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(4) describes the effects the changes to the defini-
tions of the terms ‘‘rural’’ and ‘‘rural area’’ in the
Farm Security and Rural Investment Act of 2002
and this Act had on those programs and eligible
areas; and
(5) determines what effects the changes had on
the level of rural development funding and participa-
tion in those programs in each State.
(b) ADDITIONAL TERMS.—Section 343(a) of the Con-
solidated Farm and Rural Development Act (7 U.S.C.
1991(a)) is amended by adding at the end the following:
‘‘(14) SUSTAINABLE
AGRICULTURE.—The term
‘sustainable agriculture’ means an integrated system
of plant and animal production practices having a
site-specific application that will, over the long-
term—
‘‘(A) satisfy human food and fiber needs;
‘‘(B) enhance environmental quality and
the natural resource base upon which the agri-
culture economy depends;
‘‘(C) make the most efficient use of non-
renewable resources and on-farm resources and
integrate, where appropriate, natural biological
cycles and controls;
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‘‘(D) sustain the economic viability of farm
operations; and
‘‘(E) enhance the quality of life for farmers
and society as a whole.
‘‘(15) TECHNICAL ASSISTANCE.—The term ‘tech-
nical assistance’ means managerial, financial, oper-
ational, and scientific analysis and consultation to
assist an individual or entity (including a borrower
or potential borrower under this title)—
‘‘(A) to identify and evaluate practices, ap-
proaches, problems, opportunities, or solutions;
and
‘‘(B) to assist in the planning, implementa-
tion, management, operation, marketing, or
maintenance of projects authorized under this
title.’’.
(c) COMMERCIAL FISHING.—Section 343 of the Con-
solidated Farm and Rural Development Act (7 U.S.C.
1991) is amended—
(1) in subsection (a), by inserting ‘‘and, in the
case of subtitle B, commercial fishing’’ before the pe-
riod at the end of each of paragraphs (1) and (2);
and
(2) by adding at the end the following:
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‘‘(c) DEFINITION OF FARM.—In subtitle B, the term
‘farm’ includes a commercial fishing enterprise the owner
or operator of which is unable to obtain commercial credit
from a bank or other lender, as determined by the Sec-
retary.’’.
SEC. 6021. GEOGRAPHICALLY DISADVANTAGED FARMERS
AND RANCHERS.
(a) IN GENERAL.—The Consolidated Farm and Rural
Development Act is amended by inserting after section 344
(7 U.S.C. 1992) the following:
‘‘SEC. 345. GEOGRAPHICALLY DISADVANTAGED FARMERS
AND RANCHERS.
‘‘(a) DEFINITIONS.—In this section:
‘‘(1) AGRICULTURAL COMMODITY.—The term ‘ag-
ricultural commodity’ has the meaning given the term
in section 102 of the Agricultural Trade Act of 1978
(7 U.S.C. 5602).
‘‘(2) GEOGRAPHICALLY DISADVANTAGED FARMER
OR
RANCHER.—The term ‘geographically disadvan-
taged farmer or rancher’ has the meaning given the
term in section 10906(a) of the Farm Security and
Rural Investment Act of 2002 (7 U.S.C. 2204 note;
Public Law 107–171).
‘‘(b) AUTHORIZATION.—
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‘‘(1) IN
GENERAL.—Subject to paragraph (2)
and the availability of funds under subsection (d), for
each fiscal year, the Secretary may provide geo-
graphically disadvantaged farmers or ranchers direct
reimbursement payments for activities described in
subsection (c).
‘‘(2) LIMITATION.—The total amount of direct
reimbursement payments provided by the Secretary
under this section shall not exceed $15,000,000 for
each fiscal year.
‘‘(c) TRANSPORTATION.—
‘‘(1) IN GENERAL.—Subject to paragraphs (2)
and (3), the Secretary may provide direct reimburse-
ment payments to a geographically disadvantaged
farmer or rancher to transport an agricultural com-
modity, or inputs used to produce an agricultural
commodity, during a fiscal year.
‘‘(2) PROOF OF ELIGIBILITY.—To be eligible to
receive assistance under paragraph (1), farmer or
rancher shall provide to the Secretary proof (as deter-
mined by the Secretary) that transportation or the
agricultural commodity or inputs occurred over a dis-
tance of more than 30 miles.
‘‘(3) AMOUNT.—The amount of direct reimburse-
ment payments made to a geographically disadvan-
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taged farmer or rancher under a subsection for a fis-
cal year shall equal the product obtained by
multiplying—
‘‘(A) the amount of costs incurred by the
farmer or rancher for transportation of the agri-
cultural commodity or inputs during the fiscal
year; and
‘‘(B) the percentage of the allowance for
that fiscal year made under section 5941 of title
5, United States Code, for Federal employees sta-
tioned in Alaska and Hawaii.
‘‘(d) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated such sums as are nec-
essary to carry out this section.’’.
(b) EFFECTIVE DATE.—The amendment made by sub-
section (a) takes effect on October 1, 2007.
SEC. 6022. RURAL MICROENTERPRISE ASSISTANCE PRO-
GRAM.
Subtitle D of the Consolidated Farm and Rural Devel-
opment Act (as amended by section 5207) is amended by
inserting after section 365 the following:
‘‘SEC. 366. RURAL MICROENTERPRISE ASSISTANCE PRO-
GRAM.
‘‘(a) DEFINITIONS.—In this section:
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‘‘(1) INDIAN TRIBE.—The term ‘Indian tribe’ has
the meaning given the term in section 4 of the Indian
Self-Determination and Education Assistance Act (25
U.S.C. 450b).
‘‘(2) LOW- OR MODERATE-INCOME INDIVIDUAL.—
The term ‘low- or moderate-income individual’ means
an individual with an income (adjusted for family
size) of not more than 80 percent of the national me-
dian income.
‘‘(3) MICROCREDIT.—The term ‘microcredit’
means a business loan or loan guarantee of not more
than $50,000 that is provided to a rural microenter-
prise.
‘‘(4) MICROENTERPRISE DEVELOPMENT ORGANI-
ZATION.—The term ‘microenterprise development or-
ganization’ means an organization that—
‘‘(A) is—
‘‘(i) a nonprofit entity;
‘‘(ii) an Indian tribe, the tribal gov-
ernment of which certifies to the Secretary
that no microenterprise development organi-
zation or microenterprise development pro-
gram exists under the jurisdiction of the In-
dian tribe; or
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‘‘(iii) for the purpose of subsection (b),
a public institution of higher education;
‘‘(B) provides training and technical assist-
ance to rural microenterprises;
‘‘(C) facilitates access to capital or another
service described in subsection (b) for rural
microenterprises; and
‘‘(D) has a demonstrated record of deliv-
ering services to economically disadvantaged
microenterprises, or an effective plan to develop
a program to deliver microenterprise services to
rural microenterprises effectively, as determined
by the Secretary.
‘‘(5) RURAL CAPACITY BUILDING SERVICE.—The
term ‘rural capacity building service’ means a service
provided to an organization that—
‘‘(A) is, or is in the process of becoming, a
microenterprise development organization; and
‘‘(B) serves rural areas for the purpose of
enhancing the ability of the organization to pro-
vide training, technical assistance, and other
services relating to rural development.
‘‘(6) RURAL MICROENTERPRISE.—
‘‘(A) IN GENERAL.—The term ‘rural micro-
enterprise’ means an individual described in
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subparagraph (B) who is unable to obtain suffi-
cient training, technical assistance, or micro-
credit other than under this section, as deter-
mined by the Secretary.
‘‘(B) DESCRIPTION.—An individual de-
scribed in this subparagraph is—
‘‘(i) a self-employed individual located
in a rural area; or
‘‘(ii) an owner and operator, or pro-
spective owner and operator, of a business
entity located in a rural area with not more
than 10 full-time-equivalent employees.
‘‘(7) SECRETARY.—The term ‘Secretary’ means
the Secretary of Agriculture, acting through the Rural
Business-Cooperative Service.
‘‘(b) RURAL MICROENTERPRISE PROGRAM.—
‘‘(1) ESTABLISHMENT.—The Secretary shall es-
tablish a rural microenterprise program.
‘‘(2) PURPOSE.—The purpose of the rural micro-
enterprise program shall be to provide low- or mod-
erate-income individuals with—
‘‘(A) the skills necessary to establish new
rural microenterprises; and
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‘‘(B) continuing technical and financial as-
sistance as individuals and business starting or
operating rural microenterprises.
‘‘(3) GRANTS.—
‘‘(A) IN
GENERAL.—The Secretary may
make a grant under the rural microenterprise
program 
to 
microenterprise 
development
organizations—
‘‘(i) to provide training, operational
support, business planning assistance, mar-
ket development assistance, and other re-
lated services to rural microenterprises,
with an emphasis on rural microenterprises
that—
‘‘(I) are composed of low- or mod-
erate-income individuals; or
‘‘(II) are in areas that have lost
population;
‘‘(ii) to assist in researching and devel-
oping the best practices in delivering train-
ing, technical assistance, and microcredit to
rural microenterprises; and
‘‘(iii) to carry out such other projects
and activities as the Secretary determines
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to be consistent with the purposes of this
section.
‘‘(B) DIVERSITY.—In making grants under
this paragraph, the Secretary shall ensure, to the
maximum extent practicable, that grant recipi-
ents 
include 
microenterprise 
development
organizations—
‘‘(i) of varying sizes; and
‘‘(ii) that serve racially- and eth-
nically-diverse populations.
‘‘(C) COST SHARING.—
‘‘(i) FEDERAL
SHARE.—The Federal
share of the cost of a project carried out
using funds from a grant made under this
paragraph shall be 75 percent.
‘‘(ii) 
FORM
OF
NON-FEDERAL
SHARE.—The non-Federal share of the cost
of a project described in clause (i) may be
provided—
‘‘(I) in cash (including through
fees, grants (including community de-
velopment block grants), and gifts); or
‘‘(II) as in-kind contributions.
‘‘(4) RURAL MICROLOAN PROGRAM.—
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‘‘(A) ESTABLISHMENT.—In carrying out
the rural microenterprise program, the Secretary
may carry out a rural microloan program.
‘‘(B) PURPOSE.—The purpose of the rural
microloan program shall be to provide technical
and financial assistance to rural microenter-
prises that—
‘‘(i) are composed of low- or moderate-
income individuals; or
‘‘(ii) are in areas that have lost popu-
lation.
‘‘(C) AUTHORITY OF SECRETARY.—In car-
rying out the rural microloan program, the Sec-
retary may—
‘‘(i) make direct loans to microenter-
prise development organizations for the pur-
pose 
of 
making 
fixed 
interest 
rate
microloans to startup, newly established,
and growing rural microenterprises; and
‘‘(ii) in conjunction with those loans,
provide technical assistance grants in ac-
cordance with subparagraph (E) to those
microenterprise development organizations.
‘‘(D) LOAN
DURATION; INTEREST
RATES;
CONDITIONS.—
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‘‘(i) LOAN DURATION.—A direct loan
made by the Secretary under this para-
graph shall be for a term not to exceed 20
years.
‘‘(ii) APPLICABLE INTEREST RATE.—A
direct loan made by the Secretary under
this paragraph shall bear an annual inter-
est rate of 1 percent.
‘‘(iii) LOAN
LOSS
RESERVE
FUND.—
The Secretary shall require each microenter-
prise development organization that receives
a direct loan under this paragraph to—
‘‘(I) establish a loan loss reserve
fund; and
‘‘(II) maintain the reserve fund in
an amount equal to at least 5 percent
of the outstanding balance of such
loans owed by the microenterprise de-
velopment organization, until all obli-
gations owed to the Secretary under
this paragraph are repaid.
‘‘(iv) DEFERRAL
OF
INTEREST
AND
PRINCIPAL.—The Secretary shall permit the
deferral of payments on principal and in-
terest due on a loan made under this para-