169 
Index for All Urban Consumers pub-
lished by the Bureau of Labor Statis-
tics of the Department of Labor. 
‘‘(II) REQUIREMENT.—Each ad-
justment under subclause (I) shall be 
based on the unrounded amount for 
the prior 12-month period.’’. 
SEC. 803. DAIRY EXPORT INCENTIVE AND DAIRY INDEM-
NITY PROGRAMS. 
(a) DAIRY EXPORT INCENTIVE PROGRAM.—Section 
153(a) of the Food Security Act of 1985 (15 U.S.C. 713a– 
14(a)) is amended by striking ‘‘2007’’ and inserting 
‘‘2013’’. 
(b) DAIRY INDEMNITY PROGRAM.—Section 3 of Pub-
lic Law 90–484 (7 U.S.C. 450l) is amended by striking 
‘‘2007’’ and inserting ‘‘2013’’. 
SEC. 804. FUNDING OF DAIRY PROMOTION AND RESEARCH 
PROGRAM. 
Section 113(e)(2) of the Dairy Production Stabiliza-
tion Act of 1983 (7 U.S.C. 4504(e)(2)) is amended by 
striking ‘‘2007’’ and inserting ‘‘2013’’. 
SEC. 805. FEDERAL MILK MARKETING ORDERS. 
(a) 2-CLASS SYSTEM FOR CLASSIFYING MILK.— 
(1) IN GENERAL.—Not later than September 
30, 2008, the Secretary shall conduct a study of the 
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economic benefits to milk producers of establishing 
a 2-class system for classifying milk under Federal 
milk marketing orders issued under section 8c(5) of 
the Agricultural Adjustment Act (7 U.S.C. 608c(5)), 
reenacted with amendments by the Agricultural 
Marketing Agreement Act of 1937, consisting of a 
fluid milk class and a manufacturing grade milk 
class (with the price for both classes determined 
using the component prices of butterfat, protein, and 
other solids). 
(2) AMENDMENT TO ORDERS.— 
(A) IN GENERAL.—If the Secretary deter-
mines (on the basis of the study conducted 
under paragraph (1)) that a 2-class system for 
classifying milk under Federal milk marketing 
orders would have a positive impact on milk 
producers, the Secretary submit a report to the 
Committee on Agriculture of the House of Rep-
resentatives and the Committee on Agriculture, 
Nutrition, and Forestry of the Senate that in-
cludes the text of proposed amendments to the 
Federal milk marketing orders to implement 
the 2-class system for classifying milk. 
(B) EFFECTIVE
DATE.—The proposed 
amendments described in subparagraph (A) 
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171 
shall take effect not earlier than the date that 
is 180 days after the date on which the report 
is submitted under that subparagraph. 
(b) DEADLINE FOR ISSUANCE OF ORDERS.—Section 
8c(4) of the Agricultural Adjustment Act (7 U.S.C. 
608c(4)), reenacted with amendments by the Agricultural 
Marketing Agreement Act of 1937, is amended by striking 
‘‘After’’ and inserting ‘‘Not later than 30 days after’’. 
(c) ADVANCED PRICING.—Section 8c(5) of the Agri-
cultural Adjustment Act (7 U.S.C. 608c(5)), reenacted 
with amendments by the Agricultural Marketing Agree-
ment Act of 1937, is amended by adding at the end the 
following: 
‘‘(P) ADVANCED PRICING.—Not later than 
September 30, 2007, in calculating the ad-
vanced price of Class I butterfat milk and Class 
I and II skim milk under Federal milk mar-
keting orders, the Secretary shall use the 4- 
week component prices that are used to cal-
culate prices for Class III and Class IV milk, 
as determined by the Secretary.’’. 
(d) ECONOMIC
IMPACT
ASSESSMENT.—The Sec-
retary shall— 
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(1) carry out a review of the milk–feed ratio 
during the 1-year period ending on the date of en-
actment of this Act; and 
(2) not later than September 30, 2008, and 
each time a proposed change in the Federal milk 
marketing order formulas is considered by the Sec-
retary— 
(A) assess the economic impact, over a 1- 
and 2-year period, of proposed changes in Fed-
eral milk marketing order formulas on— 
(i) milk supply; 
(ii) farm profitability; 
(iii) consumer demand; and 
(iv) market prices; 
(B) submit to the Committee on Agri-
culture of the House of Representatives and the 
Committee on Agriculture, Nutrition, and For-
estry a report that describes the results of the 
assessment; and 
(C) consider, and include in the record, the 
results of the assessment before making a deci-
sion on any proposed change to the Federal 
milk marketing order formulas. 
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173 
SEC. 806. DAIRY PROCESSING EQUIPMENT LOAN GUAR-
ANTEE FUND. 
(a) LOANS.— 
(1) IN GENERAL.—Section 310B(a) of the Con-
solidated Farm and Rural Development Act (7 
U.S.C. 1932(a)) is amended— 
(A) by designating the first through fifth 
sentences as paragraphs (1) through (5), re-
spectively; 
(B) by striking ‘‘SEC. 310B. (a) The Sec-
retary’’ and inserting the following: 
‘‘SEC. 310B. RURAL INDUSTRIALIZATION ASSISTANCE. 
‘‘(a) LOANS.— 
‘‘(1) IN GENERAL.—The Secretary’’; 
(C) by striking ‘‘for the purposes of (1) 
improving’’ and inserting ‘‘for the purposes 
of— 
‘‘(A) improving’’; 
(D) by striking ‘‘abatement and control, 
(2) the conservation’’ and inserting ‘‘abatement 
and control; 
‘‘(B) the conservation’’; 
(E) by striking ‘‘rural areas, (3) reducing’’ 
and inserting ‘‘rural areas; 
‘‘(C) reducing’’; 
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(F) by striking ‘‘rural areas, and (4) to fa-
cilitate economic’’ and inserting ‘‘rural areas; 
‘‘(D) facilitating economic’’; and 
(G) by striking ‘‘foreign trade.’’ and insert-
ing ‘‘foreign trade; and 
‘‘(E) providing processors of dairy prod-
ucts with incentives for investing in new equip-
ment and technologies by using not more than 
$15,000,000 each fiscal year to— 
‘‘(i) make loans to dairy processors 
and cooperatives to cover not more than 50 
percent of the cost of acquisition and adop-
tion of new equipment, equipment up-
grades, and new technologies— 
‘‘(I) at a fixed rate of interest 
not to exceed the prime lending rate 
plus 1 percent; and 
‘‘(II) with a term of not to ex-
ceed 15 years; and 
‘‘(ii) guarantee loans made to dairy 
processors and cooperatives for the acquisi-
tion and adoption of new dairy equipment, 
equipment upgrades, and new technologies, 
at a guarantee rate of 90 percent.’’. 
(2) CONFORMING AMENDMENTS.— 
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(A) Section 307(a)(6)(B)(ii) of the Con-
solidated Farm and Rural Development Act (7 
U.S.C. 1927(a)(6)(B)(ii)) is amended by strik-
ing ‘‘clause (1) of section 310B(a)’’ and insert-
ing ‘‘section 310B(a)(1)(A)’’. 
(B) Section 333A(g)(1)(B) of the Consoli-
dated Farm and Rural Development Act (7 
U.S.C. 1983a(g)(1)(B)) is amended by striking 
‘‘310B(a)(1)’’ and inserting ‘‘310(a)(1)(A)’’. 
(C) Section 381E(d)(3)(B) of the Consoli-
dated Farm and Rural Development Act (7 
U.S.C. 2009d(d)(3)(B)) is amended by striking 
‘‘310B(a)(1)’’ and inserting ‘‘310B(a)(1)(A)’’. 
(b) LENDING POWER FOR DAIRY PROCESSING CO-
OPERATIVES.—Section 3.7 of the Farm Credit Act of 
1971 (12 U.S.C. 2128) is amended by adding at the end 
the following: 
‘‘(g) DAIRY PROCESSING COOPERATIVES.— 
‘‘(1) IN GENERAL.—The banks for cooperatives 
may use not more than $15,000,000 each fiscal year 
to provide dairy processing cooperatives with work-
ing capital lines of credit and accounts receivable fi-
nancing for the purpose of accessing export mar-
keting opportunities for milk and milk products. 
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‘‘(2) LIMITATIONS.—Financing provided by the 
banks for cooperatives for a project under paragraph 
(1) may not exceed the lesser of— 
‘‘(A) $1,000,000; or 
‘‘(B) 75 percent of the costs of carrying 
out the project. 
‘‘(3) TERM.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), the term of a line of credit 
described in paragraph (1) shall not exceed 24 
months. 
‘‘(B) REVOLVING
LINES
OF
CREDIT.—A 
revolving line of credit may be used for multiple 
transactions. 
‘‘(4) DUE
DATE.—An accounts receivable fi-
nancing loan under this subsection shall be due on 
the earlier of— 
‘‘(A) the date on which the receivable is 
paid; or 
‘‘(B) 180 days after the date of disburse-
ment. 
‘‘(5) USE OF FINANCING.— 
‘‘(A) WORKING CAPITAL LINE OF CREDIT 
FINANCING.—Working capital line of credit fi-
nancing under this subsection may be used— 
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‘‘(i) to acquire inventory for the pro-
duction of milk; 
‘‘(ii) to pay direct and indirect costs 
(such as design, engineering, labor, and 
overhead costs) used for— 
‘‘(I) the manufacture or purchase 
of goods, including work-in-process, 
for the production of milk; or 
‘‘(II) for the provision of services 
for the production of milk; or 
‘‘(iii) to support standby letters of 
credit used as bid bonds, performance 
bonds, or payment guarantees. 
‘‘(B) ACCOUNTS
RECEIVABLE
FINANC-
ING.—Accounts receivable financing under this 
subsection may be used to finance export ac-
counts receivables for milk and milk products 
sold on payment terms of not more than 180 
days after the date of arrival at the port of im-
portation, if the finance export accounts receiv-
able have been insured by the Commodity Cred-
it Corporation or other guarantor approved by 
the Secretary.’’. 
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178 
SEC. 807. FEDERAL LOAN FORGIVENESS PROGRAM. 
The National Agricultural Research, Extension, and 
Teaching Policy Act of 1977 (7 U.S.C. 3101 et seq.) is 
amended by adding at the end the following: 
‘‘Subtitle P—Federal Dairy 
Education Loan Forgiveness 
‘‘SEC. 1495. SHORT TITLE. 
‘‘This subtitle may be cited as the ‘Federal Dairy 
Education Loan Forgiveness Act’. 
‘‘SEC. 1496. DEFINITIONS. 
‘‘In this subtitle: 
‘‘(1) FAMILY DAIRY FARM.—The term ‘family 
dairy farm’ means the real property of a dairy 
farm— 
‘‘(A) owned by— 
‘‘(i) one or more immediate family 
members; or 
‘‘(ii) a family dairy farm corporation; 
and 
‘‘(B) used for the production, for commer-
cial purposes, of milk or milk products. 
‘‘(2) FAMILY DAIRY FARM CORPORATION.—The 
term ‘family dairy farm corporation’ means a cor-
poration— 
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‘‘(A) at least 75 percent of the assets of 
which are devoted to active involvement in 
farming; and 
‘‘(B) at least 75 percent of each class of 
stock of which is continuously owned by one or 
more immediate family members. 
‘‘(3) IMMEDIATE FAMILY MEMBER.—The term 
‘immediate family member’ means a spouse, child, 
stepchild, parent, stepparent, grandparent, brother, 
stepbrother, sister, stepsister, or similar relative-in- 
law of an owner of real property, as determined by 
the Secretary. 
‘‘(4) INSTITUTION OF HIGHER EDUCATION.— 
The term ‘institution of higher education’ has the 
meaning given the term in section 101(a) of the 
Higher Education Act of 1965 (20 U.S.C. 1001(a)). 
‘‘(5) PROGRAM.—The term ‘program’ means 
the Federal dairy education loan forgiveness pro-
gram established under section 1497(a). 
‘‘(6) QUALIFIED APPLICANT.—The term ‘quali-
fied applicant’ means a resident of the United States 
who, as determined by the Secretary— 
‘‘(A) holds a 2- or 4-year degree in a field 
related to the production of agricultural prod-
ucts from an institution of higher education; 
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‘‘(B) on or after January 1, 2008, has 
commenced the first year of full-time ownership 
or operation of a family dairy farm; and 
‘‘(C) is the borrower of an outstanding 
qualified loan as a result of pursuing a degree 
described in subparagraph (A). 
‘‘(7) QUALIFIED
LOAN.—The term ‘qualified 
loan’ means— 
‘‘(A)(i) a loan made, insured, or guaran-
teed under section 428 or 428H of the Higher 
Education Act of 1965 (20 U.S.C. 1078, 1078– 
8); 
‘‘(ii) a Federal Direct Stafford Loan or a 
Federal Direct Unsubsidized Stafford Loan 
made under section 455 of that Act (20 U.S.C. 
1087e); or 
‘‘(iii) a consolidation loan under section 
428C of that Act (20 U.S.C. 1078–3), or a 
Federal Direct Consolidation Loan under sec-
tion 455 of that Act (20 U.S.C. 1087e), to the 
extent that the amount of the loan was used to 
repay a loan described in clause (i) or (ii); and 
‘‘(B) a loan under part B or D of title IV 
of that Act (20 U.S.C. 1070 et seq.); or 
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181 
‘‘(C) a loan under a guaranteed student 
loan program of the Department. 
‘‘SEC. 1497. FEDERAL DAIRY EDUCATION LOAN FORGIVE-
NESS PROGRAM. 
‘‘(a) IN GENERAL.—Subject to the availability of ap-
propriations, the Secretary shall carry out a Federal dairy 
education loan forgiveness program under which the Sec-
retary shall assume the obligation to repay an amount cal-
culated in accordance with subsection (c) for one or more 
qualified loans made to eligible qualified applicants in ac-
cordance with this section. 
‘‘(b) ELIGIBILITY.—A qualified applicant shall sub-
mit to the Secretary an application and such documenta-
tion of continued eligibility as the Secretary determines 
to be appropriate. 
‘‘(c) MAXIMUM AMOUNT.—The maximum amount 
that the Secretary may repay under the program for each 
qualified applicant shall be equal to the average annual 
cost of tuition at land-grant colleges and universities (as 
determined by the Secretary annually), for each year that 
the qualified applicant— 
‘‘(1) is an owner or operator of a family dairy 
farm; and 
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182 
‘‘(2) has not otherwise received loan repayment 
on behalf of the qualified applicant under this sec-
tion or any other Federal or State program. 
‘‘(d) PROHIBITION.—Nothing in this section author-
izes the refunding of any repayment of a qualified loan. 
‘‘(e) EXCLUSION FROM INCOME.—Any payment to, 
or on behalf of, a qualified applicant under this subtitle 
shall not be included in the gross income of the qualified 
applicant for purposes of the Internal Revenue Code of 
1986. 
‘‘(f) AUTHORIZATION OF APPROPRIATIONS.— 
‘‘(1) IN GENERAL.—There are authorized to be 
appropriated such sums as are necessary to carry 
out this subtitle. 
‘‘(2) 
INSUFFICIENT
FUNDS.—If 
the 
total 
amount of funds appropriated to carry out this sub-
title is insufficient to provide loan repayment under 
the program for all eligible qualified applicants, the 
Secretary shall provide loan repayment to eligible 
qualified applicants on a pro rata basis.’’. 
SEC. 808. MANDATORY REPORTING OF DAIRY COMMOD-
ITIES. 
(a) DEFINITIONS.—Section 272 of the Agricultural 
Marketing Act of 1946 (7 U.S.C. 1637a) is amended to 
read as follows: 
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‘‘SEC. 272. DEFINITIONS. 
‘‘In this subtitle: 
‘‘(1) DAIRY COMMODITY.— 
‘‘(A) IN GENERAL.—The term ‘dairy com-
modity’ means a product manufactured from 
milk or a milk-derived ingredient. 
‘‘(B) INCLUSIONS.—The term ‘dairy com-
modity’ includes— 
‘‘(i) fluid milk; 
‘‘(ii) cheese; 
‘‘(iii) butter; 
‘‘(iv) nonfat dry milk; 
‘‘(v) skim milk; 
‘‘(vi) whey products; 
‘‘(vii) dry proteins (such as a milk 
protein concentrate, casein, and a casein-
ate); 
‘‘(viii) a lactose product; and 
‘‘(ix) a fresh dairy product (such as 
yogurt and ice cream). 
‘‘(2) DAIRY PROCESSOR.—The term ‘dairy proc-
essor’ means a person or legal entity that commer-
cially processes milk into cheese, butter, nonfat dry 
milk, or other dairy solids. 
‘‘(3) SECRETARY.—The term ‘Secretary’ means 
the Secretary of Agriculture.’’. 
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(b) MANDATORY REPORTING.—Section 273 of the 
Agricultural Marketing Act of 1946 (7 U.S.C. 1637b) is 
amended— 
(1) by redesignating subsections (c) and (d) as 
subsections (d) and (e), respectively; and 
(2) by striking subsections (a) and (b) and in-
serting the following: 
‘‘(a) DAILY REPORTING.— 
‘‘(1) IN GENERAL.—The corporate officers or 
officially-designated representatives of each dairy 
processor shall report to the Secretary at least once 
each reporting day, not later than 10:00 a.m. Cen-
tral Time, for each sales transaction involving a 
dairy commodity, information concerning— 
‘‘(A) the sales price; 
‘‘(B) the quantity sold; 
‘‘(C) the location of the sales transaction; 
and 
‘‘(D) product characteristics, including— 
‘‘(i) moisture level; 
‘‘(ii) packaging size; 
‘‘(iii) grade; 
‘‘(iv) if appropriate, fat or protein 
level; 
‘‘(v) heat level for dried products; and 
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185 
‘‘(vi) other defining product character-
istics. 
‘‘(2) PUBLICATION.—The Secretary shall make 
the information reported under paragraph (1) avail-
able to the public not less frequently than once each 
reporting day, categorized by location and product 
characteristics. 
‘‘(b) WEEKLY REPORTING.— 
‘‘(1) IN GENERAL.—The corporate officers or 
officially-designated representatives of each dairy 
processor shall report to the Secretary, on the first 
reporting day of each week, not later than 9:00 a.m. 
Central Time, for the prior week information con-
cerning— 
‘‘(A) the sales prices for sales transactions 
involving dairy commodities, categorized by 
product characteristics; and 
‘‘(B) the quantities of dairy commodities 
sold. 
‘‘(2) PUBLICATION.—The Secretary shall make 
the information reported under paragraph (1) avail-
able to the public on the first reporting day of the 
each week, not later than 10:00 a.m. Central Time, 
categorized by location and product characteristics. 
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186 
‘‘(3) FEDERAL ORDER PRICES.—The Secretary 
shall use weekly prices published under paragraph 
(2) to calculate Federal milk marketing order prices. 
‘‘(c) MONTHLY REPORTING.— 
‘‘(1) IN GENERAL.—The corporate officers or 
officially-designated representatives of each dairy 
processor shall report to the Secretary, on the first 
reporting day of each month, not later than 9:00 
a.m. Central Time, the quantity of all dairy com-
modities processed by the dairy processor during the 
prior month. 
‘‘(2) PUBLICATION.—The Secretary shall make 
the information reported under paragraph (1) avail-
able to the public on the first reporting day of the 
each month, not later than 10:00 a.m. Central Time, 
categorized by location and product characteristics.’’. 
TITLE IX—MISCELLANEOUS 
PROVISIONS 
SEC. 901. NATIONAL ORGANIC TRANSITION AND STEWARD-
SHIP INCENTIVE PROGRAM. 
(a) PROGRAM REQUIRED.— 
(1) IN GENERAL.—Of the funds of the Com-
modity Credit Corporation, the Secretary of Agri-
culture (acting through the Natural Resources Con-
servation Service) shall use $50,000,000 for each of 
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187 
the fiscal years 2008 through 2013, to remain avail-
able until expended, to establish a national organic 
agriculture conversion and stewardship incentives 
program to assist producers developing and imple-
menting organic infrastructure and practices for 
conversion of land and animals to certified organic 
production and for the adoption of advanced organic 
farming conservation systems. 
(2) ESTABLISHMENT.—Not later than 180 days 
after the date of the enactment of this Act, the Sec-
retary shall establish a program to reimburse pro-
ducers for the costs of conversion and technical as-
sistance to organic food production as defined at the 
Organic Foods Production Act of 1990 (7 U.S.C. 
6501 et seq.) 
(3) PROGRAM.—Under the program established 
under paragraph (2), the Secretary (acting through 
the Natural Resources Conservation Service) shall 
use $50,000,000 for each of the fiscal years 2008 
through 2013 to assist producers developing and im-
plement infrastructure, practices and activities nec-
essary to conversion land and animals to meet the 
requirements of the Organic Foods Production Act 
of 1990 (7 U.S.C. 6501 et seq.) 
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(b) INCENTIVE PAYMENTS.—During each of the 
2008 through 2013 fiscal years, the Secretary shall pro-
vide incentive payments to producers who enter into con-
tracts with the Secretary under the program. 
(c) ELIGIBLE PRACTICES
AND ACTIVITIES.—The 
Secretary shall provide payments for: 
(1) Organic practices and activities during con-
version to certified organic production consistent 
with an approved Organic System Plan to conversion 
to certified organic crops and livestock production 
and handling under the national organic production 
program established under the Organic Foods Pro-
duction Act of 1990 (7 U.S.C. 6501 et seq.). 
(2) Advanced organic practices consistent with 
an approved Organic System Plan. 
(3) Organic animal welfare measures, so long as 
such practices and activities are necessary to imple-
ment an organic practice standard and are con-
sistent with an approved plan to transition to cer-
tified organic production. 
(4) Technical assistance, including the costs of 
developing an approved Organic System Plan under 
this section. 
(5) Farm infrastructure necessary to implement 
organic practice standards, including livestock water-
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189 
ing facilities and fencing, so long as such infrastruc-
ture is consistent with an approved Organic System 
Plan. 
(6) Other measures the Secretary, after con-
sulting with the National Organic Technical Com-
mittee, determines are appropriate. 
(d) ELIGIBLE PRODUCERS.— 
(1) PLAN SUBMISSION.—To be eligible for pay-
ments under this section, the producer shall develop, 
submit and implement an Organic System Plan that 
describes the conservation and environmental pur-
poses to be achieved through conservation practices 
and activities and that demonstrates an existing 
market or reasonable expectation of a future market 
for the organic production and contains expected 
costs for infrastructure and practices included in 
conversion. 
(2) COMPLIANCE.—Compliance with organic 
certification requirements must be verified by a 
USDA-Accredited Certifying Agent (ACA) in order 
for producers to qualify for payments. 
(3) CONVERSION
PAYMENTS
FOR
CERTIFIED 
ORGANIC PRODUCERS.—A certified organic producer 
under the program shall be eligible for payments to 
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make the conversion to organic production for land 
and livestock not previously certified organic. 
(e) LIMITATIONS ON PAYMENTS.— 
(1) IN GENERAL.—Except as provided in (2) 
and (3), an individual or entity may not receive, di-
rectly or indirectly, cost-share or incentive payments 
under this section that, in the aggregate, exceed 
$10,000 per year, for a period not to exceed four 
years. 
(2) SPECIALTY CROPS.—In the case of an indi-
vidual or entity who annually produces three or more 
types of specialty crops, the individual or entity may 
not receive, directly or indirectly, cost-share or in-
centive payments under this section that, in the ag-
gregate, exceed $20,000 per year, for a period not 
to exceed four years. 
(3) DAIRY.—In the case of an individual or en-
tity whose principal farming enterprise is dairy, the 
individual or entity may not receive, directly or indi-
rectly, cost-share or incentive payments under this 
section that, in the aggregate, exceed $20,000 per 
year, for a period not to exceed four years. 
(f) SUSPENSION AUTHORITY.—To ensure orderly and 
continued growth in organic farming, the following re-
quirements apply: 
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(1) Prior to each fiscal year and no later than 
October 1st of each year, the Secretary shall publish 
organic commodity specific assessments analyzing 
the domestic production and consumption, import 
and export organic market demand and growth po-
tential for each organic commodity and the antici-
pated number and total amount of new reimburse-
ments for the following year affecting each com-
modity. 
(2) The Secretary shall not enroll new pro-
ducers under this subsection if, for any particular 
agricultural commodity, any new producers would 
produce an increased amount of that agricultural 
commodity that the Secretary finds is reasonably an-
ticipated to affect the continuing economic viability 
of farmers currently certified under the national or-
ganic production program or would create unreason-
able geographic disparities in the distribution of re-
imbursements provided under this section. 
(g) TECHNICAL AND EDUCATIONAL ASSISTANCE.— 
The Secretary shall provide not less than 50 percent of 
the total program funds from the funds provided by this 
section for technical and educational assistance, of which 
not less than 50 percent shall be used for cooperative 
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192 
agreements with qualified non-profit and non-govern-
mental organizations and consultants. 
(h) NATIONAL PROGRAM REVIEW.—In conjunction 
with the National Organic Technical Committee, the Sec-
retary shall conduct a National Program Review, including 
public hearings. This review and shall be initiated within 
four years from the start of this program and shall evalu-
ate and make recommendations; to resolve any program 
deficiencies, redress any under served states, commodities, 
regions and to ensure that the program is contributing 
positively to the profitability of small and intermediate 
producers and existing organic producers. 
(i) APPEALS.—An applicant seeking conversion as-
sistance under this section has the right to appeal an ad-
verse decision by the Secretary with regard to an applica-
tion for assistance, as provide in Section 275 of the De-
partment of Agriculture Reorganization Act of 1994 (7 
U.S.C. 6991–7002). 
(j) REPORTING.—Not later than March 1 of each 
year, the Secretary shall submit to Congress and the Na-
tional Organic Technical Committee a report detailing 
State-by-State expenditures on conversion assistance, in-
cluding the number of producers served by the program, 
the practices implemented, an assessment of the impacts 
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193 
of the program on organic food production, and rec-
ommended reforms, if any. 
SEC. 902. NATIONAL ORGANIC TECHNICAL COMMITTEE. 
(a) ESTABLISHMENT.—The Secretary shall establish 
a National Organic Technical Committee to oversee devel-
opment and implementation of the National Organic Con-
version and Stewardship Incentive Program required by 
section 901 and to improve the organic agriculture inter-
face with all other conservation programs and activities 
administered by the NRCS, including development of cri-
teria for the approval of qualified organic technical advi-
sors. The committee must take into account the regional 
and industry competitiveness and economic growth poten-
tial for industry sectors. 
(b) MEMBERSHIP.—The membership of the National 
Organic Technical Committee shall be comprised of: 
(1) Three organic farmers. 
(2) Two organic certifying agents. 
(3) One organic inspector. 
(4) One representative of an environmental or-
ganization knowledgeable about organic agriculture. 
(5) One scientist with expertise in conservation 
planning. 
(6) One industry representative from organic 
retailer/wholesaler. 
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194 
SEC. 903. NATIONAL ORGANIC CERTIFICATION COST SHARE 
PROGRAM. 
Section 10606 of the Farm Security and Rural In-
vestment Act of 2002 (7 U.S.C. 6523) is amended to read 
as follows: 
‘‘SEC. 10606. NATIONAL ORGANIC CERTIFICATION COST 
SHARE PROGRAM. 
‘‘(a) IN GENERAL.—Of funds of the Commodity 
Credit Corporation, the Secretary of Agriculture (acting 
through the Agricultural Marketing Service) shall use 
$15,000,000 for fiscal year 2008, to remain available until 
expended, to establish a national organic certification cost- 
share program to assist producers and handlers of agricul-
tural products in obtaining certification under the national 
organic production program established under the Organic 
Foods Production Act of 1990 (7 U.S.C. 6501 et seq.). 
‘‘(b) FEDERAL SHARE.— 
‘‘(1) IN GENERAL.—Subject to paragraph (2), 
the Secretary shall pay under this section not more 
than 75 percent of the costs incurred by a producer 
or handler in obtaining certification under the na-
tional organic production program, as certified to 
and approved by the Secretary. 
‘‘(2) 
MAXIMUM
AMOUNT.—The 
maximum 
amount of a payment made to a producer or handler 
under this section shall be $750. 
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‘‘(c) REPORTING.—The Secretary shall provide an 
annual report to Congress by March of each year, detail-
ing the state-by-state expenditures under this program, in-
cluding the number of producers and handlers served by 
the program in the previous fiscal year. 
‘‘(d) RECORDKEEPING REQUIREMENTS.— 
‘‘(1) IN
GENERAL.—The Agricultural Mar-
keting Service shall keep accurate, up-to-date 
records of requests and disbursements from the pro-
gram, as well as to require accurate and consistent 
record-keeping from the States (or other entities) re-
ceiving program payments. 
‘‘(2) FEDERAL
REQUIREMENTS.—Within 30 
days of the closing date for States to request fund-
ing, the Agricultural Marketing Service shall— 
‘‘(A) enumerate the States requesting 
funding, along with the amount of their re-
quests; and 
‘‘(B) distribute the funding to the States. 
‘‘(3) STATE REQUIREMENTS.—Annual funding 
requests from each State should include data from 
the previous year’s program, including— 
‘‘(A) a detailing of which entities requested 
reimbursement, and how much those reimburse-
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196 
ments were for, as well as any discrepancies be-
tween requests and fulfillments; 
‘‘(B) data to back up increases in requests 
expected in the coming year, including informa-
tion from certifiers, or other data showing 
growth projections; and 
‘‘(C) justifications as to why an annual re-
quest is below the previous year’s request.’’. 
SEC. 904. EXCLUSION OF 100 PERCENT OF GAIN ON SALES 
OF DEVELOPMENT RIGHTS OR CONSERVA-
TION EASMENTS ON AGRICULTURAL LAND 
TO ELIGIBLE ENTITIES FOR CONSERVATION 
PURPOSES. 
(a) IN GENERAL.—Part I of subchapter P of chapter 
1 of the Internal Revenue Code of 1986 (relating to treat-
ment of capital gains) is amended by adding at the end 
the following new section: 
‘‘SEC. 1203. 100-PERCENT EXCLUSION OF GAIN ON SALES OF 
DEVELOPMENT RIGHTS OR CONSERVATION 
EASEMENTS ON AGRICULTURAL LAND TO EL-
IGIBLE ENTITIES FOR CONSERVATION PUR-
POSES. 
‘‘(a) EXCLUSION.—Gross income shall not include 
100 percent of any gain from the sale of development 
rights or a conservation easement that is a permanent 
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deed restriction and requires that the land subject to the 
deed restriction be made available for agricultural pur-
poses if— 
‘‘(1) such land or interest in land was owned by 
the taxpayer or a member of the taxpayer’s family 
(as defined in section 2032A(e)(2)) at all times dur-
ing the 3-year period ending on the date of the sale, 
and 
‘‘(2) such land or interest in land is being ac-
quired by an eligible entity which provides the tax-
payer, at the time of acquisition, a written letter of 
intent which shall include the following statement: 
‘The purchaser’s intent is that this acquisition will 
serve the conservation purpose specified in clause 
(iii) (II) of section 170(h)(4)(A) of the Internal Rev-
enue Code of 1986 and the land will remain avail-
able for agricultural production.’. 
‘‘(b) ELIGIBLE ENTITY.—For purposes of this sec-
tion, the term ‘eligible entity’ means— 
‘‘(1) any agency of the United States or of any 
State or local government, or 
‘‘(2) any other organization that— 
‘‘(A) is organized and at all times operated 
principally for one or more of the conservation 
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purposes specified in clause (i), (ii), or (iii) of 
section 170(h)(4)(A), 
‘‘(B) is described in section 501(c)(3) and 
exempt from tax under section 501(a), and 
‘‘(C)(i) meets the requirements of section 
509(a)(2), or 
‘‘(ii) meets the requirements of section 
509(a)(3) and is controlled by an organization 
described in section 509(a)(2). 
‘‘(c) DEFINITIONS.—For purposes of this section— 
‘‘(1) FARMLAND.—The term ‘farmland’ in-
cludes all land capable of being used for agricultural 
production and is comprised of at least 50 percent 
of any combination of prime, unique, or statewide 
important farmland. 
‘‘(2) PRIME
FARMLAND.—The term ‘prime 
farmland’ means land that has the best combination 
of physical and chemical characteristics for pro-
ducing food, feed, fiber, forage, oilseed, and other 
agricultural crops with minimum inputs of fuel, fer-
tilizer, pesticides, and labor, and without intolerable 
soil erosion, as determined by the Secretary of Agri-
culture. Prime farmland includes land that possesses 
such characteristics but is being used currently to 
produce livestock and timber. It does not include 
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