H. R. 2419—555 
‘‘(1) the relationship of the project or class of projects to 
overall regional development; 
‘‘(2) the per capita income and poverty and unemployment 
and outmigration rates in an area; 
‘‘(3) the financial resources available to the applicants for 
assistance seeking to carry out the project, with emphasis on 
ensuring that projects are adequately financed to maximize 
the probability of successful economic development; 
‘‘(4) the importance of the project or class of projects in 
relation to the other projects or classes of projects that may 
be in competition for the same funds; 
‘‘(5) the prospects that the project for which assistance 
is sought will improve, on a continuing rather than a temporary 
basis, the opportunities for employment, the average level of 
income, or the economic development of the area to be served 
by the project; and 
‘‘(6) the extent to which the project design provides for 
detailed outcome measurements by which grant expenditures 
and the results of the expenditures may be evaluated. 
‘‘§ 15505. Local development districts and organizations 
‘‘(a) GRANTS TO LOCAL DEVELOPMENT DISTRICTS.—Subject to 
the requirements of this section, a Commission may make grants 
to a local development district to assist in the payment of develop-
ment planning and administrative expenses. 
‘‘(b) CONDITIONS FOR GRANTS.— 
‘‘(1) MAXIMUM AMOUNT.—The amount of a grant awarded 
under this section may not exceed 80 percent of the administra-
tive and planning expenses of the local development district 
receiving the grant. 
‘‘(2) MAXIMUM PERIOD FOR STATE AGENCIES.—In the case 
of a State agency certified as a local development district, 
a grant may not be awarded to the agency under this section 
for more than 3 fiscal years. 
‘‘(3) LOCAL SHARE.—The contributions of a local develop-
ment district for administrative expenses may be in cash or 
in kind, fairly evaluated, including space, equipment, and serv-
ices. 
‘‘(c) DUTIES
OF
LOCAL
DEVELOPMENT
DISTRICTS.—A local 
development district shall— 
‘‘(1) operate as a lead organization serving multicounty 
areas in the region at the local level; 
‘‘(2) assist the Commission in carrying out outreach activi-
ties for local governments, community development groups, the 
business community, and the public; 
‘‘(3) serve as a liaison between State and local governments, 
nonprofit organizations (including community-based groups and 
educational institutions), the business community, and citizens; 
and 
‘‘(4) assist the individuals and entities described in para-
graph (3) in identifying, assessing, and facilitating projects 
and programs to promote the economic development of the 
region. 
‘‘§ 15506. Supplements to Federal grant programs 
‘‘(a) FINDING.—Congress finds that certain States and local 
communities of the region, including local development districts,
H. R. 2419—556 
may be unable to take maximum advantage of Federal grant pro-
grams for which the States and communities are eligible because— 
‘‘(1) they lack the economic resources to provide the 
required matching share; or 
‘‘(2) there are insufficient funds available under the 
applicable Federal law with respect to a project to be carried 
out in the region. 
‘‘(b) FEDERAL GRANT PROGRAM FUNDING.—A Commission, with 
the approval of the Federal Cochairperson, may use amounts made 
available to carry out this subtitle— 
‘‘(1) for any part of the basic Federal contribution to projects 
or activities under the Federal grant programs authorized by 
Federal laws; and 
‘‘(2) to increase the Federal contribution to projects and 
activities under the programs above the fixed maximum part 
of the cost of the projects or activities otherwise authorized 
by the applicable law. 
‘‘(c) CERTIFICATION REQUIRED.—For a program, project, or 
activity for which any part of the basic Federal contribution to 
the project or activity under a Federal grant program is proposed 
to be made under subsection (b), the Federal contribution shall 
not be made until the responsible Federal official administering 
the Federal law authorizing the Federal contribution certifies that 
the program, project, or activity meets the applicable requirements 
of the Federal law and could be approved for Federal contribution 
under that law if amounts were available under the law for the 
program, project, or activity. 
‘‘(d) LIMITATIONS IN OTHER LAWS INAPPLICABLE.—Amounts pro-
vided pursuant to this subtitle are available without regard to 
any limitations on areas eligible for assistance or authorizations 
for appropriation in any other law. 
‘‘(e) FEDERAL SHARE.—The Federal share of the cost of a project 
or activity receiving assistance under this section shall not exceed 
80 percent. 
‘‘(f) MAXIMUM COMMISSION CONTRIBUTION.—Section 15501(d), 
relating to limitations on Commission contributions, shall apply 
to a program, project, or activity receiving assistance under this 
section. 
‘‘CHAPTER 4—ADMINISTRATIVE PROVISIONS 
‘‘SUBCHAPTER I—GENERAL PROVISIONS 
‘‘Sec. 15701. Consent of States. 
‘‘Sec. 15702. Distressed counties and areas. 
‘‘Sec. 15703. Counties eligible for assistance in more than one region. 
‘‘Sec. 15704. Inspector General; records. 
‘‘Sec. 15705. Biannual meetings of representatives of all Commissions. 
‘‘SUBCHAPTER II—DESIGNATION OF REGIONS 
‘‘Sec. 15731. Southeast Crescent Regional Commission. 
‘‘Sec. 15732. Southwest Border Regional Commission. 
‘‘Sec. 15733. Northern Border Regional Commission. 
‘‘SUBCHAPTER III—AUTHORIZATION OF APPROPRIATIONS 
‘‘Sec. 15751. Authorization of appropriations.
H. R. 2419—557 
‘‘SUBCHAPTER I—GENERAL PROVISIONS 
‘‘§ 15701. Consent of States 
‘‘This subtitle does not require a State to engage in or accept 
a program under this subtitle without its consent. 
‘‘§ 15702. Distressed counties and areas 
‘‘(a) DESIGNATIONS.—Not later than 90 days after the date 
of the enactment of this section, and annually thereafter, each 
Commission shall make the following designations: 
‘‘(1) DISTRESSED
COUNTIES.—The Commission shall des-
ignate as distressed counties those counties in its region that 
are the most severely and persistently economically distressed 
and underdeveloped and have high rates of poverty, unemploy-
ment, or outmigration. 
‘‘(2) TRANSITIONAL COUNTIES.—The Commission shall des-
ignate as transitional counties those counties in its region that 
are economically distressed and underdeveloped or have 
recently suffered high rates of poverty, unemployment, or out-
migration. 
‘‘(3) ATTAINMENT COUNTIES.—The Commission shall des-
ignate as attainment counties, those counties in its region 
that are not designated as distressed or transitional counties 
under this subsection. 
‘‘(4) ISOLATED AREAS OF DISTRESS.—The Commission shall 
designate as isolated areas of distress, areas located in counties 
designated as attainment counties under paragraph (3) that 
have high rates of poverty, unemployment, or outmigration. 
‘‘(b) ALLOCATION.—A Commission shall allocate at least 50 per-
cent of the appropriations made available to the Commission to 
carry out this subtitle for programs and projects designed to serve 
the needs of distressed counties and isolated areas of distress in 
the region. 
‘‘(c) ATTAINMENT COUNTIES.— 
‘‘(1) IN GENERAL.—Except as provided in paragraph (2), 
funds may not be provided under this subtitle for a project 
located in a county designated as an attainment county under 
subsection (a). 
‘‘(2) EXCEPTIONS.— 
‘‘(A) ADMINISTRATIVE
EXPENSES
OF
LOCAL
DEVELOP-
MENT DISTRICTS.—The funding prohibition under paragraph 
(1) shall not apply to grants to fund the administrative 
expenses of local development districts under section 15505. 
‘‘(B) MULTICOUNTY AND OTHER PROJECTS.—A Commis-
sion may waive the application of the funding prohibition 
under paragraph (1) with respect to— 
‘‘(i) a multicounty project that includes participa-
tion by an attainment county; and 
‘‘(ii) any other type of project, if a Commission 
determines that the project could bring significant 
benefits to areas of the region outside an attainment 
county. 
‘‘(3) ISOLATED AREAS OF DISTRESS.—For a designation of 
an isolated area of distress to be effective, the designation 
shall be supported— 
‘‘(A) by the most recent Federal data available; or
H. R. 2419—558 
‘‘(B) if no recent Federal data are available, by the 
most recent data available through the government of the 
State in which the isolated area of distress is located. 
‘‘§ 15703. Counties eligible for assistance in more than one 
region 
‘‘(a) LIMITATION.—A political subdivision of a State may not 
receive assistance under this subtitle in a fiscal year from more 
than one Commission. 
‘‘(b) SELECTION
OF
COMMISSION.—A political subdivision 
included in the region of more than one Commission shall select 
the Commission with which it will participate by notifying, in 
writing, the Federal Cochairperson and the appropriate State 
member of that Commission. 
‘‘(c) CHANGES IN SELECTIONS.—The selection of a Commission 
by a political subdivision shall apply in the fiscal year in which 
the selection is made, and shall apply in each subsequent fiscal 
year unless the political subdivision, at least 90 days before the 
first day of the fiscal year, notifies the Cochairpersons of another 
Commission in writing that the political subdivision will participate 
in that Commission and also transmits a copy of such notification 
to the Cochairpersons of the Commission in which the political 
subdivision is currently participating. 
‘‘(d) INCLUSION OF APPALACHIAN REGIONAL COMMISSION.—In 
this section, the term ‘Commission’ includes the Appalachian 
Regional Commission established under chapter 143. 
‘‘§ 15704. Inspector General; records 
‘‘(a) APPOINTMENT OF INSPECTOR GENERAL.—There shall be an 
Inspector General for the Commissions appointed in accordance 
with section 3(a) of the Inspector General Act of 1978 (5 U.S.C. 
App.). All of the Commissions shall be subject to a single Inspector 
General. 
‘‘(b) RECORDS OF A COMMISSION.— 
‘‘(1) IN GENERAL.—A Commission shall maintain accurate 
and complete records of all its transactions and activities. 
‘‘(2) AVAILABILITY.—All records of a Commission shall be 
available for audit and examination by the Inspector General 
(including authorized representatives of the Inspector General). 
‘‘(c) RECORDS
OF RECIPIENTS
OF COMMISSION ASSISTANCE.— 
‘‘(1) IN GENERAL.—A recipient of funds from a Commission 
under this subtitle shall maintain accurate and complete 
records of transactions and activities financed with the funds 
and report to the Commission on the transactions and activities. 
‘‘(2) AVAILABILITY.—All records required under paragraph 
(1) shall be available for audit by the Commission and the 
Inspector General (including authorized representatives of the 
Commission and the Inspector General). 
‘‘(d) ANNUAL AUDIT.—The Inspector General shall audit the 
activities, transactions, and records of each Commission on an 
annual basis. 
‘‘§ 15705. Biannual meetings of representatives of all Commis-
sions 
‘‘(a) IN GENERAL.—Representatives of each Commission, the 
Appalachian Regional Commission, and the Denali Commission 
shall meet biannually to discuss issues confronting regions suffering
H. R. 2419—559 
from chronic and contiguous distress and successful strategies for 
promoting regional development. 
‘‘(b) CHAIR
OF MEETINGS.—The chair of each meeting shall 
rotate among the Commissions, with the Appalachian Regional 
Commission to host the first meeting. 
‘‘SUBCHAPTER II—DESIGNATION OF REGIONS 
‘‘§ 15731. Southeast Crescent Regional Commission 
‘‘The region of the Southeast Crescent Regional Commission 
shall consist of all counties of the States of Virginia, North Carolina, 
South Carolina, Georgia, Alabama, Mississippi, and Florida not 
already served by the Appalachian Regional Commission or the 
Delta Regional Authority. 
‘‘§ 15732. Southwest Border Regional Commission 
‘‘The region of the Southwest Border Regional Commission 
shall consist of the following political subdivisions: 
‘‘(1) ARIZONA.—The counties of Cochise, Gila, Graham, 
Greenlee, La Paz, Maricopa, Pima, Pinal, Santa Cruz, and 
Yuma in the State of Arizona. 
‘‘(2) CALIFORNIA.—The counties of Imperial, Los Angeles, 
Orange, Riverside, San Bernardino, San Diego, and Ventura 
in the State of California. 
‘‘(3) NEW MEXICO.—The counties of Catron, Chaves, Dona 
Ana, Eddy, Grant, Hidalgo, Lincoln, Luna, Otero, Sierra, and 
Socorro in the State of New Mexico. 
‘‘(4) TEXAS.—The counties of Atascosa, Bandera, Bee, 
Bexar, Brewster, Brooks, Cameron, Coke, Concho, Crane, 
Crockett, Culberson, Dimmit, Duval, Ector, Edwards, El Paso, 
Frio, Gillespie, Glasscock, Hidalgo, Hudspeth, Irion, Jeff Davis, 
Jim Hogg, Jim Wells, Karnes, Kendall, Kenedy, Kerr, Kimble, 
Kinney, Kleberg, La Salle, Live Oak, Loving, Mason, Maverick, 
McMullen, Medina, Menard, Midland, Nueces, Pecos, Presidio, 
Reagan, Real, Reeves, San Patricio, Shleicher, Sutton, Starr, 
Sterling, Terrell, Tom Green Upton, Uvalde, Val Verde, Ward, 
Webb, Willacy, Wilson, Winkler, Zapata, and Zavala in the 
State of Texas. 
‘‘§ 15733. Northern Border Regional Commission 
‘‘The region of the Northern Border Regional Commission shall 
include the following counties: 
‘‘(1) MAINE.—The counties of Androscoggin, Aroostook, 
Franklin, Hancock, Kennebec, Knox, Oxford, Penobscot, 
Piscataquis, Somerset, Waldo, and Washington in the State 
of Maine. 
‘‘(2) NEW
HAMPSHIRE.—The counties of Carroll, Coos, 
Grafton, and Sullivan in the State of New Hampshire. 
‘‘(3) NEW YORK.—The counties of Cayuga, Clinton, Essex, 
Franklin, Fulton, Hamilton, Herkimer, Jefferson, Lewis, Madi-
son, Oneida, Oswego, Seneca, and St. Lawrence in the State 
of New York. 
‘‘(4) VERMONT.—The counties of Caledonia, Essex, Franklin, 
Grand Isle, Lamoille, and Orleans in the State of Vermont.
H. R. 2419—560 
‘‘SUBCHAPTER III—AUTHORIZATION OF APPROPRIATIONS 
‘‘§ 15751. Authorization of appropriations 
‘‘(a) IN GENERAL.—There is authorized to be appropriated to 
each Commission to carry out this subtitle $30,000,000 for each 
of fiscal years 2008 through 2012. 
‘‘(b) ADMINISTRATIVE EXPENSES.—Not more than 10 percent 
of the funds made available to a Commission in a fiscal year 
under this section may be used for administrative expenses.’’. 
(b) CLERICAL AMENDMENT TO TABLE OF SUBTITLES.—The table 
of subtitles for chapter 40, United States Code, is amended by 
striking the item relating to subtitle V and inserting the following: 
‘‘V. REGIONAL ECONOMIC AND INFRASTRUCTURE DEVELOPMENT ....15101
‘‘VI. MISCELLANEOUS ........................................................................................17101’’. 
(c) CONFORMING AMENDMENTS TO INSPECTOR GENERAL ACT.— 
Section 11 of the Inspector General Act of 1978 (5 U.S.C. App.) 
is amended— 
(1) in paragraph (1), by striking ‘‘or the President of the 
Export-Import Bank;’’ and inserting ‘‘the President of the 
Export-Import Bank; or the Federal Cochairpersons of the 
Commissions established under section 15301 of title 40, United 
States Code;’’; and 
(2) in paragraph (2), by striking ‘‘or the Export-Import 
Bank,’’ and inserting ‘‘the Export-Import Bank, or the Commis-
sions established under section 15301 of title 40, United States 
Code,’’. 
(d) EFFECTIVE DATE.—This section, and the amendments made 
by this section, shall take effect on the first day of the first fiscal 
year beginning after the date of the enactment of this Act. 
SEC. 14218. COORDINATOR FOR CHRONICALLY UNDERSERVED RURAL 
AREAS. 
(a) ESTABLISHMENT.—The Secretary of Agriculture shall estab-
lish a Coordinator for Chronically Underserved Rural Areas (in 
this section referred to as the ‘‘Coordinator’’), to be located in 
the Rural Development Mission Area. 
(b) MISSION.—The mission of the Coordinator shall be to direct 
Department of Agriculture resources to high need, high poverty 
rural areas. 
(c) DUTIES.—The Coordinator shall consult with other offices 
in directing technical assistance, strategic regional planning, at 
the State and local level, for developing rural economic development 
that leverages the resources of State and local governments and 
non-profit and community development organizations. 
(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated to the Secretary such sums as necessary to 
carry out this section for fiscal years 2008 through 2012. 
SEC. 14219. ELIMINATION OF STATUTE OF LIMITATIONS APPLICABLE 
TO COLLECTION OF DEBT BY ADMINISTRATIVE OFFSET. 
(a) ELIMINATION.—Section 3716(e) of title 31, United States 
Code, is amended to read as follows: 
‘‘(e)(1) Notwithstanding any other provision of law, regulation, 
or administrative limitation, no limitation on the period within 
which an offset may be initiated or taken pursuant to this section 
shall be effective.
H. R. 2419—561 
‘‘(2) This section does not apply when a statute explicitly pro-
hibits using administrative offset or setoff to collect the claim or 
type of claim involved.’’. 
(b) APPLICATION OF AMENDMENT.—The amendment made by 
subsection (a) shall apply to any debt outstanding on or after 
the date of the enactment of this Act. 
SEC. 14220. AVAILABILITY OF EXCESS AND SURPLUS COMPUTERS IN 
RURAL AREAS. 
In addition to any other authority, the Secretary of Agriculture 
may make available to an organization excess or surplus computers 
or other technical equipment of the Department of Agriculture 
for the purposes of distribution to a city, town, or local government 
entity in a rural area (as defined in section 343(a)(13)(A) of the 
Consolidated Farm and Rural Development Act). 
SEC. 14221. REPEAL OF SECTION 3068 OF THE WATER RESOURCES 
DEVELOPMENT ACT OF 2007. 
Effective upon the date of enactment of this Act, section 3068 
of the Water Resources Development Act of 2007 (Public Law 110- 
114; 121 Stat. 1123), and the item relating to section 3068 in 
the table of contents of that Act, are repealed. 
SEC. 14222. DOMESTIC FOOD ASSISTANCE PROGRAMS. 
(a) DEFINITION OF SECTION 32.—In this section, the term ‘‘sec-
tion 32’’ means section 32 of the Act of August 24, 1935 (7 U.S.C. 
612c). 
(b) TRANSFER TO FOOD AND NUTRITION SERVICE.— 
(1) IN GENERAL.—Amounts made available for a fiscal year 
to carry out section 32 in excess of the maximum amount 
calculated under paragraph (2) shall be transferred to the Sec-
retary, acting through the Administrator of the Food and Nutri-
tion Service, to be used to carry out the Richard B. Russell 
National School Lunch Act (42 U.S.C. 1751 et seq.). 
(2) MAXIMUM AMOUNT.—The maximum amount calculated 
under this paragraph for a fiscal year is the sum of— 
(A)(i) in the case of fiscal year 2009, $1,173,000,000; 
(ii) in the case of fiscal year 2010, $1,199,000,000; 
(iii) in the case of fiscal year 2011, $1,215,000,000; 
(iv) in the case of fiscal year 2012, $1,231,000,000; 
(v) in the case of fiscal year 2013, $1,248,000,000; 
(vi) in the case of fiscal year 2014, $1,266,000,000; 
(vii) in the case of fiscal year 2015, $1,284,000,000; 
(viii) in the case of fiscal year 2016, $1,303,000,000; 
(ix) in the case of fiscal year 2017, $1,322,000,000; 
and 
(x) for fiscal year 2018 and each fiscal year thereafter, 
the amount made available for the preceding fiscal year, 
as adjusted to reflect changes for the 12-month period 
ending on the preceding November 30 in the Consumer 
Price Index for All Urban Consumers published by the 
Bureau of Labor Statistics of the Department of Labor; 
and 
(B) any transfers for the fiscal year from section 32 to 
the Department of Commerce under the Fish and Wildlife 
Act of 1956 (16 U.S.C. 742a et seq.). 
(c) FRESH FRUIT AND VEGETABLE PROGRAM.—Of amounts made 
available to carry out section 32 under subsection (b)(2)(A), the
H. R. 2419—562 
Secretary shall transfer for use to carry out the fresh fruit and 
vegetable program under section 19 of the Richard B. Russell 
National School Lunch Act the amounts specified in subsection 
(i) of that section. 
(d) WHOLE GRAIN PRODUCTS.—Of amounts made available to 
carry out section 32 under subsection (b)(2)(A), the Secretary shall 
use to carry out section 4305 $4,000,000 for fiscal year 2009. 
(e) MAINTENANCE OF FUNDING.—The funding provided under 
subsections (c) and (d) shall supplement (and not supplant) other 
Federal funding (including section 32 funding) for programs carried 
out under— 
(1) the Richard B. Russell National School Lunch Act (42 
U.S.C. 1751 et seq.), except for section 19 of that Act; 
(2) the Emergency Food Assistance Act of 1983 (7 U.S.C. 
7501 et seq.); and 
(3) section 27 of the Food Stamp Act of 1977 (7 U.S.C. 
2036). 
SEC. 14223. TECHNICAL CORRECTION. 
Section 923(1)(B) of the Federal Agriculture Improvement and 
Reform Act of 1996 (7 U.S.C. 2206a(1)(B)) is amended by striking 
‘‘as defined in section 316(b) of the Higher Education Act of 1965 
(20 U.S.C. 1059c(b))’’ and inserting ‘‘as defined in section 502(a)(5) 
of the Higher Education Act of 1965 (20 U.S.C. 1101a(a)(5))’’. 
TITLE XV—TRADE AND TAX 
PROVISIONS 
SEC. 15001. SHORT TITLE; ETC. 
(a) SHORT TITLE.—This title may be cited as the ‘‘Heartland, 
Habitat, Harvest, and Horticulture Act of 2008’’. 
(b) AMENDMENTS TO 1986 CODE.—Except as otherwise expressly 
provided, whenever in this title an amendment or repeal is 
expressed in terms of an amendment to, or repeal of, a section 
or other provision, the reference shall be considered to be made 
to a section or other provision of the Internal Revenue Code of 
1986. 
Subtitle A—Supplemental Agricultural Dis-
aster Assistance From the Agricultural 
Disaster Relief Trust Fund 
SEC. 15101. SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE. 
(a) IN GENERAL.—The Trade Act of 1974 (19 U.S.C. 2101 et 
seq.) is amended by adding at the end the following: 
‘‘TITLE IX—SUPPLEMENTAL 
AGRICULTURAL DISASTER ASSISTANCE 
‘‘SEC. 901. SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE. 
‘‘(a) DEFINITIONS.—In this section:
H. R. 2419—563 
‘‘(1) ACTUAL PRODUCTION HISTORY YIELD.—The term ‘actual 
production history yield’ means the weighted average of the 
actual production history for each insurable commodity or non-
insurable commodity, as calculated under the Federal Crop 
Insurance Act (7 U.S.C. 1501 et seq.) or the noninsured crop 
disaster assistance program, respectively. 
‘‘(2) ADJUSTED ACTUAL PRODUCTION HISTORY YIELD.—The 
term ‘adjusted actual production history yield’ means— 
‘‘(A) in the case of an eligible producer on a farm 
that has at least 4 years of actual production history yields 
for an insurable commodity that are established other than 
pursuant to section 508(g)(4)(B) of the Federal Crop Insur-
ance Act (7 U.S.C. 1508(g)(4)(B)), the actual production 
history for the eligible producer without regard to any 
yields established under that section; 
‘‘(B) in the case of an eligible producer on a farm 
that has less than 4 years of actual production history 
yields for an insurable commodity, of which 1 or more 
were established pursuant to section 508(g)(4)(B) of that 
Act, the actual production history for the eligible producer 
as calculated without including the lowest of the yields 
established pursuant to section 508(g)(4)(B) of that Act; 
and 
‘‘(C) in all other cases, the actual production history 
of the eligible producer on a farm. 
‘‘(3) ADJUSTED NONINSURED CROP DISASTER ASSISTANCE PRO-
GRAM
YIELD.—The term ‘adjusted noninsured crop disaster 
assistance program yield’ means— 
‘‘(A) in the case of an eligible producer on a farm 
that has at least 4 years of production history under the 
noninsured crop disaster assistance program that are not 
replacement yields, the noninsured crop disaster assistance 
program yield without regard to any replacement yields; 
‘‘(B) in the case of an eligible producer on a farm 
that less than 4 years of production history under the 
noninsured crop disaster assistance program that are not 
replacement yields, the noninsured crop disaster assistance 
program yield as calculated without including the lowest 
of the replacement yields; and 
‘‘(C) in all other cases, the production history of the 
eligible producer on the farm under the noninsured crop 
disaster assistance program. 
‘‘(4) COUNTER-CYCLICAL
PROGRAM
PAYMENT
YIELD.—The 
term ‘counter-cyclical program payment yield’ means the 
weighted average payment yield established under section 1102 
of the Farm Security and Rural Investment Act of 2002 (7 
U.S.C. 7912), section 1102 of the Food, Conservation, and 
Energy Act of 2008, or a successor section. 
‘‘(5) DISASTER COUNTY.— 
‘‘(A) IN GENERAL.—The term ‘disaster county’ means 
a county included in the geographic area covered by a 
qualifying natural disaster declaration. 
‘‘(B) INCLUSION.—The term ‘disaster county’ includes— 
‘‘(i) a county contiguous to a county described in 
subparagraph (A); and 
‘‘(ii) any farm in which, during a calendar year, 
the total loss of production of the farm relating to
H. R. 2419—564 
weather is greater than 50 percent of the normal 
production of the farm, as determined by the Secretary. 
‘‘(6) ELIGIBLE PRODUCER ON A FARM.— 
‘‘(A) IN GENERAL.—The term ‘eligible producer on a 
farm’ means an individual or entity described in subpara-
graph (B) that, as determined by the Secretary, assumes 
the production and market risks associated with the agri-
cultural production of crops or livestock. 
‘‘(B) DESCRIPTION.—An individual or entity referred 
to in subparagraph (A) is— 
‘‘(i) a citizen of the United States; 
‘‘(ii) a resident alien; 
‘‘(iii) a partnership of citizens of the United States; 
or 
‘‘(iv) a corporation, limited liability corporation, or 
other farm organizational structure organized under 
State law. 
‘‘(7) FARM.— 
‘‘(A) IN GENERAL.—The term ‘farm’ means, in relation 
to an eligible producer on a farm, the sum of all crop 
acreage in all counties that is planted or intended to be 
planted for harvest by the eligible producer. 
‘‘(B) AQUACULTURE.—In the case of aquaculture, the 
term ‘farm’ means, in relation to an eligible producer on 
a farm, all fish being produced in all counties that are 
intended to be harvested for sale by the eligible producer. 
‘‘(C) HONEY.—In the case of honey, the term ‘farm’ 
means, in relation to an eligible producer on a farm, all 
bees and beehives in all counties that are intended to 
be harvested for a honey crop by the eligible producer. 
‘‘(8) FARM-RAISED FISH.—The term ‘farm-raised fish’ means 
any aquatic species that is propagated and reared in a con-
trolled environment. 
‘‘(9) INSURABLE
COMMODITY.—The term ‘insurable com-
modity’ means an agricultural commodity (excluding livestock) 
for which the producer on a farm is eligible to obtain a policy 
or plan of insurance under the Federal Crop Insurance Act 
(7 U.S.C. 1501 et seq.). 
‘‘(10) LIVESTOCK.—The term ‘livestock’ includes— 
‘‘(A) cattle (including dairy cattle); 
‘‘(B) bison; 
‘‘(C) poultry; 
‘‘(D) sheep; 
‘‘(E) swine; 
‘‘(F) horses; and 
‘‘(G) other livestock, as determined by the Secretary. 
‘‘(11) NONINSURABLE COMMODITY.—The term ‘noninsurable 
commodity’ means a crop for which the eligible producers on 
a farm are eligible to obtain assistance under the noninsured 
crop assistance program. 
‘‘(12) NONINSURED CROP ASSISTANCE PROGRAM.—The term 
‘noninsured crop assistance program’ means the program car-
ried out under section 196 of the Federal Agriculture Improve-
ment and Reform Act of 1996 (7 U.S.C. 7333). 
‘‘(13) QUALIFYING NATURAL DISASTER DECLARATION.—The 
term ‘qualifying natural disaster declaration’ means a natural 
disaster declared by the Secretary for production losses under
H. R. 2419—565 
section 321(a) of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1961(a)). 
‘‘(14) SECRETARY.—The term ‘Secretary’ means the Sec-
retary of Agriculture. 
‘‘(15) SOCIALLY DISADVANTAGED FARMER OR RANCHER.—The 
term ‘socially disadvantaged farmer or rancher’ has the 
meaning given the term in section 2501(e) of the Food, Agri-
culture, Conservation, and Trade Act of 1990 (7 U.S.C. 2279(e)). 
‘‘(16) STATE.—The term ‘State’ means— 
‘‘(A) a State; 
‘‘(B) the District of Columbia; 
‘‘(C) the Commonwealth of Puerto Rico; and 
‘‘(D) any other territory or possession of the United 
States. 
‘‘(17) TRUST FUND.—The term ‘Trust Fund’ means the Agri-
cultural Disaster Relief Trust Fund established under section 
902. 
‘‘(18) UNITED STATES.—The term ‘United States’ when used 
in a geographical sense, means all of the States. 
‘‘(b) SUPPLEMENTAL REVENUE ASSISTANCE PAYMENTS.— 
‘‘(1) IN GENERAL.—The Secretary shall use such sums as 
are necessary from the Trust Fund to make crop disaster assist-
ance payments to eligible producers on farms in disaster coun-
ties that have incurred crop production losses or crop quality 
losses, or both, during the crop year. 
‘‘(2) AMOUNT.— 
‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 
Secretary shall provide crop disaster assistance payments 
under this section to an eligible producer on a farm in 
an amount equal to 60 percent of the difference between— 
‘‘(i) the disaster assistance program guarantee, as 
described in paragraph (3); and 
‘‘(ii) the total farm revenue for a farm, as described 
in paragraph (4). 
‘‘(B) LIMITATION.—The disaster assistance program 
guarantee for a crop used to calculate the payments for 
a farm under subparagraph (A)(i) may not be greater than 
90 percent of the sum of the expected revenue, as described 
in paragraph (5) for each of the crops on a farm, as deter-
mined by the Secretary. 
‘‘(3) SUPPLEMENTAL REVENUE ASSISTANCE PROGRAM GUAR-
ANTEE.— 
‘‘(A) IN
GENERAL.—Except as otherwise provided in 
this paragraph, the supplemental assistance program guar-
antee shall be the sum obtained by adding— 
‘‘(i) for each insurable commodity on the farm, 
115 percent of the product obtained by multiplying— 
‘‘(I) a payment rate for the commodity that 
is equal to the price election for the commodity 
elected by the eligible producer; 
‘‘(II) the payment acres for the commodity that 
is equal to the number of acres planted, or pre-
vented from being planted, to the commodity; 
‘‘(III) the payment yield for the commodity 
that is equal to the percentage of the crop insur-
ance yield elected by the producer of the higher 
of—
H. R. 2419—566 
‘‘(aa) the adjusted actual production his-
tory yield; or 
‘‘(bb) the counter-cyclical program pay-
ment yield for each crop; and 
‘‘(ii) for each noninsurable commodity on a farm, 
120 percent of the product obtained by multiplying— 
‘‘(I) a payment rate for the commodity that 
is equal to 100 percent of the noninsured crop 
assistance program established price for the com-
modity; 
‘‘(II) the payment acres for the commodity that 
is equal to the number of acres planted, or pre-
vented from being planted, to the commodity; and 
‘‘(III) the payment yield for the commodity 
that is equal to the higher of— 
‘‘(aa) the adjusted noninsured crop assist-
ance program yield guarantee; or 
‘‘(bb) the counter-cyclical program pay-
ment yield for each crop. 
‘‘(B) ADJUSTMENT
INSURANCE
GUARANTEE.—Notwith-
standing subparagraph (A), in the case of an insurable 
commodity for which a plan of insurance provides for an 
adjustment in the guarantee, such as in the case of pre-
vented planting, the adjusted insurance guarantee shall 
be the basis for determining the disaster assistance pro-
gram guarantee for the insurable commodity. 
‘‘(C) ADJUSTED
ASSISTANCE
LEVEL.—Notwithstanding 
subparagraph (A), in the case of a noninsurable commodity 
for which the noninsured crop assistance program provides 
for an adjustment in the level of assistance, such as in 
the case of unharvested crops, the adjusted assistance level 
shall be the basis for determining the disaster assistance 
program guarantee for the noninsurable commodity. 
‘‘(D) EQUITABLE TREATMENT FOR NON-YIELD BASED POLI-
CIES.—The Secretary shall establish equitable treatment 
for non-yield based policies and plans of insurance, such 
as the Adjusted Gross Revenue Lite insurance program. 
‘‘(4) FARM REVENUE.— 
‘‘(A) IN GENERAL.—For purposes of this subsection, the 
total farm revenue for a farm, shall equal the sum obtained 
by adding— 
‘‘(i) the estimated actual value for each crop pro-
duced on a farm by using the product obtained by 
multiplying— 
‘‘(I) the actual crop acreage harvested by an 
eligible producer on a farm; 
‘‘(II) the estimated actual yield of the crop 
production; and 
‘‘(III) subject to subparagraphs (B) and (C), 
to the extent practicable, the national average 
market price received for the marketing year, as 
determined by the Secretary; 
‘‘(ii) 15 percent of amount of any direct payments 
made to the producer under sections 1103 and 1303 
of the Food, Conservation, and Energy Act of 2008 
or successor sections;
H. R. 2419—567 
‘‘(iii) the total amount of any counter-cyclical pay-
ments made to the producer under sections 1104 and 
1304 of the Food, Conservation, and Energy Act of 
2008 or successor sections or of any average crop rev-
enue election payments made to the producer under 
section 1105 of that Act; 
‘‘(iv) the total amount of any loan deficiency pay-
ments, marketing loan gains, and marketing certificate 
gains made to the producer under subtitles B and 
C of the Food, Conservation, and Energy Act of 2008 
or successor subtitles; 
‘‘(v) the amount of payments for prevented planting 
on a farm; 
‘‘(vi) the amount of crop insurance indemnities 
received by an eligible producer on a farm for each 
crop on a farm; 
‘‘(vii) the amount of payments an eligible producer 
on a farm received under the noninsured crop assist-
ance program for each crop on a farm; and 
‘‘(viii) the value of any other natural disaster 
assistance payments provided by the Federal Govern-
ment to an eligible producer on a farm for each crop 
on a farm for the same loss for which the eligible 
producer is seeking assistance. 
‘‘(B) ADJUSTMENT.—The Secretary shall adjust the 
average market price received by the eligible producer on 
a farm— 
‘‘(i) to reflect the average quality discounts applied 
to the local or regional market price of a crop or 
mechanically harvested forage due to a reduction in 
the intrinsic characteristics of the production resulting 
from adverse weather, as determined annually by the 
State office of the Farm Service Agency; and 
‘‘(ii) to account for a crop the value of which is 
reduced due to excess moisture resulting from a dis-
aster-related condition. 
‘‘(C) MAXIMUM
AMOUNT
FOR
CERTAIN
CROPS.—With 
respect to a crop for which an eligible producer on a farm 
receives assistance under the noninsured crop assistance 
program, the national average market price received during 
the marketing year shall be an amount not more than 
100 percent of the price of the crop established under 
the noninsured crop assistance program. 
‘‘(5) EXPECTED REVENUE.—The expected revenue for each 
crop on a farm shall equal the sum obtained by adding— 
‘‘(A) the product obtained by multiplying— 
‘‘(i) the greatest of— 
‘‘(I) the adjusted actual production history 
yield of the eligible producer on a farm; and 
‘‘(II) the counter-cyclical program payment 
yield; 
‘‘(ii) the acreage planted or prevented from being 
planted for each crop; and 
‘‘(iii) 100 percent of the insurance price guarantee; 
and 
‘‘(B) the product obtained by multiplying—
H. R. 2419—568 
‘‘(i) 100 percent of the adjusted noninsured crop 
assistance program yield; and 
‘‘(ii) 100 percent of the noninsured crop assistance 
program price for each of the crops on a farm. 
‘‘(c) LIVESTOCK INDEMNITY PAYMENTS.— 
‘‘(1) PAYMENTS.—The Secretary shall use such sums as 
are necessary from the Trust Fund to make livestock indemnity 
payments to eligible producers on farms that have incurred 
livestock death losses in excess of the normal mortality due 
to adverse weather, as determined by the Secretary, during 
the calendar year, including losses due to hurricanes, floods, 
blizzards, disease, wildfires, extreme heat, and extreme cold. 
‘‘(2) PAYMENT RATES.—Indemnity payments to an eligible 
producer on a farm under paragraph (1) shall be made at 
a rate of 75 percent of the market value of the applicable 
livestock on the day before the date of death of the livestock, 
as determined by the Secretary. 
‘‘(d) LIVESTOCK FORAGE DISASTER PROGRAM.— 
‘‘(1) DEFINITIONS.—In this subsection: 
‘‘(A) COVERED LIVESTOCK.— 
‘‘(i) IN
GENERAL.—The term ‘covered livestock’ 
means livestock of an eligible livestock producer that, 
during the 60 days prior to the beginning date of 
a qualifying drought or fire condition, as determined 
by the Secretary, the eligible livestock producer— 
‘‘(I) owned; 
‘‘(II) leased; 
‘‘(III) purchased; 
‘‘(IV) entered into a contract to purchase; 
‘‘(V) is a contract grower; or 
‘‘(VI) sold or otherwise disposed of due to quali-
fying drought conditions during— 
‘‘(aa) the current production year; or 
‘‘(bb) subject to paragraph (3)(B)(ii), 1 or 
both of the 2 production years immediately 
preceding the current production year. 
‘‘(ii) EXCLUSION.—The term ‘covered livestock’ does 
not include livestock that were or would have been 
in a feedlot, on the beginning date of the qualifying 
drought or fire condition, as a part of the normal 
business operation of the eligible livestock producer, 
as determined by the Secretary. 
‘‘(B) DROUGHT MONITOR.—The term ‘drought monitor’ 
means a system for classifying drought severity according 
to a range of abnormally dry to exceptional drought, as 
defined by the Secretary. 
‘‘(C) ELIGIBLE LIVESTOCK PRODUCER.— 
‘‘(i) IN GENERAL.—The term ‘eligible livestock pro-
ducer’ means an eligible producer on a farm that— 
‘‘(I) is an owner, cash or share lessee, or con-
tract grower of covered livestock that provides the 
pastureland or grazing land, including cash-leased 
pastureland or grazing land, for the livestock; 
‘‘(II) provides the pastureland or grazing land 
for 
covered 
livestock, 
including 
cash-leased 
pastureland or grazing land that is physically 
located in a county affected by drought;
H. R. 2419—569 
‘‘(III) certifies grazing loss; and 
‘‘(IV) meets all other eligibility requirements 
established under this subsection. 
‘‘(ii) EXCLUSION.—The term ‘eligible livestock pro-
ducer’ does not include an owner, cash or share lessee, 
or contract grower of livestock that rents or leases 
pastureland or grazing land owned by another person 
on a rate-of-gain basis. 
‘‘(D) NORMAL CARRYING CAPACITY.—The term ‘normal 
carrying capacity’, with respect to each type of grazing 
land or pastureland in a county, means the normal carrying 
capacity, as determined under paragraph (3)(D)(i), that 
would be expected from the grazing land or pastureland 
for livestock during the normal grazing period, in the 
absence of a drought or fire that diminishes the production 
of the grazing land or pastureland. 
‘‘(E) NORMAL
GRAZING
PERIOD.—The term ‘normal 
grazing period’, with respect to a county, means the normal 
grazing period during the calendar year for the county, 
as determined under paragraph (3)(D)(i). 
‘‘(2) PROGRAM.—The Secretary shall use such sums as are 
necessary from the Trust Fund to provide compensation for 
losses to eligible livestock producers due to grazing losses for 
covered livestock due to— 
‘‘(A) a drought condition, as described in paragraph 
(3); or 
‘‘(B) fire, as described in paragraph (4). 
‘‘(3) ASSISTANCE
FOR
LOSSES
DUE
TO
DROUGHT
CONDI-
TIONS.— 
‘‘(A) ELIGIBLE LOSSES.— 
‘‘(i) IN GENERAL.—An eligible livestock producer 
may receive assistance under this subsection only for 
grazing losses for covered livestock that occur on land 
that— 
‘‘(I) is native or improved pastureland with 
permanent vegetative cover; or 
‘‘(II) is planted to a crop planted specifically 
for the purpose of providing grazing for covered 
livestock. 
‘‘(ii) EXCLUSIONS.—An eligible livestock producer 
may not receive assistance under this subsection for 
grazing losses that occur on land used for haying or 
grazing under the conservation reserve program estab-
lished under subchapter B of chapter 1 of subtitle 
D of title XII of the Food Security Act of 1985 (16 
U.S.C. 3831 et seq.). 
‘‘(B) MONTHLY PAYMENT RATE.— 
‘‘(i) IN
GENERAL.—Except as provided in clause 
(ii), the payment rate for assistance under this para-
graph for 1 month shall, in the case of drought, be 
equal to 60 percent of the lesser of— 
‘‘(I) the monthly feed cost for all covered live-
stock owned or leased by the eligible livestock 
producer, as determined under subparagraph (C); 
or
H. R. 2419—570 
‘‘(II) the monthly feed cost calculated by using 
the normal carrying capacity of the eligible grazing 
land of the eligible livestock producer. 
‘‘(ii) PARTIAL COMPENSATION.—In the case of an 
eligible livestock producer that sold or otherwise dis-
posed of covered livestock due to drought conditions 
in 1 or both of the 2 production years immediately 
preceding the current production year, as determined 
by the Secretary, the payment rate shall be 80 percent 
of the payment rate otherwise calculated in accordance 
with clause (i). 
‘‘(C) MONTHLY FEED COST.— 
‘‘(i) IN
GENERAL.—The monthly feed cost shall 
equal the product obtained by multiplying— 
‘‘(I) 30 days; 
‘‘(II) a payment quantity that is equal to the 
feed grain equivalent, as determined under clause 
(ii); and 
‘‘(III) a payment rate that is equal to the corn 
price per pound, as determined under clause (iii). 
‘‘(ii) FEED
GRAIN
EQUIVALENT.—For purposes of 
clause (i)(I), the feed grain equivalent shall equal— 
‘‘(I) in the case of an adult beef cow, 15.7 
pounds of corn per day; or 
‘‘(II) in the case of any other type of weight 
of livestock, an amount determined by the Sec-
retary that represents the average number of 
pounds of corn per day necessary to feed the live-
stock. 
‘‘(iii) CORN
PRICE
PER
POUND.—For purposes of 
clause (i)(II), the corn price per pound shall equal 
the quotient obtained by dividing— 
‘‘(I) the higher of— 
‘‘(aa) the national average corn price per 
bushel for the 12-month period immediately 
preceding March 1 of the year for which the 
disaster assistance is calculated; or 
‘‘(bb) the national average corn price per 
bushel for the 24-month period immediately 
preceding that March 1; by 
‘‘(II) 56. 
‘‘(D) NORMAL GRAZING PERIOD AND DROUGHT MONITOR 
INTENSITY.— 
‘‘(i) FSA COUNTY COMMITTEE DETERMINATIONS.— 
‘‘(I) IN GENERAL.—The Secretary shall deter-
mine the normal carrying capacity and normal 
grazing period for each type of grazing land or 
pastureland in the county served by the applicable 
committee. 
‘‘(II) CHANGES.—No change to the normal car-
rying capacity or normal grazing period established 
for a county under subclause (I) shall be made 
unless the change is requested by the appropriate 
State and county Farm Service Agency committees. 
‘‘(ii) DROUGHT INTENSITY.— 
‘‘(I) D2.—An eligible livestock producer that 
owns or leases grazing land or pastureland that
H. R. 2419—571 
is physically located in a county that is rated by 
the U.S. Drought Monitor as having a D2 (severe 
drought) intensity in any area of the county for 
at least 8 consecutive weeks during the normal 
grazing period for the county, as determined by 
the Secretary, shall be eligible to receive assistance 
under this paragraph in an amount equal to 1 
monthly payment using the monthly payment rate 
determined under subparagraph (B). 
‘‘(II) D3.—An eligible livestock producer that 
owns or leases grazing land or pastureland that 
is physically located in a county that is rated by 
the U.S. Drought Monitor as having at least a 
D3 (extreme drought) intensity in any area of the 
county at any time during the normal grazing 
period for the county, as determined by the Sec-
retary, shall be eligible to receive assistance under 
this paragraph— 
‘‘(aa) in an amount equal to 2 monthly 
payments using the monthly payment rate 
determined under subparagraph (B); or 
‘‘(bb) if the county is rated as having a 
D3 (extreme drought) intensity in any area 
of the county for at least 4 weeks during the 
normal grazing period for the county, or is 
rated as having a D4 (exceptional drought) 
intensity in any area of the county at any 
time during the normal grazing period, in an 
amount equal to 3 monthly payments using 
the monthly payment rate determined under 
subparagraph (B). 
‘‘(4) ASSISTANCE FOR LOSSES DUE TO FIRE ON PUBLIC MAN-
AGED LAND.— 
‘‘(A) IN GENERAL.—An eligible livestock producer may 
receive assistance under this paragraph only if— 
‘‘(i) the grazing losses occur on rangeland that 
is managed by a Federal agency; and 
‘‘(ii) the eligible livestock producer is prohibited 
by the Federal agency from grazing the normal per-
mitted livestock on the managed rangeland due to 
a fire. 
‘‘(B) PAYMENT RATE.—The payment rate for assistance 
under this paragraph shall be equal to 50 percent of the 
monthly feed cost for the total number of livestock covered 
by the Federal lease of the eligible livestock producer, 
as determined under paragraph (3)(C). 
‘‘(C) PAYMENT DURATION.— 
‘‘(i) IN GENERAL.—Subject to clause (ii), an eligible 
livestock producer shall be eligible to receive assistance 
under this paragraph for the period— 
‘‘(I) beginning on the date on which the Fed-
eral agency excludes the eligible livestock producer 
from using the managed rangeland for grazing; 
and 
‘‘(II) ending on the last day of the Federal 
lease of the eligible livestock producer.
H. R. 2419—572 
‘‘(ii) LIMITATION.—An eligible livestock producer 
may only receive assistance under this paragraph for 
losses that occur on not more than 180 days per year. 
‘‘(5) MINIMUM
RISK
MANAGEMENT
PURCHASE
REQUIRE-
MENTS.— 
‘‘(A) IN
GENERAL.—Except as otherwise provided in 
this paragraph, a livestock producer shall only be eligible 
for assistance under this subsection if the livestock pro-
ducer— 
‘‘(i) obtained a policy or plan of insurance under 
the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.) 
for the grazing land incurring the losses for which 
assistance is being requested; or 
‘‘(ii) filed the required paperwork, and paid the 
administrative fee by the applicable State filing dead-
line, for the noninsured crop assistance program for 
the grazing land incurring the losses for which assist-
ance is being requested. 
‘‘(B) WAIVER FOR SOCIALLY DISADVANTAGED, LIMITED 
RESOURCE, OR
BEGINNING
FARMER
OR
RANCHER.—In the 
case of an eligible livestock producer that is a socially 
disadvantaged farmer or rancher or limited resource or 
beginning farmer or rancher, as determined by the Sec-
retary, the Secretary may— 
‘‘(i) waive subparagraph (A); and 
‘‘(ii) provide disaster assistance under this section 
at a level that the Secretary determines to be equitable 
and appropriate. 
‘‘(C) WAIVER FOR 2008 CALENDAR YEAR.—In the case 
of an eligible livestock producer that suffered losses on 
grazing land during the 2008 calendar year but does not 
meet the requirements of subparagraph (A), the Secretary 
shall waive subparagraph (A) if the eligible livestock pro-
ducer pays a fee in an amount equal to the applicable 
noninsured crop assistance program fee or catastrophic 
risk protection plan fee required under subparagraph (A) 
to the Secretary not later than 90 days after the date 
of enactment of this subtitle. 
‘‘(D) EQUITABLE RELIEF.— 
‘‘(i) IN GENERAL.—The Secretary may provide equi-
table relief to an eligible livestock producer that is 
otherwise ineligible or unintentionally fails to meet 
the requirements of subparagraph (A) for the grazing 
land incurring the loss on a case-by-case basis, as 
determined by the Secretary. 
‘‘(ii) 2008 CALENDAR
YEAR.—In the case of an 
eligible livestock producer that suffered losses on 
grazing land during the 2008 calendar year, the Sec-
retary shall take special consideration to provide equi-
table relief in cases in which the eligible livestock 
producer failed to meet the requirements of subpara-
graph (A) due to the enactment of this title after the 
closing date of sales periods for crop insurance under 
the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.) 
and the noninsured crop assistance program. 
‘‘(6) NO DUPLICATIVE PAYMENTS.—
H. R. 2419—573 
‘‘(A) IN GENERAL.—An eligible livestock producer may 
elect to receive assistance for grazing or pasture feed losses 
due to drought conditions under paragraph (3) or fire under 
paragraph (4), but not both for the same loss, as determined 
by the Secretary. 
‘‘(B) RELATIONSHIP TO SUPPLEMENTAL REVENUE ASSIST-
ANCE.—An eligible livestock producer that receives assist-
ance under this subsection may not also receive assistance 
for losses to crops on the same land with the same intended 
use under subsection (b). 
‘‘(e) EMERGENCY ASSISTANCE FOR LIVESTOCK, HONEY BEES, AND 
FARM-RAISED FISH.— 
‘‘(1) 
IN
GENERAL.—The 
Secretary 
shall 
use 
up 
to 
$50,000,000 per year from the Trust Fund to provide emergency 
relief to eligible producers of livestock, honey bees, and farm- 
raised fish to aid in the reduction of losses due to disease, 
adverse weather, or other conditions, such as blizzards and 
wildfires, as determined by the Secretary, that are not covered 
under subsection (b), (c), or (d). 
‘‘(2) USE OF FUNDS.—Funds made available under this sub-
section shall be used to reduce losses caused by feed or water 
shortages, disease, or other factors as determined by the Sec-
retary. 
‘‘(3) AVAILABILITY OF FUNDS.—Any funds made available 
under this subsection shall remain available until expended. 
‘‘(f) TREE ASSISTANCE PROGRAM.— 
‘‘(1) DEFINITIONS.—In this subsection: 
‘‘(A) 
ELIGIBLE
ORCHARDIST.—The 
term 
‘eligible 
orchardist’ means a person that produces annual crops 
from trees for commercial purposes. 
‘‘(B) NATURAL DISASTER.—The term ‘natural disaster’ 
means plant disease, insect infestation, drought, fire, 
freeze, flood, earthquake, lightning, or other occurrence, 
as determined by the Secretary. 
‘‘(C) NURSERY TREE GROWER.—The term ‘nursery tree 
grower’ means a person who produces nursery, ornamental, 
fruit, nut, or Christmas trees for commercial sale, as deter-
mined by the Secretary. 
‘‘(D) TREE.—The term ‘tree’ includes a tree, bush, and 
vine. 
‘‘(2) ELIGIBILITY.— 
‘‘(A) LOSS.—Subject to subparagraph (B), the Secretary 
shall provide assistance— 
‘‘(i) under paragraph (3) to eligible orchardists and 
nursery tree growers that planted trees for commercial 
purposes but lost the trees as a result of a natural 
disaster, as determined by the Secretary; and 
‘‘(ii) under paragraph (3)(B) to eligible orchardists 
and nursery tree growers that have a production his-
tory for commercial purposes on planted or existing 
trees but lost the trees as a result of a natural disaster, 
as determined by the Secretary. 
‘‘(B) LIMITATION.—An eligible orchardist or nursery 
tree grower shall qualify for assistance under subparagraph 
(A) only if the tree mortality of the eligible orchardist 
or nursery tree grower, as a result of damaging weather
H. R. 2419—574 
or related condition, exceeds 15 percent (adjusted for 
normal mortality). 
‘‘(3) ASSISTANCE.—Subject to paragraph (4), the assistance 
provided by the Secretary to eligible orchardists and nursery 
tree growers for losses described in paragraph (2) shall consist 
of— 
‘‘(A)(i) reimbursement of 70 percent of the cost of 
replanting trees lost due to a natural disaster, as deter-
mined by the Secretary, in excess of 15 percent mortality 
(adjusted for normal mortality); or 
‘‘(ii) at the option of the Secretary, sufficient seedlings 
to reestablish a stand; and 
‘‘(B) reimbursement of 50 percent of the cost of pruning, 
removal, and other costs incurred by an eligible orchardist 
or nursery tree grower to salvage existing trees or, in 
the case of tree mortality, to prepare the land to replant 
trees as a result of damage or tree mortality due to a 
natural disaster, as determined by the Secretary, in excess 
of 15 percent damage or mortality (adjusted for normal 
tree damage and mortality). 
‘‘(4) LIMITATIONS ON ASSISTANCE.— 
‘‘(A) DEFINITIONS OF LEGAL ENTITY AND PERSON.—In 
this paragraph, the terms ‘legal entity’ and ‘person’ have 
the meaning given those terms in section 1001(a) of the 
Food Security Act of 1985 (7 U.S.C. 1308(a) (as amended 
by section 1603 of the Food, Conservation, and Energy 
Act of 2008). 
‘‘(B) AMOUNT.—The total amount of payments received, 
directly or indirectly, by a person or legal entity (excluding 
a joint venture or general partnership) under this sub-
section may not exceed $100,000 for any crop year, or 
an equivalent value in tree seedlings. 
‘‘(C) ACRES.—The total quantity of acres planted to 
trees or tree seedlings for which a person or legal entity 
shall be entitled to receive payments under this subsection 
may not exceed 500 acres. 
‘‘(g) RISK MANAGEMENT PURCHASE REQUIREMENT.— 
‘‘(1) IN GENERAL.—Except as otherwise provided in this 
section, the eligible producers on a farm shall not be eligible 
for assistance under this section (other than subsection (c)) 
if the eligible producers on the farm— 
‘‘(A) in the case of each insurable commodity of the 
eligible producers on the farm, did not obtain a policy 
or plan of insurance under the Federal Crop Insurance 
Act (7 U.S.C. 1501 et seq.) (excluding a crop insurance 
pilot program under that Act); or 
‘‘(B) in the case of each noninsurable commodity of 
the eligible producers on the farm, did not file the required 
paperwork, and pay the administrative fee by the 
applicable State filing deadline, for the noninsured crop 
assistance program. 
‘‘(2) MINIMUM.—To be considered to have obtained insur-
ance under paragraph (1)(A), an eligible producer on a farm 
shall have obtained a policy or plan of insurance with not 
less than 50 percent yield coverage at 55 percent of the insur-
able price for each crop grazed, planted, or intended to be 
planted for harvest on a whole farm.
H. R. 2419—575 
‘‘(3) WAIVER
FOR
SOCIALLY
DISADVANTAGED, 
LIMITED 
RESOURCE, OR BEGINNING FARMER OR RANCHER.—With respect 
to eligible producers that are socially disadvantaged farmers 
or ranchers or limited resource or beginning farmers or 
ranchers, as determined by the Secretary, the Secretary may— 
‘‘(A) waive paragraph (1); and 
‘‘(B) provide disaster assistance under this section at 
a level that the Secretary determines to be equitable and 
appropriate. 
‘‘(4) WAIVER FOR 2008 CROP YEAR.—In the case of an eligible 
producer that suffered losses in an insurable commodity or 
noninsurable commodity during the 2008 crop year but does 
not meet the requirements of paragraph (1), the Secretary 
shall waive paragraph (1) if the eligible producer pays a fee 
in an amount equal to the applicable noninsured crop assistance 
program fee or catastrophic risk protection plan fee required 
under paragraph (1) to the Secretary not later than 90 days 
after the date of enactment of this subtitle. 
‘‘(5) EQUITABLE RELIEF.— 
‘‘(A) IN GENERAL.—The Secretary may provide equi-
table relief to eligible producers on a farm that are other-
wise ineligible or unintentionally fail to meet the require-
ments of paragraph (1) for 1 or more crops on a farm 
on a case-by-case basis, as determined by the Secretary. 
‘‘(B) 2008 CROP YEAR.—In the case of eligible producers 
on a farm that suffered losses in an insurable commodity 
or noninsurable commodity during the 2008 crop year, the 
Secretary shall take special consideration to provide equi-
table relief in cases in which the eligible producers failed 
to meet the requirements of paragraph (1) due to the 
enactment of this title after the closing date of sales periods 
for crop insurance under the Federal Crop Insurance Act 
(7 U.S.C. 1501 et seq.) and the noninsured crop assistance 
program. 
‘‘(h) PAYMENT LIMITATIONS.— 
‘‘(1) DEFINITIONS OF LEGAL ENTITY AND PERSON.—In this 
subsection, the terms ‘legal entity’ and ‘person’ have the 
meaning given those terms in section 1001(a) of the Food Secu-
rity Act of 1985 (7 U.S.C. 1308(a) (as amended by section 
1603 of the Food, Conservation, and Energy Act of 2008). 
‘‘(2) AMOUNT.—The total amount of disaster assistance pay-
ments received, directly or indirectly, by a person or legal 
entity (excluding a joint venture or general partnership) under 
this section (excluding payments received under subsection (f)) 
may not exceed $100,000 for any crop year. 
‘‘(3) AGI LIMITATION.—Section 1001D of the Food Security 
Act of 1985 (7 U.S.C. 1308–3a) or any successor provision 
shall apply with respect to assistance provided under this sec-
tion. 
‘‘(4) DIRECT ATTRIBUTION.—Subsections (e) and (f) of section 
1001 of the Food Security Act of 1985 (7 U.S.C. 1308) or 
any successor provisions relating to direct attribution shall 
apply with respect to assistance provided under this section. 
‘‘(i) PERIOD OF EFFECTIVENESS.—This section shall be effective 
only for losses that are incurred as the result of a disaster, adverse 
weather, or other environmental condition that occurs on or before 
September 30, 2011, as determined by the Secretary.
H. R. 2419—576 
‘‘(j) NO DUPLICATIVE PAYMENTS.—In implementing any other 
program which makes disaster assistance payments (except for 
indemnities made under the Federal Crop Insurance Act (7 U.S.C. 
1501 et seq.)) and section 196 of the Federal Agriculture Improve-
ment and Reform Act of 1996), the Secretary shall prevent duplica-
tive payments with respect to the same loss for which a person 
receives a payment under subsections (b), (c), (d), (e), or (f). 
‘‘SEC. 902. AGRICULTURAL DISASTER RELIEF TRUST FUND. 
‘‘(a) CREATION OF TRUST FUND.—There is established in the 
Treasury of the United States a trust fund to be known as the 
‘Agricultural Disaster Relief Trust Fund’, consisting of such 
amounts as may be appropriated or credited to such Trust Fund 
as provided in this section. 
‘‘(b) TRANSFER TO TRUST FUND.— 
‘‘(1) IN GENERAL.—There are appropriated to the Agricul-
tural Disaster Relief Trust Fund amounts equivalent to 3.08 
percent of the amounts received in the general fund of the 
Treasury of the United States during fiscal years 2008 through 
2011 attributable to the duties collected on articles entered, 
or withdrawn from warehouse, for consumption under the Har-
monized Tariff Schedule of the United States. 
‘‘(2) AMOUNTS BASED ON ESTIMATES.—The amounts appro-
priated under this section shall be transferred at least monthly 
from the general fund of the Treasury of the United States 
to the Agricultural Disaster Relief Trust Fund on the basis 
of estimates made by the Secretary of the Treasury. Proper 
adjustments shall be made in the amounts subsequently trans-
ferred to the extent prior estimates were in excess of or less 
than the amounts required to be transferred. 
‘‘(3) LIMITATION ON TRANSFERS TO AGRICULTURAL DISASTER 
RELIEF TRUST FUND.—No amount may be appropriated to the 
Agricultural Disaster Relief Trust Fund on and after the date 
of any expenditure from the Agricultural Disaster Relief Trust 
Fund which is not permitted by this section. The determination 
of whether an expenditure is so permitted shall be made with-
out regard to— 
‘‘(A) any provision of law which is not contained or 
referenced in this title or in a revenue Act, and 
‘‘(B) whether such provision of law is a subsequently 
enacted provision or directly or indirectly seeks to waive 
the application of this paragraph. 
‘‘(c) ADMINISTRATION.— 
‘‘(1) REPORTS.—The Secretary of the Treasury shall be the 
trustee of the Agricultural Disaster Relief Trust Fund and 
shall submit an annual report to Congress each year on the 
financial condition and the results of the operations of such 
Trust Fund during the preceding fiscal year and on its expected 
condition and operations during the 4 fiscal years succeeding 
such fiscal year. Such report shall be printed as a House 
document of the session of Congress to which the report is 
made. 
‘‘(2) INVESTMENT.— 
‘‘(A) IN GENERAL.—The Secretary of the Treasury shall 
invest such portion of the Agricultural Disaster Relief Trust 
Fund as is not in his judgment required to meet current 
withdrawals. Such investments may be made only in
H. R. 2419—577 
interest bearing obligations of the United States. For such 
purpose, such obligations may be acquired— 
‘‘(i) on original issue at the issue price, or 
‘‘(ii) by purchase of outstanding obligations at the 
market price. 
‘‘(B) SALE OF OBLIGATIONS.—Any obligation acquired 
by the Agricultural Disaster Relief Trust Fund may be 
sold by the Secretary of the Treasury at the market price. 
‘‘(C) INTEREST
ON
CERTAIN
PROCEEDS.—The interest 
on, and the proceeds from the sale or redemption of, any 
obligations held in the Agricultural Disaster Relief Trust 
Fund shall be credited to and form a part of such Trust 
Fund. 
‘‘(d) EXPENDITURES FROM TRUST FUND.—Amounts in the Agri-
cultural Disaster Relief Trust Fund shall be available for the pur-
poses of making expenditures to meet those obligations of the 
United States incurred under section 901 or section 531 of the 
Federal Crop Insurance Act (as such sections are in effect on the 
date of the enactment of the Food, Conservation, and Energy Act 
of 2008). 
‘‘(e) AUTHORITY TO BORROW.— 
‘‘(1) IN GENERAL.—There are authorized to be appropriated, 
and are appropriated, to the Agricultural Disaster Relief Trust 
Fund, as repayable advances, such sums as may be necessary 
to carry out the purposes of such Trust Fund. 
‘‘(2) REPAYMENT OF ADVANCES.— 
‘‘(A) IN GENERAL.—Advances made to the Agricultural 
Disaster Relief Trust Fund shall be repaid, and interest 
on such advances shall be paid, to the general fund of 
the Treasury when the Secretary determines that moneys 
are available for such purposes in such Trust Fund. 
‘‘(B) RATE OF INTEREST.—Interest on advances made 
pursuant to this subsection shall be— 
‘‘(i) at a rate determined by the Secretary of the 
Treasury (as of the close of the calendar month pre-
ceding the month in which the advance is made) to 
be equal to the current average market yield on out-
standing marketable obligations of the United States 
with remaining periods to maturity comparable to the 
anticipated period during which the advance will be 
outstanding, and 
‘‘(ii) compounded annually. 
‘‘SEC. 903. JURISDICTION. 
‘‘Legislation in the Senate of the United States amending sec-
tion 901 or 902 shall be referred to the Committee on Finance 
of the Senate.’’. 
(b) TRANSITION.—For purposes of the 2008 crop year, the Sec-
retary shall carry out subsections (f)(4) and (h) of section 901 
of the Trade Act of 1974 (as added by subsection (a)) in accordance 
with the terms and conditions of sections 1001 through 1001D 
of the Food Security Act of 1985 (16 U.S.C. 1308 et seq.), as 
in effect on September 30, 2007. 
(c) CLERICAL AMENDMENT.—The table of contents for the Trade 
Act of 1974 (19 U.S.C. 2101 et seq.) is amended by adding at 
the end the following:
H. R. 2419—578 
‘‘TITLE IX—SUPPLEMENTAL AGRICULTURAL DISASTER ASSISTANCE 
‘‘Sec. 901. Supplemental agricultural disaster assistance. 
‘‘Sec. 902. Agricultural Disaster Relief Trust Fund. 
‘‘Sec. 903. Jurisdiction.’’. 
Subtitle B—Revenue Provisions for 
Agriculture Programs 
SEC. 15201. CUSTOMS USER FEES. 
(a) IN GENERAL.—Section 13031(j)(3)(A) of the Consolidated 
Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)(A)) 
is amended by striking ‘‘December 27, 2014’’ and inserting 
‘‘November 14, 2017’’. 
(b) OTHER FEES.—Section 13031(j)(3)(B)(i) of the Consolidated 
Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)(B)(i)) 
is amended by striking ‘‘December 27, 2014’’ and inserting ‘‘Sep-
tember 30, 2017’’. 
(c) TIME
FOR REMITTING CERTAIN COBRA FEES.—Notwith-
standing any other provision of law, any fees authorized under 
paragraphs (1) through (8) of section 13031(a) of the Consolidated 
Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(a) (1) 
through (8)) with respect to customs services provided on or after 
July 1, 2017, and before September 20, 2017, shall be paid not 
later than September 25, 2017. 
(d) TIME FOR REMITTING CERTAIN MERCHANDISE PROCESSING 
FEES.— 
(1) IN GENERAL.—Notwithstanding any other provision of 
law, any fees authorized under paragraphs (9) and (10) of 
section 13031(a) of the Consolidated Omnibus Budget Reconcili-
ation Act of 1985 (19 U.S.C. 58c(a) (9) and (10)) with respect 
to processing merchandise entered on or after October 1, 2017, 
and before November 15, 2017, shall be paid not later than 
September 25, 2017, in an amount equivalent to the amount 
of such fees paid by the person responsible for such fees with 
respect to merchandise entered on or after October 1, 2016, 
and before November 15, 2016, as determined by the Secretary 
of the Treasury. 
(2) RECONCILIATION OF MERCHANDISE PROCESSING FEES.— 
Not later than December 15, 2017, the Secretary of the 
Treasury shall reconcile the fees paid pursuant to paragraph 
(1) with the fees for services actually provided on or after 
October 1, 2017, and before November 15, 2017, and shall 
refund with interest any overpayment of such fees and make 
proper adjustments with respect to any underpayment of such 
fees. No interest may be assessed with respect to any such 
underpayment that was based on the amount of fees paid 
for merchandise entered on or after October 1, 2016, and before 
November 15, 2016. 
SEC. 15202. TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES. 
The percentage under subparagraph (B) of section 401(1) of 
the Tax Increase Prevention and Reconciliation Act of 2005 in 
effect on the date of the enactment of this Act is increased by 
7.75 percentage points.
H. R. 2419—579 
Subtitle C—Tax Provisions 
PART I—CONSERVATION 
Subpart A—Land and Species Preservation 
Provisions 
SEC. 15301. EXCLUSION OF CONSERVATION RESERVE PROGRAM PAY-
MENTS FROM SECA TAX FOR CERTAIN INDIVIDUALS. 
(a) INTERNAL REVENUE CODE.—Section 1402(a)(1) (defining net 
earnings from self-employment) is amended by inserting ‘‘, and 
including payments under section 1233(2) of the Food Security 
Act of 1985 (16 U.S.C. 3833(2)) to individuals receiving benefits 
under section 202 or 223 of the Social Security Act’’ after ‘‘crop 
shares’’. 
(b) SOCIAL SECURITY ACT.—Section 211(a)(1) of the Social Secu-
rity Act is amended by inserting ‘‘, and including payments under 
section 1233(2) of the Food Security Act of 1985 (16 U.S.C. 3833(2)) 
to individuals receiving benefits under section 202 or 223’’ after 
‘‘crop shares’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to payments made after December 31, 2007. 
SEC. 15302. TWO-YEAR EXTENSION OF SPECIAL RULE ENCOURAGING 
CONTRIBUTIONS OF CAPITAL GAIN REAL PROPERTY 
FOR CONSERVATION PURPOSES. 
(a) IN GENERAL.— 
(1) INDIVIDUALS.—Section 170(b)(1)(E)(vi) (relating to 
termination) is amended by striking ‘‘December 31, 2007’’ and 
inserting ‘‘December 31, 2009’’. 
(2) CORPORATIONS.—Section 170(b)(2)(B)(iii) (relating to 
termination) is amended by striking ‘‘December 31, 2007’’ and 
inserting ‘‘December 31, 2009’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to contributions made in taxable years beginning after 
December 31, 2007. 
SEC. 15303. DEDUCTION FOR ENDANGERED SPECIES RECOVERY 
EXPENDITURES. 
(a) DEDUCTION FOR ENDANGERED SPECIES RECOVERY EXPENDI-
TURES.— 
(1) IN GENERAL.—Paragraph (1) of section 175(c) (relating 
to definitions) is amended by inserting after the first sentence 
the following new sentence: ‘‘Such term shall include expendi-
tures paid or incurred for the purpose of achieving site-specific 
management actions recommended in recovery plans approved 
pursuant to the Endangered Species Act of 1973.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 175 is amended by inserting ‘‘, or for endan-
gered species recovery’’ after ‘‘prevention of erosion of land 
used in farming’’ each place it appears in subsections (a) 
and (c). 
(B) The heading of section 175 is amended by inserting 
‘‘; ENDANGERED SPECIES RECOVERY EXPENDITURES’’ before 
the period. 
(C) The item relating to section 175 in the table of 
sections for part VI of subchapter B of chapter 1 is amended
H. R. 2419—580 
by inserting ‘‘; endangered species recovery expenditures’’ 
before the period. 
(b) LIMITATIONS.—Paragraph (3) of section 175(c) (relating to 
additional limitations) is amended— 
(1) in the heading of subparagraph (A), by inserting ‘‘OR 
ENDANGERED
SPECIES
RECOVERY
PLAN’’ after ‘‘CONSERVATION 
PLAN’’, and 
(2) in subparagraph (A)(i), by inserting ‘‘or the recovery 
plan approved pursuant to the Endangered Species Act of 1973’’ 
after ‘‘Department of Agriculture’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to expenditures paid or incurred after December 31, 
2008. 
Subpart B—Timber Provisions 
SEC. 15311. TEMPORARY REDUCTION IN RATE OF TAX ON QUALIFIED 
TIMBER GAIN OF CORPORATIONS. 
(a) IN GENERAL.—Section 1201 (relating to alternative tax for 
corporations) is amended by redesignating subsection (b) as sub-
section (c) and by adding after subsection (a) the following new 
subsection: 
‘‘(b) SPECIAL RATE FOR QUALIFIED TIMBER GAINS.— 
‘‘(1) IN GENERAL.—If, for any taxable year ending after 
the date of the enactment of the Food, Conservation, and 
Energy Act of 2008 and beginning on or before the date which 
is 1 year after such date, a corporation has both a net capital 
gain and qualified timber gain— 
‘‘(A) subsection (a) shall apply to such corporation for 
the taxable year without regard to whether the applicable 
tax rate exceeds 35 percent, and 
‘‘(B) the tax computed under subsection (a)(2) shall 
be equal to the sum of— 
‘‘(i) 15 percent of the least of— 
‘‘(I) qualified timber gain, 
‘‘(II) net capital gain, or 
‘‘(III) taxable income, plus 
‘‘(ii) 35 percent of the excess (if any) of taxable 
income over the sum of the amounts for which a tax 
was determined under subsection (a)(1) and clause (i). 
‘‘(2) QUALIFIED TIMBER GAIN.—For purposes of this section, 
the term ‘qualified timber gain’ means, with respect to any 
taxpayer for any taxable year, the excess (if any) of— 
‘‘(A) the sum of the taxpayer’s gains described in sub-
sections (a) and (b) of section 631 for such year, over 
‘‘(B) the sum of the taxpayer’s losses described in such 
subsections for such year. 
For purposes of subparagraphs (A) and (B), only timber held 
more than 15 years shall be taken into account. 
‘‘(3) COMPUTATION FOR TAXABLE YEARS IN WHICH RATE FIRST 
APPLIES
OR
ENDS.—In the case of any taxable year which 
includes either of the dates set forth in paragraph (1), the 
qualified timber gain for such year shall not exceed the qualified 
timber gain properly taken into account for— 
‘‘(A) in the case of the taxable year including the date 
of the enactment of the Food, Conservation, and Energy 
Act of 2008, the portion of the year after such date, and
H. R. 2419—581 
‘‘(B) in the case of the taxable year including the date 
which is 1 year after such date of enactment, the portion 
of the year on or before such later date.’’. 
(b) MINIMUM TAX.—Subsection (b) of section 55 is amended 
by adding at the end the following paragraph: 
‘‘(4) MAXIMUM RATE OF TAX ON QUALIFIED TIMBER GAIN 
OF CORPORATIONS.—In the case of any taxable year to which 
section 1201(b) applies, the amount determined under clause 
(i) of subparagraph (B) shall not exceed the sum of— 
‘‘(A) 20 percent of so much of the taxable excess (if 
any) as exceeds the qualified timber gain (or, if less, the 
net capital gain), plus 
‘‘(B) 15 percent of the taxable excess in excess of the 
amount on which a tax is determined under subparagraph 
(A). 
Any term used in this paragraph which is also used in section 
1201 shall have the meaning given such term by such section, 
except to the extent such term is subject to adjustment under 
this part.’’. 
(c) 
CONFORMING
AMENDMENT.—Section 
857(b)(3)(A)(ii) 
is 
amended by striking ‘‘rate’’ and inserting ‘‘rates’’. 
(d) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years ending after the date of enactment. 
SEC. 15312. TIMBER REIT MODERNIZATION. 
(a) IN GENERAL.—Section 856(c)(5) is amended by adding after 
subparagraph (G) the following new subparagraph: 
‘‘(H) TREATMENT OF TIMBER GAINS.— 
‘‘(i) IN GENERAL.—Gain from the sale of real prop-
erty described in paragraph (2)(D) and (3)(C) shall 
include gain which is— 
‘‘(I) recognized by an election under section 
631(a) from timber owned by the real estate invest-
ment trust, the cutting of which is provided by 
a taxable REIT subsidiary of the real estate invest-
ment trust; 
‘‘(II) recognized under section 631(b); or 
‘‘(III) income which would constitute gain 
under subclause (I) or (II) but for the failure to 
meet the 1-year holding period requirement. 
‘‘(ii) SPECIAL RULES.— 
‘‘(I) For purposes of this subtitle, cut timber, 
the gain from which is recognized by a real estate 
investment trust pursuant to an election under 
section 631(a) described in clause (i)(I) or so much 
of clause (i)(III) as relates to clause (i)(I), shall 
be deemed to be sold to the taxable REIT sub-
sidiary of the real estate investment trust on the 
first day of the taxable year. 
‘‘(II) For purposes of this subtitle, income 
described in this subparagraph shall not be treated 
as gain from the sale of property described in 
section 1221(a)(1). 
‘‘(iii) TERMINATION.—This subparagraph shall not 
apply to dispositions after the termination date.’’. 
(b) TERMINATION
DATE.—Subsection (c) of section 856 is 
amended by adding at the end the following new paragraph:
H. R. 2419—582 
‘‘(8) TERMINATION DATE.—For purposes of this subsection, 
the term ‘termination date’ means, with respect to any taxpayer, 
the last day of the taxpayer’s first taxable year beginning 
after the date of the enactment of this paragraph and before 
the date that is 1 year after such date of enactment.’’. 
(c) EFFECTIVE DATE.—The amendments made by subsection 
(a) shall apply to dispositions in taxable years beginning after 
the date of the enactment of this Act. 
SEC. 15313. MINERAL ROYALTY INCOME QUALIFYING INCOME FOR 
TIMBER REITS. 
(a) IN GENERAL.—Section 856(c)(2) is amended by striking ‘‘and’’ 
at the end of subparagraph (G), by inserting ‘‘and’’ at the end 
of subparagraph (H), and by adding after subparagraph (H) the 
following new subparagraph: 
‘‘(I) mineral royalty income earned in the first taxable 
year beginning after the date of the enactment of this 
subparagraph from real property owned by a timber real 
estate investment trust and held, or once held, in connec-
tion with the trade or business of producing timber by 
such real estate investment trust;’’. 
(b) 
TIMBER
REAL
ESTATE
INVESTMENT
TRUST.—Section 
856(c)(5), as amended by this Act, is amended by adding after 
subparagraph (H) the following new subparagraph: 
‘‘(I) TIMBER
REAL
ESTATE
INVESTMENT
TRUST.—The 
term ‘timber real estate investment trust’ means a real 
estate investment trust in which more than 50 percent 
in value of its total assets consists of real property held 
in connection with the trade or business of producing 
timber.’’. 
(c) EFFECTIVE DATE.—The amendments by this section shall 
apply to taxable years beginning after the date of the enactment 
of this Act. 
SEC. 15314. MODIFICATION OF TAXABLE REIT SUBSIDIARY ASSET TEST 
FOR TIMBER REITS. 
(a) IN
GENERAL.—Section 856(c)(4)(B)(ii) is amended by 
inserting ‘‘(in the case of a quarter which closes on or before the 
termination date, 25 percent in the case of a timber real estate 
investment trust)’’ after ‘‘REIT subsidiaries’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to taxable years beginning after the date of the enact-
ment of this Act. 
SEC. 15315. SAFE HARBOR FOR TIMBER PROPERTY. 
(a) IN GENERAL.—Section 857(b)(6) (relating to income from 
prohibited transactions) is amended by adding at the end the fol-
lowing new subparagraph: 
‘‘(G) SPECIAL RULES FOR SALES TO QUALIFIED ORGANIZA-
TIONS.— 
‘‘(i) IN
GENERAL.—In the case of the sale of a 
real estate asset (as defined in section 856(c)(5)(B)) 
to a qualified organization (as defined in section 
170(h)(3)) exclusively for conservation purposes (within 
the meaning of section 170(h)(1)(C)), subparagraph (D) 
shall be applied— 
‘‘(I) by substituting ‘2 years’ for ‘4 years’ in 
clause (i), and
H. R. 2419—583 
‘‘(II) by substituting ‘2-year period’ for ‘4-year 
period’ in clauses (ii) and (iii). 
‘‘(ii) TERMINATION.—This subparagraph shall not 
apply to sales after the termination date.’’. 
(b) PROHIBITED
TRANSACTIONS.—Section 857(b)(6)(D)(v) is 
amended by inserting ‘‘, or, in the case of a sale on or before 
the termination date, a taxable REIT subsidiary’’ after ‘‘any income’’. 
(c) SALES THAT ARE NOT PROHIBITED TRANSACTIONS.—Section 
857(b)(6), as amended by subsection (a), is amended by adding 
at the end the following new subparagraph: 
‘‘(H) SALES OF PROPERTY THAT ARE NOT A PROHIBITED 
TRANSACTION.—In the case of a sale on or before the termi-
nation date, the sale of property which is not a prohibited 
transaction through the application of subparagraph (D) 
shall be considered property held for investment or for 
use in a trade or business and not property described 
in section 1221(a)(1) for all purposes of this subtitle.’’. 
(d) TERMINATION DATE.—Section 857(b)(6), as amended by sub-
sections (a) and (c), is amended by adding at the end the following 
new subparagraph: 
‘‘(I) TERMINATION DATE.—For purposes of this para-
graph, the term ‘termination date’ has the meaning given 
such term by section 856(c)(8).’’. 
(e) EFFECTIVE DATE.—The amendments made by this section 
shall apply to dispositions in taxable years beginning after the 
date of the enactment of this Act. 
SEC. 15316. QUALIFIED FORESTRY CONSERVATION BONDS. 
(a) IN GENERAL.—Part IV of subchapter A of chapter 1 (relating 
to credits against tax) is amended by adding at the end the following 
new subpart: 
‘‘Subpart I—Qualified Tax Credit Bonds 
‘‘Sec. 54A. Credit to holders of qualified tax credit bonds. 
‘‘Sec. 54B. Qualified forestry conservation bonds. 
‘‘SEC. 54A. CREDIT TO HOLDERS OF QUALIFIED TAX CREDIT BONDS. 
‘‘(a) ALLOWANCE OF CREDIT.—If a taxpayer holds a qualified 
tax credit bond on one or more credit allowance dates of the bond 
during any taxable year, there shall be allowed as a credit against 
the tax imposed by this chapter for the taxable year an amount 
equal to the sum of the credits determined under subsection (b) 
with respect to such dates. 
‘‘(b) AMOUNT OF CREDIT.— 
‘‘(1) IN GENERAL.—The amount of the credit determined 
under this subsection with respect to any credit allowance 
date for a qualified tax credit bond is 25 percent of the annual 
credit determined with respect to such bond. 
‘‘(2) ANNUAL CREDIT.—The annual credit determined with 
respect to any qualified tax credit bond is the product of— 
‘‘(A) the applicable credit rate, multiplied by 
‘‘(B) the outstanding face amount of the bond. 
‘‘(3) APPLICABLE CREDIT RATE.—For purposes of paragraph 
(2), the applicable credit rate is the rate which the Secretary 
estimates will permit the issuance of qualified tax credit bonds 
with a specified maturity or redemption date without discount 
and without interest cost to the qualified issuer. The applicable
H. R. 2419—584 
credit rate with respect to any qualified tax credit bond shall 
be determined as of the first day on which there is a binding, 
written contract for the sale or exchange of the bond. 
‘‘(4) SPECIAL RULE FOR ISSUANCE AND REDEMPTION.—In the 
case of a bond which is issued during the 3-month period 
ending on a credit allowance date, the amount of the credit 
determined under this subsection with respect to such credit 
allowance date shall be a ratable portion of the credit otherwise 
determined based on the portion of the 3-month period during 
which the bond is outstanding. A similar rule shall apply when 
the bond is redeemed or matures. 
‘‘(c) LIMITATION BASED ON AMOUNT OF TAX.— 
‘‘(1) IN GENERAL.—The credit allowed under subsection (a) 
for any taxable year shall not exceed the excess of— 
‘‘(A) the sum of the regular tax liability (as defined 
in section 26(b)) plus the tax imposed by section 55, over 
‘‘(B) the sum of the credits allowable under this part 
(other than subpart C and this subpart). 
‘‘(2) CARRYOVER OF UNUSED CREDIT.—If the credit allowable 
under subsection (a) exceeds the limitation imposed by para-
graph (1) for such taxable year, such excess shall be carried 
to the succeeding taxable year and added to the credit allowable 
under subsection (a) for such taxable year (determined before 
the application of paragraph (1) for such succeeding taxable 
year). 
‘‘(d) QUALIFIED TAX CREDIT BOND.—For purposes of this sec-
tion— 
‘‘(1) QUALIFIED TAX CREDIT BOND.—The term ‘qualified tax 
credit bond’ means a qualified forestry conservation bond which 
is part of an issue that meets the requirements of paragraphs 
(2), (3), (4), (5), and (6). 
‘‘(2) SPECIAL RULES RELATING TO EXPENDITURES.— 
‘‘(A) IN GENERAL.—An issue shall be treated as meeting 
the requirements of this paragraph if, as of the date of 
issuance, the issuer reasonably expects— 
‘‘(i) 100 percent or more of the available project 
proceeds to be spent for 1 or more qualified purposes 
within the 3-year period beginning on such date of 
issuance, and 
‘‘(ii) a binding commitment with a third party to 
spend at least 10 percent of such available project 
proceeds will be incurred within the 6-month period 
beginning on such date of issuance. 
‘‘(B) FAILURE TO SPEND REQUIRED AMOUNT OF BOND 
PROCEEDS WITHIN 3 YEARS.— 
‘‘(i) IN
GENERAL.—To the extent that less than 
100 percent of the available project proceeds of the 
issue are expended by the close of the expenditure 
period for 1 or more qualified purposes, the issuer 
shall redeem all of the nonqualified bonds within 90 
days after the end of such period. For purposes of 
this paragraph, the amount of the nonqualified bonds 
required to be redeemed shall be determined in the 
same manner as under section 142. 
‘‘(ii) EXPENDITURE PERIOD.—For purposes of this 
subpart, the term ‘expenditure period’ means, with 
respect to any issue, the 3-year period beginning on
H. R. 2419—585 
the date of issuance. Such term shall include any exten-
sion of such period under clause (iii). 
‘‘(iii) EXTENSION OF PERIOD.—Upon submission of 
a request prior to the expiration of the expenditure 
period (determined without regard to any extension 
under this clause), the Secretary may extend such 
period if the issuer establishes that the failure to 
expend the proceeds within the original expenditure 
period is due to reasonable cause and the expenditures 
for qualified purposes will continue to proceed with 
due diligence. 
‘‘(C) QUALIFIED PURPOSE.—For purposes of this para-
graph, the term ‘qualified purpose’ means a purpose speci-
fied in section 54B(e). 
‘‘(D) REIMBURSEMENT.—For purposes of this subtitle, 
available project proceeds of an issue shall be treated as 
spent for a qualified purpose if such proceeds are used 
to reimburse the issuer for amounts paid for a qualified 
purpose after the date that the Secretary makes an alloca-
tion of bond limitation with respect to such issue, but 
only if— 
‘‘(i) prior to the payment of the original expendi-
ture, the issuer declared its intent to reimburse such 
expenditure with the proceeds of a qualified tax credit 
bond, 
‘‘(ii) not later than 60 days after payment of the 
original expenditure, the issuer adopts an official intent 
to reimburse the original expenditure with such pro-
ceeds, and 
‘‘(iii) the reimbursement is made not later than 
18 months after the date the original expenditure is 
paid. 
‘‘(3) REPORTING.—An issue shall be treated as meeting 
the requirements of this paragraph if the issuer of qualified 
tax credit bonds submits reports similar to the reports required 
under section 149(e). 
‘‘(4) SPECIAL RULES RELATING TO ARBITRAGE.— 
‘‘(A) IN GENERAL.—An issue shall be treated as meeting 
the requirements of this paragraph if the issuer satisfies 
the requirements of section 148 with respect to the proceeds 
of the issue. 
‘‘(B) SPECIAL RULE FOR INVESTMENTS DURING EXPENDI-
TURE
PERIOD.—An issue shall not be treated as failing 
to meet the requirements of subparagraph (A) by reason 
of any investment of available project proceeds during the 
expenditure period. 
‘‘(C) SPECIAL RULE FOR RESERVE FUNDS.—An issue shall 
not be treated as failing to meet the requirements of 
subparagraph (A) by reason of any fund which is expected 
to be used to repay such issue if— 
‘‘(i) such fund is funded at a rate not more rapid 
than equal annual installments, 
‘‘(ii) such fund is funded in a manner reasonably 
expected to result in an amount not greater than an 
amount necessary to repay the issue, and
H. R. 2419—586 
‘‘(iii) the yield on such fund is not greater than 
the discount rate determined under paragraph (5)(B) 
with respect to the issue. 
‘‘(5) MATURITY LIMITATION.— 
‘‘(A) IN GENERAL.—An issue shall be treated as meeting 
the requirements of this paragraph if the maturity of any 
bond which is part of such issue does not exceed the max-
imum term determined by the Secretary under subpara-
graph (B). 
‘‘(B) MAXIMUM TERM.—During each calendar month, 
the Secretary shall determine the maximum term per-
mitted under this paragraph for bonds issued during the 
following calendar month. Such maximum term shall be 
the term which the Secretary estimates will result in the 
present value of the obligation to repay the principal on 
the bond being equal to 50 percent of the face amount 
of such bond. Such present value shall be determined using 
as a discount rate the average annual interest rate of 
tax-exempt obligations having a term of 10 years or more 
which are issued during the month. If the term as so 
determined is not a multiple of a whole year, such term 
shall be rounded to the next highest whole year. 
‘‘(6) PROHIBITION ON FINANCIAL CONFLICTS OF INTEREST.— 
An issue shall be treated as meeting the requirements of this 
paragraph if the issuer certifies that— 
‘‘(A) applicable State and local law requirements gov-
erning conflicts of interest are satisfied with respect to 
such issue, and 
‘‘(B) if the Secretary prescribes additional conflicts of 
interest rules governing the appropriate Members of Con-
gress, Federal, State, and local officials, and their spouses, 
such additional rules are satisfied with respect to such 
issue. 
‘‘(e) OTHER DEFINITIONS.—For purposes of this subchapter— 
‘‘(1) CREDIT ALLOWANCE DATE.—The term ‘credit allowance 
date’ means— 
‘‘(A) March 15, 
‘‘(B) June 15, 
‘‘(C) September 15, and 
‘‘(D) December 15. 
Such term includes the last day on which the bond is out-
standing. 
‘‘(2) BOND.—The term ‘bond’ includes any obligation. 
‘‘(3) STATE.—The term ‘State’ includes the District of 
Columbia and any possession of the United States. 
‘‘(4) AVAILABLE PROJECT PROCEEDS.—The term ‘available 
project proceeds’ means— 
‘‘(A) the excess of— 
‘‘(i) the proceeds from the sale of an issue, over 
‘‘(ii) the issuance costs financed by the issue (to 
the extent that such costs do not exceed 2 percent 
of such proceeds), and 
‘‘(B) the proceeds from any investment of the excess 
described in subparagraph (A). 
‘‘(f) CREDIT TREATED AS INTEREST.—For purposes of this sub-
title, the credit determined under subsection (a) shall be treated 
as interest which is includible in gross income.
H. R. 2419—587 
‘‘(g) S CORPORATIONS AND PARTNERSHIPS.—In the case of a 
tax credit bond held by an S corporation or partnership, the alloca-
tion of the credit allowed by this section to the shareholders of 
such corporation or partners of such partnership shall be treated 
as a distribution. 
‘‘(h) BONDS HELD BY REGULATED INVESTMENT COMPANIES AND 
REAL ESTATE INVESTMENT TRUSTS.—If any qualified tax credit bond 
is held by a regulated investment company or a real estate invest-
ment trust, the credit determined under subsection (a) shall be 
allowed to shareholders of such company or beneficiaries of such 
trust (and any gross income included under subsection (f) with 
respect to such credit shall be treated as distributed to such share-
holders or beneficiaries) under procedures prescribed by the Sec-
retary. 
‘‘(i) CREDITS MAY BE STRIPPED.—Under regulations prescribed 
by the Secretary— 
‘‘(1) IN GENERAL.—There may be a separation (including 
at issuance) of the ownership of a qualified tax credit bond 
and the entitlement to the credit under this section with respect 
to such bond. In case of any such separation, the credit under 
this section shall be allowed to the person who on the credit 
allowance date holds the instrument evidencing the entitlement 
to the credit and not to the holder of the bond. 
‘‘(2) CERTAIN RULES TO APPLY.—In the case of a separation 
described in paragraph (1), the rules of section 1286 shall 
apply to the qualified tax credit bond as if it were a stripped 
bond and to the credit under this section as if it were a 
stripped coupon. 
‘‘SEC. 54B. QUALIFIED FORESTRY CONSERVATION BONDS. 
‘‘(a) QUALIFIED FORESTRY CONSERVATION BOND.—For purposes 
of this subchapter, the term ‘qualified forestry conservation bond’ 
means any bond issued as part of an issue if— 
‘‘(1) 100 percent of the available project proceeds of such 
issue are to be used for one or more qualified forestry conserva-
tion purposes, 
‘‘(2) the bond is issued by a qualified issuer, and 
‘‘(3) the issuer designates such bond for purposes of this 
section. 
‘‘(b) LIMITATION ON AMOUNT OF BONDS DESIGNATED.—The max-
imum aggregate face amount of bonds which may be designated 
under subsection (a) by any issuer shall not exceed the limitation 
amount allocated to such issuer under subsection (d). 
‘‘(c) NATIONAL
LIMITATION
ON
AMOUNT
OF
BONDS
DES-
IGNATED.—There is a national qualified forestry conservation bond 
limitation of $500,000,000. 
‘‘(d) ALLOCATIONS.— 
‘‘(1) IN GENERAL.—The Secretary shall make allocations 
of the amount of the national qualified forestry conservation 
bond limitation described in subsection (c) among qualified 
forestry conservation purposes in such manner as the Secretary 
determines appropriate so as to ensure that all of such limita-
tion is allocated before the date which is 24 months after 
the date of the enactment of this section. 
‘‘(2) SOLICITATION OF APPLICATIONS.—The Secretary shall 
solicit applications for allocations of the national qualified for-
estry conservation bond limitation described in subsection (c)
H. R. 2419—588 
not later than 90 days after the date of the enactment of 
this section. 
‘‘(e) QUALIFIED FORESTRY CONSERVATION PURPOSE.—For pur-
poses of this section, the term ‘qualified forestry conservation pur-
pose’ means the acquisition by a State or any political subdivision 
or instrumentality thereof or a 501(c)(3) organization (as defined 
in section 150(a)(4)) from an unrelated person of forest and forest 
land that meets the following qualifications: 
‘‘(1) Some portion of the land acquired must be adjacent 
to United States Forest Service Land. 
‘‘(2) At least half of the land acquired must be transferred 
to the United States Forest Service at no net cost to the 
United States and not more than half of the land acquired 
may either remain with or be conveyed to a State. 
‘‘(3) All of the land must be subject to a native fish habitat 
conservation plan approved by the United States Fish and 
Wildlife Service. 
‘‘(4) The amount of acreage acquired must be at least 
40,000 acres. 
‘‘(f) QUALIFIED ISSUER.—For purposes of this section, the term 
‘qualified issuer’ means a State or any political subdivision or 
instrumentality thereof or a 501(c)(3) organization (as defined in 
section 150(a)(4)). 
‘‘(g) SPECIAL ARBITRAGE RULE.—In the case of any qualified 
forestry conservation bond issued as part of an issue, section 
54A(d)(4)(C) shall be applied to such issue without regard to clause 
(i). 
‘‘(h) ELECTION TO TREAT 50 PERCENT OF BOND ALLOCATION 
AS PAYMENT OF TAX.— 
‘‘(1) IN GENERAL.—If— 
‘‘(A) a qualified issuer receives an allocation of any 
portion of the national qualified forestry conservation bond 
limitation described in subsection (c), and 
‘‘(B) the qualified issuer elects the application of this 
subsection with respect to such allocation, 
then the qualified issuer (without regard to whether the issuer 
is subject to tax under this chapter) shall be treated as having 
made a payment against the tax imposed by this chapter, 
for the taxable year preceding the taxable year in which the 
allocation is received, in an amount equal to 50 percent of 
the amount of such allocation. 
‘‘(2) TREATMENT OF DEEMED PAYMENT.— 
‘‘(A) IN GENERAL.—Notwithstanding any other provi-
sion of this title, the Secretary shall not use the payment 
of tax described in paragraph (1) as an offset or credit 
against any tax liability of the qualified issuer but shall 
refund such payment to such issuer. 
‘‘(B) NO INTEREST.—Except as provided in paragraph 
(3)(A), the payment described in paragraph (1) shall not 
be taken into account in determining any amount of 
interest under this title. 
‘‘(3) REQUIREMENT FOR, AND EFFECT OF, ELECTION.— 
‘‘(A) REQUIREMENT.—No election under this subsection 
shall take effect unless the qualified issuer certifies to 
the Secretary that any payment of tax refunded to the 
issuer under this subsection will be used exclusively for 
1 or more qualified forestry conservation purposes. If the
H. R. 2419—589 
qualified issuer fails to use any portion of such payment 
for such purpose, the issuer shall be liable to the United 
States in an amount equal to such portion, plus interest 
at the overpayment rate under section 6621 for the period 
from the date such portion was refunded to the date such 
amount is paid. Any such amount shall be assessed and 
collected in the same manner as tax imposed by this 
chapter, except that subchapter B of chapter 63 (relating 
to deficiency procedures) shall not apply in respect of such 
assessment or collection. 
‘‘(B) EFFECT OF ELECTION ON ALLOCATION.—If a quali-
fied issuer makes the election under this subsection with 
respect to any allocation— 
‘‘(i) the issuer may issue no bonds pursuant to 
the allocation, and 
‘‘(ii) the Secretary may not reallocate such alloca-
tion for any other purpose.’’. 
(b) REPORTING.—Subsection (d) of section 6049 (relating to 
returns regarding payments of interest) is amended by adding at 
the end the following new paragraph: 
‘‘(9) REPORTING
OF
CREDIT
ON
QUALIFIED
TAX
CREDIT 
BONDS.— 
‘‘(A) IN GENERAL.—For purposes of subsection (a), the 
term ‘interest’ includes amounts includible in gross income 
under section 54A and such amounts shall be treated as 
paid on the credit allowance date (as defined in section 
54A(e)(1)). 
‘‘(B) REPORTING
TO
CORPORATIONS, ETC.—Except as 
otherwise provided in regulations, in the case of any 
interest described in subparagraph (A) of this paragraph, 
subsection (b)(4) of this section shall be applied without 
regard to subparagraphs (A), (H), (I), (J), (K), and (L)(i). 
‘‘(C) REGULATORY AUTHORITY.—The Secretary may pre-
scribe such regulations as are necessary or appropriate 
to carry out the purposes of this paragraph, including regu-
lations which require more frequent or more detailed 
reporting.’’. 
(c) CONFORMING AMENDMENTS.— 
(1) Sections 54(c)(2) and 1400N(l)(3)(B) are each amended 
by striking ‘‘subpart C’’ and inserting ‘‘subparts C and I’’. 
(2) Section 1397E(c)(2) is amended by striking ‘‘subpart 
H’’ and inserting ‘‘subparts H and I’’. 
(3) Section 6401(b)(1) is amended by striking ‘‘and H’’ and 
inserting ‘‘H, and I’’. 
(4) The heading of subpart H of part IV of subchapter 
A of chapter 1 is amended by striking ‘‘Certain Bonds’’ and 
inserting ‘‘Clean Renewable Energy Bonds’’. 
(5) The table of subparts for part IV of subchapter A 
of chapter 1 is amended by striking the item relating to subpart 
H and inserting the following new items: 
‘‘SUBPART H. NONREFUNDABLE CREDIT TO HOLDERS OF CLEAN RENEWABLE ENERGY 
BONDS. 
‘‘SUBPART I. QUALIFIED TAX CREDIT BONDS.’’. 
(6) Paragraph (2) of section 1324(b) of title 31, United 
States Code, is amended by striking ‘‘or 6428 or 53(e)’’ and 
inserting ‘‘, 53(e), 54B(h), or 6428’’.
H. R. 2419—590 
(d) EFFECTIVE DATES.—The amendments made by this section 
shall apply to obligations issued after the date of the enactment 
of this Act. 
PART II—ENERGY PROVISIONS 
Subpart A—Cellulosic Biofuel 
SEC. 15321. CREDIT FOR PRODUCTION OF CELLULOSIC BIOFUEL. 
(a) IN GENERAL.—Subsection (a) of section 40 (relating to 
alcohol used as fuel) is amended by striking ‘‘plus’’ at the end 
of paragraph (1), by striking ‘‘plus’’ at the end of paragraph (2), 
by striking the period at the end of paragraph (3) and inserting 
‘‘, plus’’, and by adding at the end the following new paragraph: 
‘‘(4) the cellulosic biofuel producer credit.’’. 
(b) CELLULOSIC BIOFUEL PRODUCER CREDIT.— 
(1) IN GENERAL.—Subsection (b) of section 40 is amended 
by adding at the end the following new paragraph: 
‘‘(6) CELLULOSIC BIOFUEL PRODUCER CREDIT.— 
‘‘(A) IN GENERAL.—The cellulosic biofuel producer credit 
of any taxpayer is an amount equal to the applicable 
amount for each gallon of qualified cellulosic biofuel produc-
tion. 
‘‘(B) APPLICABLE AMOUNT.—For purposes of subpara-
graph (A), the applicable amount means $1.01, except that 
such amount shall, in the case of cellulosic biofuel which 
is alcohol, be reduced by the sum of— 
‘‘(i) the amount of the credit in effect for such 
alcohol under subsection (b)(1) (without regard to sub-
section (b)(3)) at the time of the qualified cellulosic 
biofuel production, plus 
‘‘(ii) in the case of ethanol, the amount of the 
credit in effect under subsection (b)(4) at the time 
of such production. 
‘‘(C) QUALIFIED CELLULOSIC BIOFUEL PRODUCTION.—For 
purposes of this section, the term ‘qualified cellulosic biofuel 
production’ means any cellulosic biofuel which is produced 
by the taxpayer, and which during the taxable year— 
‘‘(i) is sold by the taxpayer to another person— 
‘‘(I) for use by such other person in the produc-
tion of a qualified cellulosic biofuel mixture in 
such other person’s trade or business (other than 
casual off-farm production), 
‘‘(II) for use by such other person as a fuel 
in a trade or business, or 
‘‘(III) who sells such cellulosic biofuel at retail 
to another person and places such cellulosic biofuel 
in the fuel tank of such other person, or 
‘‘(ii) is used or sold by the taxpayer for any purpose 
described in clause (i). 
The qualified cellulosic biofuel production of any taxpayer 
for any taxable year shall not include any alcohol which 
is purchased by the taxpayer and with respect to which 
such producer increases the proof of the alcohol by addi-
tional distillation. 
‘‘(D) QUALIFIED
CELLULOSIC
BIOFUEL
MIXTURE.—For 
purposes of this paragraph, the term ‘qualified cellulosic
H. R. 2419—591 
biofuel mixture’ means a mixture of cellulosic biofuel and 
gasoline or of cellulosic biofuel and a special fuel which— 
‘‘(i) is sold by the person producing such mixture 
to any person for use as a fuel, or 
‘‘(ii) is used as a fuel by the person producing 
such mixture. 
‘‘(E) CELLULOSIC BIOFUEL.—For purposes of this para-
graph— 
‘‘(i) IN
GENERAL.—The term ‘cellulosic biofuel’ 
means any liquid fuel which— 
‘‘(I) is produced from any lignocellulosic or 
hemicellulosic matter that is available on a renew-
able or recurring basis, and 
‘‘(II) meets the registration requirements for 
fuels and fuel additives established by the Environ-
mental Protection Agency under section 211 of the 
Clean Air Act (42 U.S.C. 7545). 
‘‘(ii) EXCLUSION
OF
LOW-PROOF
ALCOHOL.—Such 
term shall not include any alcohol with a proof of 
less than 150. The determination of the proof of any 
alcohol shall be made without regard to any added 
denaturants. 
‘‘(F) ALLOCATION
OF
CELLULOSIC
BIOFUEL
PRODUCER 
CREDIT TO PATRONS OF COOPERATIVE.—Rules similar to the 
rules under subsection (g)(6) shall apply for purposes of 
this paragraph. 
‘‘(G) REGISTRATION REQUIREMENT.—No credit shall be 
determined under this paragraph with respect to any tax-
payer unless such taxpayer is registered with the Secretary 
as a producer of cellulosic biofuel under section 4101. 
‘‘(H) APPLICATION
OF
PARAGRAPH.—This paragraph 
shall apply with respect to qualified cellulosic biofuel 
production after December 31, 2008, and before January 
1, 2013.’’. 
(2) TERMINATION DATE NOT TO APPLY.—Subsection (e) of 
section 40 (relating to termination) is amended— 
(A) by inserting ‘‘or subsection (b)(6)(H)’’ after ‘‘by rea-
son of paragraph (1)’’ in paragraph (2), and 
(B) by adding at the end the following new paragraph: 
‘‘(3) EXCEPTION
FOR
CELLULOSIC
BIOFUEL
PRODUCER 
CREDIT.—Paragraph (1) shall not apply to the portion of the 
credit allowed under this section by reason of subsection (a)(4).’’. 
(3) CONFORMING AMENDMENTS.— 
(A) Paragraph (1) of section 4101(a) is amended— 
(i) by striking ‘‘and every person’’ and inserting 
‘‘, every person’’, and 
(ii) by inserting ‘‘, and every person producing 
cellulosic biofuel (as defined in section 40(b)(6)(E))’’ 
after ‘‘section 6426(b)(4)(A))’’. 
(B) The heading of section 40, and the item relating 
to such section in the table of sections for subpart D of 
part IV of subchapter A of chapter 1, are each amended 
by inserting ‘‘, etc.,’’ after ‘‘Alcohol’’. 
(c) BIOFUEL NOT USED AS A FUEL, ETC.— 
(1) IN GENERAL.—Paragraph (3) of section 40(d) is amended 
by redesignating subparagraph (D) as subparagraph (E) and
H. R. 2419—592 
by inserting after subparagraph (C) the following new subpara-
graph: 
‘‘(D) CELLULOSIC BIOFUEL PRODUCER CREDIT.—If— 
‘‘(i) any credit is allowed under subsection (a)(4), 
and 
‘‘(ii) any person does not use such fuel for a purpose 
described in subsection (b)(6)(C), 
then there is hereby imposed on such person a tax equal 
to the applicable amount (as defined in subsection (b)(6)(B)) 
for each gallon of such cellulosic biofuel.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Subparagraph (C) of section 40(d)(3) is amended 
by striking ‘‘PRODUCER’’ in the heading and inserting 
‘‘SMALL ETHANOL PRODUCER’’. 
(B) Subparagraph (E) of section 40(d)(3), as redesig-
nated by paragraph (1), is amended by striking ‘‘or (C)’’ 
and inserting ‘‘(C), or (D)’’. 
(d) BIOFUEL PRODUCED IN THE UNITED STATES.—Section 40(d) 
is amended by adding at the end the following new paragraph: 
‘‘(6) SPECIAL
RULE
FOR
CELLULOSIC
BIOFUEL
PRODUCER 
CREDIT.—No cellulosic biofuel producer credit shall be deter-
mined under subsection (a) with respect to any cellulosic biofuel 
unless such cellulosic biofuel is produced in the United States 
and used as a fuel in the United States. For purposes of 
this subsection, the term ‘United States’ includes any possession 
of the United States.’’. 
(e) WAIVER OF CREDIT LIMIT FOR CELLULOSIC BIOFUEL PRODUC-
TION
BY
SMALL
ETHANOL
PRODUCERS.—Section 40(b)(4)(C) is 
amended by inserting ‘‘(determined without regard to any qualified 
cellulosic biofuel production)’’ after ‘‘15,000,000 gallons’’. 
(f) DENIAL OF DOUBLE BENEFIT.— 
(1) BIODIESEL.—Paragraph (1) of section 40A(d) is amended 
by adding at the end the following new flush sentence: 
‘‘Such term shall not include any liquid with respect to which 
a credit may be determined under section 40.’’. 
(2) RENEWABLE DIESEL.—Paragraph (3) of section 40A(f) 
is amended by adding at the end the following new flush 
sentence: 
‘‘Such term shall not include any liquid with respect to which 
a credit may be determined under section 40.’’. 
(g) EFFECTIVE DATE.—The amendments made by this section 
shall apply to fuel produced after December 31, 2008. 
SEC. 15322. COMPREHENSIVE STUDY OF BIOFUELS. 
(a) STUDY.—The Secretary of the Treasury, in consultation 
with the Secretary of Agriculture, the Secretary of Energy, and 
the Administrator of the Environmental Protection Agency, shall 
enter into an agreement with the National Academy of Sciences 
to produce an analysis of current scientific findings to determine— 
(1) current biofuels production, as well as projections for 
future production, 
(2) the maximum amount of biofuels production capable 
in United States forests and farmlands, including the current 
quantities and character of the feedstocks and including such 
information as regional forest inventories that are commercially 
available, used in the production of biofuels,
H. R. 2419—593 
(3) the domestic effects of an increase in biofuels production 
levels, including the effects of such levels on— 
(A) the price of fuel, 
(B) the price of land in rural and suburban commu-
nities, 
(C) crop acreage, forest acreage, and other land use, 
(D) the environment, due to changes in crop acreage, 
fertilizer use, runoff, water use, emissions from vehicles 
utilizing biofuels, and other factors, 
(E) the price of feed, 
(F) the selling price of grain crops and forest products, 
(G) exports and imports of grains and forest products, 
(H) taxpayers, through cost or savings to commodity 
crop payments, and 
(I) the expansion of refinery capacity, 
(4) the ability to convert corn ethanol plants for other 
uses, such as cellulosic ethanol or biodiesel, 
(5) a comparative analysis of corn ethanol versus other 
biofuels and renewable energy sources, considering cost, energy 
output, and ease of implementation, 
(6) the impact of the tax credit established by this subpart 
on the regional agricultural and silvicultural capabilities of 
commercially available forest inventories, and 
(7) the need for additional scientific inquiry, and specific 
areas of interest for future research. 
(b) REPORT.—The Secretary of the Treasury shall submit an 
initial report of the findings of the study required under subsection 
(a) to Congress not later than 6 months after the date of the 
enactment of this Act (36 months after such date in the case 
of the information required by subsection (a)(6)), and a final report 
not later than 12 months after such date (42 months after such 
date in the case of the information required by subsection (a)(6)). 
Subpart B—Revenue Provisions 
SEC. 15331. MODIFICATION OF ALCOHOL CREDIT. 
(a) INCOME TAX CREDIT.— 
(1) IN GENERAL.—The table in paragraph (2) of section 
40(h) is amended— 
(A) by striking ‘‘through 2010’’ in the first column 
and inserting ‘‘, 2006, 2007, or 2008’’, 
(B) by striking the period at the end of the third 
row, and 
(C) by adding at the end the following new row: 
‘‘2009 through 2010
45 cents ....................
33.33 cents.’’. 
(2) EXCEPTION.—Section 40(h) is amended by adding at 
the end the following new paragraph: 
‘‘(3) REDUCTION DELAYED UNTIL ANNUAL PRODUCTION OR 
IMPORTATION OF 7,500,000,000 GALLONS.— 
‘‘(A) IN GENERAL.—In the case of any calendar year 
beginning after 2008, if the Secretary makes a determina-
tion described in subparagraph (B) with respect to all pre-
ceding calendar years beginning after 2007, the last row 
in the table in paragraph (2) shall be applied by sub-
stituting ‘51 cents’ for ‘45 cents’.
H. R. 2419—594 
‘‘(B) DETERMINATION.—A determination described in 
this subparagraph with respect to any calendar year is 
a determination, in consultation with the Administrator 
of the Environmental Protection Agency, that an amount 
less than 7,500,000,000 gallons of ethanol (including cel-
lulosic ethanol) has been produced in or imported into 
the United States in such year.’’. 
(b) EXCISE TAX CREDIT.— 
(1) IN GENERAL.—Subparagraph (A) of section 6426(b)(2) 
(relating to alcohol fuel mixture credit) is amended by striking 
‘‘the applicable amount is 51 cents’’ and inserting ‘‘the 
applicable amount is— 
‘‘(i) in the case of calendar years beginning before 
2009, 51 cents, and 
‘‘(ii) in the case of calendar years beginning after 
2008, 45 cents.’’. 
(2) EXCEPTION.—Paragraph (2) of section 6426(b) is 
amended by adding at the end the following new subparagraph: 
‘‘(C) REDUCTION DELAYED UNTIL ANNUAL PRODUCTION 
OR IMPORTATION OF 7,500,000,000 GALLONS.—In the case of 
any calendar year beginning after 2008, if the Secretary 
makes a determination described in section 40(h)(3)(B) with 
respect to all preceding calendar years beginning after 
2007, subparagraph (A)(ii) shall be applied by substituting 
‘51 cents’ for ‘45 cents’.’’ 
(3) CONFORMING AMENDMENT.—Subparagraph (A) of section 
6426(b)(2) is amended by striking ‘‘subparagraph (B)’’ and 
inserting ‘‘subparagraphs (B) and (C)’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall take effect on the date of the enactment of this Act. 
SEC. 15332. CALCULATION OF VOLUME OF ALCOHOL FOR FUEL 
CREDITS. 
(a) IN GENERAL.—Paragraph (4) of section 40(d) (relating to 
volume of alcohol) is amended by striking ‘‘5 percent’’ and inserting 
‘‘2 percent’’. 
(b) CONFORMING AMENDMENT FOR EXCISE TAX CREDIT.—Section 
6426(b) (relating to alcohol fuel mixture credit) is amended by 
redesignating paragraph (5) as paragraph (6) and by inserting 
after paragraph (4) the following new paragraph: 
‘‘(5) VOLUME OF ALCOHOL.—For purposes of determining 
under subsection (a) the number of gallons of alcohol with 
respect to which a credit is allowable under subsection (a), 
the volume of alcohol shall include the volume of any dena-
turant (including gasoline) which is added under any formulas 
approved by the Secretary to the extent that such denaturants 
do not exceed 2 percent of the volume of such alcohol (including 
denaturants).’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to fuel sold or used after December 31, 2008. 
SEC. 15333. ETHANOL TARIFF EXTENSION. 
Headings 9901.00.50 and 9901.00.52 of the Harmonized Tariff 
Schedule of the United States are each amended in the effective 
period column by striking ‘‘1/1/2009’’ and inserting ‘‘1/1/2011’’.
H. R. 2419—595 
SEC. 15334. LIMITATIONS ON DUTY DRAWBACK ON CERTAIN IMPORTED 
ETHANOL. 
(a) IN GENERAL.—Section 313(p) of the Tariff Act of 1930 (19 
U.S.C. 1313(p)) is amended by adding at the end the following 
new paragraph: 
‘‘(5) SPECIAL
RULES
FOR
ETHYL
ALCOHOL.—For purposes 
of this subsection, any duty paid under subheading 9901.00.50 
of the Harmonized Tariff Schedule of the United States on 
imports of ethyl alcohol or a mixture of ethyl alcohol may 
not be refunded if the exported article upon which a drawback 
claim is based does not contain ethyl alcohol or a mixture 
of ethyl alcohol.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
applies with respect to— 
(1) imports of ethyl alcohol or a mixture of ethyl alcohol 
entered for consumption, or withdrawn from warehouse for 
consumption, on or after October 1, 2008; and 
(2) imports of ethyl alcohol or a mixture of ethyl alcohol 
entered for consumption, or withdrawn from warehouse for 
consumption, before October 1, 2008, if a duty drawback claim 
is filed with respect to such imports on or after October 1, 
2010. 
PART III—AGRICULTURAL PROVISIONS 
SEC. 15341. INCREASE IN LOAN LIMITS ON AGRICULTURAL BONDS. 
(a) IN
GENERAL.—Subparagraph (A) of section 147(c)(2) 
(relating to exception for first-time farmers) is amended by striking 
‘‘$250,000’’ and inserting ‘‘$450,000’’. 
(b) INFLATION ADJUSTMENT.—Section 147(c)(2) is amended by 
adding at the end the following new subparagraph: 
‘‘(H) ADJUSTMENTS FOR INFLATION.—In the case of any 
calendar year after 2008, the dollar amount in subpara-
graph (A) shall be increased by an amount equal to— 
‘‘(i) such dollar amount, multiplied by 
‘‘(ii) the cost-of-living adjustment determined 
under section 1(f)(3) for the calendar year, determined 
by substituting ‘calendar year 2007’ for ‘calendar year 
1992’ in subparagraph (B) thereof. 
If any amount as increased under the preceding sentence 
is not a multiple of $100, such amount shall be rounded 
to the nearest multiple of $100.’’. 
(c) MODIFICATION
OF SUBSTANTIAL FARMLAND DEFINITION.— 
Section 147(c)(2)(E) (defining substantial farmland) is amended by 
striking ‘‘unless’’ and all that follows through the period and 
inserting ‘‘unless such parcel is smaller than 30 percent of the 
median size of a farm in the county in which such parcel is located.’’. 
(d) CONFORMING
AMENDMENT.—Section 147(c)(2)(C)(i)(II) is 
amended by striking ‘‘$250,000’’ and inserting ‘‘the amount in effect 
under subparagraph (A)’’. 
(e) EFFECTIVE DATE.—The amendments made by this section 
shall apply to bonds issued after the date of the enactment of 
this Act.
H. R. 2419—596 
SEC. 
15342. 
ALLOWANCE 
OF 
SECTION 
1031 
TREATMENT 
FOR 
EXCHANGES INVOLVING CERTAIN MUTUAL DITCH, RES-
ERVOIR, OR IRRIGATION COMPANY STOCK. 
(a) IN GENERAL.—Section 1031 (relating to exchange of property 
held for productive use or investment) is amended by adding at 
the end the following new subsection: 
‘‘(i) SPECIAL RULES FOR MUTUAL DITCH, RESERVOIR, OR IRRIGA-
TION COMPANY STOCK.—For purposes of subsection (a)(2)(B), the 
term ‘stocks’ shall not include shares in a mutual ditch, reservoir, 
or irrigation company if at the time of the exchange— 
‘‘(1) the mutual ditch, reservoir, or irrigation company is 
an organization described in section 501(c)(12)(A) (determined 
without regard to the percentage of its income that is collected 
from its members for the purpose of meeting losses and 
expenses), and 
‘‘(2) the shares in such company have been recognized 
by the highest court of the State in which such company was 
organized or by applicable State statute as constituting or 
representing real property or an interest in real property.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to exchanges completed after the date of the enactment 
of this Act. 
SEC. 15343. AGRICULTURAL CHEMICALS SECURITY CREDIT. 
(a) IN GENERAL.—Subpart D of part IV of subchapter A of 
chapter 1 (relating to business related credits) is amended by adding 
at the end the following new section: 
‘‘SEC. 45O. AGRICULTURAL CHEMICALS SECURITY CREDIT. 
‘‘(a) IN GENERAL.—For purposes of section 38, in the case of 
an eligible agricultural business, the agricultural chemicals security 
credit determined under this section for the taxable year is 30 
percent of the qualified security expenditures for the taxable year. 
‘‘(b) FACILITY LIMITATION.—The amount of the credit deter-
mined under subsection (a) with respect to any facility for any 
taxable year shall not exceed— 
‘‘(1) $100,000, reduced by 
‘‘(2) the aggregate amount of credits determined under 
subsection (a) with respect to such facility for the 5 prior 
taxable years. 
‘‘(c) ANNUAL LIMITATION.—The amount of the credit determined 
under subsection (a) with respect to any taxpayer for any taxable 
year shall not exceed $2,000,000. 
‘‘(d) QUALIFIED CHEMICAL SECURITY EXPENDITURE.—For pur-
poses of this section, the term ‘qualified chemical security expendi-
ture’ means, with respect to any eligible agricultural business for 
any taxable year, any amount paid or incurred by such business 
during such taxable year for— 
‘‘(1) employee security training and background checks, 
‘‘(2) limitation and prevention of access to controls of speci-
fied agricultural chemicals stored at the facility, 
‘‘(3) tagging, locking tank valves, and chemical additives 
to prevent the theft of specified agricultural chemicals or to 
render such chemicals unfit for illegal use, 
‘‘(4) protection of the perimeter of specified agricultural 
chemicals,
H. R. 2419—597 
‘‘(5) installation of security lighting, cameras, recording 
equipment, and intrusion detection sensors, 
‘‘(6) implementation of measures to increase computer or 
computer network security, 
‘‘(7) conducting a security vulnerability assessment, 
‘‘(8) implementing a site security plan, and 
‘‘(9) such other measures for the protection of specified 
agricultural chemicals as the Secretary may identify in regula-
tion. 
Amounts described in the preceding sentence shall be taken into 
account only to the extent that such amounts are paid or incurred 
for the purpose of protecting specified agricultural chemicals. 
‘‘(e) ELIGIBLE AGRICULTURAL BUSINESS.—For purposes of this 
section, the term ‘eligible agricultural business’ means any person 
in the trade or business of— 
‘‘(1) selling agricultural products, including specified agri-
cultural chemicals, at retail predominantly to farmers and 
ranchers, or 
‘‘(2) manufacturing, formulating, distributing, or aerially 
applying specified agricultural chemicals. 
‘‘(f) SPECIFIED AGRICULTURAL CHEMICAL.—For purposes of this 
section, the term ‘specified agricultural chemical’ means— 
‘‘(1) any fertilizer commonly used in agricultural operations 
which is listed under— 
‘‘(A) section 302(a)(2) of the Emergency Planning and 
Community Right-to-Know Act of 1986, 
‘‘(B) section 101 of part 172 of title 49, Code of Federal 
Regulations, or 
‘‘(C) part 126, 127, or 154 of title 33, Code of Federal 
Regulations, and 
‘‘(2) any pesticide (as defined in section 2(u) of the Federal 
Insecticide, Fungicide, and Rodenticide Act), including all active 
and inert ingredients thereof, which is customarily used on 
crops grown for food, feed, or fiber. 
‘‘(g) CONTROLLED GROUPS.—Rules similar to the rules of para-
graphs (1) and (2) of section 41(f) shall apply for purposes of 
this section. 
‘‘(h) REGULATIONS.—The Secretary may prescribe such regula-
tions as may be necessary or appropriate to carry out the purposes 
of this section, including regulations which— 
‘‘(1) provide for the proper treatment of amounts which 
are paid or incurred for purpose of protecting any specified 
agricultural chemical and for other purposes, and 
‘‘(2) provide for the treatment of related properties as one 
facility for purposes of subsection (b). 
‘‘(i) TERMINATION.—This section shall not apply to any amount 
paid or incurred after December 31, 2012.’’. 
(b) CREDIT ALLOWED AS PART OF GENERAL BUSINESS CREDIT.— 
Section 38(b) is amended by striking ‘‘plus’’ at the end of paragraph 
(30), by striking the period at the end of paragraph (31) and 
inserting ‘‘, plus’’, and by adding at the end the following new 
paragraph: 
‘‘(32) in the case of an eligible agricultural business (as 
defined in section 45O(e)), the agricultural chemicals security 
credit determined under section 45O(a).’’. 
(c) DENIAL
OF DOUBLE BENEFIT.—Section 280C is amended 
by adding at the end the following new subsection:
H. R. 2419—598 
‘‘(f) CREDIT FOR SECURITY OF AGRICULTURAL CHEMICALS.—No 
deduction shall be allowed for that portion of the expenses otherwise 
allowable as a deduction taken into account in determining the 
credit under section 45O for the taxable year which is equal to 
the amount of the credit determined for such taxable year under 
section 45O(a).’’. 
(d) CLERICAL AMENDMENT.—The table of sections for subpart 
D of part IV of subchapter A of chapter 1 is amended by adding 
at the end the following new item: 
‘‘Sec. 45O. Agricultural chemicals security credit.’’. 
(e) EFFECTIVE DATE.—The amendments made by this section 
shall apply to amounts paid or incurred after the date of the 
enactment of this Act. 
SEC. 15344. 3-YEAR DEPRECIATION FOR RACE HORSES THAT ARE 2- 
YEARS OLD OR YOUNGER. 
(a) IN GENERAL.—Clause (i) of section 168(e)(3)(A) (relating 
to 3-year property) is amended to read as follows: 
‘‘(i) any race horse— 
‘‘(I) which is placed in service before January 
1, 2014, and 
‘‘(II) which is placed in service after December 
31, 2013, and which is more than 2 years old 
at the time such horse is placed in service by 
such purchaser,’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to property placed in service after December 31, 2008. 
SEC. 15345. TEMPORARY TAX RELIEF FOR KIOWA COUNTY, KANSAS 
AND SURROUNDING AREA. 
(a) IN GENERAL.—Subject to the modifications described in this 
section, the following provisions of or relating to the Internal Rev-
enue Code of 1986 shall apply to the Kansas disaster area in 
addition to the areas to which such provisions otherwise apply: 
(1) Section 1400N(d) of such Code (relating to special allow-
ance for certain property). 
(2) Section 1400N(e) of such Code (relating to increase 
in expensing under section 179). 
(3) Section 1400N(f) of such Code (relating to expensing 
for certain demolition and clean-up costs). 
(4) Section 1400N(k) of such Code (relating to treatment 
of net operating losses attributable to storm losses). 
(5) Section 1400N(n) of such Code (relating to treatment 
of representations regarding income eligibility for purposes of 
qualified rental project requirements). 
(6) Section 1400N(o) of such Code (relating to treatment 
of public utility property disaster losses). 
(7) Section 1400Q of such Code (relating to special rules 
for use of retirement funds). 
(8) Section 1400R(a) of such Code (relating to employee 
retention credit for employers). 
(9) Section 1400S(b) of such Code (relating to suspension 
of certain limitations on personal casualty losses). 
(10) Section 405 of the Katrina Emergency Tax Relief Act 
of 2005 (relating to extension of replacement period for non-
recognition of gain).
H. R. 2419—599 
(b) KANSAS DISASTER AREA.—For purposes of this section, the 
term ‘‘Kansas disaster area’’ means an area with respect to which 
a major disaster has been declared by the President under section 
401 of the Robert T. Stafford Disaster Relief and Emergency Assist-
ance Act (FEMA–1699–DR, as in effect on the date of the enactment 
of this Act) by reason of severe storms and tornados beginning 
on May 4, 2007, and determined by the President to warrant 
individual or individual and public assistance from the Federal 
Government under such Act with respect to damages attributable 
to such storms and tornados. 
(c) REFERENCES TO AREA OR LOSS.— 
(1) AREA.—Any reference in such provisions to the Katrina 
disaster area or the Gulf Opportunity Zone shall be treated 
as a reference to the Kansas disaster area. 
(2) LOSS.—Any reference in such provisions to any loss 
or damage attributable to Hurricane Katrina shall be treated 
as a reference to any loss or damage attributable to the May 
4, 2007, storms and tornados. 
(d) REFERENCES TO DATES, ETC.— 
(1) SPECIAL ALLOWANCE FOR CERTAIN PROPERTY ACQUIRED 
ON OR AFTER MAY 5, 2007.—Section 1400N(d) of such Code— 
(A) by substituting ‘‘qualified Recovery Assistance prop-
erty’’ for ‘‘qualified Gulf Opportunity Zone property’’ each 
place it appears, 
(B) by substituting ‘‘May 5, 2007’’ for ‘‘August 28, 2005’’ 
each place it appears, 
(C) by substituting ‘‘December 31, 2008’’ for ‘‘December 
31, 2007’’ in paragraph (2)(A)(v), 
(D) by substituting ‘‘December 31, 2009’’ for ‘‘December 
31, 2008’’ in paragraph (2)(A)(v), 
(E) by substituting ‘‘May 4, 2007’’ for ‘‘August 27, 2005’’ 
in paragraph (3)(A), 
(F) by substituting ‘‘January 1, 2009’’ for ‘‘January 
1, 2008’’ in paragraph (3)(B), and 
(G) determined without regard to paragraph (6) 
thereof. 
(2) INCREASE IN EXPENSING UNDER SECTION 179.—Section 
1400N(e) of such Code, by substituting ‘‘qualified section 179 
Recovery Assistance property’’ for ‘‘qualified section 179 Gulf 
Opportunity Zone property’’ each place it appears. 
(3) EXPENSING
FOR
CERTAIN
DEMOLITION
AND
CLEAN-UP 
COSTS.—Section 1400N(f) of such Code— 
(A) by substituting ‘‘qualified Recovery Assistance 
clean-up cost’’ for ‘‘qualified Gulf Opportunity Zone clean- 
up cost’’ each place it appears, and 
(B) by substituting ‘‘beginning on May 4, 2007, and 
ending on December 31, 2009’’ for ‘‘beginning on August 
28, 2005, and ending on December 31, 2007’’ in paragraph 
(2) thereof. 
(4) TREATMENT OF NET OPERATING LOSSES ATTRIBUTABLE 
TO STORM LOSSES.—Section 1400N(k) of such Code— 
(A) by substituting ‘‘qualified Recovery Assistance loss’’ 
for ‘‘qualified Gulf Opportunity Zone loss’’ each place it 
appears, 
(B) by substituting ‘‘after May 3, 2007, and before 
on January 1, 2010’’ for ‘‘after August 27, 2005, and before 
January 1, 2008’’ each place it appears,
H. R. 2419—600 
(C) by substituting ‘‘May 4, 2007’’ for ‘‘August 28, 2005’’ 
in paragraph (2)(B)(ii)(I) thereof, 
(D) by substituting ‘‘qualified Recovery Assistance 
property’’ for ‘‘qualified Gulf Opportunity Zone property’’ 
in paragraph (2)(B)(iv) thereof, and 
(E) by substituting ‘‘qualified Recovery Assistance cas-
ualty loss’’ for ‘‘qualified Gulf Opportunity Zone casualty 
loss’’ each place it appears. 
(5) SPECIAL RULES FOR USE OF RETIREMENT FUNDS.—Section 
1400Q of such Code— 
(A) by substituting ‘‘qualified Recovery Assistance dis-
tribution’’ for ‘‘qualified hurricane distribution’’ each place 
it appears, 
(B) by substituting ‘‘on or after May 4, 2007, and 
before January 1, 2009’’ for ‘‘on or after August 25, 2005, 
and before January 1, 2007’’ in subsection (a)(4)(A)(i), 
(C) by substituting ‘‘May 4, 2007’’ for ‘‘August 28, 2005’’ 
in subsections (a)(4)(A)(i) and (c)(3)(B), 
(D) disregarding clauses (ii) and (iii) of subsection 
(a)(4)(A), 
(E) by substituting ‘‘qualified storm distribution’’ for 
‘‘qualified Katrina distribution’’ each place it appears, 
(F) by substituting ‘‘after November 4, 2006, and before 
May 5, 2007’’ for ‘‘after February 28, 2005, and before 
August 29, 2005’’ in subsection (b)(2)(B)(ii), 
(G) by substituting ‘‘the Kansas disaster area (as 
defined in section 15345(b) of the Food, Conservation, and 
Energy Act of 2008) but which was not so purchased or 
constructed on account of the May 4, 2007, storms and 
tornados’’ for ‘‘the Hurricane Katrina disaster area, but 
not so purchased or constructed on account of Hurricane 
Katrina’’ in subsection (b)(2)(B)(iii), 
(H) by substituting ‘‘beginning on May 4, 2007, and 
ending on the date which is 5 months after the date of 
the enactment of the Heartland, Habitat, Harvest, and 
Horticulture Act of 2008’’ for ‘‘beginning on August 25, 
2005, and ending on February 28, 2006’’ in subsection 
(b)(3)(A), 
(I) by substituting ‘‘qualified storm individual’’ for 
‘‘qualified Hurricane Katrina individual’’ each place it 
appears, 
(J) by substituting ‘‘December 31, 2008’’ for ‘‘December 
31, 2006’’ in subsection (c)(2)(A), 
(K) by substituting ‘‘beginning on the date of the enact-
ment of the Food, Conservation, and Energy Act of 2008 
and ending on December 31, 2008’’ for ‘‘beginning on Sep-
tember 24, 2005, and ending on December 31, 2006’’ in 
subsection (c)(4)(A)(i), 
(L) by substituting ‘‘May 4, 2007’’ for ‘‘August 25, 2005’’ 
in subsection (c)(4)(A)(ii), and 
(M) by substituting ‘‘January 1, 2009’’ for ‘‘January 
1, 2007’’ in subsection (d)(2)(A)(ii). 
(6) EMPLOYEE RETENTION CREDIT FOR EMPLOYERS AFFECTED 
BY
MAY
STORMS
AND
TORNADOS.—Section 1400R(a) of the 
Internal Revenue Code of 1986— 
(A) by substituting ‘‘May 4, 2007’’ for ‘‘August 28, 2005’’ 
each place it appears,
H. R. 2419—601 
(B) by substituting ‘‘January 1, 2008’’ for ‘‘January 
1, 2006’’ both places it appears, and 
(C) only with respect to eligible employers who 
employed an average of not more than 200 employees on 
business days during the taxable year before May 4, 2007. 
(7) SUSPENSION OF CERTAIN LIMITATIONS ON PERSONAL CAS-
UALTY LOSSES.—Section 1400S(b)(1) of the Internal Revenue 
Code of 1986, by substituting ‘‘May 4, 2007’’ for ‘‘August 25, 
2005’’. 
(8) EXTENSION OF REPLACEMENT PERIOD FOR NONRECOGNI-
TION
OF
GAIN.—Section 405 of the Katrina Emergency Tax 
Relief Act of 2005, by substituting ‘‘on or after May 4, 2007’’ 
for ‘‘on or after August 25, 2005’’. 
SEC. 15346. COMPETITIVE CERTIFICATION AWARDS MODIFICATION 
AUTHORITY. 
(a) IN GENERAL.—Section 48A (relating to qualifying advanced 
coal project credit) is amended by adding at the end the following 
new subsection: 
‘‘(h) 
COMPETITIVE
CERTIFICATION
AWARDS
MODIFICATION 
AUTHORITY.—In implementing this section or section 48B, the Sec-
retary is directed to modify the terms of any competitive certification 
award and any associated closing agreement where such modifica-
tion— 
‘‘(1) is consistent with the objectives of such section, 
‘‘(2) is requested by the recipient of the competitive certifi-
cation award, and 
‘‘(3) involves moving the project site to improve the poten-
tial to capture and sequester carbon dioxide emissions, reduce 
costs of transporting feedstock, and serve a broader customer 
base, 
unless the Secretary determines that the dollar amount of tax 
credits available to the taxpayer under such section would increase 
as a result of the modification or such modification would result 
in such project not being originally certified. In considering any 
such modification, the Secretary shall consult with other relevant 
Federal agencies, including the Department of Energy.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall take effect on the date of the enactment of this Act and 
is applicable to all competitive certification awards entered into 
under section 48A or 48B of the Internal Revenue Code of 1986, 
whether such awards were issued before, on, or after such date 
of enactment. 
PART IV—OTHER REVENUE PROVISIONS 
SEC. 15351. LIMITATION ON EXCESS FARM LOSSES OF CERTAIN TAX-
PAYERS. 
(a) IN GENERAL.—Section 461 (relating to general rule for tax-
able year of deduction) is amended by adding at the end the fol-
lowing new subsection: 
‘‘(j) LIMITATION
ON EXCESS FARM LOSSES
OF CERTAIN TAX-
PAYERS.— 
‘‘(1) LIMITATION.—If a taxpayer other than a C corporation 
receives any applicable subsidy for any taxable year, any excess 
farm loss of the taxpayer for the taxable year shall not be 
allowed.
H. R. 2419—602 
‘‘(2) DISALLOWED LOSS CARRIED TO NEXT TAXABLE YEAR.— 
Any loss which is disallowed under paragraph (1) shall be 
treated as a deduction of the taxpayer attributable to farming 
businesses in the next taxable year. 
‘‘(3) APPLICABLE SUBSIDY.—For purposes of this subsection, 
the term ‘applicable subsidy’ means— 
‘‘(A) any direct or counter-cyclical payment under title 
I of the Food, Conservation, and Energy Act of 2008, or 
any payment elected to be received in lieu of any such 
payment, or 
‘‘(B) any Commodity Credit Corporation loan. 
‘‘(4) EXCESS FARM LOSS.—For purposes of this subsection— 
‘‘(A) IN GENERAL.—The term ‘excess farm loss’ means 
the excess of— 
‘‘(i) the aggregate deductions of the taxpayer for 
the taxable year which are attributable to farming 
businesses of such taxpayer (determined without 
regard to whether or not such deductions are dis-
allowed for such taxable year under paragraph (1)), 
over 
‘‘(ii) the sum of— 
‘‘(I) the aggregate gross income or gain of such 
taxpayer for the taxable year which is attributable 
to such farming businesses, plus 
‘‘(II) the threshold amount for the taxable year. 
‘‘(B) THRESHOLD AMOUNT.— 
‘‘(i) IN
GENERAL.—The term ‘threshold amount’ 
means, with respect to any taxable year, the greater 
of— 
‘‘(I) $300,000 ($150,000 in the case of married 
individuals filing separately), or 
‘‘(II) the excess (if any) of the aggregate 
amounts described in subparagraph (A)(ii)(I) for 
the 5-consecutive taxable year period preceding 
the taxable year over the aggregate amounts 
described in subparagraph (A)(i) for such period. 
‘‘(ii) SPECIAL RULES FOR DETERMINING AGGREGATE 
AMOUNTS.—For purposes of clause (i)(II)— 
‘‘(I) notwithstanding the disregard in subpara-
graph (A)(i) of any disallowance under paragraph 
(1), in the case of any loss which is carried forward 
under paragraph (2) from any taxable year, such 
loss (or any portion thereof) shall be taken into 
account for the first taxable year in which a deduc-
tion for such loss (or portion) is not disallowed 
by reason of this subsection, and 
‘‘(II) the Secretary shall prescribe rules for 
the 
computation 
of 
the 
aggregate 
amounts 
described in such clause in cases where the filing 
status of the taxpayer is not the same for the 
taxable year and each of the taxable years in the 
period described in such clause. 
‘‘(C) FARMING BUSINESS.— 
‘‘(i) IN GENERAL.—The term ‘farming business’ has 
the meaning given such term in section 263A(e)(4). 
‘‘(ii) CERTAIN TRADES AND BUSINESSES INCLUDED.— 
If, without regard to this clause, a taxpayer is engaged
H. R. 2419—603 
in a farming business with respect to any agricultural 
or horticultural commodity— 
‘‘(I) the term ‘farming business’ shall include 
any trade or business of the taxpayer of the proc-
essing of such commodity (without regard to 
whether the processing is incidental to the 
growing, raising, or harvesting of such commodity), 
and 
‘‘(II) if the taxpayer is a member of a coopera-
tive to which subchapter T applies, any trade or 
business of the cooperative described in subclause 
(I) shall be treated as the trade or business of 
the taxpayer. 
‘‘(D) CERTAIN LOSSES DISREGARDED.—For purposes of 
subparagraph (A)(i), there shall not be taken into account 
any deduction for any loss arising by reason of fire, storm, 
or other casualty, or by reason of disease or drought, 
involving any farming business. 
‘‘(5) APPLICATION OF SUBSECTION IN CASE OF PARTNERSHIPS 
AND S CORPORATIONS.—In the case of a partnership or S cor-
poration— 
‘‘(A) this subsection shall be applied at the partner 
or shareholder level, and 
‘‘(B) each partner’s or shareholder’s proportionate share 
of the items of income, gain, or deduction of the partnership 
or S corporation for any taxable year from farming 
businesses attributable to the partnership or S corporation, 
and of any applicable subsidies received by the partnership 
or S corporation during the taxable year, shall be taken 
into account by the partner or shareholder in applying 
this subsection to the taxable year of such partner or 
shareholder with or within which the taxable year of the 
partnership or S corporation ends. 
The Secretary may provide rules for the application of this 
paragraph to any other pass-thru entity to the extent necessary 
to carry out the provisions of this subsection. 
‘‘(6) ADDITIONAL REPORTING.—The Secretary may prescribe 
such additional reporting requirements as the Secretary deter-
mines appropriate to carry out the purposes of this subsection. 
‘‘(7) COORDINATION
WITH
SECTION
469.—This subsection 
shall be applied before the application of section 469.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to taxable years beginning after December 31, 2009. 
SEC. 15352. MODIFICATION TO OPTIONAL METHOD OF COMPUTING 
NET EARNINGS FROM SELF-EMPLOYMENT. 
(a) AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986.— 
(1) IN GENERAL.—The matter following paragraph (17) of 
section 1402(a) is amended— 
(A) by striking ‘‘$2,400’’ each place it appears and 
inserting ‘‘the upper limit’’, and 
(B) by striking ‘‘$1,600’’ each place it appears and 
inserting ‘‘the lower limit’’. 
(2) DEFINITIONS.—Section 1402 is amended by adding at 
the end the following new subsection: 
‘‘(l) UPPER
AND LOWER LIMITS.—For purposes of subsection 
(a)—
H. R. 2419—604 
‘‘(1) LOWER LIMIT.—The lower limit for any taxable year 
is the sum of the amounts required under section 213(d) of 
the Social Security Act for a quarter of coverage in effect 
with respect to each calendar quarter ending with or within 
such taxable year. 
‘‘(2) UPPER LIMIT.—The upper limit for any taxable year 
is the amount equal to 150 percent of the lower limit for 
such taxable year.’’. 
(b) AMENDMENTS TO THE SOCIAL SECURITY ACT.— 
(1) IN GENERAL.—The matter following paragraph (16) of 
section 211(a) of the Social Security Act is amended— 
(A) by striking ‘‘$2,400’’ each place it appears and 
inserting ‘‘the upper limit’’, and 
(B) by striking ‘‘$1,600’’ each place it appears and 
inserting ‘‘the lower limit’’. 
(2) DEFINITIONS.—Section 211 of such Act is amended by 
adding at the end the following new subsection: 
‘‘(k) UPPER AND LOWER LIMITS.—For purposes of subsection 
(a)— 
‘‘(1) The lower limit for any taxable year is the sum of 
the amounts required under section 213(d) for a quarter of 
coverage in effect with respect to each calendar quarter ending 
with or within such taxable year. 
‘‘(2) The upper limit for any taxable year is the amount 
equal to 150 percent of the lower limit for such taxable year.’’. 
(3) CONFORMING
AMENDMENT.—Section 212 of such Act 
is amended— 
(A) in subsection (b), by striking ‘‘For’’ and inserting 
‘‘Except as provided in subsection (c), for’’; and 
(B) by adding at the end the following new subsection: 
‘‘(c) For the purpose of determining average indexed monthly 
earnings, average monthly wage, and quarters of coverage in the 
case of any individual who elects the option described in clause 
(ii) or (iv) in the matter following section 211(a)(16) for any taxable 
year that does not begin with or during a particular calendar 
year and end with or during such year, the self-employment income 
of such individual deemed to be derived during such taxable year 
shall be allocated to the two calendar years, portions of which 
are included within such taxable year, in the same proportion 
to the total of such deemed self-employment income as the sum 
of the amounts applicable under section 213(d) for the calendar 
quarters ending with or within each such calendar year bears 
to the lower limit for such taxable year specified in section 
211(k)(1).’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2007. 
SEC. 15353. INFORMATION REPORTING FOR COMMODITY CREDIT COR-
PORATION TRANSACTIONS. 
(a) IN GENERAL.—Subpart A of part III of subchapter A of 
chapter 61 (relating to information concerning persons subject to 
special provisions) is amended by inserting after section 6039I 
the following new section: 
‘‘SEC. 6039J. INFORMATION REPORTING WITH RESPECT TO COM-
MODITY CREDIT CORPORATION TRANSACTIONS. 
‘‘(a) REQUIREMENT OF REPORTING.—The Commodity Credit Cor-
poration, through the Secretary of Agriculture, shall make a return,
H. R. 2419—605 
according to the forms and regulations prescribed by the Secretary 
of the Treasury, setting forth any market gain realized by a tax-
payer during the taxable year in relation to the repayment of 
a loan issued by the Commodity Credit Corporation, without regard 
to the manner in which such loan was repaid. 
‘‘(b) STATEMENTS TO BE FURNISHED TO PERSONS WITH RESPECT 
TO WHOM INFORMATION IS REQUIRED.—The Secretary of Agriculture 
shall furnish to each person whose name is required to be set 
forth in a return required under subsection (a) a written statement 
showing the amount of market gain reported in such return.’’. 
(b) CLERICAL AMENDMENT.—The table of sections for subpart 
A of part III of subchapter A of chapter 61 is amended by inserting 
after the item relating to section 6039I the following new item: 
‘‘Sec. 6039J. Information reporting with respect to Commodity Credit Corporation 
transactions.’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to loans repaid on or after January 1, 2007. 
PART V—PROTECTION OF SOCIAL SECURITY 
SEC. 15361. PROTECTION OF SOCIAL SECURITY. 
To ensure that the assets of the trust funds established under 
section 201 of the Social Security Act (42 U.S.C. 401) are not 
reduced as a result of the enactment of this Act, the Secretary 
of the Treasury shall transfer annually from the general revenues 
of the Federal Government to those trust funds the following 
amounts: 
(1) For fiscal year 2009, $5,000,000. 
(2) For fiscal year 2010, $9,000,000. 
(3) For fiscal year 2011, $8,000,000. 
(4) For fiscal year 2012, $7,000,000. 
(5) For fiscal year 2013, $8,000,000. 
(6) For fiscal year 2014, $8,000,000. 
(7) For fiscal year 2015, $8,000,000. 
(8) For fiscal year 2016, $6,000,000. 
(9) For fiscal year 2017, $7,000,000. 
Subtitle D—Trade Provisions 
PART I—EXTENSION OF CERTAIN TRADE 
BENEFITS 
SEC. 15401. SHORT TITLE. 
This part may be cited as the ‘‘Haitian Hemispheric Oppor-
tunity through Partnership Encouragement Act of 2008’’ or the 
‘‘HOPE II Act’’. 
SEC. 15402. BENEFITS FOR APPAREL AND OTHER TEXTILE ARTICLES. 
(a) VALUE-ADDED RULE.—Section 213A(b) of the Carribean 
Basin Economic Recovery Act (19 U.S.C. 2703a(b)) is amended 
as follows: 
(1) The subsection heading is amended to read as follows: 
‘‘APPAREL AND OTHER TEXTILE ARTICLES’’. 
(2) Paragraph (1) is amended to read as follows: 
‘‘(1) VALUE-ADDED RULE FOR APPAREL ARTICLES.—
H. R. 2419—606 
‘‘(A) IN
GENERAL.—Apparel articles described in 
subparagraph (B) of a producer or entity controlling produc-
tion that are imported directly from Haiti or the Dominican 
Republic shall enter the United States free of duty during 
an applicable 1-year period, subject to the limitations set 
forth in subparagraphs (B) and (C), and subject to subpara-
graph (D).’’. 
(3) Paragraph (2) is amended— 
(A) in subparagraph (A)— 
(i) by moving such subparagraph 2 ems to the 
right; 
(ii) in clause (i), by striking ‘‘subparagraph (C)’’ 
and inserting ‘‘clause (iii)’’; 
(iii) in clause (ii), by striking ‘‘subparagraph (C)’’ 
and inserting ‘‘clause (iii)’’; 
(iv) in the matter following clause (ii), by striking 
‘‘subparagraph (E)(I)’’ and inserting ‘‘clause (v)(I)’’; 
(v) by redesignating clauses (i) and (ii) as sub-
clauses (I) and (II), respectively; and 
(vi) by redesignating subparagraph (A) as clause 
(i); 
(B) in subparagraph (B)— 
(i) by moving such subparagraph 2 ems to the 
right; 
(ii) by striking ‘‘subparagraph (A)(i)’’ each place 
it appears and inserting ‘‘clause (i)(I)’’; 
(iii) by redesignating clauses (i) and (ii) as sub-
clauses (I) and (II), respectively; and 
(iv) by redesignating subparagraph (B) as clause 
(ii); 
(C) in subparagraph (C)— 
(i) by moving such subparagraph 2 ems to the 
right; 
(ii) in the matter preceding clause (i), by striking 
‘‘subparagraph (A)’’ and inserting ‘‘clause (i)’’; 
(iii) in clause (ii), by striking ‘‘that enters into 
force’’ and all that follows through ‘‘et seq.)’’ and 
inserting ‘‘that enters into force thereafter’’; 
(iv) by redesignating clauses (i) through (v) as 
subclauses (I) through (V), respectively; and 
(v) by redesignating subparagraph (C) as clause 
(iii); 
(D) in subparagraph (D)— 
(i) by moving such subparagraph 2 ems to the 
right; 
(ii) in clause (i)— 
(I) in the matter preceding subclause (I), by 
striking ‘‘subparagraph (A)’’ and inserting ‘‘clause 
(i)’’; 
(II) in subclause (I), by striking ‘‘clause (i) 
of subparagraph (A)’’ and inserting ‘‘subclause (I) 
of clause (i)’’; 
(III) in subclause (II), by striking ‘‘clause (ii) 
of subparagraph (A)’’ and inserting ‘‘subclause (II) 
of clause (i)’’; 
(IV) by redesignating subclauses (I) and (II) 
as items (aa) and (bb), respectively; and
H. R. 2419—607 
(V) by redesignating clause (i) as subclause 
(I); 
(iii) in clause (ii)— 
(I) in the matter preceding subclause (I), by 
striking ‘‘subparagraph (A)’’ and inserting ‘‘clause 
(i)’’; 
(II) in subclause (I), by striking ‘‘clause (i) 
of subparagraph (A)’’ and inserting ‘‘subclause (I) 
of clause (i)’’; 
(III) in subclause (II), by striking ‘‘clause (ii) 
of subparagraph (A)’’ and inserting ‘‘subclause (II) 
of clause (i)’’; 
(IV) by redesignating subclauses (I) and (II) 
as items (aa) and (bb), respectively; and 
(V) by redesignating clause (ii) as subclause 
(II); 
(iv) in clause (iii)— 
(I) by striking ‘‘clause (i)(I) or (ii)(I)’’ each place 
it appears and inserting ‘‘subclause (I)(aa) or 
(II)(aa)’’; 
(II) by redesignating subclauses (I) and (II) 
as items (aa) and (bb), respectively; and 
(III) by redesignating clause (iii) as subclause 
(III); 
(v) by amending clause (iv) to read as follows: 
‘‘(IV) INCLUSION
IN
CALCULATION
OF
OTHER 
ARTICLES RECEIVING PREFERENTIAL TREATMENT.— 
Entries of apparel articles that receive preferential 
treatment under any provision of law other than 
this subparagraph or are subject to the ‘General’ 
column 1 rate of duty under the HTS are not 
included in the annual aggregation under sub-
clause (I) or (II) unless the producer or entity 
controlling production elects, at the time the 
annual aggregation calculation is made, to include 
such entries in such aggregation.’’; and 
(vi) by redesignating subparagraph (D) as clause 
(iv); 
(E) in subparagraph (E)— 
(i) by moving such subparagraph 2 ems to the 
right; 
(ii) in clause (i)— 
(I) by redesignating subclauses (I) through 
(III) as items (aa) through (cc), respectively; and 
(II) by redesignating clause (i) as subclause 
(I); 
(iii) in clause (ii)— 
(I) 
by 
striking 
‘‘subparagraph 
(C)’’ 
and 
inserting ‘‘clause (iii)’’; and 
(II) by redesignating clause (ii) as subclause 
(II); and 
(iv) by redesignating subparagraph (E) as clause 
(v); 
(F) in subparagraph (F)— 
(i) by moving such subparagraph 2 ems to the 
right; 
(ii) in clause (i)—
H. R. 2419—608 
(I) by striking ‘‘The Bureau of Customs and 
Border Protection’’ and inserting ‘‘U.S. Customs 
and Border Protection’’; 
(II) by striking ‘‘subparagraphs (A) and (D)’’ 
and inserting ‘‘clauses (i) and (iv)’’; and 
(III) by redesignating clause (i) as subclause 
(I); 
(iii) in clause (ii)— 
(I) in the matter preceding subclause (I)— 
(aa) by striking ‘‘the Bureau of Customs 
and Border Protection’’ and inserting ‘‘U.S. 
Customs and Border Protection’’; 
(bb) by striking ‘‘subparagraph (A)’’ each 
place it appears and inserting ‘‘clause (i)’’; and 
(cc) by striking ‘‘subparagraph (D)’’ and 
inserting ‘‘clause (iv)’’; 
(II) in subclause (I), by striking ‘‘clause (i) 
of subparagraph (A)’’ and inserting ‘‘subclause (I) 
of clause (i)’’; 
(III) in subclause (II), by striking ‘‘clause (ii) 
of subparagraph (A)’’ and inserting ‘‘subclause (II) 
of clause (i)’’; 
(IV) in the matter following subclause (II), 
by striking ‘‘subparagraph (E)(i)’’ and inserting 
‘‘clause (v)(I)’’; 
(V) by redesignating subclauses (I) and (II) 
as items (aa) and (bb), respectively; and 
(VI) by redesignating clause (ii) as subclause 
(II); 
(iv) in clause (iii)— 
(I) in subclause (I)— 
(aa) by striking ‘‘paragraph (1)’’ and 
inserting ‘‘subparagraph (A)’’; and 
(bb) by striking ‘‘subparagraph (A) or (D)’’ 
and inserting ‘‘clause (i) or (iv)’’; 
(II) in subclause (II), by striking ‘‘clause (ii) 
of this subparagraph’’ and inserting ‘‘subclause (II) 
of this clause’’; 
(III) in the matter following subclause (II)— 
(aa) by striking ‘‘the Bureau of Customs 
and Border Protection’’ each place it appears 
and inserting ‘‘U.S. Customs and Border 
Protection’’; and 
(bb) by striking ‘‘subclause (II)’’ and 
inserting ‘‘item (bb)’’; and 
(IV) in item (bb)— 
(aa) by striking ‘‘paragraph (1)’’ and 
inserting ‘‘subparagraph (A)’’; and 
(bb) by striking ‘‘subparagraph (A) or (D)’’ 
and inserting ‘‘clause (i) or (iv)’’; and 
(V) in the matter following item (bb), by 
striking ‘‘paragraph (1)’’ and inserting ‘‘subpara-
graph (A)’’; 
(VI) by redesignating items (aa) and (bb) as 
subitems (AA) and (BB), respectively; 
(VII) by redesignating subclauses (I) and (II) 
as items (aa) and (bb), respectively; and
H. R. 2419—609 
(VIII) by redesignating clause (iii) as subclause 
(III); and 
(v) by redesignating subparagraph (F) as clause 
(vi); 
(G) in subparagraph (G)— 
(i) by moving such subparagraph 2 ems to the 
right; 
(ii) in clause (i)— 
(I) in the matter preceding subclause (I), by 
striking ‘‘subparagraph (A) or (D)’’ and inserting 
‘‘clause (i) or (iv)’’; 
(II) in subclause (II)— 
(aa) in item (dd), by striking ‘‘under the 
Bipartisan Trade Promotion Authority Act of 
2002’’ and inserting ‘‘with respect to the 
United States’’; and 
(bb) by redesignating items (aa) through 
(dd) as subitems (AA) through (DD), respec-
tively; 
(III) by redesignating subclauses (I) and (II) 
as items (aa) and (bb), respectively; and 
(IV) by redesignating clause (i) as subclause 
(I); 
(iii) in clause (ii)— 
(I) in subclause (I), by striking ‘‘clause (i)(I)’’ 
and inserting ‘‘subclause (I)(aa)’’; 
(II) in subclause (II), by striking ‘‘clause (i)(II)’’ 
and inserting ‘‘subclause (I)(bb)’’; 
(III) by redesignating subclauses (I) and (II) 
as items (aa) and (bb), respectively; and 
(IV) by redesignating clause (ii) as subclause 
(II); and 
(iv) by redesignating subparagraph (G) as clause 
(vii); and 
(H) by striking ‘‘(2) APPAREL ARTICLES DESCRIBED.— 
’’ and inserting the following: 
‘‘(B) APPAREL ARTICLES DESCRIBED.—’’. 
(4) Paragraph (3) is amended— 
(A) by redesignating such paragraph as subparagraph 
(C) and moving it 2 ems to the right; 
(B) by striking ‘‘paragraph (1)’’ each place it appears 
and inserting ‘‘subparagraph (A)’’; and 
(C) in the table— 
(i) by striking ‘‘1.5 percent’’ and inserting ‘‘1.25 
percent’’; 
(ii) by striking ‘‘1.75 percent’’ and inserting ‘‘1.25 
percent’’; and 
(iii) by striking ‘‘2 percent’’ and inserting ‘‘1.25 
percent’’. 
(5) The following is added after subparagraph (C), as 
redesignated by paragraph (4)(A) of this subsection: 
‘‘(D) OTHER PREFERENTIAL TREATMENT NOT AFFECTED 
BY QUANTITATIVE LIMITATIONS.—Any apparel article that 
qualifies for preferential treatment under paragraph (2), 
(3), (4), or (5) or any other provision of this title shall 
not be subject to, or included in the calculation of, the 
quantitative limitations under subparagraph (C).’’.
H. R. 2419—610 
(b) SPECIAL RULE FOR WOVEN ARTICLES AND CERTAIN KNIT 
ARTICLES.—Section 213A(b) of the Carribean Basin Economic 
Recovery Act is amended by striking paragraph (4) and inserting 
the following: 
‘‘(2) SPECIAL RULE FOR WOVEN ARTICLES AND CERTAIN KNIT 
ARTICLES.— 
‘‘(A) SPECIAL RULE FOR ARTICLES OF CHAPTER 62 OF 
THE HTS.— 
‘‘(i) GENERAL RULE.—Any apparel article classifi-
able under chapter 62 of the HTS that is wholly assem-
bled, or knit-to-shape, in Haiti from any combination 
of fabrics, fabric components, components knit-to- 
shape, or yarns and is imported directly from Haiti 
or the Dominican Republic shall enter the United 
States free of duty, subject to clauses (ii) and (iii), 
without regard to the source of the fabric, fabric compo-
nents, components knit-to-shape, or yarns from which 
the article is made. 
‘‘(ii) 
LIMITATION.—The 
preferential 
treatment 
described in clause (i) shall be extended, in the 1- 
year period beginning October 1, 2008, and in each 
of the 9 succeeding 1-year periods, to not more than 
70,000,000 square meter equivalents of apparel articles 
described in such clause. 
‘‘(iii) 
OTHER
PREFERENTIAL
TREATMENT
NOT 
AFFECTED BY QUANTITATIVE LIMITATION.—Any apparel 
article that qualifies for preferential treatment under 
paragraph (1), (3), (4), or (5) or subparagraph (B) of 
this paragraph or any other provision of this title shall 
not be subject to, or included in the calculation of, 
the quantitative limitation under clause (ii). 
‘‘(B) SPECIAL RULE FOR CERTAIN ARTICLES OF CHAPTER 
61 OF THE HTS.— 
‘‘(i) GENERAL RULE.—Any apparel article classifi-
able under chapter 61 of the HTS that is wholly assem-
bled, or knit-to-shape, in Haiti from any combination 
of fabrics, fabric components, components knit-to- 
shape, or yarns and is imported directly from Haiti 
or the Dominican Republic shall enter the United 
States free of duty, subject to clauses (ii), (iii), and 
(iv), without regard to the source of the fabric, fabric 
components, components knit-to-shape, or yarns from 
which the article is made. 
‘‘(ii) 
EXCLUSIONS.—The 
preferential 
treatment 
described in clause (i) shall not apply to the following: 
‘‘(I) The following apparel articles of cotton, 
for men or boys, that are classifiable under sub-
heading 6109.10.00 of the HTS: 
‘‘(aa) All white T-shirts, with short 
hemmed sleeves and hemmed bottom, with 
crew or round neckline or with V-neck and 
with a mitered seam at the center of the V, 
and without pockets, trim, or embroidery. 
‘‘(bb) All white singlets, without pockets, 
trim, or embroidery. 
‘‘(cc) Other T-shirts, but not including 
thermal undershirts.
H. R. 2419—611 
‘‘(II) T-shirts for men or boys that are classifi-
able under subheading 6109.90.10. 
‘‘(III) The following apparel articles of cotton, 
for men or boys, that are classifiable under sub-
heading 6110.20.20 of the HTS: 
‘‘(aa) Sweatshirts. 
‘‘(bb) Pullovers, other than sweaters, vests, 
or garments imported as part of playsuits. 
‘‘(IV) Sweatshirts for men or boys, of man- 
made fibers and containing less than 65 percent 
by weight of man-made fibers, that are classifiable 
under subheading 6110.30.30 of the HTS. 
‘‘(iii) 
LIMITATION.—The 
preferential 
treatment 
described in clause (i) shall be extended, in the 1- 
year period beginning October 1, 2008, and in each 
of the 9 succeeding 1-year periods, to not more than 
70,000,000 square meter equivalents of apparel articles 
described in such clause. 
‘‘(iv) 
OTHER
PREFERENTIAL
TREATMENT
NOT 
AFFECTED BY QUANTITATIVE LIMITATION.—Any apparel 
article that qualifies for preferential treatment under 
paragraph (1), (3), (4), or (5) or subparagraph (A) of 
this paragraph or any other provision of this title shall 
not be subject to, or included in the calculation of, 
the quantitative limitation under clause (iii).’’. 
(c) SINGLE TRANSFORMATION RULES NOT SUBJECT TO QUAN-
TITATIVE LIMITATIONS.—Section 213A(b) of the Caribbean Basin 
Economic Recovery Act is amended by striking paragraph (5) and 
inserting the following: 
‘‘(3) APPAREL AND OTHER ARTICLES SUBJECT TO CERTAIN 
ASSEMBLY RULES.— 
‘‘(A) BRASSIERES.—Any apparel article classifiable 
under subheading 6212.10 of the HTS that is wholly assem-
bled, or knit-to-shape, in Haiti from any combination of 
fabrics, fabric components, components knit-to-shape, or 
yarns and is imported directly from Haiti or the Dominican 
Republic shall enter the United States free of duty, without 
regard to the source of the fabric, fabric components, compo-
nents knit-to-shape, or yarns from which the article is 
made. 
‘‘(B) OTHER APPAREL ARTICLES.—Any of the following 
apparel articles that is wholly assembled, or knit-to-shape, 
in Haiti from any combination of fabrics, fabric components, 
components knit-to-shape, or yarns and is imported directly 
from Haiti or the Dominican Republic shall enter the 
United States free of duty, without regard to the source 
of the fabric, fabric components, components knit-to-shape, 
or yarns from which the article is made: 
‘‘(i) Any apparel article that is of a type listed 
in chapter rule 3, 4, or 5 for chapter 61 of the HTS 
(as such chapter rules are contained in section A of 
the Annex to Proclamation 8213 of the President of 
December 20, 2007) as being excluded from the scope 
of such chapter rule, when such chapter rule is applied 
to determine whether an apparel article is an origi-
nating good for purposes of general note 29(n) to the 
HTS, except that, for purposes of this clause, reference
H. R. 2419—612 
in such chapter rules to ‘6104.12.00’ shall be deemed 
to be a reference to ‘6104.19.60’. 
‘‘(ii)(I) Subject to subclause (II), any apparel article 
that is of a type listed in chapter rule 3(a), 4(a), or 
5(a) for chapter 62 of the HTS, as such chapter rules 
are contained in paragraph 9 of section A of the Annex 
to Proclamation 8213 of the President of December 
20, 2007. 
‘‘(II) Subclause (I) shall not include any apparel 
article to which subparagraph (A) of this paragraph 
applies. 
‘‘(C) LUGGAGE AND SIMILAR ITEMS.—Any article classifi-
able under subheading 4202.12, 4202.22, 4202.32 or 
4202.92 of the HTS that is wholly assembled in Haiti 
and is imported directly from Haiti or the Dominican 
Republic shall enter the United States free of duty, without 
regard to the source of the fabric, components, or materials 
from which the article is made. 
‘‘(D) 
HEADGEAR.—Any 
article 
classifiable 
under 
heading 6501, 6502, or 6504 of the HTS, or under sub-
heading 6505.90 of the HTS, that is wholly assembled, 
knit-to-shape, or formed in Haiti from any combination 
of fabrics, fabric components, components knit-to-shape, 
or yarns and is imported directly from Haiti or the Domini-
can Republic shall enter the United States free of duty, 
without regard to the source of the fabric, fabric compo-
nents, components knit-to-shape, or yarns from which the 
article is made. 
‘‘(E) CERTAIN
SLEEPWEAR.—Any of the following 
apparel articles that is wholly assembled, or knit-to-shape, 
in Haiti from any combination of fabrics, fabric components, 
components knit-to-shape, or yarns and is imported directly 
from Haiti or the Dominican Republic shall enter the 
United States free of duty, without regard to the source 
of the fabric, fabric components, components knit-to-shape, 
or yarns from which the article is made: 
‘‘(i) Pajama bottoms and other sleepwear for 
women and girls, of cotton, that are classifiable under 
subheading 6208.91.30, or of man-made fibers, that 
are classifiable under subheading 6208.92.00. 
‘‘(ii) Pajama bottoms and other sleepwear for girls, 
of other textile materials, that are classifiable under 
subheading 6208.99.20.’’. 
(d) EARNED IMPORT ALLOWANCE RULES.—Section 231A(b) of 
the Caribbean Basin Economic Recovery Act is amended by adding 
at the end the following new paragraph: 
‘‘(4) EARNED IMPORT ALLOWANCE RULE.— 
‘‘(A) IN GENERAL.—Apparel articles wholly assembled, 
or knit-to-shape, in Haiti from any combination of fabrics, 
fabric components, components knit-to-shape, or yarns and 
imported directly from Haiti or the Dominican Republic 
shall enter the United States free of duty, without regard 
to the source of the fabric, fabric components, components 
knit-to-shape, or yarns from which the articles are made, 
if such apparel articles are accompanied by an earned 
import allowance certificate that reflects the amount of 
credits equal to the total square meter equivalents of such
H. R. 2419—613 
apparel articles, in accordance with the program estab-
lished under subparagraph (B). For purposes of deter-
mining the quantity of square meter equivalents under 
this subparagraph, the conversion factors listed in ‘Correla-
tion: U.S. Textile and Apparel Industry Category System 
with the Harmonized Tariff Schedule of the United States 
of America, 2008’, or its successor publications, of the 
United States Department of Commerce, shall apply. 
‘‘(B) EARNED IMPORT ALLOWANCE PROGRAM.— 
‘‘(i) ESTABLISHMENT.—The Secretary of Commerce 
shall establish a program to provide earned import 
allowance certificates to any producer or entity control-
ling production for purposes of subparagraph (A), based 
on the elements described in clause (ii). 
‘‘(ii) ELEMENTS.—The elements referred to in 
clause (i) are the following: 
‘‘(I) One credit shall be issued to a producer 
or an entity controlling production for every three 
square meter equivalents of qualifying woven 
fabric or qualifying knit fabric that the producer 
or entity controlling production can demonstrate 
that it purchased for the manufacture in Haiti 
of articles like or similar to any article eligible 
for preferential treatment under subparagraph (A). 
The Secretary of Commerce shall, if requested by 
a producer or entity controlling production, create 
and maintain an account for such producer or 
entity controlling production, into which such 
credits shall be deposited. 
‘‘(II) Such producer or entity controlling 
production may redeem credits issued under sub-
clause (I) for earned import allowance certificates 
reflecting such number of earned credits as the 
producer or entity may request and has available. 
‘‘(III) The Secretary of Commerce may require 
any textile mill or other entity located in the 
United States that exports to Haiti qualifying 
woven fabric or qualifying knit fabric to submit, 
upon such export or upon request, documentation, 
such as a Shipper’s Export Declaration, to the 
Secretary of Commerce— 
‘‘(aa) verifying that the qualifying woven 
fabric or qualifying knit fabric was exported 
to a producer in Haiti or to an entity control-
ling production; and 
‘‘(bb) identifying such producer or entity 
controlling production, and the quantity and 
description of qualifying woven fabric or quali-
fying knit fabric exported to such producer 
or entity controlling production. 
‘‘(IV) The Secretary of Commerce may require 
that a producer or entity controlling production 
submit documentation to verify purchases of quali-
fying woven fabric or qualifying knit fabric. 
‘‘(V) The Secretary of Commerce may make 
available to each person or entity identified in 
documentation submitted under subclause (III) or
H. R. 2419—614 
(IV) information contained in such documentation 
that relates to the purchase of qualifying woven 
fabric or qualifying knit fabric involving such per-
son or entity. 
‘‘(VI) The program under this subparagraph 
shall be established so as to allow, to the extent 
feasible, the submission, storage, retrieval, and 
disclosure of information in electronic format, 
including information with respect to the earned 
import 
allowance 
certificates 
required 
under 
subparagraph (A)(i). 
‘‘(VII) The Secretary of Commerce may rec-
oncile discrepancies in information provided under 
subclause (III) or (IV) and verify the accuracy of 
such information. 
‘‘(VIII) The Secretary of Commerce shall estab-
lish procedures to carry out the program under 
this subparagraph and may establish additional 
requirements to carry out this subparagraph. Such 
additional requirements may include— 
‘‘(aa) submissions by textile mills or other 
entities in the United States documenting 
exports of yarns wholly formed in the United 
States to countries described in paragraph 
(1)(B)(iii) for the manufacture of qualifying 
knit fabric; and 
‘‘(bb) procedures imposed on producers or 
entities controlling production to allow the 
Secretary of Commerce to obtain and verify 
information relating to the production of quali-
fying knit fabric. 
‘‘(iii) QUALIFYING
WOVEN
FABRIC
DEFINED.—For 
purposes of this subparagraph, the term ‘qualifying 
woven fabric’ means fabric wholly formed in the United 
States from yarns wholly formed in the United States, 
except that— 
‘‘(I) fabric otherwise eligible as qualifying 
woven fabric shall not be ineligible as qualifying 
woven fabric because the fabric contains nylon fila-
ment yarn to which section 213(b)(2)(A)(vii)(IV) 
applies; 
‘‘(II) fabric that would otherwise be ineligible 
as qualifying woven fabric because the fabric con-
tains yarns not wholly formed in the United States 
shall not be ineligible as qualifying woven fabric 
if the total weight of all such yarns is not more 
than 10 percent of the total weight of the fabric; 
and 
‘‘(III) fabric otherwise eligible as qualifying 
woven fabric shall not be ineligible as qualifying 
fabric because the fabric contains yarns covered 
by clause (i) or (ii) of paragraph (5)(A). 
‘‘(iv) QUALIFYING KNIT FABRIC DEFINED.—For pur-
poses of this subparagraph, the term ‘qualifying knit 
fabric’ means fabric or knit-to-shape components 
wholly formed or knit-to-shape in any country or any 
combination of countries described in paragraph
H. R. 2419—615 
(1)(B)(iii), from yarns wholly formed in the United 
States, except that— 
‘‘(I) fabric or knit-to-shape components other-
wise eligible as qualifying knit fabric shall not 
be ineligible as qualifying knit fabric because the 
fabric or knit-to-shape components contain nylon 
filament yarn to which section 213(b)(2)(A)(vii)(IV) 
applies; 
‘‘(II) fabric or knit-to-shape components that 
would otherwise be ineligible as qualifying knit 
fabric because the fabric or knit-to-shape compo-
nents contain yarns not wholly formed in the 
United States shall not be ineligible as qualifying 
knit fabric if the total weight of all such yarns 
is not more than 10 percent of the total weight 
of the fabric or knit-to-shape components; and 
‘‘(III) fabric or knit-to-shape components other-
wise eligible as qualifying knit fabric shall not 
be ineligible as qualifying knit fabric because the 
fabric or knit-to-shape components contain yarns 
covered by clause (i) or (ii) of paragraph (5)(A). 
‘‘(C) REVIEW BY UNITED STATES GOVERNMENT ACCOUNT-
ABILITY OFFICE.—The United States Government Account-
ability Office shall review the program established under 
subparagraph (B) annually for the purpose of evaluating 
the effectiveness of, and making recommendations for 
improvements in, the program. 
‘‘(D) ENFORCEMENT PROVISIONS.— 
‘‘(i) FRAUDULENT
CLAIMS
OF
PREFERENCE.—Any 
person who makes a false claim for preference under 
the program established under subparagraph (B) shall 
be subject to any applicable civil or criminal penalty 
that may be imposed under the customs laws of the 
United States or under title 18, United States Code. 
‘‘(ii) PENALTIES FOR OTHER FRAUDULENT INFORMA-
TION.—The Secretary of Commerce may establish and 
impose penalties for the submission to the Secretary 
of Commerce of fraudulent information under the pro-
gram established under subparagraph (B), other than 
a claim described in clause (i).’’. 
(e) SHORT SUPPLY RULES .—Section 213A(b) of the Caribbean 
Basin Economic Recovery Act is amended by adding at the end 
the following: 
‘‘(5) SHORT SUPPLY PROVISION.— 
‘‘(A) IN GENERAL.—Any apparel article that is wholly 
assembled, or knit-to-shape, in Haiti from any combination 
of fabrics, fabric components, components knit-to-shape, 
or yarns and is imported directly from Haiti or the Domini-
can Republic shall enter the United States free of duty, 
without regard to the source of the fabrics, fabric compo-
nents, components knit-to-shape, or yarns from which the 
article is made, if the fabrics, fabric components, compo-
nents knit-to-shape, or yarns comprising the component 
that determines the tariff classification of the article are 
of any of the following: 
‘‘(i) Fabrics or yarns, to the extent that apparel 
articles of such fabrics or yarns would be eligible for
H. R. 2419—616 
preferential treatment, without regard to the source 
of the fabrics or yarns, under Annex 401 of the NAFTA. 
‘‘(ii) Fabrics or yarns, to the extent that such fab-
rics or yarns are designated as not being available 
in commercial quantities for purposes of— 
‘‘(I) section 213(b)(2)(A)(v) of this Act; 
‘‘(II) section 112(b)(5) of the African Growth 
and Opportunity Act; 
‘‘(III) clause (i)(III) or (ii) of section 204(b)(3)(B) 
of the Andean Trade Preference Act; or 
‘‘(IV) any other provision, relating to deter-
mining whether a textile or apparel article is an 
originating good eligible for preferential treatment, 
of a law that implements a free trade agreement 
entered into by the United States that is in effect 
at the time the claim for preferential treatment 
is made. 
‘‘(B) REMOVAL OF DESIGNATION OF FABRICS OR YARNS 
NOT AVAILABLE IN COMMERCIAL QUANTITIES.—If the Presi-
dent determines that— 
‘‘(i) any fabric or yarn described in clause (i) of 
subparagraph (A) was determined to be eligible for 
preferential treatment, or 
‘‘(ii) any fabric or yarn described in clause (ii) 
of subparagraph (A) was designated as not being avail-
able in commercial quantities, 
on the basis of fraud, the President is authorized to remove 
the eligibility or designation (as the case may be) of that 
fabric or yarn with respect to articles entered after such 
removal.’’. 
(f) MISCELLANEOUS PROVISIONS.— 
(1) RELATIONSHIP
TO
OTHER
PREFERENTIAL
PROGRAMS.— 
Section 213A(b) of the Caribbean Basin Economic Recovery 
Act is amended by adding at the end the following: 
‘‘(6) OTHER PREFERENTIAL TREATMENT NOT AFFECTED.—The 
duty-free treatment provided under this subsection is in addi-
tion to any other preferential treatment under this title.’’. 
(2) DEFINITIONS.—Section 213A(a) of the Caribbean Basin 
Economic Recovery Act (19 U.S.C. 2703a(a)) is amended by 
adding at the end the following: 
‘‘(3) IMPORTED DIRECTLY FROM HAITI OR THE DOMINICAN 
REPUBLIC.—Articles are ‘imported directly from Haiti or the 
Dominican Republic’ if— 
‘‘(A) the articles are shipped directly from Haiti or 
the Dominican Republic into the United States without 
passing through the territory of any intermediate country; 
or 
‘‘(B) the articles are shipped from Haiti or the Domini-
can Republic into the United States through the territory 
of an intermediate country, and— 
‘‘(i) the articles in the shipment do not enter into 
the commerce of any intermediate country, and the 
invoices, bills of lading, and other shipping documents 
specify the United States as the final destination; or 
‘‘(ii) the invoices and other documents do not 
specify the United States as the final destination, but 
the articles in the shipment—
H. R. 2419—617 
‘‘(I) remain under the control of the customs 
authority in the intermediate country; 
‘‘(II) do not enter into the commerce of the 
intermediate country except for the purpose of a 
sale other than at retail; and 
‘‘(III) have not been subjected to operations 
in the intermediate country other than loading, 
unloading, or other activities necessary to preserve 
the articles in good condition. 
‘‘(4) KNIT-TO-SHAPE.—A good is ‘knit-to-shape’ if 50 percent 
or more of the exterior surface area of the good is formed 
by major parts that have been knitted or crocheted directly 
to the shape used in the good, with no consideration being 
given to patch pockets, applique´s, or the like. Minor cutting, 
trimming, or sewing of those major parts shall not affect the 
determination of whether a good is ‘knit-to-shape.’ 
‘‘(5) WHOLLY
ASSEMBLED.—A good is ‘wholly assembled’ 
in Haiti if all components, of which there must be at least 
two, pre-existed in essentially the same condition as found 
in the finished good and were combined to form the finished 
good in Haiti. Minor attachments and minor embellishments 
(for example, applique´s, beads, spangles, embroidery, and but-
tons) not appreciably affecting the identity of the good, and 
minor subassemblies (for example, collars, cuffs, plackets, and 
pockets), shall not affect the determination of whether a good 
is ‘wholly assembled’ in Haiti.’’. 
(g) TERMINATION.—Section 213A of the Caribbean Basin Eco-
nomic Recovery Act (19 U.S.C. 2703a) is amended by adding at 
the end the following new subsection: 
‘‘(g) TERMINATION.—Except as provided in subsection (b)(1), 
the duty-free treatment provided under this section shall remain 
in effect until September 30, 2018.’’. 
(h) CONFORMING AMENDMENTS.—Subsection (e)(1) of section 
213A of the Caribbean Basin Economic Recovery Act (19 U.S.C. 
2703a(e)(1)) is amended by striking ‘‘the Bureau of Customs and 
Border Protection’’ each place it appears and inserting ‘‘U.S. Cus-
toms and Border Protection’’. 
SEC. 
15403. 
LABOR 
OMBUDSMAN 
AND 
TECHNICAL 
ASSISTANCE 
IMPROVEMENT AND COMPLIANCE NEEDS ASSESSMENT 
AND REMEDIATION PROGRAM. 
Section 213A of the Caribbean Basin Economic Recovery Act 
(19 U.S.C. 2703a), as amended by section 15402 of this Act, is 
amended— 
(1) in subsection (a)— 
(A) by redesignating paragraph (5) as paragraph (8): 
(B) by redesignating paragraphs (2) through (4) as 
paragraphs (4) through (6), respectively; 
(C) by inserting after paragraph (1) the following new 
paragraphs: 
‘‘(2) APPROPRIATE CONGRESSIONAL COMMITTEES.—. The term 
‘‘appropriate congressional committees’’ means the Committee 
on Finance of the Senate and the Committee on Ways and 
Means of the House of Representatives. 
‘‘(3) CORE LABOR STANDARDS.—The term ‘‘core labor stand-
ards’’ means— 
‘‘(A) freedom of association;
H. R. 2419—618 
‘‘(B) the effective recognition of the right to bargain 
collectively; 
‘‘(C) the elimination of all forms of compulsory or forced 
labor; 
‘‘(D) the effective abolition of child labor and a prohibi-
tion on the worst forms of child labor; and 
‘‘(E) the elimination of discrimination in respect of 
employment and occupation.’’; and 
(D) by inserting after paragraph (6) (as redesignated) 
the following new paragraph: 
‘‘(7) TAICNAR PROGRAM.—The term ‘TAICNAR Program’ 
means the Technical Assistance Improvement and Compliance 
Needs Assessment and Remediation Program established 
pursuant to subsection (e).’’; 
(2) by redesignating subsections (e), (f), and (g) as sub-
sections (f), (g), and (h), respectively; and 
(3) by inserting after subsection (d) the following new sub-
section: 
‘‘(e) TECHNICAL ASSISTANCE IMPROVEMENT
AND COMPLIANCE 
NEEDS ASSESSMENT AND REMEDIATION PROGRAM.— 
‘‘(1) CONTINUED ELIGIBILITY FOR PREFERENCES.— 
‘‘(A) PRESIDENTIAL CERTIFICATION OF COMPLIANCE BY 
HAITI
WITH
REQUIREMENTS.—Upon the expiration of the 
16-month period beginning on the date of the enactment 
of the Haitian Hemispheric Opportunity through Partner-
ship Encouragement Act of 2008, Haiti shall continue to 
be eligible for the preferential treatment provided under 
subsection (b) only if the President determines and certifies 
to the Congress that— 
‘‘(i) Haiti has implemented the requirements set 
forth in paragraphs (2) and (3); and 
‘‘(ii) Haiti has agreed to require producers of arti-
cles for which duty-free treatment may be requested 
under subsection (b) to participate in the TAICNAR 
Program described in paragraph (3) and has developed 
a system to ensure participation in such program by 
such 
producers, 
including 
by 
developing 
and 
maintaining the registry described in paragraph 
(2)(B)(i). 
‘‘(B) EXTENSION.—The President may extend the period 
for compliance by Haiti under subparagraph (A) if the 
President— 
‘‘(i) determines that Haiti has made a good faith 
effort toward such compliance and has agreed to take 
additional steps to come into full compliance that are 
satisfactory to the President; and 
‘‘(ii) provides to the appropriate congressional 
committees, not later than 6 months after the last 
day of the 16-month period specified in subparagraph 
(A), and every 6 months thereafter, a report identifying 
the steps that Haiti has agreed to take to come into 
full compliance and the progress made over the pre-
ceding 6-month period in implementing such steps. 
‘‘(C) CONTINUING COMPLIANCE.— 
‘‘(i) TERMINATION OF PREFERENTIAL TREATMENT.— 
If, after making a certification under subparagraph 
(A), the President determines that Haiti is no longer
H. R. 2419—619 
meeting the requirements set forth in subparagraph 
(A), the President shall terminate the preferential 
treatment provided under subsection (b), unless the 
President determines, after consulting with the appro-
priate congressional committees, that meeting such 
requirements is not practicable because of extraor-
dinary circumstances existing in Haiti when the deter-
mination is made. 
‘‘(ii) SUBSEQUENT COMPLIANCE.—If the President, 
after terminating preferential treatment under clause 
(i), determines that Haiti is meeting the requirements 
set forth in subparagraph (A), the President shall 
reinstate the application of preferential treatment 
under subsection (b). 
‘‘(2) LABOR OMBUDSMAN.— 
‘‘(A) IN GENERAL.—The requirement under this para-
graph is that Haiti has established an independent Labor 
Ombudsman’s Office within the national government that— 
‘‘(i) reports directly to the President of Haiti; 
‘‘(ii) is headed by a Labor Ombudsman chosen 
by the President of Haiti, in consultation with Haitian 
labor unions and industry associations; and 
‘‘(iii) is vested with the authority to perform the 
functions described in subparagraph (B). 
‘‘(B) FUNCTIONS.—The functions of the Labor Ombuds-
man’s Office shall include— 
‘‘(i) developing and maintaining a registry of pro-
ducers of articles for which duty-free treatment may 
be requested under subsection (b), and developing, in 
consultation and coordination with any other appro-
priate officials of the Government of Haiti, a system 
to ensure participation by such producers in the 
TAICNAR Program described in paragraph (3); 
‘‘(ii) 
overseeing 
the 
implementation 
of 
the 
TAICNAR Program described in paragraph (3); 
‘‘(iii) receiving and investigating comments from 
any interested party regarding the conditions described 
in paragraph (3)(B) in facilities of producers listed 
in the registry described in clause (i) and, where appro-
priate, referring such comments or the result of such 
investigations to the appropriate Haitian authorities, 
or to the entity operating the TAICNAR Program 
described in paragraph (3); 
‘‘(iv) assisting, in consultation and coordination 
with any other appropriate Haitian authorities, pro-
ducers listed in the registry described in clause (i) 
in meeting the conditions set forth in paragraph (3)(B); 
and 
‘‘(v) coordinating, with the assistance of the entity 
operating the TAICNAR Program described in para-
graph (3), a tripartite committee comprised of appro-
priate 
representatives 
of 
government 
agencies, 
employers, and workers, as well as other relevant 
interested parties, for the purposes of evaluating 
progress in implementing the TAICNAR Program 
described 
in 
paragraph 
(3), 
and 
consulting 
on 
improving core labor standards and working conditions
H. R. 2419—620 
in the textile and apparel sector in Haiti, and on other 
matters of common concern relating to such core labor 
standards and working conditions. 
‘‘(3) TECHNICAL ASSISTANCE IMPROVEMENT AND COMPLIANCE 
NEEDS ASSESSMENT AND REMEDIATION PROGRAM.— 
‘‘(A) IN GENERAL.—The requirement under this para-
graph is that Haiti, in cooperation with the International 
Labor Organization, has established a Technical Assistance 
Improvement and Compliance Needs Assessment and 
Remediation Program meeting the requirements under 
subparagraph (C)— 
‘‘(i) to assess compliance by producers listed in 
the registry described in paragraph (2)(B)(i) with the 
conditions set forth in subparagraph (B) and to assist 
such producers in meeting such conditions; and 
‘‘(ii) to provide assistance to improve the capacity 
of the Government of Haiti— 
‘‘(I) to inspect facilities of producers listed in 
the registry described in paragraph (2)(B)(i); and 
‘‘(II) to enforce national labor laws and resolve 
labor 
disputes, 
including 
through 
measures 
described in subparagraph (E). 
‘‘(B) CONDITIONS DESCRIBED.—The conditions referred 
to in subparagraph (A) are— 
‘‘(i) compliance with core labor standards; and 
‘‘(ii) compliance with the labor laws of Haiti that 
relate directly to core labor standards and to ensuring 
acceptable conditions of work with respect to minimum 
wages, hours of work, and occupational health and 
safety. 
‘‘(C) 
REQUIREMENTS.—The 
requirements 
for 
the 
TAICNAR Program are that the program— 
‘‘(i) be operated by the International Labor 
Organization (or any subdivision, instrumentality, or 
designee thereof), which prepares the biannual reports 
described in subparagraph (D); 
‘‘(ii) be developed through a participatory process 
that includes the Labor Ombudsman described in para-
graph (2) and appropriate representatives of govern-
ment agencies, employers, and workers; 
‘‘(iii) assess compliance by each producer listed 
in the registry described in paragraph (2)(B)(i) with 
the conditions set forth in subparagraph (B) and iden-
tify any deficiencies by such producer with respect 
to meeting such conditions, including by— 
‘‘(I) conducting unannounced site visits to 
manufacturing facilities of the producer; 
‘‘(II) conducting confidential interviews sepa-
rately with workers and management of the facili-
ties of the producer; 
‘‘(III) providing to management and workers, 
and where applicable, worker organizations in the 
facilities of the producer, on a confidential basis— 
‘‘(aa) the results of the assessment carried 
out under this clause; and 
‘‘(bb) specific suggestions for remediating 
any such deficiencies;
H. R. 2419—621 
‘‘(iv) assist the producer in remediating any defi-
ciencies identified under clause (iii); 
‘‘(v) conduct prompt follow-up site visits to the 
facilities of the producer to assess progress on remedi-
ation of any deficiencies identified under clause (iii); 
and 
‘‘(vi) provide training to workers and management 
of the producer, and where appropriate, to other per-
sons or entities, to promote compliance with subpara-
graph (B). 
‘‘(D) BIANNUAL REPORT.—The biannual reports referred 
to in subparagraph (C)(i) are a report, by the entity oper-
ating the TAICNAR Program, that is published (and avail-
able to the public in a readily accessible manner) on a 
biannual basis, beginning 6 months after Haiti implements 
the TAICNAR Program under this paragraph, covering 
the preceding 6-month period, and that includes the fol-
lowing: 
‘‘(i) The name of each producer listed in the reg-
istry described in paragraph (2)(B)(i) that has been 
identified as having met the conditions under subpara-
graph (B). 
‘‘(ii) The name of each producer listed in the reg-
istry described in paragraph (2)(B)(i) that has been 
identified as having deficiencies with respect to the 
conditions under subparagraph (B), and has failed to 
remedy such deficiencies. 
‘‘(iii) For each producer listed under clause (ii)— 
‘‘(I) a description of the deficiencies found to 
exist and the specific suggestions for remediating 
such deficiencies made by the entity operating the 
TAICNAR Program; 
‘‘(II) a description of the efforts by the producer 
to remediate the deficiencies, including a descrip-
tion of assistance provided by any entity to assist 
in such remediation; and 
‘‘(III) with respect to deficiencies that have 
not been remediated, the amount of time that has 
elapsed since the deficiencies were first identified 
in a report under this subparagraph. 
‘‘(iv) For each producer identified as having defi-
ciencies with respect to the conditions described under 
subparagraph (B) in a prior report under this subpara-
graph, a description of the progress made in remedi-
ating such deficiencies since the submission of the 
prior report, and an assessment of whether any aspect 
of such deficiencies persists. 
‘‘(E) CAPACITY
BUILDING.—The assistance to the 
Government of Haiti referred to in subparagraph (A)(ii) 
shall include programs— 
‘‘(i) to review the labor laws and regulations of 
Haiti and to develop and implement strategies for 
bringing the laws and regulations into conformity with 
core labor standards; 
‘‘(ii) to develop additional strategies for facilitating 
protection of core labor standards and providing accept-
able conditions of work with respect to minimum
H. R. 2419—622 
wages, hours of work, and occupational safety and 
health, including through legal, regulatory, and institu-
tional reform; 
‘‘(iii) to increase awareness of worker rights, 
including under core labor standards and national 
labor laws; 
‘‘(iv) to promote consultation and cooperation 
between 
government 
representatives, 
employers, 
worker representatives, and United States importers 
on matters relating to core labor standards and 
national labor laws; 
‘‘(v) to assist the Labor Ombudsman appointed 
pursuant to paragraph (2) in establishing and coordi-
nating operation of the committee described in para-
graph (2)(B)(v); 
‘‘(vi) to assist worker representatives in more fully 
and effectively advocating on behalf of their members; 
and 
‘‘(vii) to provide on-the-job training and technical 
assistance to labor inspectors, judicial officers, and 
other relevant personnel to build their capacity to 
enforce national labor laws and resolve labor disputes. 
‘‘(4) COMPLIANCE WITH ELIGIBILITY CRITERIA.— 
‘‘(A) COUNTRY COMPLIANCE WITH WORKER RIGHTS ELIGI-
BILITY CRITERIA.—In making a determination of whether 
Haiti is meeting the requirement set forth in subsection 
(d)(1)(A)(vi) relating to internationally recognized worker 
rights, the President shall consider the reports produced 
under paragraph (3)(D). 
‘‘(B) PRODUCER ELIGIBILITY.— 
‘‘(i) IDENTIFICATION OF PRODUCERS.—Beginning in 
the second calendar year after the President makes 
the certification under paragraph (1)(A), the President 
shall identify on a biennial basis whether a producer 
listed in the registry described in paragraph (2)(B)(i) 
has failed to comply with core labor standards and 
with the labor laws of Haiti that directly relate to 
and are consistent with core labor standards. 
‘‘(ii) ASSISTANCE TO PRODUCERS; WITHDRAWAL, ETC., 
OF PREFERENTIAL TREATMENT.—For each producer that 
the President identifies under clause (i), the President 
shall seek to assist such producer in coming into 
compliance with core labor standards and with the 
labor laws of Haiti that directly relate to and are 
consistent with core labor standards. If such efforts 
fail, the President shall withdraw, suspend, or limit 
the application of preferential treatment under sub-
section (b) to articles of such producer. 
‘‘(iii) REINSTATING PREFERENTIAL TREATMENT.—If 
the President, after withdrawing, suspending, or lim-
iting the application of preferential treatment under 
clause (ii) to articles of a producer, determines that 
such producer is complying with core labor standards 
and with the labor laws of Haiti that directly relate 
to and are consistent with core labor standards, the 
President shall reinstate the application of preferential
H. R. 2419—623 
treatment under subsection (b) to the articles of the 
producer. 
‘‘(iv) CONSIDERATION OF REPORTS.—In making the 
identification under clause (i) and the determination 
under clause (iii), the President shall consider the 
reports made available under paragraph (3)(D). 
‘‘(5) REPORTS BY THE PRESIDENT.— 
‘‘(A) IN GENERAL.—Not later than one year after the 
date of the enactment of the Haitian Hemispheric Oppor-
tunity through Partnership Encouragement Act of 2008, 
and annually thereafter, the President shall transmit to 
the appropriate congressional committees a report on the 
implementation of this subsection during the preceding 
1-year period. 
‘‘(B) MATTERS TO BE INCLUDED.—Each report required 
by subparagraph (A) shall include the following: 
‘‘(i) An explanation of the efforts of Haiti, the Presi-
dent, and the International Labor Organization to 
carry out this subsection. 
‘‘(ii) A summary of each report produced under 
paragraph (3)(D) during the preceding 1-year period 
and a summary of the findings contained in such 
report. 
‘‘(iii) 
Identifications 
made 
under 
paragraph 
(4)(B)(i) and determinations made under paragraph 
(4)(B)(iii). 
‘‘(6) AUTHORIZATION OF APPROPRIATIONS.—There is author-
ized to be appropriated to carry out this subsection the sum 
of $10,000,000 for the period beginning on October 1, 2008, 
and ending on September 30, 2013.’’. 
SEC. 15404. PETITION PROCESS. 
Section 213A(d) of the Caribbean Basin Economic Recovery 
Act (19 U.S.C. 2703A(d)) is amended by adding at the end the 
following new paragraph: 
‘‘(4) PETITION PROCESS.—Any interested party may file a 
request to have the status of Haiti reviewed with respect to 
the eligibility requirements listed in paragraph (1), and the 
President shall provide for this purpose the same procedures 
as those that are provided for reviewing the status of eligible 
beneficiary developing countries with respect to the designation 
criteria listed in subsections (b) and (c) of section 502 of the 
Trade Act of 1974 (19 U.S.C. 2642 (b) and (c)).’’. 
SEC. 15405. CONDITIONS REGARDING ENFORCEMENT OF CIRCUMVEN-
TION. 
Section 213A(f) of the Caribbean Basin Economic Recovery 
Act, as redesignated by section 15403(2) of this Act, is amended 
by adding at the end the following new paragraph: 
‘‘(3) LIMITATION ON GOODS SHIPPED FROM THE DOMINICAN 
REPUBLIC.— 
‘‘(A) LIMITATION.—Notwithstanding subsection (a)(5), 
relating to the definition of ‘imported directly from Haiti 
or the Dominican Republic’, articles described in subsection 
(b) that are shipped from the Dominican Republic, directly 
or through the territory of an intermediate country, 
whether or not such articles undergo processing in the 
Dominican Republic, shall not be considered to be ‘imported
H. R. 2419—624 
directly from Haiti or the Dominican Republic’ until the 
President certifies to the Congress that Haiti and the 
Dominican Republic have developed procedures to prevent 
unlawful transshipment of the articles and the use of 
counterfeit documents related to the importation of the 
articles into the United States. 
‘‘(B) TECHNICAL AND OTHER ASSISTANCE.—The Commis-
sioner responsible for U.S. Customs and Border Protection 
shall provide technical and other assistance to Haiti and 
the Dominican Republic to develop expeditiously the proce-
dures described in subparagraph (A).’’. 
SEC. 15406. PRESIDENTIAL PROCLAMATION AUTHORITY. 
The President may exercise the authority under section 604 
of the Trade Act of 1974 to proclaim such modifications to the 
Harmonized Tariff Schedule of the United States as may be nec-
essary to carry out this part and the amendments made by this 
part. 
SEC. 15407. REGULATIONS AND PROCEDURES. 
The President shall issue such regulations as may be necessary 
to carry out the amendments made by sections 15402, 15403, and 
15404. Regulations to carry out the amendments made by section 
15402 shall be issued not later than September 30, 2008. The 
Secretary of Commerce shall issue such procedures as may be 
necessary to carry out the amendment made by section 15402(d) 
not later than September 30, 2008. 
SEC. 15408. EXTENSION OF CBTPA. 
Section 213(b) of the Caribbean Basin Economic Recovery Act 
(19 U.S.C. 2703(b)) is amended— 
(1) in paragraph (2)(A)— 
(A) in clause (iii)— 
(i) in subclause (II)(cc), by striking ‘‘2008’’ and 
inserting ‘‘2010’’; and 
(ii) in subclause (IV)(dd), by striking ‘‘2008’’ and 
inserting ‘‘2010’’; and 
(B) in clause (iv)(II), by striking ‘‘6’’ and inserting 
‘‘8’’; and 
(2) in paragraph (5)(D)— 
(A) in clause (i), by striking ‘‘2008’’ and inserting 
‘‘2010’’; and 
(B) in clause (ii), by striking ‘‘108(b)(5)’’ and inserting 
‘‘section 108(b)(5)’’. 
SEC. 15409. SENSE OF CONGRESS ON INTERPRETATION OF TEXTILE 
AND APPAREL PROVISIONS FOR HAITI. 
It is the sense of the Congress that the executive branch, 
particularly the Committee for the Implementation of Textile Agree-
ments (CITA), U.S. Customs and Border Protection of the Depart-
ment of Homeland Security, and the Department of Commerce, 
should interpret, implement, and enforce the provisions of section 
213A(b) of the Caribbean Basin Economic Recovery Act, as amended 
by section 15402 of this Act, relating to preferential treatment 
of textile and apparel articles, broadly in order to expand trade 
by maximizing opportunities for imports of articles eligible for pref-
erential treatment under such section 213A(b).
H. R. 2419—625 
SEC. 15410. SENSE OF CONGRESS ON TRADE MISSION TO HAITI. 
It is the sense of the Congress that the Secretary of Commerce, 
in coordination with the United States Trade Representative, the 
Secretary of State, and the Commissioner responsible for U.S. Cus-
toms and Border Protection of the Department of Homeland Secu-
rity, should lead a trade mission to Haiti, within 6 months after 
the date of the enactment of this Act, to promote trade between 
the United States and Haiti, to promote new economic opportunities 
afforded under the amendments made by section 15402 of this 
Act, and to help educate United States and Haitian business con-
cerns about such opportunities. 
SEC. 15411. SENSE OF CONGRESS ON VISA SYSTEMS. 
It is the sense of the Congress that Haiti, and other countries 
that receive preferences under trade preference programs of the 
United States that require effective visa systems to prevent trans-
shipment, should ensure that monetary compensation for such visas 
is not required beyond the costs of processing the visa, including 
ensuring that such monetary compensation does not violate an 
applicable system to combat corruption and bribery. 
SEC. 15412. EFFECTIVE DATE. 
(a) IN GENERAL.—Except as provided in subsection (b), this 
part and the amendments made by this part shall take effect 
on the date of the enactment of this Act. 
(b) EXCEPTION.—The amendments made by section 15402 shall 
take effect on October 1, 2008, and shall apply to articles entered, 
or withdrawn from warehouse for consumption, on or after that 
date. 
PART II—MISCELLANEOUS TRADE 
PROVISIONS 
SEC. 15421. UNUSED MERCHANDISE DRAWBACK. 
(a) IN GENERAL.—Section 313(j)(2) of the Tariff Act of 1930 
(19 U.S.C. 1313(j)(2)) is amended by adding at the end the following: 
‘‘For purposes of subparagraph (A) of this paragraph, wine of the 
same color having a price variation not to exceed 50 percent between 
the imported wine and the exported wine shall be deemed to be 
commercially interchangeable.’’. 
(b) EFFECTIVE DATE.—The amendment made by subsection (a) 
shall apply with respect to claims filed for drawback under section 
313(j)(2) of the Tariff Act of 1930 on or after the date of the 
enactment of this Act. 
SEC. 15422. REQUIREMENTS RELATING TO DETERMINATION OF TRANS-
ACTION VALUE OF IMPORTED MERCHANDISE. 
(a) REQUIREMENT ON IMPORTERS.— 
(1) IN GENERAL.—Pursuant to sections 484 and 485 of the 
Tariff Act of 1930 (19 U.S.C. 1484 and 1485), the Commissioner 
responsible for U.S. Customs and Border Protection shall 
require each importer of merchandise to provide to U.S. Cus-
toms and Border Protection at the time of entry of the merchan-
dise the information described in paragraph (2). 
(2) INFORMATION REQUIRED.—The information referred to 
in paragraph (1) is a declaration as to whether the transaction 
value of the imported merchandise is determined on the basis
H. R. 2419—626 
of the price paid by the buyer in the first or earlier sale 
occurring prior to introduction of the merchandise into the 
United States. 
(3) EFFECTIVE DATE.—The requirement to provide informa-
tion under this subsection shall be effective for the 1-year 
period beginning 90 days after the date of the enactment of 
this Act. 
(b) REPORT TO INTERNATIONAL TRADE COMMISSION.— 
(1) IN GENERAL.—The Commissioner responsible for U.S. 
Customs and Border Protection shall submit to the United 
States International Trade Commission on a monthly basis 
for the 1-year period specified in subsection (a)(3) a report 
on the information provided by importers under subsection 
(a)(2) during the preceding month. The report required under 
this paragraph shall be submitted in a form agreed upon 
between U.S. Customs and Border Protection and the United 
States International Trade Commission. 
(2) MATTERS TO BE INCLUDED.—The report required under 
paragraph (1) shall include— 
(A) the number of importers that declare the trans-
action value of the imported merchandise is determined 
on the basis of the method described in subsection (a)(2); 
(B) the tariff classification of such imported merchan-
dise under the Harmonized Tariff Schedule of the United 
States; and 
(C) the transaction value of such imported merchan-
dise. 
(c) REPORT TO CONGRESS.— 
(1) IN GENERAL.—Not later than 90 days after the submis-
sion of the final report under subsection (b), the United States 
International Trade Commission shall submit to the appro-
priate congressional committees a report on the information 
contained in all reports submitted under subsection (b). 
(2) MATTERS TO BE INCLUDED.—The report required under 
paragraph (1) shall include— 
(A) the aggregate number of importers that declare 
the transaction value of the imported merchandise is deter-
mined on the basis of the method described in subsection 
(a)(2), including a description of the frequency of the use 
of such method; 
(B) the tariff classification of such imported merchan-
dise under the Harmonized Tariff Schedule of the United 
States on an aggregate basis, including an analysis of 
the tariff classification of such imported merchandise on 
a sectoral basis; 
(C) the aggregate transaction value of such imported 
merchandise, including an analysis of the transaction value 
of such imported merchandise on a sectoral basis; and 
(D) the aggregate transaction value of all merchandise 
imported into the United States during the 1-year period 
specified in subsection (a)(3). 
(d) SENSE OF CONGRESS REGARDING PROHIBITION ON PROPOSED 
INTERPRETATION OF THE TERM ‘‘SOLD FOR EXPORTATION TO THE 
UNITED STATES’’.— 
(1) IN
GENERAL.—It is the sense of Congress that the 
Commissioner responsible for U.S. Customs and Border Protec-
tion should not implement a change to U.S. Customs and Border
H. R. 2419—627 
Protection’s interpretation (as such interpretation is in effect 
on the date of the enactment of this Act) of the term ‘‘sold 
for exportation to the United States’’, as described in section 
402(b) of the Tariff Act of 1930 (19 U.S.C. 1401a(b)), for pur-
poses of applying the transaction value of the imported mer-
chandise in a series of sales, before January 1, 2011. 
(2) EXCEPTION.—It is the sense of Congress that beginning 
on January 1, 2011, the Commissioner responsible for U.S. 
Customs and Border Protection may propose to change or 
change U.S. Customs and Border Protection’s interpretation 
of the term ‘‘sold for exportation to the United States’’, as 
described in paragraph (1), only if U.S. Customs and Border 
Protection— 
(A) consults with, and provides notice to, the appro-
priate congressional committees— 
(i) not less than 180 days prior to proposing a 
change; and 
(ii) not less than 90 days prior to publishing a 
change; 
(B) consults with, provides notice to, and takes into 
consideration views expressed by, the Commercial Oper-
ations Advisory Committee— 
(i) not less than 120 days prior to proposing a 
change; and 
(ii) not less than 60 days prior to publishing a 
change; and 
(C) receives the explicit approval of the Secretary of 
the Treasury prior to publishing a change. 
(3) CONSIDERATION OF INTERNATIONAL TRADE COMMISSION 
REPORT.—It is the sense of Congress that prior to publishing 
a change to U.S. Customs and Border Protection’s interpreta-
tion (as such interpretation is in effect on the date of the 
enactment of this Act) of the term ‘‘sold for exportation to 
the United States’’, as described in section 402(b) of the Tariff 
Act of 1930 (19 U.S.C. 1401a(b)), for purposes of applying 
the transaction value of the imported merchandise in a series 
of sales, the Commissioner responsible for U.S. Customs and 
Border Protection should take into consideration the matters 
included in the report prepared by the United States Inter-
national Trade Commission under subsection (c). 
(e) DEFINITIONS.—In this section: 
(1) APPROPRIATE CONGRESSIONAL COMMITTEES.—The term 
‘‘appropriate congressional committees’’ means the Committee 
on Ways and Means of the House of Representatives and the 
Committee on Finance of the Senate. 
(2) COMMERCIAL OPERATIONS ADVISORY COMMITTEE.—The 
term ‘‘Commercial Operations Advisory Committee’’ means the 
Advisory Committee established pursuant to section 9503(c) 
of the Omnibus Budget Reconciliation Act of 1987 (19 U.S.C. 
2071 note) or any successor committee. 
(3) IMPORTER.—The term ‘‘importer’’ means one of the par-
ties qualifying as an ‘‘importer of record’’ under section 
484(a)(2)(B) in the Tariff Act of 1930 (19 U.S.C. 1484(a)(2)(B)).
H. R. 2419—628 
(4) TRANSACTION VALUE OF THE IMPORTED MERCHANDISE.—The 
term ‘‘transaction value of the imported merchandise’’ has the 
meaning described in section 402(b) of the Tariff Act of 1930 
(19 U.S.C. 1401a(b)). 
Speaker of the House of Representatives. 
Vice President of the United States and
President of the Senate.