I

103D CONGRESS

1ST SESSION H. R. 2072

To reform the payment limitation provisions of the Food Security Act of

1985, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

MAY 11, 1993

Mr. PENNY (for himself, Ms. LONG, Mr. LEACH, Mr. MINGE, Mr. POMEROY,

and Mr. JOHNSON of South Dakota) introduced the following bill; which

was referred to the Committee on Agriculture

A BILL

To reform the payment limitation provisions of the Food

Security Act of 1985, 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.

4 This Act may be cited as the ‘‘Farm Program Pay5 ment Limitations Reform Act of 1993’’.

6 SEC. 2. ATTRIBUTION OF PAYMENTS.

7 (a) Paragraph (5)(C) of section 1001 of the Food Se8 curity Act of 1985 (7 U.S.C. 1308(5)(C)) is amended to

9 read as follows:
2

HR 2072 IH

1 ‘‘(C) In the case of corporations and other enti2 ties included in subparagraph (B), and partnerships,

3 the Secretary shall attribute payments to natural

4 persons in proportion to their ownership interests in

5 an entity and in any other entity, or partnership,

6 which owns or controls the entity, or partnership, re7 ceiving such payment.’’.

8 (b) Section 609 of the Agricultural Act of 1949 (7

9 U.S.C. 1471g) is amended by striking subsections (c) and

10 (d) and inserting the following:

11 ‘‘(c) In the case of corporations and other entities in12 cluded in section 1001(5)(B) of the Food Security Act of

13 1985, and partnerships, the Secretary shall attribute pay14 ments to natural persons in proportion to their ownership

15 interests in such entities and partnerships.’’.

16 SEC. 3. REPEAL OF 3–ENTITY RULE.

17 Section 1001A(a)(1) of the Food Security Act of

18 1985 (7 U.S.C. 1308–1(a)(1) is amended—

19 (1) in the first sentence by—

20 (A) striking ‘‘substantial beneficial inter21 ests in more than two entities’’ and inserting ‘‘a

22 substantial beneficial interest in any other en23 tity’’; and
3

HR 2072 IH

1 (B) striking ‘‘receive such payment as sep2 arate persons’’ and insert ‘‘receives such pay3 ments as a separate person’’; and

4 (2) by striking the second sentence.

5 SEC. 4. IMPOSITION OF PERSONAL LABOR REQUIREMENT.

6 Section 1001A(b) of the Food Security Act of 1985

7 (7 U.S.C. 1308–1(b)) is amended in subparagraphs

8 (A)(i)(II), (B)(ii), and (C) of paragraph (2) and subpara9 graph (B) of paragraph (3) by striking ‘‘or active personal

10 management’’.

11 SEC. 5. REDUCTION IN WOOL ACT PAYMENT LIMITATION.

12 Subparagraph (D) of section 704(b)(1) of the Na13 tional Wool Act of 1954 (7 U.S.C. 1783(b)(1)(D)) is

14 amended by striking ‘‘$125,000’’ and inserting

15 ‘‘$50,000’’.

16 SEC. 6. GENERAL ACCOUNTING OFFICE REVIEW AND RE17 PORT.

18 The Food Security Act of 1985 is amended by adding

19 after section 1001E the following new section:

20 ‘‘SEC. 1001F. GENERAL ACCOUNTING OFFICE REVIEW AND

21 REPORT.

22 ‘‘(a) REVIEW.—The Comptroller General of the Unit23 ed States shall review the implementation of the amend24 ments made by the Farm Program Payment Limitations

25 Reform Act of 1993 to determine whether the payment
4

HR 2072 IH

1 limitation provisions of this Act and the National Wool

2 Act of 1945 (7 U.S.C. 1781 et seq.), as amended by the

3 Farm Program Payment Limitations Reform Act of 1993,

4 have been implemented to effectively and fairly—

5 ‘‘(1) require the attribution of payments to in6 dividuals;

7 ‘‘(2) prohibit the creation of entities by pro8 gram participants to garner payments to any indi9 vidual in amounts greater than those described in

10 sections 1001 through 1001E and section 704(b)(1)

11 of the National Wool Act of 1954 (7 U.S.C.

12 1783(b)(1));

13 ‘‘(3) limit payments to any one farm program

14 participant to the amounts described in paragraph

15 (2);

16 ‘‘(4) require the contribution of active personal

17 labor by program participants in order to be eligible

18 for payments under this Act and the National Wool

19 Act of 1945; and

20 ‘‘(5) administer the payment limitation provi21 sions of such Acts.

22 ‘‘(b) REPORT.—Not later than two years after the

23 date of enactment of this section, and periodically there24 after as he or she determines necessary, the Comptroller

25 General shall submit a report to the Committee on Agri-
5

HR 2072 IH

1 culture of the House of Representatives and the Commit2 tee on Agriculture, Nutrition, and Forestry of the Senate

3 that describes—

4 ‘‘(1) the results of the review required under

5 subsection (a);

6 ‘‘(2) any information available to the Comptrol7 ler General that any individual, farming operation,

8 or entity is receiving payments in excess of the

9 amounts described in sections 1001 through 1001E

10 and section 704(b)(1) of the National Wool Act of

11 1954, including—

12 ‘‘(A) the number and dollar value of pay13 ments described in section 1001(1)(A) or in

14 section 704 of the National Wool Act of 1954

15 made to any natural persons, entities, and

16 farming operations, by State and commodity,

17 that exceeded the payment limitation in such

18 section and an explanation of why the payment

19 limitation was exceeded;

20 ‘‘(B) for any commodity for which a mar21 keting loan is in effect, the number and dollar

22 value of any gain realized, plus forfeitures, by

23 natural persons, entities, and farming oper24 ations, by State and commodity, that exceeded

25 the payment limitation in section 1001(1)(B)
6

HR 2072 IH

1 and an explanation of why the payment limita2 tion was exceeded; and

3 ‘‘(C) the number and dollar value of total

4 payments set forth under section 1001(2)(B)

5 made to natural persons, entities, and farming

6 operations, by State and commodity, that ex7 ceeded the payment limitation in section

8 1001(2)(A) and an explanation of why the pay9 ment limitation was exceeded;

10 ‘‘(3) any other information that the Comptroller

11 General determines appropriate to assist in the over12 sight of the implementation of the payment limita13 tions described in subsection (a); and

14 ‘‘(4) the recommendations of the Comptroller

15 General for the effective and fair implementation of

16 the payment limitation provisions of such Acts to—

17 ‘‘(A) address the matters described in sub18 section (a);

19 ‘‘(B) enforce the payment limitations de20 scribed in paragraph (2); and

21 ‘‘(C) effectively and fairly administer the

22 commodity programs established under the Ag23 ricultural Act of 1949 and the National Wool

24 Act of 1954.’’.

Æ