FARM DIVERSIFIED RISK MAN8 AGEMENT INSURANCE PLAN.— 

9 ‘‘(A) IN GENERAL.—The Corporation shall 

10 conduct activities or enter into contracts to 

11 carry out research and development to develop 

12 a whole farm risk management insurance plan, 

13 with a liability limitation of $1,500,000, that 

14 allows a diversified crop or livestock producer 

15 the option to qualify for an indemnity if actual 

16 gross farm revenue is below 85 percent of the 

17 average gross farm revenue or the expected 

18 gross farm revenue that can reasonably be ex19 pected of the producer, as determined by the 

20 Corporation. 

21 ‘‘(B) ELIGIBLE PRODUCERS.—The Cor22 poration shall permit producers (including di23 rect-to-consumer marketers, and producers 

24 servicing local and regional and farm identity25 preserved markets) who produce multiple agriVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00966 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 cultural commodities, including specialty crops, 

2 industrial crops, livestock, and aquaculture 

3 products, to participate in the plan in lieu of 

4 any other plan under this subtitle. 

5 ‘‘(C) DIVERSIFICATION.—The Corporation 

6 may provide diversification-based additional 

7 coverage payment rates, premium discounts, or 

8 other enhanced benefits in recognition of the 

9 risk management benefits of crop and livestock 

10 diversification strategies for producers that 

11 grow multiple crops or that may have income 

12 from the production of livestock that uses a 

13 crop grown on the farm. 

14 ‘‘(D) MARKET READINESS.—The Corpora15 tion may include coverage for the value of any 

16 packing, packaging, or any other similar on17 farm activity the Corporation determines to be 

18 the minimum required in order to remove the 

19 commodity from the field. 

20 ‘‘(E) REPORT.—Not later than 2 years 

21 after the date of enactment of this paragraph, 

22 the Corporation shall submit to the Committee 

23 on Agriculture of the House of Representatives 

24 and the Committee on Agriculture, Nutrition, 

25 and Forestry of the Senate a report that deVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00967 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 scribes the results and feasibility of the re2 search and development conducted under this 

3 paragraph, including an analysis of potential 

4 adverse market distortions.’’. 

5 SEC. 11017. CROP INSURANCE FOR LIVESTOCK. 

6 Section 522(c) of the Federal Crop Insurance Act (as 

7 amended by section 11016) is amended by adding at the 

8 end the following: 

9 ‘‘(19) STUDY ON SWINE CATASTROPHIC DIS10 EASE PROGRAM.— 

11 ‘‘(A) IN GENERAL.—The Corporation shall 

12 contract with a qualified person to conduct a 

13 study to determine the feasibility of insuring 

14 swine producers for a catastrophic event. 

15 ‘‘(B) REPORT.—Not later than 1 year 

16 after the date of the enactment of this para17 graph, the Corporation shall submit to the 

18 Committee on Agriculture of the House of Rep19 resentatives and the Committee on Agriculture, 

20 Nutrition, and Forestry of the Senate a report 

21 that describes the results of the study con22 ducted under subparagraph (A).’’. 


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1 SEC. 11018. MARGIN COVERAGE FOR CATFISH. 

2 Section 522(c) of the Federal Crop Insurance Act (as 

3 amended by section 11017) is amended by adding at the 

4 end the following: 

5 ‘‘(20) MARGIN COVERAGE FOR CATFISH.— 

6 ‘‘(A) IN GENERAL.—The Corporation shall 

7 offer to enter into a contract with a qualified 

8 entity to conduct research and development re9 garding a policy to insure producers against re10 duction in the margin between the market value 

11 of catfish and selected costs incurred in the 

12 production of catfish. 

13 ‘‘(B) ELIGIBILITY.—Eligibility for the pol14 icy described in subparagraph (A) shall be lim15 ited to freshwater species of catfish that are 

16 propagated and reared in controlled or selected 

17 environments. 

18 ‘‘(C) IMPLEMENTATION.—The Board shall 

19 review the policy described in subparagraph (B) 

20 under subsection 508(h) and approve the policy 

21 if the Board finds that the policy— 

22 ‘‘(i) will likely result in a viable and 

23 marketable policy consistent with this sub24 section; 

25 ‘‘(ii) would provide crop insurance 

26 coverage in a significantly improved form; 


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1 ‘‘(iii) adequately protects the interests 

2 of producers; and 

3 ‘‘(iv) the proposed policy meets other 

4 requirements of this subtitle determined 

5 appropriate by the Board.’’. 

6 SEC. 11019. RESEARCH AND DEVELOPMENT. 

7 (a) IN GENERAL.—Section 522(c) of the Federal 

8 Crop Insurance Act (7 U.S.C. 1522(c)) is amended— 

9 (1) in the subsection heading, by striking ‘‘Con10 tracting’’; 

11 (2) in paragraph (1), in the matter preceding 

12 subparagraph (A), by striking ‘‘may enter into con13 tracts to carry out research and development to’’ 

14 and inserting ‘‘may conduct activities or enter into 

15 contracts to carry out research and development to 

16 maintain or improve existing policies or develop new 

17 policies to’’; 

18 (3) in paragraph (2)— 

19 (A) in subparagraph (A), by inserting 

20 ‘‘conduct research and development or’’ after 

21 ‘‘The Corporation may’’; and 

22 (B) by striking subparagraph (B) and in23 serting the following: 

24 ‘‘(B) CONSULTATION.—Before conducting 

25 research and development or entering into a 


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1 contract under subparagraph (A), the Corpora2 tion shall follow the consultation requirements 

3 described in section 508(h)(4)(E).’’; 

4 (4) in paragraph (5), by inserting ‘‘after expert 

5 review in accordance with section 505(e) and proce6 dures of the Board’’ after ‘‘approved by the Board’’; 

7 and 

8 (5) in paragraph (6), by striking ‘‘a pasture, 

9 range, and forage program’’ and inserting ‘‘policies 

10 that increase participation by producers of under11 served agricultural commodities, including sweet sor12 ghum, sorghum for biomass, specialty crops, sugar13 cane, and dedicated energy crops’’. 

14 (b) FUNDING.—Section 522(e) of the Federal Crop 

15 Insurance Act (7 U.S.C. 1522(e)) is amended— 

16 (1) in paragraph (2)— 

17 (A) by striking ‘‘(A) AUTHORITY.—’’ and 

18 inserting ‘‘(A) CONDUCTING AND CONTRACTING

19 FOR RESEARCH AND DEVELOPMENT.—’’; 

20 (B) in subparagraph (A), by inserting 

21 ‘‘conduct research and development and’’ after 

22 ‘‘the Corporation may use to’’; and 

23 (C) in subparagraph (B), by inserting 

24 ‘‘conduct research and development and’’ after 

25 ‘‘for the fiscal year to’’; 


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1 (2) in paragraph (3), in the matter preceding 

2 subparagraph (A), by striking ‘‘to provide either re3 imbursement payments or contract payments’’; and 

4 (3) by striking paragraph (4). 

5 SEC. 11020. PILOT PROGRAMS. 

6 Section 523(a) of the Federal Crop Insurance Act (7 

7 U.S.C. 1523(a)) is amended— 

8 (1) in paragraph (1), by inserting ‘‘, at the sole 

9 discretion of the Corporation,’’ after ‘‘may’’; and 

10 (2) by striking paragraph (5). 

11 SEC. 11021. INDEX-BASED WEATHER INSURANCE PILOT 

12 PROGRAM. 

13 Section 523(a)(2) of the Federal Crop Insurance Act 

14 (7 U.S.C. 1523(a)(2)) is amended— 

15 (1) by striking ‘‘Under’’ inserting the following: 

16 ‘‘(A) IN GENERAL.—Under’’; and 

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

18 ‘‘(B) INDEX-BASED WEATHER INSURANCE

19 PILOT PROGRAM.— 

20 ‘‘(i) IN GENERAL.—Notwithstanding 

21 subparagraph (A), the Corporation, at the 

22 sole discretion of the Corporation, may 

23 conduct a pilot program to provide finan24 cial assistance for producers of under25 served crops and livestock (including speVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00972 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 cialty crops) to purchase an index-based 

2 weather insurance product from a private 

3 insurance company, subject to the require4 ments of this subparagraph. 

5 ‘‘(ii) PAYMENT OF PREMIUM.— 

6 ‘‘(I) IN GENERAL.—Subject to 

7 subclause (II) and clause (v), the Cor8 poration may pay a portion of the pre9 mium for producers who purchase 

10 index-based weather insurance protec11 tion from a private insurance com12 pany for a crop and policy that is not 

13 reinsured under this subtitle, as deter14 mined by the Corporation. 

15 ‘‘(II) CONDITION.—The premium 

16 assistance under subclause (I) shall 

17 not exceed 60 percent of the esti18 mated premium amount, based on ex19 pected losses, representative operating 

20 expenses, and representative profit 

21 margins, as determined by the Cor22 poration. 

23 ‘‘(iii) ELIGIBLE PROVIDERS.—Before 

24 providing premium assistance to producers 

25 to purchase index-based weather insurance 


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1 from a private insurance company pursu2 ant to this subparagraph, the Corporation 

3 shall verify that the company has adequate 

4 experience— 

5 ‘‘(I) to develop and manage the 

6 index-based weather insurance prod7 ucts, including adequate resources, ex8 perience, and assets or sufficient rein9 surance to meet the obligations of the 

10 company under this subparagraph; 

11 and 

12 ‘‘(II) to support and deliver the 

13 index-based weather insurance prod14 ucts. 

15 ‘‘(iv) PROCEDURES.—The Corporation 

16 shall develop and publish procedures to ad17 minister the pilot program under this sub18 paragraph that— 

19 ‘‘(I) require each applicable pri20 vate insurance company to report 

21 claim and sales data, and any other 

22 data the Corporation determines to be 

23 appropriate, to allow the Corporation 

24 to evaluate product pricing and per25 formance; 


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1 ‘‘(II) allow the private insurance 

2 companies exclusive rights over the 

3 private insurance offered under this 

4 subparagraph, including rating of 

5 policies, protection of intellectual 

6 property rights on the product or pol7 icy, and associated rating method8 ology, for the period during which the 

9 companies are eligible under clause 

10 (iii); and 

11 ‘‘(III) contain such other require12 ments as the Corporation determines 

13 to be necessary to ensure that— 

14 ‘‘(aa) the interests of pro15 ducers are protected; and 

16 ‘‘(bb) the program operates 

17 in an actuarially sound manner. 

18 ‘‘(v) FUNDING.—Of the funds of the 

19 Corporation, the Corporation shall use to 

20 carry out this subparagraph $10,000,000 

21 for each of fiscal years 2013 through 

22 2017, to remain available until expended.’’. 


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1 SEC. 11022. ENHANCING PRODUCER SELF-HELP THROUGH 

2 FARM FINANCIAL BENCHMARKING. 

3 (a) DEFINITION.—Section 502(b) of the Federal 

4 Crop Insurance Act (7 U.S.C. 1502(b)) is amended— 

5 (1) by redesignating paragraphs (6) through 

6 (9) as paragraphs (7) through (10), respectively; 

7 and 

8 (2) by inserting after paragraph (5) the fol9 lowing: 

10 ‘‘(6) FARM FINANCIAL BENCHMARKING.—The 

11 term ‘farm financial benchmarking’ means— 

12 ‘‘(A) the process of comparing the per13 formance of an agricultural enterprise against 

14 the performance of other similar enterprises, 

15 through the use of comparable and reliable 

16 data, in order to identify business management 

17 strengths, weaknesses, and steps necessary to 

18 improve management performance and business 

19 profitability; and 

20 ‘‘(B) benchmarking of the type conducted 

21 by farm management and producer associations 

22 consistent with the activities described in or 

23 funded pursuant to section 1672D of the Food, 

24 Agriculture, Conservation, and Trade Act of 

25 1990 (7 U.S.C. 5925f).’’. 


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1 (b) PARTNERSHIPS FOR RISK MANAGEMENT FOR

2 PRODUCERS OF SPECIALTY CROPS AND UNDERSERVED

3 AGRICULTURAL COMMODITIES.—Section 522(d)(3)(F) of 

4 the Federal Crop Insurance Act (7 U.S.C. 1522(d)(3)(F)) 

5 is amended by inserting ‘‘farm financial benchmarking,’’ 

6 after ‘‘management,’’. 

7 (c) CROP INSURANCE EDUCATION AND RISK MAN8 AGEMENT ASSISTANCE.—Section 524(a) of the Federal 

9 Crop Insurance Act (7 U.S.C. 1524(a)) is amended— 

10 (1) in paragraph (3)(A), by inserting ‘‘farm fi11 nancial benchmarking,’’ after ‘‘risk reduction,’’; and 

12 (2) in paragraph (4), in the matter preceding 

13 subparagraph (A), by inserting ‘‘(including farm fi14 nancial benchmarking)’’ after ‘‘management strate15 gies’’. 

16 SEC. 11023. BEGINNING FARMER AND RANCHER PROVI17 SIONS. 

18 (a) DEFINITION.—Section 502(b) of the Federal 

19 Crop Insurance Act (7 U.S.C. 1502(b)) (as amended by 

20 section 11022(a)) is amended— 

21 (1) by redesignating paragraphs (3) through 

22 (10) as paragraphs (4) through (11), respectively; 

23 and 

24 (2) by inserting after paragraph (2) the fol25 lowing: 


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1 ‘‘(3) BEGINNING FARMER OR RANCHER.—The 

2 term ‘beginning farmer or rancher’ means a farmer 

3 or rancher who has not actively operated and man4 aged a farm or ranch with a bona fide insurable in5 terest in a crop or livestock as an owner-operator, 

6 landlord, tenant, or sharecropper for more than 5 

7 crop years, as determined by the Secretary.’’. 

8 (b) PREMIUM ADJUSTMENTS.—Section 508 of the 

9 Federal Crop Insurance Act (7 U.S.C. 1508) is amend10 ed— 

11 (1) in subsection (b)(5)(E), by inserting ‘‘and 

12 beginning farmers or ranchers’’ after ‘‘limited re13 source farmers’’; 

14 (2) in subsection (e), by adding at the end the 

15 following: 

16 ‘‘(8) PREMIUM FOR BEGINNING FARMERS OR

17 RANCHERS.—Notwithstanding any other provision of 

18 this subsection regarding payment of a portion of 

19 premiums, a beginning farmer or rancher shall re20 ceive premium assistance that is 10 percentage 

21 points greater than premium assistance that would 

22 otherwise be available under paragraphs (2) (except 

23 for subparagraph (A) of that paragraph), (5), (6), 

24 and (7) for the applicable policy, plan of insurance, 


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1 and coverage level selected by the beginning farmer 

2 or rancher.’’; and 

3 (3) in subsection (g)— 

4 (A) in paragraph (2)(B)— 

5 (i) in clause (i), by striking ‘‘or’’ at 

6 the end; 

7 (ii) in clause (ii)(III), by striking the 

8 period at the end and inserting ‘‘; or’’; and 

9 (iii) by adding at the end the fol10 lowing: 

11 ‘‘(iii) if the producer is a beginning 

12 farmer or rancher who was previously in13 volved in a farming or ranching operation, 

14 including involvement in the decision15 making or physical involvement in the pro16 duction of the crop or livestock on the 

17 farm, for any acreage obtained by the be18 ginning farmer or rancher, a yield that is 

19 the higher of— 

20 ‘‘(I) the actual production history 

21 of the previous producer of the crop 

22 or livestock on the acreage determined 

23 under subparagraph (A); or 

24 ‘‘(II) a yield of the producer, as 

25 determined in clause (i).’’; and 


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1 (B) in paragraph (4)(B)(ii) (as amended 

2 by section 11006)— 

3 (i) by inserting ‘‘(I)’’ after ‘‘(ii)’’; 

4 (ii) by striking the period at the end 

5 and inserting ‘‘; or’’; and 

6 (iii) by adding at the end the fol7 lowing: 

8 ‘‘(II) in the case of begin9 ning farmers or ranchers, replace 

10 each excluded yield with a yield 

11 equal to 80 percent of the appli12 cable transitional yield.’’. 

13 SEC. 11024. AGRICULTURAL MANAGEMENT ASSISTANCE, 

14 RISK MANAGEMENT EDUCATION, AND OR15 GANIC CERTIFICATION COST SHARE ASSIST16 ANCE. 

17 Section 524 of the Federal Crop Insurance Act (7 

18 U.S.C. 1524) is amended by striking subsection (b) and 

19 inserting the following: 

20 ‘‘(b) AGRICULTURAL MANAGEMENT ASSISTANCE, 

21 RISK MANAGEMENT EDUCATION, AND ORGANIC CERTIFI22 CATION COST SHARE ASSISTANCE.— 

23 ‘‘(1) AUTHORITY FOR PROVISION OF ASSIST24 ANCE.—The Secretary shall provide assistance under 

25 this section as follows: 


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1 ‘‘(A) Provision of organic certification cost 

2 share assistance pursuant to section 10606 of 

3 the Farm Security and Rural Investment Act of 

4 2002 (7 U.S.C. 6523). 

5 ‘‘(B) Activities to support risk manage6 ment education and community outreach part7 nerships pursuant to section 522(d), includ8 ing— 

9 ‘‘(i) entering into futures or hedging; 

10 ‘‘(ii) entering into agricultural trade 

11 options as a hedging transaction to reduce 

12 production, price, or revenue risk; or 

13 ‘‘(iii) conducting any other activity re14 lating to an activity described in clause (i) 

15 or (ii), including farm financial 

16 benchmarking, as determined by the Sec17 retary. 

18 ‘‘(C) Provision of agricultural management 

19 assistance grants to producers in States in 

20 which there has been traditionally, and con21 tinues to be, a low level of Federal crop insur22 ance participation and availability, and pro23 ducers underserved by the Federal crop insur24 ance program, as determined by the Secretary, 

25 for the purposes of— 


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1 ‘‘(i) constructing or improving— 

2 ‘‘(I) watershed management 

3 structures; or 

4 ‘‘(II) irrigation structures; 

5 ‘‘(ii) planting trees to form 

6 windbreaks or to improve water quality; 

7 and 

8 ‘‘(iii) mitigating financial risk through 

9 production or marketing diversification or 

10 resource conservation practices, includ11 ing— 

12 ‘‘(I) soil erosion control; 

13 ‘‘(II) integrated pest manage14 ment; 

15 ‘‘(III) organic farming; or 

16 ‘‘(IV) to develop and implement a 

17 plan to create marketing opportunities 

18 for the producer, including through 

19 value-added processing. 

20 ‘‘(2) PAYMENT LIMITATION.—The total amount 

21 of payments made to a person (as defined in section 

22 1001(5) of the Food Security Act (7 U.S.C. 

23 1308(5))) (as in existence before the amendment 

24 made by section 1603(b) of the Food, Conservation, 

25 and Energy Act of 2008 (Public Law 110–246; 122 


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1 Stat. 1730)) under paragraph (1) for any year may 

2 not exceed $50,000. 

3 ‘‘(3) FUNDING.— 

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

5 carry out this subsection through the Com6 modity Credit Corporation. 

7 ‘‘(B) FUNDING.—For each of fiscal years 

8 2013 through 2017, the Commodity Credit Cor9 poration shall make available to carry out this 

10 subsection $23,000,000. 

11 ‘‘(C) DISTRIBUTION OF FUNDS.—Of the 

12 amount made available to carry out this sub13 section for a fiscal year, the Commodity Credit 

14 Corporation shall use not less than— 

15 ‘‘(i) 50 percent to carry out para16 graph (1)(A); 

17 ‘‘(ii) 26 percent to carry out para18 graph (1)(B); and 

19 ‘‘(iii) 24 percent to carry out para20 graph (1)(C).’’. 

21 SEC. 11025. CROP PRODUCTION ON NATIVE SOD. 

22 (a) FEDERAL CROP INSURANCE.—Section 508(o) of 

23 the Federal Crop Insurance Act (7 U.S.C. 1508(o)) is 

24 amended— 


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1 (1) in paragraph (1)(B), by inserting ‘‘, or the 

2 producer cannot substantiate that the ground has 

3 never been tilled,’’ after ‘‘tilled’’; 

4 (2) in paragraph (2)(A), by striking ‘‘for bene5 fits under—’’ and all that follows through the period 

6 at the end and inserting ‘‘for— 

7 ‘‘(i) a portion of crop insurance pre8 mium subsidies under this subtitle in ac9 cordance with paragraph (3); 

10 ‘‘(ii) benefits under section 196 of the 

11 Federal Agriculture Improvement and Re12 form Act of 1996 (7 U.S.C. 7333); and 

13 ‘‘(iii) payments described in sub14 section (b) of section 1001 of the Food Se15 curity Act of 1985 (7 U.S.C. 1308).’’; and 

16 (3) by striking paragraph (3) and inserting the 

17 following: 

18 ‘‘(3) ADMINISTRATION.— 

19 ‘‘(A) IN GENERAL.—During the first 4 

20 crop years of planting on native sod acreage by 

21 a producer described in paragraph (2)— 

22 ‘‘(i) paragraph (2) shall apply to 65 

23 percent of the applicable transitional yield; 

24 and 


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1 ‘‘(ii) the crop insurance premium sub2 sidy provided for the producer under this 

3 subtitle shall be 50 percentage points less 

4 than the premium subsidy that would oth5 erwise apply. 

6 ‘‘(B) YIELD SUBSTITUTION.—During the 

7 period native sod acreage is covered by this sub8 section, a producer may not substitute yields 

9 for the native sod acreage.’’. 

10 (b) NONINSURED CROP DISASTER ASSISTANCE.— 

11 Section 196(a)(4) of the Federal Agriculture Improvement 

12 and Reform Act of 1996 (7 U.S.C. 7333(a)(4)) is amend13 ed— 

14 (1) in subparagraph (A)(ii), by inserting ‘‘, or 

15 the producer cannot substantiate that the ground 

16 has never been tilled,’’ after ‘‘tilled’’; 

17 (2) in subparagraph (B)(i), by striking ‘‘for 

18 benefits under—’’ and all that follows through the 

19 period at the end and inserting ‘‘for— 

20 ‘‘(I) benefits under this section; 

21 ‘‘(II) a portion of crop insurance 

22 premium subsidies under the Federal 

23 Crop Insurance Act (7 U.S.C. 1501 et 

24 seq.) in accordance with subparagraph 

25 (C); and 


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1 ‘‘(III) payments described in sub2 section (b) of section 1001 of the 

3 Food Security Act of 1985 (7 U.S.C. 

4 1308).’’; and 

5 (3) by striking subparagraph (C) and inserting 

6 the following: 

7 ‘‘(C) ADMINISTRATION.— 

8 ‘‘(i) IN GENERAL.—During the first 4 

9 crop years of planting on native sod acre10 age by a producer described in subpara11 graph (B)— 

12 ‘‘(I) subparagraph (B) shall 

13 apply to 65 percent of the applicable 

14 transitional yield; and 

15 ‘‘(II) the crop insurance premium 

16 subsidy provided for the producer 

17 under the Federal Crop Insurance Act 

18 (7 U.S.C. 1501 et seq.) shall be 50 

19 percentage points less than the pre20 mium subsidy that would otherwise 

21 apply. 

22 ‘‘(ii) YIELD SUBSTITUTION.—During 

23 the period native sod acreage is covered by 

24 this paragraph, a producer may not sub25 stitute yields for the native sod acreage.’’. 


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1 (c) CROPLAND REPORT.— 

2 (1) BASELINE.——Not later than 180 days 

3 after the date of enactment of this Act, the Sec4 retary of Agriculture shall submit to the Committee 

5 on Agriculture of the House of Representatives and 

6 the Committee on Agriculture, Nutrition, and For7 estry of the Senate a report that describes the crop8 land acreage in each county and State, and the 

9 change in cropland acreage from the preceding year 

10 in each county and State, beginning with calendar 

11 year 2000 and including that information for the 

12 most recent year for which that information is avail13 able. 

14 (2) ANNUAL UPDATES.—Not later than Janu15 ary 1, 2014, and each January 1 thereafter through 

16 January 1, 2017, the Secretary of Agriculture shall 

17 submit to the Committee on Agriculture of the 

18 House of Representatives and the Committee on Ag19 riculture, Nutrition, and Forestry of the Senate a 

20 report that describes— 

21 (A) the cropland acreage in each county 

22 and State as of the date of submission of the 

23 report; and 

24 (B) the change in cropland acreage from 

25 the preceding year in each county and State. 


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1 SEC. 11026. TECHNICAL AMENDMENTS. 

2 Section 508(b) of the Federal Crop Insurance Act (7 

3 U.S.C. 1508(b)) is amended— 

4 (1) by striking paragraph (7); and 

5 (2) by redesignating paragraphs (8) through 

6 (11) as paragraphs (7) through (10), respectively. 

7 TITLE XII—MISCELLANEOUS 

8 Subtitle A—Socially Disadvantaged 

9 Producers and Limited Re10 source Producers 

11 SEC. 12001. OUTREACH AND ASSISTANCE FOR SOCIALLY 

12 DISADVANTAGED FARMERS AND RANCHERS 

13 AND VETERAN FARMERS AND RANCHERS. 

14 (a) OUTREACH AND ASSISTANCE FOR SOCIALLY DIS15 ADVANTAGED FARMERS AND RANCHERS AND VETERAN

16 FARMERS AND RANCHERS.—Section 2501 of the Food, 

17 Agriculture, Conservation, and Trade Act of 1990 (7 

18 U.S.C. 2279) is amended— 

19 (1) in the section heading, by inserting ‘‘AND

20 VETERAN FARMERS AND RANCHERS’’ after 

21 ‘‘RANCHERS’’; 

22 (2) in subsection (a)— 

23 (A) in paragraph (2)(B)(i), by inserting 

24 ‘‘and veteran farmers or ranchers’’ after 

25 ‘‘ranchers’’; and 

26 (B) in paragraph (4)— 


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1 (i) in subparagraph (A)— 

2 (I) in clause (i), by striking 

3 ‘‘and’’ at the end; 

4 (II) in clause (ii), by striking the 

5 period at the end and inserting ‘‘; 

6 and’’; and 

7 (III) by adding at the end the 

8 following: 

9 ‘‘(iii) $5,000,000 for each of fiscal 

10 years 2013 through 2017.’’; and 

11 (ii) by adding at the end the fol12 lowing: 

13 ‘‘(D) AUTHORIZATION OF APPROPRIA14 TIONS.—There is authorized to be appropriated 

15 to carry out this section $20,000,000 for each 

16 of fiscal years 2013 through 2017.’’; 

17 (3) in subsection (b)(2), by inserting ‘‘or vet18 eran farmers and ranchers’’ after ‘‘socially disadvan19 taged farmers and ranchers’’; and 

20 (4) in subsection (c)— 

21 (A) in paragraph (1)(A), by inserting ‘‘vet22 eran farmers or ranchers and’’ before ‘‘mem23 bers’’; and 


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1 (B) in paragraph (2)(A), by inserting ‘‘vet2 eran farmers or ranchers and’’ before ‘‘mem3 bers’’. 

4 (b) DEFINITION OF VETERAN FARMER OR RANCH5 ER.—Section 2501(e) of the Food, Agriculture, Conserva6 tion, and Trade Act of 1990 (7 U.S.C. 2279(e)) is amend7 ed by adding at the end the following: 

8 ‘‘(7) VETERAN FARMER OR RANCHER.—The 

9 term ‘veteran farmer or rancher’ means a farmer or 

10 rancher who served in the active military, naval, or 

11 air service, and who was discharged or released from 

12 the service under conditions other than dishonor13 able.’’. 

14 SEC. 12002. OFFICE OF ADVOCACY AND OUTREACH. 

15 Section 226B(f)(3) of the Department of Agriculture 

16 Reorganization Act of 1994 (7 U.S.C. 6934(f)(3)) is 

17 amended to read as follows: 

18 ‘‘(3) AUTHORIZATION OF APPROPRIATIONS.— 

19 There are authorized to be appropriated to carry out 

20 this subsection— 

21 ‘‘(A) such sums as are necessary for each 

22 of fiscal years 2009 through 2012; and 

23 ‘‘(B) $2,000,000 for each of fiscal years 

24 2013 through 2017.’’. 


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1 Subtitle B—Livestock 

2 SEC. 12101. WILDLIFE RESERVOIR ZOONOTIC DISEASE INI3 TIATIVE. 

4 Title IV of the Agricultural Research, Extension, and 

5 Education Reform Act of 1998 (7 U.S.C. 7621 et seq.) 

6 is amended by adding at the end the following: 

7 ‘‘SEC. 413. WILDLIFE RESERVOIR ZOONOTIC DISEASE INI8 TIATIVE. 

9 ‘‘(a) DEFINITION OF COVERED DISEASE.—In this 

10 section, the term ‘covered disease’ means a zoonotic dis11 ease affecting domestic livestock that is transmitted pri12 marily from wildlife. 

13 ‘‘(b) ESTABLISHMENT.—There is established within 

14 the Department a wildlife reservoir zoonotic disease initia15 tive to provide assistance through Coordinated Agricul16 tural Project grants for research and development of sur17 veillance methods, vaccines, vaccination delivery systems, 

18 or diagnostic tests for covered diseases. 

19 ‘‘(c) COVERED DISEASE.— 

20 ‘‘(1) IN GENERAL.—To be eligible for a grant 

21 under this section, an eligible entity shall conduct 

22 research and development of surveillance methods, 

23 vaccines, vaccination delivery systems, or diagnostic 

24 tests for covered diseases in— 


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1 ‘‘(A) a wildlife reservoir in the United 

2 States; or 

3 ‘‘(B) domestic livestock or wildlife pre4 senting a potential concern to public health. 

5 ‘‘(2) PRIORITY.—In making grants under this 

6 section, the Secretary shall give priority to grants 

7 that address— 

8 ‘‘(A) Brucella abortus (Bovine Brucellosis); 

9 ‘‘(B) Mycobacterium bovis (Bovine Tuber10 culosis); or 

11 ‘‘(C) other zoonotic disease in livestock 

12 that is covered by a high-priority research and 

13 extension initiative conducted under section 

14 1672 of the Food, Agriculture, Conservation, 

15 and Trade Act of 1990 (7 U.S.C. 5925). 

16 ‘‘(d) ELIGIBLE ENTITIES.—The Secretary shall carry 

17 out the initiative established under subsection (b) through 

18 public scientific research consortia that may consist of 

19 members from— 

20 ‘‘(1) Federal agencies; 

21 ‘‘(2) National Laboratories; 

22 ‘‘(3) institutions of higher education; 

23 ‘‘(4) research institutions and organizations; or 

24 ‘‘(5) State agricultural experiment stations. 


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1 ‘‘(e) RESEARCH PROJECTS.—In carrying out this 

2 section, the Secretary shall award grants on a competitive 

3 basis. 

4 ‘‘(f) ADMINISTRATION.— 

5 ‘‘(1) IN GENERAL.—In the case of grants 

6 awarded under this section, the Secretary shall— 

7 ‘‘(A) seek and accept proposals for grants; 

8 ‘‘(B) determine the relevance and merit of 

9 proposals through a system of peer and merit 

10 review in accordance with section 103; 

11 ‘‘(C) award grants on the basis of merit, 

12 quality, and relevance; and 

13 ‘‘(D) manage the initiative established 

14 under subsection (b) using a Coordinated Agri15 cultural Project format. 

16 ‘‘(2) TERM.—The term of a grant under this 

17 section may not exceed 10 years. 

18 ‘‘(3) MATCHING FUNDS REQUIRED.—The Sec19 retary shall require the recipient of a grant under 

20 this section to provide funds or in-kind support from 

21 non-Federal sources in an amount that is not less 

22 than 25 percent of the amount provided by the Fed23 eral Government. 

24 ‘‘(4) OTHER CONDITIONS.—The Secretary may 

25 set such other conditions on the award of a grant 


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1 under this section as the Secretary determines to be 

2 appropriate. 

3 ‘‘(g) BUILDINGS AND FACILITIES.—Funds made 

4 available under this section shall not be used for— 

5 ‘‘(1) the construction of a new building or facil6 ity; or 

7 ‘‘(2) the acquisition, expansion, remodeling, or 

8 alteration of an existing building or facility (includ9 ing site grading and improvement and architect 

10 fees). 

11 ‘‘(h) AUTHORIZATION OF APPROPRIATIONS.— 

12 ‘‘(1) IN GENERAL.—There is authorized to be 

13 appropriated to carry out this section $7,000,000 for 

14 each of fiscal years 2012 through 2017. 

15 ‘‘(2) ALLOCATION.—Of the amount made avail16 able for a fiscal year under paragraph (1), the Sec17 retary shall use not less than 30 percent of the 

18 amount for the fiscal year to carry out activities 

19 under each of subparagraphs (A) and (B) of sub20 section (c)(2).’’. 

21 SEC. 12102. TRICHINAE CERTIFICATION PROGRAM. 

22 Section 10405(d)(1) of the Animal Health Protection 

23 Act (7 U.S.C. 8304(d)(1)) is amended in subparagraphs 

24 (A) and (B) by striking ‘‘2012’’ each place it appears and 

25 inserting ‘‘2017’’. 


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1 SEC. 12103. NATIONAL AQUATIC ANIMAL HEALTH PLAN. 

2 Section 11013(d) of the Food, Conservation, and En3 ergy Act of 2008 (7 U.S.C. 8322(d)) is amended by strik4 ing ‘‘2012’’ and inserting ‘‘2017’’. 

5 SEC. 12104. SHEEP PRODUCTION AND MARKETING GRANT 

6 PROGRAM. 

7 (a) IN GENERAL.—Subtitle A of the Agricultural 

8 Marketing Act of 1946 (7 U.S.C. 1621 et seq.) is amended 

9 by adding at the end the following: 

10 ‘‘SEC. 209. SHEEP PRODUCTION AND MARKETING GRANT 

11 PROGRAM. 

12 ‘‘(a) ESTABLISHMENT.—The Secretary, acting 

13 through the Administrator of the Agricultural Marketing 

14 Service (referred to in this section as the ‘Secretary’) shall 

15 establish a competitive grant program for the purposes of 

16 improving the United States sheep industry. 

17 ‘‘(b) PURPOSE.—The purpose of the grant program 

18 shall be to strengthen and enhance the production and 

19 marketing of sheep and sheep products, including im20 provement of— 

21 ‘‘(1) infrastructure; 

22 ‘‘(2) business; 

23 ‘‘(3) resource development; and 

24 ‘‘(4) innovative approaches to solve long-term 

25 needs. 


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1 ‘‘(c) ELIGIBILITY.—The Secretary shall make grants 

2 under this section to 1 or more national entities the mis3 sion of which is consistent with the purpose of the grant 

4 program. 

5 ‘‘(d) FUNDING.—Of the funds of the Commodity 

6 Credit Corporation, the Secretary shall use to carry out 

7 this section $1,500,000 for fiscal year 2013, to remain 

8 available until expended.’’. 

9 (b) CONFORMING AMENDMENT.—Section 374 of the 

10 Consolidated Farm and Rural Development Act (7 U.S.C. 

11 2008j) (as in existence on the day before the date of enact12 ment of this Act) is— 

13 (1) amended in subsection (e)— 

14 (A) in paragraph (3)(D), by striking ‘‘3 

15 percent’’ and inserting ‘‘10 percent’’; and 

16 (B) by striking paragraph (6); and 

17 (2) redesignated as section 210 of the Agricul18 tural Marketing Act of 1946; and 

19 (3) moved so as to appear at the end of subtitle 

20 A of that Act (as amended by subsection (a)). 

21 SEC. 12105. FERAL SWINE ERADICATION PILOT PROGRAM. 

22 (a) IN GENERAL.—To eradicate or control the threat 

23 feral swine pose to the domestic swine population, the en24 tire livestock industry, and the destruction of crops and 

25 natural plant communities and native habitats, the SecVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 00996 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 retary of Agriculture may establish a feral swine eradi2 cation pilot program. 

3 (b) PILOT.—Subject to the availability of appropria4 tions under this section, the Secretary may provide finan5 cial assistance for the cost of carrying out a pilot pro6 gram— 

7 (1) to study and assess the nature and extent 

8 of damage to the pilot area caused by feral swine; 

9 (2) to develop methods to eradicate or control 

10 feral swine in the pilot area; and 

11 (3) to develop methods to restore damage 

12 caused by feral swine. 

13 (c) COORDINATION.—The Secretary shall ensure that 

14 the Natural Resource Conservation Service and the Ani15 mal and Plant Health Inspection Service coordinate to 

16 carry out the pilot program. 

17 (d) COST SHARING.— 

18 (1) FEDERAL SHARE.—The Federal share of 

19 the costs of the pilot program under this section 

20 may not exceed 75 percent of the total costs of car21 rying out the pilot program. 

22 (2) IN-KIND CONTRIBUTIONS.—The non-Fed23 eral share of the costs of the pilot program may be 

24 provided in the form of in-kind contributions of ma25 terials or services. 


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1 (e) LIMITATION ON ADMINISTRATIVE EXPENSES.— 

2 Not more than 10 percent of financial assistance provided 

3 by the Secretary under this section may be used for ad4 ministrative expenses. 

5 (f) AUTHORIZATION OF APPROPRIATIONS.—There is 

6 authorized to be appropriated to carry out this section 

7 $2,000,000 for each of fiscal years 2013 through 2017. 

8 Subtitle C—Other Miscellaneous 

9 Provisions 

10 SEC. 12201. MILITARY VETERANS AGRICULTURAL LIAISON. 

11 (a) IN GENERAL.—Subtitle A of the Department of 

12 Agriculture Reorganization Act of 1994 is amended by in13 serting after section 218 (7 U.S.C. 6918) the following: 

14 ‘‘SEC. 219. MILITARY VETERANS AGRICULTURAL LIAISON. 

15 ‘‘(a) AUTHORIZATION.—The Secretary shall establish 

16 in the Department the position of Military Veterans Agri17 cultural Liaison. 

18 ‘‘(b) DUTIES.—The Military Veterans Agricultural 

19 Liaison shall— 

20 ‘‘(1) provide information to returning veterans 

21 about, and connect returning veterans with, begin22 ning farmer training and agricultural vocational and 

23 rehabilitation programs appropriate to the needs and 

24 interests of returning veterans, including assisting 

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1 fits for purposes relating to beginning a farming or 

2 ranching career; 

3 ‘‘(2) provide information to veterans concerning 

4 the availability of and eligibility requirements for 

5 participation in agricultural programs, with par6 ticular emphasis on beginning farmer and rancher 

7 programs; 

8 ‘‘(3) serving as a resource for assisting veteran 

9 farmers and ranchers, and potential farmers and 

10 ranchers, in applying for participation in agricul11 tural programs; and 

12 ‘‘(4) advocating on behalf of veterans in inter13 actions with employees of the Department.’’. 

14 (b) CONFORMING AMENDMENTS.—Section 296(b) of 

15 the Department of Agriculture Reorganization Act of 

16 1994 (7 U.S.C. 7014(b)) (as amended by section 1608(d)) 

17 is amended— 

18 (1) in paragraph (7), by striking the ‘‘or’’ at 

19 the end; 

20 (2) in paragraph (8), by striking the period at 

21 the end and inserting ‘‘;or’’; and 

22 (3) by adding at the end the following: 

23 ‘‘(9) the authority of the Secretary to establish 

24 in the Department the position of Military Veterans 


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1 Agricultural Liaison in accordance with section 

2 219.’’. 

3 SEC. 12202. INFORMATION GATHERING. 

4 Section 1619(b)(3) of the Food, Conservation, and 

5 Energy Act of 2008 (7 U.S.C. 8791) is amended by add6 ing at the end the following: 

7 ‘‘(B) COOPERATION WITH STATE AND

8 LOCAL GOVERNMENTS.— 

9 ‘‘(i) IN GENERAL.—Subject to clause 

10 (ii), in the case of a State agency, political 

11 subdivision, or local governmental agency 

12 that is charged with implementing an agri13 culture or conservation program under 

14 State law, on request of the State agency, 

15 political subdivision, or local governmental 

16 agency, the information described in para17 graph (2) shall be disclosed to the State 

18 agency, political subdivision, or local gov19 ernmental agency if the Secretary deter20 mines that the State agency, political sub21 division, or local governmental agency 

22 demonstrates that the disclosure is re23 quired for implementing the State pro24 gram. 


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1 ‘‘(ii) RESTRICTION.—Any information 

2 disclosed to a State agency, political sub3 division, or local governmental agency 

4 under clause (i) shall be— 

5 ‘‘(I) used solely by the State 

6 agency, political subdivision, or local 

7 governmental agency; and 

8 ‘‘(II) exempt from disclosure to 

9 the public, including under any State 

10 law that allows a citizen to petition a 

11 State agency for that information.’’. 

12 SEC. 12203. GRANTS TO IMPROVE SUPPLY, STABILITY, 

13 SAFETY, AND TRAINING OF AGRICULTURAL 

14 LABOR FORCE. 

15 Section 14204(d) of the Food, Conservation, and En16 ergy Act of 2008 (7 U.S.C. 2008q–1(d)) is amended to 

17 read as follows: 

18 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 

19 are authorized to be appropriated to carry out this sec20 tion— 

21 ‘‘(1) such sums as are necessary for each of fis22 cal years 2008 through 2012; and 

23 ‘‘(2) $10,000,000 for each of fiscal years 2013 

24 through 2017.’’. 


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1 SEC. 12204. NONINSURED CROP ASSISTANCE PROGRAM. 

2 (a) IN GENERAL.—Section 196 of the Federal Agri3 culture Improvement and Reform Act of 1996 (7 U.S.C. 

4 7333) is amended— 

5 (1) in subsection (a)— 

6 (A) by striking paragraph (1) and insert7 ing the following: 

8 ‘‘(1) IN GENERAL.— 

9 ‘‘(A) COVERAGES.—In the case of an eligi10 ble crop described in paragraph (2), the Sec11 retary of Agriculture shall operate a noninsured 

12 crop disaster assistance program to provide cov13 erages based on individual yields (other than 

14 for value-loss crops) equivalent to— 

15 ‘‘(i) catastrophic risk protection avail16 able under section 508(b) of the Federal 

17 Crop Insurance Act (7 U.S.C. 1508(b)); or 

18 ‘‘(ii) additional coverage available 

19 under subsections (c) and (h) of section 

20 508 of that Act (7 U.S.C. 1508) that does 

21 not exceed 65 percent. 

22 ‘‘(B) ADMINISTRATION.—The Secretary 

23 shall carry out this section through the Farm 

24 Service Agency (referred to in this section as 

25 the ‘Agency’).’’; and 

26 (B) in paragraph (2)— 


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1 (i) in subparagraph (A)— 

2 (I) in the matter before clause 

3 (i), by striking ‘‘(except livestock)’’ 

4 and inserting ‘‘(except livestock and 

5 crops and grasses used for grazing)’’; 

6 (II) in clause (i), by striking 

7 ‘‘and’’ after the semicolon at the end; 

8 (III) by redesignating clause (ii) 

9 as clause (iii); and 

10 (IV) by inserting after clause (i) 

11 the following: 

12 ‘‘(ii) for which additional 

13 coverage under subsections (c) 

14 and (h) of section 508 of that 

15 Act (7 U.S.C. 1508) is not avail16 able; and’’; and 

17 (ii) in subparagraph (B)— 

18 (I) by inserting ‘‘(except ferns)’’ 

19 after ‘‘floricultural’’; 

20 (II) by inserting ‘‘(except ferns)’’ 

21 after ‘‘ornamental nursery’’; and 

22 (III) by striking ‘‘(including or23 namental fish)’’ and inserting ‘‘(in24 cluding ornamental fish, but excluding 

25 tropical fish)’’; 


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1 (2) in subsection (d), by striking ‘‘The Sec2 retary’’ and inserting ‘‘Subject to subsection (l), the 

3 Secretary’’; 

4 (3) in subsection (k)(1)— 

5 (A) in subparagraph (A), by striking 

6 ‘‘$250’’ and inserting ‘‘$260’’; and 

7 (B) in subparagraph (B)— 

8 (i) by striking ‘‘$750’’ and inserting 

9 ‘‘$780’’; and 

10 (ii) by striking ‘‘$1,875’’ and insert11 ing ‘‘$1,950’’; and 

12 (4) by adding at the end the following: 

13 ‘‘(l) PAYMENT EQUIVALENT TO ADDITIONAL COV14 ERAGE.— 

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

16 available to a producer eligible for noninsured assist17 ance under this section a payment equivalent to an 

18 indemnity for additional coverage under subsections 

19 (c) and (h) of section 508 of the Federal Crop In20 surance Act (7 U.S.C. 1508) that does not exceed 

21 65 percent, computed by multiplying— 

22 ‘‘(A) the quantity that is less than 50 to 

23 65 percent of the established yield for the crop, 

24 as determined by the Secretary, specified in in25 crements of 5 percent; 


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1 ‘‘(B) 100 percent of the average market 

2 price for the crop, as determined by the Sec3 retary; and 

4 ‘‘(C) a payment rate for the type of crop, 

5 as determined by the Secretary, that reflects— 

6 ‘‘(i) in the case of a crop that is pro7 duced with a significant and variable har8 vesting expense, the decreasing cost in9 curred in the production cycle for the crop 

10 that is, as applicable— 

11 ‘‘(I) harvested; 

12 ‘‘(II) planted but not harvested; 

13 or 

14 ‘‘(III) prevented from being 

15 planted because of drought, flood, or 

16 other natural disaster, as determined 

17 by the Secretary; or 

18 ‘‘(ii) in the case of a crop that is pro19 duced without a significant and variable 

20 harvesting expense, such rate as shall be 

21 determined by the Secretary. 

22 ‘‘(2) PREMIUM.—To be eligible to receive a pay23 ment under this subsection, a producer shall pay— 

24 ‘‘(A) the service fee required by subsection 

25 (k); and 


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1 ‘‘(B) a premium for the applicable crop 

2 year that is equal to— 

3 ‘‘(i) the product obtained by multi4 plying— 

5 ‘‘(I) the number of acres devoted 

6 to the eligible crop; 

7 ‘‘(II) the yield, as determined by 

8 the Secretary under subsection (e); 

9 ‘‘(III) the coverage level elected 

10 by the producer; 

11 ‘‘(IV) the average market price, 

12 as determined by the Secretary; and 

13 ‘‘(ii) 5.25-percent premium fee. 

14 ‘‘(3) LIMITED RESOURCE, BEGINNING, AND SO15 CIALLY DISADVANTAGED FARMERS.—The additional 

16 coverage made available under this subsection shall 

17 be available to limited resource, beginning, and so18 cially disadvantaged producers, as determined by the 

19 Secretary, in exchange for a premium that is 50 per20 cent of the premium determined for a producer 

21 under paragraph (2).’’. 

22 (b) TERMINATION DATE.— 

23 (1) IN GENERAL.—Effective October 1, 2017, 

24 subsection (a) and the amendments made by sub25 section (a) (other than the amendments made by 


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1 clauses (i)(I) and (ii) of subsection (a)(1)(B)) are re2 pealed 

3 (2) ADMINISTRATION.—Effective October 1, 

4 2017, section 196 of the Federal Agriculture Im5 provement and Reform Act of 1996 (7 U.S.C. 7333) 

6 shall be applied and administered as if subsection 

7 (a) and the amendments made by subsection (a) 

8 (other than the amendments made by clauses (i)(I) 

9 and (ii) of subsection (a)(1)(B)) had not been en10 acted. 

11 SEC. 12205. REGIONAL ECONOMIC AND INFRASTRUCTURE 

12 DEVELOPMENT. 

13 Section 15751 of title 40, United States Code, is 

14 amended— 

15 (1) in subsection (a), by striking ‘‘2012’’ and 

16 inserting ‘‘2017’’; and 

17 (2) in subsection (b)— 

18 (A) by striking ‘‘Not more than’’ and in19 serting the following: 

20 ‘‘(1) IN GENERAL.—Except as provided in para21 graph (2), not more than’’; and 

22 (B) by adding at the end the following: 

23 ‘‘(2) LIMITED FUNDING.—In a case in which 

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1 mission for a fiscal year under this section, para2 graph (1) shall not apply.’’. 

3 SEC. 12206. CANADA GEESE REMOVAL. 

4 (a) IN GENERAL.—On a determination by the Ad5 ministrator of the Federal Aviation Administration that 

6 the population of Canada geese residing on land under the 

7 jurisdiction of the National Park Service that is located 

8 within 5 miles of any commercial airport poses a risk to 

9 flight safety, the Secretary (acting through the Adminis10 trator of the Animal and Plant Health Inspection Service), 

11 in consultation with the Secretary of the Interior and the 

12 Administrator of the Federal Aviation Administration, 

13 shall— 

14 (1) by the first subsequent molting period for 

15 Canada geese that occurs after the date of enact16 ment of this Act, publish a management plan that 

17 provides for the removal, by not later than 1 year 

18 after the date of publication, of all Canada geese re19 siding on the applicable land; and 

20 (2) as soon as practicable after the date of pub21 lication of the management plan under paragraph 

22 (1), commence removal of Canada geese from the 

23 applicable land. 

24 (b) JFK INTERNATIONAL AIRPORT.—Not later than 

25 June 1, 2012, the Secretary (acting through the AdminisVerDate Mar 15 2010 02:25 May 25, 2012 Jkt 019200 PO 00000 Frm 01008 Fmt 6652 Sfmt 6201 E:\BILLS\S3240.PCS S3240

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1 trator of the Animal and Plant Health Inspection Service) 

2 shall— 

3 (1) issue a record of decision for the document 

4 entitled ‘‘Supplement to the Environmental Impact 

5 Statement Bird Hazard Reduction Program: John 

6 F. Kennedy International Airport’’; and 

7 (2) commence consultation with the Secretary 

8 of the Interior to complete the collection and re9 moval of Canada geese from the applicable National 

10 Park Service land to ensure that the removal is com11 pleted by not later than August 1, 2012. 


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Calendar No. 415 

112TH CONGRESS 

2D SESSION S. 3240 

A BILL 

To reauthorize agricultural programs through 

2017, and for other purposes. 

MAY 24, 2012 

Read twice and placed on the calendar 


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