563 
(3) in subsection (c)— 
(A) by striking ‘‘(c) Coupons’’ and insert-
ing the following: 
‘‘(c) DESIGN.— 
‘‘(1) IN GENERAL.—EBT cards’’; 
(B) in the first sentence, by striking ‘‘and 
define their denomination’’; and 
(C) by striking the second sentence and in-
serting the following: 
‘‘(2) PROHIBITION.—The name of any public 
official shall not appear on any EBT card.’’; 
(4) by striking subsection (d); 
(5) in subsection (e)— 
(A) by striking ‘‘coupons’’ each place it ap-
pears and inserting ‘‘benefits’’; and 
(B) by striking ‘‘coupon issuers’’ each 
place it appears and inserting ‘‘benefit issuers’’; 
(6) in subsection (f)— 
(A) by striking ‘‘coupons’’ each place it ap-
pears and inserting ‘‘benefits’’; 
(B) by striking ‘‘coupon issuer’’ and insert-
ing ‘‘benefit issuers’’; 
(C) by striking ‘‘including any losses’’ and 
all that follows through ‘‘section 11(e)(20),’’; 
and 
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(D) by striking ‘‘and allotments’’; 
(7) by striking subsection (g) and inserting the 
following: 
‘‘(g) ALTERNATIVE BENEFIT DELIVERY.— 
‘‘(1) IN
GENERAL.—If the Secretary deter-
mines, in consultation with the Inspector General of 
the Department of Agriculture, that it would im-
prove the integrity of the supplemental nutrition as-
sistance program, the Secretary shall require a State 
agency to issue or deliver benefits using alternative 
methods. 
‘‘(2) NO IMPOSITION OF COSTS.—The cost of 
documents or systems that may be required by this 
subsection may not be imposed upon a retail food 
store participating in the supplemental nutrition as-
sistance program. 
‘‘(3) DEVALUATION
AND
TERMINATION
OF 
ISSUANCE OF PAPER COUPONS.— 
‘‘(A) COUPON ISSUANCE.—Effective on the 
date of enactment of the Food, Conservation, 
and Energy Act of 2008, no State shall issue 
any coupon, stamp, certificate, or authorization 
card to a household that receives supplemental 
nutrition assistance under this Act. 
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‘‘(B) EBT CARDS.—Effective beginning on 
the date that is 1 year after the date of enact-
ment of the Food, Conservation, and Energy 
Act of 2008, only an EBT card issued under 
subsection (i) shall be eligible for exchange at 
any retail food store. 
‘‘(C) DE-OBLIGATION OF COUPONS.—Cou-
pons not redeemed during the 1-year period be-
ginning on the date of enactment of the Food, 
Conservation, and Energy Act of 2008 shall— 
‘‘(i) no longer be an obligation of the 
Federal Government; and 
‘‘(ii) not be redeemable.’’; 
(8) in subsection (h)(1), by striking ‘‘coupons’’ 
and inserting ‘‘benefits’’; 
(9) in subsection (i), by adding at the end the 
following: 
‘‘(12) INTERCHANGE
FEES.—No interchange 
fees shall apply to electronic benefit transfer trans-
actions under this subsection.’’; 
(10) in subsection (j)— 
(A) in paragraph (2)(A)(ii), by striking 
‘‘printing, shipping, and redeeming coupons’’ 
and inserting ‘‘issuing and redeeming benefits’’; 
and 
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(B) in paragraph (5), by striking ‘‘coupon’’ 
and inserting ‘‘benefit’’; 
(11) in subsection (k)— 
(A) by striking ‘‘coupons in the form of’’ 
each place it appears and inserting ‘‘program 
benefits in the form of’’; 
(B) by striking ‘‘a coupon issued in the 
form of’’ each place it appears and inserting 
‘‘program benefits in the form of’’; and 
(C) in subparagraph (A), by striking ‘‘sub-
section (i)(11)(A)’’ and inserting ‘‘subsection 
(h)(11)(A)’’; and 
(12) by redesignating subsections (e) through 
(k) as subsections (d) through (j), respectively. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 3 of the Food and Nutrition Act of 
2008 (7 U.S.C. 2012) is amended— 
(A) in subsection (a), by striking ‘‘cou-
pons’’ and inserting ‘‘benefits’’; 
(B) by striking subsection (b) and insert-
ing the following: 
‘‘(b) BENEFIT.—The term ‘benefit’ means the value 
of supplemental nutrition assistance provided to a house-
hold by means of— 
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‘‘(1) an electronic benefit transfer under section 
7(i); or 
‘‘(2) other means of providing assistance, as de-
termined by the Secretary.’’; 
(C) in subsection (c), in the first sentence, 
by striking ‘‘authorization cards’’ and inserting 
‘‘benefits’’; 
(D) in subsection (d), by striking ‘‘or ac-
cess device’’ and all that follows through the 
end of the subsection and inserting a period; 
(E) in subsection (e)— 
(i) by striking ‘‘(e) ‘Coupon issuer’ 
means’’ and inserting the following: 
‘‘(e) BENEFIT ISSUER.—The term ‘benefit issuer’ 
means’’; and 
(ii) by striking ‘‘coupons’’ and insert-
ing ‘‘benefits’’; 
(F) in subsection (g)(7), by striking ‘‘sub-
section (r)’’ and inserting ‘‘subsection (j)’’; 
(G) in subsection (i)(5)— 
(i) in subparagraph (B), by striking 
‘‘subsection (r)’’ and inserting ‘‘subsection 
(j)’’; and 
(ii) in subparagraph (D), by striking 
‘‘coupons’’ and inserting ‘‘benefits’’; 
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(H) in subsection (j), by striking ‘‘(as that 
term is defined in subsection (p))’’; 
(I) in subsection (k)— 
(i) in paragraph (1)(A), by striking 
‘‘subsection (u)(1)’’ and inserting ‘‘sub-
section (r)(1)’’; 
(ii) in paragraph (2), by striking 
‘‘subsections (g)(3), (4), (5), (7), (8), and 
(9) of this section’’ and inserting ‘‘para-
graphs (3), (4), (5), (7), (8), and (9) of 
subsection (k)’’; and 
(iii) in paragraph (3), by striking 
‘‘subsection (g)(6) of this section’’ and in-
serting ‘‘subsection (k)(6)’’; 
(J) in subsection (t), by inserting ‘‘, in-
cluding point of sale devices,’’ after ‘‘other 
means of access’’; 
(K) in subsection (u), by striking ‘‘(as de-
fined in subsection (g))’’; 
(L) by adding at the end the following: 
‘‘(v) EBT CARD.—The term ‘EBT card’ means an 
electronic benefit transfer card issued under section 7(i).’’; 
and 
(M) by redesignating subsections (a) 
through (v) as subsections (b), (d), (f), (g), (e), 
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572 
(ii) by striking ‘‘section 3(n)(2) of this 
Act’’ each place it appears and inserting 
‘‘section 3(t)(2)’’; 
(B) in subsection (e)— 
(i) in paragraph (8)(E), by striking 
‘‘paragraph (16) or (20)(B)’’ and inserting 
‘‘paragraph (15) or (18)(B)’’; 
(ii) by striking paragraphs (15) and 
(19); 
(iii) by redesignating paragraphs (16) 
through (18) and (20) through (25) as 
paragraphs (15) through (17) and (18) 
through (23), respectively; and 
(iv) in paragraph (17) (as so redesig-
nated), by striking ‘‘(described in section 
3(n)(1) of this Act)’’ and inserting ‘‘de-
scribed in section 3(t)(1)’’; 
(C) in subsection (h), by striking ‘‘coupon 
or coupons’’ and inserting ‘‘benefits’’; 
(D) by striking ‘‘coupon’’ each place it ap-
pears and inserting ‘‘benefit’’; 
(E) by striking ‘‘coupons’’ each place it ap-
pears and inserting ‘‘benefits’’; and 
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573 
(F) in subsection (q), by striking ‘‘section 
11(e)(20)(B)’’ 
and 
inserting 
‘‘subsection 
(e)(18)(B)’’. 
(9) Section 13 of the Food and Nutrition Act 
of 2008 (7 U.S.C. 2022) is amended by striking 
‘‘coupons’’ each place it appears and inserting ‘‘ben-
efits’’. 
(10) Section 15 of the Food and Nutrition Act 
of 2008 (7 U.S.C. 2024) is amended— 
(A) in subsection (a), by striking ‘‘cou-
pons’’ and inserting ‘‘benefits’’; 
(B) in subsection (b)(1)— 
(i) by striking ‘‘coupons, authorization 
cards, or access devices’’ each place it ap-
pears and inserting ‘‘benefits’’; 
(ii) by striking ‘‘coupons or authoriza-
tion cards’’ and inserting ‘‘benefits’’; and 
(iii) by striking ‘‘access device’’ each 
place it appears and inserting ‘‘benefit’’; 
(C) in subsection (c), by striking ‘‘cou-
pons’’ each place it appears and inserting ‘‘ben-
efits’’; 
(D) in subsection (d), by striking ‘‘Cou-
pons’’ and inserting ‘‘Benefits’’; 
(E) by striking subsections (e) and (f); 
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574 
(F) by redesignating subsections (g) and 
(h) as subsections (e) and (f), respectively; and 
(G) in subsection (e) (as so redesignated), 
by striking ‘‘coupon, authorization cards or ac-
cess devices’’ and inserting ‘‘benefits’’. 
(11) Section 16(a) of the Food and Nutrition 
Act of 2008 (7 U.S.C. 2025(a)) is amended by strik-
ing ‘‘coupons’’ each place it appears and inserting 
‘‘benefits’’. 
(12) Section 17 of the Food and Nutrition Act 
of 2008 (7 U.S.C. 2026) is amended— 
(A) in subsection (a)(2), by striking ‘‘cou-
pon’’ and inserting ‘‘benefit’’; 
(B) in subsection (b)(1)— 
(i) in subparagraph (B)— 
(I) in clause (iv)— 
(aa) in subclause (I), insert-
ing ‘‘or otherwise providing bene-
fits in a form not restricted to 
the purchase of food’’ after ‘‘of 
cash’’; 
(bb) in subclause (III)(aa), 
by striking ‘‘section 3(i)’’ and in-
serting ‘‘section 3(n)’’; and 
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575 
(cc) in subclause (VII), by 
striking ‘‘section 7(j)’’ and in-
serting ‘‘section 7(i)’’; and 
(II) in clause (v)— 
(aa) 
by 
striking 
‘‘countersigned food coupons or 
similar’’; and 
(bb) by striking ‘‘food cou-
pons’’ 
and 
inserting 
‘‘EBT 
cards’’; and 
(ii) in subparagraph (C)(i)(I), by 
striking ‘‘coupons’’ and inserting ‘‘EBT 
cards’’; 
(C) in subsection (f), by striking ‘‘section 
7(g)(2)’’ and inserting ‘‘section 7(f)(2)’’; and 
(D) in subsection (j), by striking ‘‘coupon’’ 
and inserting ‘‘benefit’’. 
(13) Section 19(a)(2)(A)(ii) of the Food and 
Nutrition Act of 2008 (7 U.S.C. 2028(a)(2)(A)(ii)) 
is amended by striking ‘‘section 3(o)(4)’’ and insert-
ing ‘‘section 3(u)(4)’’. 
(14) Section 21 of the Food and Nutrition Act 
of 2008 (7 U.S.C. 2030) is repealed. 
(15) Section 22 of the Food and Nutrition Act 
of 2008 (7 U.S.C. 2031) is amended— 
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576 
(A) by striking ‘‘food coupons’’ each place 
it appears and inserting ‘‘benefits’’; 
(B) by striking ‘‘coupons’’ each place it ap-
pears and inserting ‘‘benefits’’; and 
(C) in subsection (g)(1)(A), by striking 
‘‘coupon’’ and inserting ‘‘benefits’’. 
(16) Section 26(f)(3) of the Food and Nutrition 
Act of 2008 (7 U.S.C. 2035(f)(3)) is amended— 
(A) in subparagraph (A), by striking ‘‘sub-
sections (a) through (g)’’ and inserting ‘‘sub-
sections (a) through (f)’’; and 
(B) in subparagraph (E), by striking 
‘‘(16), (18), (20), (24), and (25)’’ and inserting 
‘‘(15), (17), (18), (22), and (23)’’. 
(c) CONFORMING CROSS-REFERENCES.— 
(1) IN GENERAL.— 
(A) USE
OF
TERMS.—Each provision of 
law described in subparagraph (B) is amended 
(as applicable)— 
(i) by striking ‘‘coupons’’ each place it 
appears and inserting ‘‘benefits’’; 
(ii) by striking ‘‘coupon’’ each place it 
appears and inserting ‘‘benefit’’; 
(iii) by striking ‘‘food coupons’’ each 
place it appears and inserting ‘‘benefits’’; 
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577 
(iv) in each section heading, by strik-
ing ‘‘FOOD COUPONS’’ each place it ap-
pears and inserting ‘‘BENEFITS’’; 
(v) by striking ‘‘food stamp coupon’’ 
each place it appears and inserting ‘‘ben-
efit’’; and 
(vi) by striking ‘‘food stamps’’ each 
place it appears and inserting ‘‘benefits’’. 
(B) PROVISIONS OF LAW.—The provisions 
of law referred to in subparagraph (A) are the 
following: 
(i) Section 2 of Public Law 103–205 
(7 U.S.C. 2012 note; 107 Stat. 2418). 
(ii) Section 1956(c)(7)(D) of title 18, 
United States Code. 
(iii) Titles II through XIX of the So-
cial Security Act (42 U.S.C. 401 et seq.). 
(iv) Section 401(b)(3) of the Social 
Security Amendments of 1972 (42 U.S.C. 
1382e note; Public Law 92–603). 
(v) The Robert T. Stafford Disaster 
Relief and Emergency Assistance Act (42 
U.S.C. 5121 et seq.). 
(vi) Section 802(d)(2)(A)(i)(II) of the 
Cranston-Gonzalez 
National 
Affordable 
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Housing 
Act 
(42 
U.S.C. 
8011(d)(2)(A)(i)(II)). 
(2) DEFINITION REFERENCES.— 
(A) Section 2 of Public Law 103–205 (7 
U.S.C. 2012 note; 107 Stat. 2418) is amended 
by striking ‘‘section 3(k)(1)’’ and inserting 
‘‘section 3(p)(1)’’. 
(B) Section 205 of the Food Stamp Pro-
gram Improvements Act of 1994 (7 U.S.C. 
2012 note; Public Law 103–225) is amended by 
striking ‘‘section 3(k) of such Act (as amended 
by section 201)’’ and inserting ‘‘section 3(p) of 
that Act’’. 
(C) Section 115 of the Personal Responsi-
bility and Work Opportunity Reconciliation Act 
of 1996 (21 U.S.C. 862a) is amended— 
(i) by striking ‘‘section 3(h)’’ each 
place it appears and inserting ‘‘section 
3(l)’’; and 
(ii) in subsection (e)(2), by striking 
‘‘section 3(m)’’ and inserting ‘‘section 
3(s)’’. 
(D) Section 402(a) of the Personal Re-
sponsibility and Work Opportunity Reconcili-
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579 
ation Act of 1996 (8 U.S.C. 1612(a)) is amend-
ed— 
(i) in paragraph (2)(F)(ii), by striking 
‘‘section 3(r)’’ and inserting ‘‘section 3(j)’’; 
and 
(ii) in paragraph (3)(B), by striking 
‘‘section 3(h)’’ and inserting ‘‘section 3(l)’’. 
(E) Section 3803(c)(2)(C)(vii) of title 31, 
United States Code, is amended by striking 
‘‘section 3(h)’’ and inserting ‘‘section 3(l)’’. 
(F) Section 303(d)(4) of the Social Secu-
rity Act (42 U.S.C. 503(d)(4)) is amended by 
striking ‘‘section 3(n)(1)’’ and inserting ‘‘sec-
tion 3(t)(1)’’. 
(G) Section 404 of the Social Security Act 
(42 U.S.C. 604) is amended by striking ‘‘sec-
tion 3(h)’’ each place it appears and inserting 
‘‘section 3(l)’’. 
(H) Section 531 of the Social Security Act 
(42 U.S.C. 654) is amended by striking ‘‘sec-
tion 3(h)’’ each place it appears and inserting 
‘‘section 3(l)’’. 
(I) Section 802(d)(2)(A)(i)(II) of the 
Cranston-Gonzalez National Affordable Hous-
ing Act (42 U.S.C. 8011(d)(2)(A)(i)(II)) is 
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580 
amended by striking ‘‘(as defined in section 
3(e) of such Act)’’. 
(d) REFERENCES.—Any reference in any Federal, 
State, tribal, or local law (including regulations) to a ‘‘cou-
pon’’, ‘‘authorization card’’, or other access device pro-
vided under the Food and Nutrition Act of 2008 (7 U.S.C. 
2011 et seq.) shall be considered to be a reference to a 
‘‘benefit’’ provided under that Act. 
SEC. 4116. REVIEW OF MAJOR CHANGES IN PROGRAM DE-
SIGN. 
Section 11 of the Food and Nutrition Act of 2008 
(7 U.S.C. 2020) is amended by striking the section enu-
merator and heading and subsection (a) and inserting the 
following: 
‘‘SEC. 11. ADMINISTRATION. 
‘‘(a) STATE RESPONSIBILITY.— 
‘‘(1) IN GENERAL.—The State agency of each 
participating State shall have responsibility for certi-
fying applicant households and issuing EBT cards. 
‘‘(2) LOCAL
ADMINISTRATION.—The responsi-
bility of the agency of the State government shall 
not be affected by whether the program is operated 
on a State-administered or county-administered 
basis, as provided under section 3(t)(1). 
‘‘(3) RECORDS.— 
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581 
‘‘(A) IN
GENERAL.—Each State agency 
shall keep such records as may be necessary to 
determine whether the program is being con-
ducted in compliance with this Act (including 
regulations issued under this Act). 
‘‘(B) INSPECTION
AND
AUDIT.—Records 
described in subparagraph (A) shall— 
‘‘(i) be available for inspection and 
audit at any reasonable time; 
‘‘(ii) subject to subsection (e)(8), be 
available for review in any action filed by 
a household to enforce any provision of 
this Act (including regulations issued 
under this Act); and 
‘‘(iii) be preserved for such period of 
not less than 3 years as may be specified 
in regulations. 
‘‘(4) REVIEW OF MAJOR CHANGES IN PROGRAM 
DESIGN.— 
‘‘(A) IN
GENERAL.—The Secretary shall 
develop standards for identifying major changes 
in the operations of a State agency, including— 
‘‘(i) large or substantially-increased 
numbers of low-income households that do 
not live in reasonable proximity to an of-
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582 
fice performing the major functions de-
scribed in subsection (e); 
‘‘(ii) substantial increases in reliance 
on automated systems for the performance 
of responsibilities previously performed by 
personnel 
described 
in 
subsection 
(e)(6)(B); 
‘‘(iii) changes that potentially increase 
the difficulty of reporting information 
under subsection (e) or section 6(c); and 
‘‘(iv) changes that may disproportion-
ately increase the burdens on any of the 
types of households described in subsection 
(e)(2)(A). 
‘‘(B) NOTIFICATION.—If a State agency 
implements a major change in operations, the 
State agency shall— 
‘‘(i) notify the Secretary; and 
‘‘(ii) collect such information as the 
Secretary shall require to identify and cor-
rect any adverse effects on program integ-
rity or access, including access by any of 
the types of households described in sub-
section (e)(2)(A).’’. 
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583 
SEC. 4117. CIVIL RIGHTS COMPLIANCE. 
Section 11 of the Food and Nutrition Act of 2008 
(7 U.S.C. 2020) is amended by striking subsection (c) and 
inserting the following: 
‘‘(c) CIVIL RIGHTS COMPLIANCE.— 
‘‘(1) IN GENERAL.—In the certification of ap-
plicant households for the supplemental nutrition as-
sistance program, there shall be no discrimination by 
reason of race, sex, religious creed, national origin, 
or political affiliation. 
‘‘(2) RELATION TO OTHER LAWS.—The admin-
istration of the program by a State agency shall be 
consistent with the rights of households under the 
following laws (including implementing regulations): 
‘‘(A) The Age Discrimination Act of 1975 
(42 U.S.C. 6101 et seq.). 
‘‘(B) Section 504 of the Rehabilitation Act 
of 1973 (29 U.S.C. 794). 
‘‘(C) The Americans with Disabilities Act 
of 1990 (42 U.S.C. 12101 et seq.). 
‘‘(D) Title VI of the Civil Rights Act of 
1964 (42 U.S.C. 2000d et seq.).’’. 
SEC. 4118. CODIFICATION OF ACCESS RULES. 
Section 11(e)(1) of the Food and Nutrition Act of 
2008 (7 U.S.C. 2020(e)(1)) is amended— 
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584 
(1) by striking ‘‘shall (A) at’’ and inserting 
‘‘shall— 
‘‘(A) at’’; and 
(2) by striking ‘‘and (B) use’’ and inserting 
‘‘and 
‘‘(B) comply with regulations of the Sec-
retary requiring the use of’’. 
SEC. 4119. STATE OPTION FOR TELEPHONIC SIGNATURE. 
Section 11(e)(2)(C) of the Food and Nutrition Act 
of 2008 (7 U.S.C. 2020(e)(2)(C)) is amended— 
(1) by striking ‘‘(C) Nothing in this Act’’ and 
inserting the following: 
‘‘(C) ELECTRONIC AND AUTOMATED SYS-
TEMS.— 
‘‘(i) IN
GENERAL.—Nothing in this 
Act’’; and 
(2) by adding at the end the following: 
‘‘(ii) STATE OPTION FOR TELEPHONIC 
SIGNATURE.—A State agency may estab-
lish a system by which an applicant house-
hold may sign an application through a re-
corded verbal assent over the telephone. 
‘‘(iii) REQUIREMENTS.—A system es-
tablished under clause (ii) shall— 
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‘‘(I) record for future reference 
the verbal assent of the household 
member and the information to which 
assent was given; 
‘‘(II) include effective safeguards 
against impersonation, identity theft, 
and invasions of privacy; 
‘‘(III) not deny or interfere with 
the right of the household to apply in 
writing; 
‘‘(IV) promptly provide to the 
household member a written copy of 
the completed application, with in-
structions for a simple procedure for 
correcting any errors or omissions; 
‘‘(V) 
comply 
with 
paragraph 
(1)(B); 
‘‘(VI) satisfy all requirements for 
a signature on an application under 
this Act and other laws applicable to 
the supplemental nutrition assistance 
program, with the date on which the 
household member provides verbal as-
sent considered as the date of applica-
tion for all purposes; and 
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‘‘(VII) comply with such other 
standards as the Secretary may estab-
lish.’’. 
SEC. 4120. PRIVACY PROTECTIONS. 
Section 11(e)(8) of the Food and Nutrition Act of 
2008 (7 U.S.C. 2020(e)(8)) is amended— 
(1) in the matter preceding subparagraph (A)— 
(A) by striking ‘‘limit’’ and inserting ‘‘pro-
hibit’’; and 
(B) by striking ‘‘to persons’’ and all that 
follows through ‘‘State programs’’; 
(2) by redesignating subparagraphs (A) through 
(E) as subparagraphs (B) through (F), respectively; 
(3) by inserting before subparagraph (B) (as so 
redesignated) the following: 
‘‘(A) the safeguards shall permit— 
‘‘(i) the disclosure of such information 
to persons directly connected with the ad-
ministration or enforcement of the provi-
sions of this Act, regulations issued pursu-
ant to this Act, Federal assistance pro-
grams, or federally-assisted State pro-
grams; and 
‘‘(ii) the subsequent use of the infor-
mation by persons described in clause (i) 
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only for such administration or enforce-
ment;’’; and 
(4) in subparagraph (F) (as so redesignated) by 
inserting ‘‘or subsection (u)’’ before the semicolon at 
the end. 
SEC. 4121. PRESERVATION OF ACCESS AND PAYMENT AC-
CURACY. 
Section 16 of the Food and Nutrition Act of 2008 
(7 U.S.C. 2025) is amended by striking subsection (g) and 
inserting the following: 
‘‘(g) COST SHARING FOR COMPUTERIZATION.— 
‘‘(1) IN GENERAL.—Except as provided in para-
graphs (2) and (3), the Secretary is authorized to 
pay to each State agency the amount provided under 
subsection (a)(6) for the costs incurred by the State 
agency in the planning, design, development, or in-
stallation of 1 or more automatic data processing 
and information retrieval systems that the Secretary 
determines— 
‘‘(A) would assist in meeting the require-
ments of this Act; 
‘‘(B) meet such conditions as the Secretary 
prescribes; 
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‘‘(C) are likely to provide more efficient 
and effective administration of the supplemental 
nutrition assistance program; 
‘‘(D) would be compatible with other sys-
tems used in the administration of State pro-
grams, including the program funded under 
part A of title IV of the Social Security Act (42 
U.S.C. 601 et seq.); 
‘‘(E) would be tested adequately before 
and after implementation, including through 
pilot projects in limited areas for major systems 
changes as determined under rules promulgated 
by the Secretary, data from which shall be thor-
oughly evaluated before the Secretary approves 
the system to be implemented more broadly; 
and 
‘‘(F) would be operated in accordance with 
an adequate plan for— 
‘‘(i) continuous updating to reflect 
changed policy and circumstances; and 
‘‘(ii) testing the effect of the system 
on access for eligible households and on 
payment accuracy. 
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‘‘(2) LIMITATION.—The Secretary shall not 
make payments to a State agency under paragraph 
(1) to the extent that the State agency— 
‘‘(A) is reimbursed for the costs under any 
other Federal program; or 
‘‘(B) uses the systems for purposes not 
connected with the supplemental nutrition as-
sistance program.’’. 
SEC. 4122. FUNDING OF EMPLOYMENT AND TRAINING PRO-
GRAMS. 
Section 16(h)(1)(A) of the Food and Nutrition Act 
of 2008 (7 U.S.C. 2025(h)(1)(A)) is amended in subpara-
graph (A), by striking ‘‘to remain available until ex-
pended’’ and inserting ‘‘to remain available for 15 
months’’. 
PART IV—PROGRAM INTEGRITY 
SEC. 4131. ELIGIBILITY DISQUALIFICATION. 
Section 6 of the Food and Nutrition Act of 2008 (7 
U.S.C. 2015) is amended by adding at the end the fol-
lowing: 
‘‘(p) DISQUALIFICATION FOR OBTAINING CASH BY 
DESTROYING FOOD AND COLLECTING DEPOSITS.—Sub-
ject to any requirements established by the Secretary, any 
person who has been found by a State or Federal court 
or administrative agency in a hearing under subsection (b) 
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to have intentionally obtained cash by purchasing products 
with supplemental nutrition assistance program benefits 
that have containers that require return deposits, dis-
carding the product, and returning the container for the 
deposit amount shall be ineligible for benefits under this 
Act for such period of time as the Secretary shall prescribe 
by regulation. 
‘‘(q) DISQUALIFICATION FOR SALE OF FOOD PUR-
CHASED WITH SUPPLEMENTAL NUTRITION ASSISTANCE 
PROGRAM BENEFITS.—Subject to any requirements es-
tablished by the Secretary, any person who has been found 
by a State or Federal court or administrative agency in 
a hearing under subsection (b) to have intentionally sold 
any food that was purchased using supplemental nutrition 
assistance program benefits shall be ineligible for benefits 
under this Act for such period of time as the Secretary 
shall prescribe by regulation.’’. 
SEC. 4132. CIVIL PENALTIES AND DISQUALIFICATION OF 
RETAIL 
FOOD 
STORES 
AND 
WHOLESALE 
FOOD CONCERNS. 
Section 12 of the Food and Nutrition Act of 2008 
(7 U.S.C. 2021) is amended— 
(1) by striking the section designation and 
heading and all that follows through the end of sub-
section (a) and inserting the following: 
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‘‘SEC. 12. CIVIL PENALTIES AND DISQUALIFICATION OF RE-
TAIL FOOD STORES AND WHOLESALE FOOD 
CONCERNS. 
‘‘(a) DISQUALIFICATION.— 
‘‘(1) IN
GENERAL.—An approved retail food 
store or wholesale food concern that violates a provi-
sion of this Act or a regulation under this Act may 
be— 
‘‘(A) disqualified for a specified period of 
time from further participation in the supple-
mental nutrition assistance program; 
‘‘(B) assessed a civil penalty of up to 
$100,000 for each violation; or 
‘‘(C) both. 
‘‘(2) REGULATIONS.—Regulations promulgated 
under this Act shall provide criteria for the finding 
of a violation of, the suspension or disqualification 
of and the assessment of a civil penalty against a re-
tail food store or wholesale food concern on the basis 
of evidence that may include facts established 
through on-site investigations, inconsistent redemp-
tion data, or evidence obtained through a trans-
action report under an electronic benefit transfer 
system.’’; 
(2) in subsection (b)— 
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(A) by striking ‘‘(b) Disqualification’’ and 
inserting the following: 
‘‘(b) PERIOD
OF DISQUALIFICATION.—Subject to 
subsection (c), a disqualification’’; 
(B) in paragraph (1), by striking ‘‘of no 
less than six months nor more than five years’’ 
and inserting ‘‘not to exceed 5 years’’; 
(C) in paragraph (2), by striking ‘‘of no 
less than twelve months nor more than ten 
years’’ and inserting ‘‘not to exceed 10 years’’; 
(D) in paragraph (3)(B)— 
(i) by inserting ‘‘or a finding of the 
unauthorized redemption, use, transfer, ac-
quisition, alteration, or possession of EBT 
cards’’ after ‘‘concern’’ the first place it 
appears; and 
(ii) by striking ‘‘civil money penalties’’ 
and inserting ‘‘civil penalties’’; and 
(E) by striking ‘‘civil money penalty’’ each 
place it appears and inserting ‘‘civil penalty’’; 
(3) in subsection (c)— 
(A) by striking ‘‘(c) The action’’ and in-
serting the following: 
‘‘(c) CIVIL PENALTY AND REVIEW OF DISQUALIFICA-
TION AND PENALTY DETERMINATIONS.— 
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‘‘(1) CIVIL
PENALTY.—In addition to a dis-
qualification under this section, the Secretary may 
assess a civil penalty in an amount not to exceed 
$100,000 for each violation. 
‘‘(2) REVIEW.—The action’’; and 
(B) in paragraph (2) (as designated by 
subparagraph (A)), by striking ‘‘civil money 
penalty’’ and inserting ‘‘civil penalty’’; 
(4) in subsection (d)— 
(A) by striking ‘‘(d)’’ and all that follows 
through ‘‘. The Secretary shall’’ and inserting 
the following: 
‘‘(d) CONDITIONS OF AUTHORIZATION.— 
‘‘(1) IN GENERAL.—As a condition of author-
ization to accept and redeem benefits, the Secretary 
may require a retail food store or wholesale food 
concern that, pursuant to subsection (a), has been 
disqualified for more than 180 days, or has been 
subjected to a civil penalty in lieu of a disqualifica-
tion period of more than 180 days, to furnish a col-
lateral bond or irrevocable letter of credit for a pe-
riod of not more than 5 years to cover the value of 
benefits that the store or concern may in the future 
accept and redeem in violation of this Act. 
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‘‘(2) COLLATERAL.—The Secretary also may 
require a retail food store or wholesale food concern 
that has been sanctioned for a violation and incurs 
a subsequent sanction regardless of the length of the 
disqualification period to submit a collateral bond or 
irrevocable letter of credit. 
‘‘(3) BOND
REQUIREMENTS.—The Secretary 
shall’’; 
(B) by striking ‘‘If the Secretary finds’’ 
and inserting the following 
‘‘(4) FORFEITURE.—If the Secretary finds’’; 
and 
(C) by striking ‘‘Such store or concern’’ 
and inserting the following: 
‘‘(5) HEARING.—A store or concern described 
in paragraph (4)’’; 
(5) in subsection (e), by striking ‘‘civil money 
penalty’’ each place it appears and inserting ‘‘civil 
penalty’’; and 
(6) by adding at the end the following: 
‘‘(h) FLAGRANT VIOLATIONS.— 
‘‘(1) IN GENERAL.—The Secretary, in consulta-
tion with the Inspector General of the Department 
of Agriculture, shall establish procedures under 
which the processing of program benefit redemptions 
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for a retail food store or wholesale food concern may 
be immediately suspended pending administrative 
action to disqualify the retail food store or wholesale 
food concern. 
‘‘(2) REQUIREMENTS.—Under the procedures 
described in paragraph (1), if the Secretary, in con-
sultation with the Inspector General, determines 
that a retail food store or wholesale food concern is 
engaged in flagrant violations of this Act (including 
regulations promulgated under this Act), unsettled 
program benefits that have been redeemed by the re-
tail food store or wholesale food concern— 
‘‘(A) may be suspended; and 
‘‘(B)(i) if the program disqualification is 
upheld, may be subject to forfeiture pursuant to 
section 15(g); or 
‘‘(ii) if the program disqualification is not 
upheld, shall be released to the retail food store 
or wholesale food concern. 
‘‘(3) NO LIABILITY FOR INTEREST.—The Sec-
retary shall not be liable for the value of any interest 
on funds suspended under this subsection.’’. 
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SEC. 4133. MAJOR SYSTEMS FAILURES. 
Section 13(b) of the Food and Nutrition Act of 2008 
(7 U.S.C. 2022(b)) is amended by adding at the end the 
following: 
‘‘(5) OVERISSUANCES
CAUSED
BY
SYSTEMIC 
STATE ERRORS.— 
‘‘(A) IN GENERAL.—If the Secretary deter-
mines that a State agency overissued benefits to 
a substantial number of households in a fiscal 
year as a result of a major systemic error by 
the State agency, as defined by the Secretary, 
the Secretary may prohibit the State agency 
from collecting these overissuances from some 
or all households. 
‘‘(B) PROCEDURES.— 
‘‘(i) INFORMATION
REPORTING
BY 
STATES.—Every State agency shall provide 
to the Secretary all information requested 
by the Secretary concerning the issuance of 
benefits to households by the State agency 
in the applicable fiscal year. 
‘‘(ii) FINAL
DETERMINATION.—After 
reviewing relevant information provided by 
a State agency, the Secretary shall make a 
final determination— 
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‘‘(I) whether the State agency 
overissued benefits to a substantial 
number of households as a result of a 
systemic error in the applicable fiscal 
year; and 
‘‘(II) as to the amount of the 
overissuance in the applicable fiscal 
year for which the State agency is lia-
ble. 
‘‘(iii) ESTABLISHING A CLAIM.—Upon 
determining under clause (ii) that a State 
agency has overissued benefits to house-
holds due to a major systemic error deter-
mined under subparagraph (A), the Sec-
retary shall establish a claim against the 
State agency equal to the value of the 
overissuance caused by the systemic error. 
‘‘(iv) ADMINISTRATIVE AND JUDICIAL 
REVIEW.—Administrative and judicial re-
view, as provided in section 14, shall apply 
to the final determinations by the Sec-
retary under clause (ii). 
‘‘(v) 
REMISSION
TO
THE
SEC-
RETARY.— 
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‘‘(I) DETERMINATION
NOT
AP-
PEALED.—If the determination of the 
Secretary under clause (ii) is not ap-
pealed, the State agency shall, as soon 
as practicable, remit to the Secretary 
the dollar amount specified in the 
claim under clause (iii). 
‘‘(II) 
DETERMINATION
AP-
PEALED.—If the determination of the 
Secretary under clause (ii) is ap-
pealed, upon completion of adminis-
trative and judicial review under 
clause (iv), and a finding of liability 
on the part of the State, the appealing 
State agency shall, as soon as prac-
ticable, remit to the Secretary a dollar 
amount subject to the finding made in 
the administrative and judicial review. 
‘‘(vi) ALTERNATIVE METHOD OF COL-
LECTION.— 
‘‘(I) IN
GENERAL.—If a State 
agency fails to make a payment under 
clause (v) within a reasonable period 
of time, as determined by the Sec-
retary, the Secretary may reduce any 
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amount due to the State agency under 
any other provision of this Act by the 
amount due. 
‘‘(II) ACCRUAL OF INTEREST.— 
During the period of time determined 
by the Secretary to be reasonable 
under subclause (I), interest in the 
amount owed shall not accrue. 
‘‘(vii) 
LIMITATION.—Any 
liability 
amount 
established 
under 
section 
16(c)(1)(C) shall be reduced by the 
amount of the claim established under this 
subparagraph.’’. 
PART V—MISCELLANEOUS 
SEC. 4141. PILOT PROJECTS TO EVALUATE HEALTH AND 
NUTRITION PROMOTION IN THE SUPPLE-
MENTAL NUTRITION ASSISTANCE PROGRAM. 
Section 17 of the Food and Nutrition Act of 2008 
(7 U.S.C. 2026) is amended by adding at the end the fol-
lowing: 
‘‘(k) PILOT PROJECTS TO EVALUATE HEALTH AND 
NUTRITION PROMOTION IN THE SUPPLEMENTAL NUTRI-
TION ASSISTANCE PROGRAM.— 
‘‘(1) IN GENERAL.—The Secretary shall carry 
out, under such terms and conditions as the Sec-
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retary considers to be appropriate, pilot projects to 
develop and test methods— 
‘‘(A) of using the supplemental nutrition 
assistance program to improve the dietary and 
health status of households eligible for or par-
ticipating in the supplemental nutrition assist-
ance program; and 
‘‘(B) to reduce overweight, obesity (includ-
ing childhood obesity), and associated co- 
morbidities in the United States. 
‘‘(2) GRANTS.— 
‘‘(A) IN GENERAL.—In carrying out this 
subsection, the Secretary may enter into com-
petitively awarded contracts or cooperative 
agreements with, or provide grants to, public or 
private organizations or agencies (as defined by 
the Secretary), for use in accordance with 
projects that meet the strategy goals of this 
subsection. 
‘‘(B) APPLICATION.—To be eligible to re-
ceive a contract, cooperative agreement, or 
grant under this paragraph, an organization 
shall submit to the Secretary an application at 
such time, in such manner, and containing such 
information as the Secretary may require. 
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‘‘(C) SELECTION CRITERIA.—Pilot projects 
shall be evaluated against publicly disseminated 
criteria that may include— 
‘‘(i) identification of a low-income tar-
get audience that corresponds to individ-
uals living in households with incomes at 
or below 185 percent of the poverty level; 
‘‘(ii) incorporation of a scientifically 
based strategy that is designed to improve 
diet quality through more healthful food 
purchases, preparation, or consumption; 
‘‘(iii) a commitment to a pilot project 
that allows for a rigorous outcome evalua-
tion, including data collection; 
‘‘(iv) strategies to improve the nutri-
tional value of food served during school 
hours and during after-school hours; 
‘‘(v) innovative ways to provide sig-
nificant improvement to the health and 
wellness of children; 
‘‘(vi) other criteria, as determined by 
the Secretary. 
‘‘(D) USE
OF
FUNDS.—Funds provided 
under this paragraph shall not be used for any 
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‘‘(E) provide incentives at the point of pur-
chase to encourage households participating in 
the supplemental nutrition assistance program 
to purchase fruits, vegetables, or other healthful 
foods; or 
‘‘(F) provide to participating households 
integrated communication and education pro-
grams, including the provision of funding for a 
portion of a school-based nutrition coordinator 
to implement a broad nutrition action plan and 
parent nutrition education programs in elemen-
tary schools, separately or in combination with 
pilot projects carried out under subparagraphs 
(A) through (E). 
‘‘(4) EVALUATION AND REPORTING.— 
‘‘(A) EVALUATION.— 
‘‘(i) INDEPENDENT EVALUATION.— 
‘‘(I) IN
GENERAL.—The Sec-
retary shall provide for an inde-
pendent evaluation of projects selected 
under this subsection that measures 
the impact of the pilot program on 
health and nutrition as described in 
paragraph (1). 
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‘‘(II) REQUIREMENT.—The inde-
pendent evaluation under subclause 
(I) shall use rigorous methodologies, 
particularly random assignment or 
other methods that are capable of pro-
ducing scientifically valid information 
regarding which activities are effec-
tive. 
‘‘(ii) COSTS.—The Secretary may use 
funds provided to carry out this section to 
pay costs associated with monitoring and 
evaluating each pilot project. 
‘‘(B) REPORTING.—Not later than 90 days 
after the last day of fiscal year 2009 and each 
fiscal year thereafter until the completion of the 
last evaluation under subparagraph (A), the 
Secretary shall submit to the Committee on Ag-
riculture of the House of Representatives and 
the Committee on Agriculture, Nutrition, and 
Forestry of the Senate a report that includes a 
description of— 
‘‘(i) the status of each pilot project; 
‘‘(ii) the results of the evaluation com-
pleted during the previous fiscal year; and 
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‘‘(iii) to the maximum extent prac-
ticable— 
‘‘(I) the impact of the pilot 
project on appropriate health, nutri-
tion, and associated behavioral out-
comes among households participating 
in the pilot project; 
‘‘(II) baseline information rel-
evant to the stated goals and desired 
outcomes of the pilot project; and 
‘‘(III) 
equivalent 
information 
about similar or identical measures 
among control or comparison groups 
that did not participate in the pilot 
project. 
‘‘(C) PUBLIC
DISSEMINATION.—In addi-
tion to the reporting requirements under sub-
paragraph (B), evaluation results shall be 
shared broadly to inform policy makers, service 
providers, other partners, and the public in 
order to promote wide use of successful strate-
gies. 
‘‘(5) FUNDING.— 
‘‘(A) 
AUTHORIZATION
OF
APPROPRIA-
TIONS.—There are authorized to be appro-
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priated such sums as are necessary to carry out 
this section for each of fiscal years 2008 
through 2012. 
‘‘(B) MANDATORY FUNDING.—Out of any 
funds made available under section 18, on Octo-
ber 1, 2008, the Secretary shall make available 
$20,000,000 to carry out a project described in 
paragraph (3)(E), to remain available until ex-
pended.’’. 
SEC. 4142. STUDY ON COMPARABLE ACCESS TO SUPPLE-
MENTAL NUTRITION ASSISTANCE FOR PUER-
TO RICO. 
(a) IN GENERAL.—The Secretary shall carry out a 
study of the feasibility and effects of including the Com-
monwealth of Puerto Rico in the definition of the term 
‘‘State’’ under section 3 of the Food and Nutrition Act 
of 2008 (7 U.S.C. 2012), in lieu of providing block grants 
under section 19 of that Act (7 U.S.C. 2028). 
(b) INCLUSIONS.—The study shall include— 
(1) an assessment of the administrative, finan-
cial management, and other changes that would be 
necessary for the Commonwealth to establish a com-
parable supplemental nutrition assistance program, 
including compliance with appropriate program rules 
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under the Food and Nutrition Act of 2008 (7 U.S.C. 
2011 et seq.), such as— 
(A) benefit levels under section 3(u) of 
that Act (7 U.S.C. 2012(u)); 
(B) income eligibility standards under sec-
tions 5(c) and 6 of that Act (7 U.S.C. 2014(c), 
2015); and 
(C) deduction levels under section 5(e) of 
that Act (7 U.S.C. 2014(e)); 
(2) an estimate of the impact on Federal and 
Commonwealth benefit and administrative costs; 
(3) an assessment of the impact of the program 
on low-income Puerto Ricans, as compared to the 
program under section 19 of that Act (7 U.S.C. 
2028); and 
(4) such other matters as the Secretary con-
siders to be appropriate. 
(c) REPORT.—Not later than 2 years after the date 
of enactment of this Act, the Secretary shall submit to 
the Committee on Agriculture of the House of Representa-
tives and the Committee on Agriculture, Nutrition, and 
Forestry of the Senate a report that describes the results 
of the study conducted under this section. 
(d) FUNDING.— 
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608 
(1) IN GENERAL.—On October 1, 2008, out of 
any funds in the Treasury not otherwise appro-
priated, the Secretary of the Treasury shall transfer 
to 
the 
Secretary 
to 
carry 
out 
this 
section 
$1,000,000, to remain available until expended. 
(2) RECEIPT
AND
ACCEPTANCE.—The Sec-
retary shall be entitled to receive, shall accept, and 
shall use to carry out this section the funds trans-
ferred under paragraph (1), without further appro-
priation. 
Subtitle B—Food Distribution 
Programs 
PART I—EMERGENCY FOOD ASSISTANCE 
PROGRAM 
SEC. 4201. EMERGENCY FOOD ASSISTANCE. 
(a) PURCHASE OF COMMODITIES.—Section 27(a) of 
the Food and Nutrition Act of 2008 (7 U.S.C. 2036(a)) 
is amended by – 
(1) by striking ‘‘(A) PURCHASE OF COMMOD-
ITIES’’ and all that follows through ‘‘$140,000,000 
of’’ and inserting the following: 
‘‘(a) PURCHASE OF COMMODITIES.— 
‘‘(1) IN GENERAL.—From amounts made avail-
able to carry out this Act, for each of the fiscal 
years 2008 through 2012, the Secretary shall pur-
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chase a dollar amount described in paragraph (2) 
of’’; and 
(2) by adding at the end the following: 
‘‘(2) AMOUNTS.—The Secretary shall use to 
carry out paragraph (1)— 
‘‘(A) for fiscal year 2008, $190,000,000; 
‘‘(B) for fiscal year 2009, $250,000,000; 
and 
‘‘(C) for each of fiscal years 2010 through 
2012, the dollar amount of commodities speci-
fied in subparagraph (B) adjusted by the per-
centage by which the thrifty food plan has been 
adjusted under section 3(u)(4) between June 
30, 2008, and June 30 of the immediately pre-
ceding fiscal year.’’. 
(b) STATE PLANS.—Section 202A of the Emergency 
Food Assistance Act of 1983 (7 U.S.C. 7503) is amended 
by striking subsection (a) and inserting the following: 
‘‘(a) PLANS.— 
‘‘(1) IN
GENERAL.—To receive commodities 
under this Act, a State shall submit to the Secretary 
an operation and administration plan for the provi-
sion of benefits under this Act. 
‘‘(2) UPDATES.—A State shall submit to the 
Secretary for approval any amendment to a plan 
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submitted under paragraph (1) in any case in which 
the State proposes to make a change to the oper-
ation or administration of a program described in 
the plan.’’. 
(c) AUTHORIZATION AND APPROPRIATIONS.—Section 
204(a)(1) of the Emergency Food Assistance Act of 1983 
(7 U.S.C. 7508(a)(1)) is amended in the first sentence— 
(1) by striking ‘‘$60,000,000’’ and inserting 
‘‘$100,000,000’’; and 
(2) by inserting ‘‘and donated wild game’’ be-
fore the period at the end. 
SEC. 4202. EMERGENCY FOOD PROGRAM INFRASTRUCTURE 
GRANTS. 
The Emergency Food Assistance Act of 1983 is 
amended by inserting after section 208 (7 U.S.C. 7511) 
the following: 
‘‘SEC. 209. EMERGENCY FOOD PROGRAM INFRASTRUCTURE 
GRANTS. 
‘‘(a) DEFINITION OF ELIGIBLE ENTITY.—In this sec-
tion, the term ‘eligible entity’ means an emergency feeding 
organization. 
‘‘(b) PROGRAM AUTHORIZED.— 
‘‘(1) IN
GENERAL.—The Secretary shall use 
funds made available under subsection (d) to make 
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grants to eligible entities to pay the costs of an ac-
tivity described in subsection (c). 
‘‘(2) RURAL
PREFERENCE.—The Secretary 
shall use not less than 50 percent of the funds de-
scribed in paragraph (1) for a fiscal year to make 
grants to eligible entities that serve predominantly 
rural communities for the purposes of— 
‘‘(A) expanding the capacity and infra-
structure of food banks, State-wide food bank 
associations, and food bank collaboratives that 
operate in rural areas; and 
‘‘(B) improving the capacity of the food 
banks to procure, receive, store, distribute, 
track, and deliver time-sensitive or perishable 
food products. 
‘‘(c) USE OF FUNDS.—An eligible entity shall use a 
grant received under this section for any fiscal year to 
carry out activities of the eligible entity, including— 
‘‘(1) the development and maintenance of a 
computerized system for the tracking of time-sen-
sitive food products; 
‘‘(2) capital, infrastructure, and operating costs 
associated with the collection, storage, distribution, 
and transportation of time-sensitive and perishable 
food products; 
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‘‘(3) improving the security and diversity of the 
emergency food distribution and recovery systems of 
the United States through the support of small or 
mid-size farms and ranches, fisheries, and aqua-
culture, and donations from local food producers and 
manufacturers to persons in need; 
‘‘(4) providing recovered foods to food banks 
and similar nonprofit emergency food providers to 
reduce hunger in the United States; 
‘‘(5) improving the identification of— 
‘‘(A) potential providers of donated foods; 
‘‘(B) potential nonprofit emergency food 
providers; and 
‘‘(C) persons in need of emergency food as-
sistance in rural areas; and 
‘‘(6) constructing, expanding, or repairing a fa-
cility or equipment to support hunger relief agencies 
in the community. 
‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 
is authorized to be appropriated to carry out this section 
$15,000,000 for each of fiscal years 2008 through 2012.’’. 
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PART II—FOOD DISTRIBUTION PROGRAM ON 
INDIAN RESERVATIONS 
SEC. 4211. ASSESSING THE NUTRITIONAL VALUE OF THE 
FDPIR FOOD PACKAGE. 
(a) IN GENERAL.—Section 4 of the Food and Nutri-
tion Act of 2008 (7 U.S.C. 2013) is amended by striking 
subsection (b) and inserting the following: 
‘‘(b) FOOD DISTRIBUTION PROGRAM
ON INDIAN 
RESERVATIONS.— 
‘‘(1) IN
GENERAL.—Distribution of commod-
ities, with or without the supplemental nutrition as-
sistance program, shall be made whenever a request 
for concurrent or separate food program operations, 
respectively, is made by a tribal organization. 
‘‘(2) ADMINISTRATION.— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graphs (B) and (C), in the event of distribution 
on all or part of an Indian reservation, the ap-
propriate agency of the State government in the 
area involved shall be responsible for the dis-
tribution. 
‘‘(B) ADMINISTRATION BY TRIBAL ORGANI-
ZATION.—If the Secretary determines that a 
tribal organization is capable of effectively and 
efficiently administering a distribution de-
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scribed in paragraph (1), then the tribal organi-
zation shall administer the distribution. 
‘‘(C) PROHIBITION.—The Secretary shall 
not approve any plan for a distribution de-
scribed in paragraph (1) that permits any 
household on any Indian reservation to partici-
pate simultaneously in the supplemental nutri-
tion assistance program and the program estab-
lished under this subsection. 
‘‘(3) DISQUALIFIED
PARTICIPANTS.—An indi-
vidual who is disqualified from participation in the 
food distribution program on Indian reservations 
under this subsection is not eligible to participate in 
the supplemental nutrition assistance program under 
this Act for a period of time to be determined by the 
Secretary. 
‘‘(4) ADMINISTRATIVE COSTS.—The Secretary 
is authorized to pay such amounts for administrative 
costs and distribution costs on Indian reservations 
as the Secretary finds necessary for effective admin-
istration of such distribution by a State agency or 
tribal organization. 
‘‘(5) BISON MEAT.—Subject to the availability 
of appropriations to carry out this paragraph, the 
Secretary may purchase bison meat for recipients of 
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food distributed under this subsection, including 
bison meat from— 
‘‘(A) Native American bison producers; 
and 
‘‘(B) producer–owned cooperatives of bison 
ranchers. 
‘‘(6) TRADITIONAL AND LOCALLY-GROWN FOOD 
FUND.— 
‘‘(A) IN GENERAL.—Subject to the avail-
ability of appropriations, the Secretary shall es-
tablish a fund for use in purchasing traditional 
and locally-grown foods for recipients of food 
distributed under this subsection. 
‘‘(B) NATIVE
AMERICAN
PRODUCERS.— 
Where practicable, of the food provided under 
subparagraph (A), at least 50 percent shall be 
produced by Native American farmers, ranch-
ers, and producers. 
‘‘(C) DEFINITION
OF
TRADITIONAL
AND 
LOCALLY GROWN.—The Secretary shall deter-
mine the definition of the term ‘traditional and 
locally-grown’ with respect to food distributed 
under this paragraph. 
‘‘(D) SURVEY.—In carrying out this para-
graph, the Secretary shall— 
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‘‘(i) survey participants of the food 
distribution program on Indian reserva-
tions established under this subsection to 
determine which traditional foods are most 
desired by those participants; and 
‘‘(ii) purchase or offer to purchase 
those traditional foods that may be pro-
cured cost-effectively. 
‘‘(E) REPORT.—Not later than 1 year 
after the date of enactment of this paragraph, 
and annually thereafter, the Secretary shall 
submit to the Committee on Agriculture of the 
House of Representatives and the Committee 
on Agriculture, Nutrition, and Forestry of the 
Senate a report describing the activities carried 
out under this paragraph during the preceding 
calendar year. 
‘‘(F) 
AUTHORIZATION
OF
APPROPRIA-
TIONS.—There is authorized to be appropriated 
to the Secretary to carry out this paragraph 
$5,000,000 for each of fiscal years 2008 
through 2012.’’. 
(b) FDPIR FOOD PACKAGE.—Not later than 180 
days after the date of enactment of this Act, the Secretary 
shall submit to the Committee on Agriculture of the House 
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of Representatives and the Committee on Agriculture, Nu-
trition, and Forestry of the Senate a report that de-
scribes— 
(1) how the Secretary derives the process for 
determining the food package under the food dis-
tribution program on Indian reservations established 
under section 4(b) of the Food and Nutrition Act of 
2008 (7 U.S.C. 2013(b)) (referred to in this sub-
section as the ‘‘food package’’); 
(2) the extent to which the food package— 
(A) addresses the nutritional needs of low- 
income Native Americans compared to the sup-
plemental nutrition assistance program, par-
ticularly for very low-income households; 
(B) conforms (or fails to conform) to the 
2005 Dietary Guidelines for Americans pub-
lished under section 301 of the National Nutri-
tion Monitoring and Related Research Act of 
1990 (7 U.S.C. 5341); 
(C) addresses (or fails to address) the nu-
tritional and health challenges that are specific 
to Native Americans; and 
(D) is limited by distribution costs or chal-
lenges in infrastructure; and 
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(3)(A) any plans of the Secretary to revise and 
update the food package to conform with the most 
recent Dietary Guidelines for Americans, including 
any costs associated with the planned changes; or 
(B) if the Secretary does not plan changes to 
the food package, the rationale of the Secretary for 
retaining the food package. 
PART III—COMMODITY SUPPLEMENTAL FOOD 
PROGRAM 
SEC. 4221. COMMODITY SUPPLEMENTAL FOOD PROGRAM. 
Section 5 of the Agriculture and Consumer Protec-
tion Act of 1973 (7 U.S.C. 612c note; Public Law 93– 
86) is amended by striking subsection (g) and inserting 
the following: 
‘‘(g) PROHIBITION.—Notwithstanding any other pro-
vision of law (including regulations), the Secretary may 
not require a State or local agency to prioritize assistance 
to a particular group of individuals that are— 
‘‘(1) low-income persons aged 60 and older; or 
‘‘(2) women, infants, and children.’’. 
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PART IV—SENIOR FARMERS’ MARKET 
NUTRITION PROGRAM 
SEC. 4231. SENIORS FARMERS’ MARKET NUTRITION PRO-
GRAM. 
Section 4402 of the Farm Security and Rural Invest-
ment Act of 2002 (7 U.S.C. 3007) is amended— 
(1) in subsection (b)(1), by inserting ‘‘honey,’’ 
after ‘‘vegetables,’’; 
(2) by striking subsection (c) and inserting the 
following: 
‘‘(c) EXCLUSION
OF BENEFITS
IN DETERMINING 
ELIGIBILITY FOR OTHER PROGRAMS.—The value of any 
benefit provided to any eligible seniors farmers’ market 
nutrition program recipient under this section shall not 
be considered to be income or resources for any purposes 
under any Federal, State, or local law.’’; and 
(3) by adding at the end the following: 
‘‘(d) PROHIBITION
ON
COLLECTION
OF
SALES 
TAX.—Each State shall ensure that no State or local tax 
is collected within the State on a purchase of food with 
a benefit distributed under the seniors farmers’ market 
nutrition program. 
‘‘(e) REGULATIONS.—The Secretary may promulgate 
such regulations as the Secretary considers to be nec-
essary to carry out the seniors farmers’ market nutrition 
program.’’. 
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Subtitle C—Child Nutrition and 
Related Programs 
SEC. 4301. STATE PERFORMANCE ON ENROLLING CHIL-
DREN RECEIVING PROGRAM BENEFITS FOR 
FREE SCHOOL MEALS. 
(a) IN GENERAL.—Not later than December 31, 
2008 and June 30 of each year thereafter, the Secretary 
shall submit to the Committees on Agriculture and Edu-
cation and Labor of the House of Representatives and the 
Committee on Agriculture, Nutrition, and Forestry of the 
Senate a report that assesses the effectiveness of each 
State in enrolling school-aged children in households re-
ceiving program benefits under the Food and Nutrition 
Act of 2008 (7 U.S.C. 2011 et seq.) (referred to in this 
section as ‘‘program benefits’’) for free school meals using 
direct certification. 
(b) SPECIFIC MEASURES.—The assessment of the 
Secretary of the performance of each State shall include— 
(1) an estimate of the number of school-aged 
children, by State, who were members of a house-
hold receiving program benefits at any time in July, 
August, or September of the prior year; 
(2) an estimate of the number of school-aged 
children, by State, who were directly certified as eli-
gible for free lunches under the Richard B. Russell 
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National School Lunch Act (42 U.S.C. 1751 et 
seq.), based on receipt of program benefits, as of Oc-
tober 1 of the prior year; and 
(3) an estimate of the number of school-aged 
children, by State, who were members of a house-
hold receiving program benefits at any time in July, 
August, or September of the prior year who were not 
candidates for direct certification because on Octo-
ber 1 of the prior year the children attended a 
school operating under the special assistance provi-
sions of section 11(a)(1) of the Richard B. Russell 
National School Lunch Act (42 U.S.C. 1759a(a)(1)) 
that is not operating in a base year. 
(c) PERFORMANCE INNOVATIONS.—The report of the 
Secretary shall describe best practices from States with 
the best performance or the most improved performance 
from the previous year. 
SEC. 4302. PURCHASES OF LOCALLY PRODUCED FOODS. 
Section 9(j) of the Richard B. Russell National 
School Lunch Act (42 U.S.C. 1758(j)) is amended to read 
as follows: 
‘‘(j) PURCHASES OF LOCALLY PRODUCED FOODS.— 
The Secretary shall— 
‘‘(1) encourage institutions receiving funds 
under this Act and the Child Nutrition Act of 1966 
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(42 U.S.C. 1771 et seq.) to purchase unprocessed 
agricultural products, both locally grown and locally 
raised, to the maximum extent practicable and ap-
propriate; 
‘‘(2) advise institutions participating in a pro-
gram described in paragraph (1) of the policy de-
scribed in that paragraph and paragraph (3) and 
post information concerning the policy on the 
website maintained by the Secretary; and 
‘‘(3) allow institutions receiving funds under 
this Act and the Child Nutrition Act of 1966 (42 
U.S.C. 1771 et seq.), including the Department of 
Defense Fresh Fruit and Vegetable Program, to use 
a geographic preference for the procurement of un-
processed agricultural products, both locally grown 
and locally raised.’’. 
SEC. 4303. HEALTHY FOOD EDUCATION AND PROGRAM 
REPLICABILITY. 
Section 18(h) of the Richard B. Russell National 
School Lunch Act (42 U.S.C. 1769(h)) is amended— 
(1) in paragraph (1)(C), by inserting ‘‘promotes 
healthy food education in the school curriculum 
and’’ before ‘‘incorporates’’; 
(2) by redesignating paragraph (2) as para-
graph (4); and 
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(3) by inserting after paragraph (1) the fol-
lowing: 
‘‘(2) ADMINISTRATION.—In providing grants 
under paragraph (1), the Secretary shall give pri-
ority to projects that can be replicated in schools. 
‘‘(3) PILOT
PROGRAM
FOR
HIGH-POVERTY 
SCHOOLS.— 
‘‘(A) DEFINITIONS.—In this paragraph: 
‘‘(i) ELIGIBLE PROGRAM.—The term 
‘eligible program’ means— 
‘‘(I) a school-based program with 
hands-on vegetable gardening and nu-
trition education that is incorporated 
into the curriculum for 1 or more 
grades at 2 or more eligible schools; 
or 
‘‘(II) a community-based summer 
program with hands-on vegetable gar-
dening and nutrition education that is 
part of, or coordinated with, a sum-
mer enrichment program at 2 or more 
eligible schools. 
‘‘(ii) ELIGIBLE
SCHOOL.—The term 
‘eligible school’ means a public school, at 
least 50 percent of the students of which 
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are eligible for free or reduced price meals 
under this Act. 
‘‘(B) 
ESTABLISHMENT.—The 
Secretary 
shall carry out a pilot program under which the 
Secretary shall provide to nonprofit organiza-
tions or public entities in not more than 5 
States grants to develop and run, through eligi-
ble programs, community gardens at eligible 
schools in the States that would— 
‘‘(i) be planted, cared for, and har-
vested by students at the eligible schools; 
and 
‘‘(ii) teach the students participating 
in the community gardens about agri-
culture production practices and diet. 
‘‘(C) PRIORITY STATES.—Of the States in 
which grantees under this paragraph are lo-
cated— 
‘‘(i) at least 1 State shall be among 
the 15 largest States, as determined by the 
Secretary; 
‘‘(ii) at least 1 State shall be among 
the 16th to 30th largest States, as deter-
mined by the Secretary; and 
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‘‘(iii) at least 1 State shall be a State 
that is not described in clause (i) or (ii). 
‘‘(D) USE OF PRODUCE.—Produce from a 
community garden provided a grant under this 
paragraph may be— 
‘‘(i) used to supplement food provided 
at the eligible school; 
‘‘(ii) distributed to students to bring 
home to the families of the students; or 
‘‘(iii) donated to a local food bank or 
senior center nutrition program. 
‘‘(E) NO COST-SHARING REQUIREMENT.— 
A nonprofit organization or public entity that 
receives a grant under this paragraph shall not 
be required to share the cost of carrying out the 
activities assisted under this paragraph. 
‘‘(F) EVALUATION.—A nonprofit organiza-
tion or public entity that receives a grant under 
this paragraph shall be required to cooperate in 
an evaluation in accordance with paragraph 
(1)(H).’’. 
SEC. 4304. FRESH FRUIT AND VEGETABLE PROGRAM. 
(a) PROGRAM.— 
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(1) IN GENERAL.—The Richard B. Russell Na-
tional School Lunch Act is amended by inserting 
after section 18 (42 U.S.C. 1769) the following: 
‘‘SEC. 19. FRESH FRUIT AND VEGETABLE PROGRAM. 
‘‘(a) IN GENERAL.—For the school year beginning 
July 2008 and each subsequent school year, the Secretary 
shall provide grants to States to carry out a program to 
make free fresh fruits and vegetables available in elemen-
tary schools (referred to in this section as the ‘program’). 
‘‘(b) PROGRAM.—A school participating in the pro-
gram shall make free fresh fruits and vegetables available 
to students throughout the school day (or at such other 
times as are considered appropriate by the Secretary) in 
1 or more areas designated by the school. 
‘‘(c) FUNDING TO STATES.— 
‘‘(1) MINIMUM GRANT.—Except as provided in 
subsection (i)(2), the Secretary shall provide to each 
of the 50 States and the District of Columbia an an-
nual grant in an amount equal to 1 percent of the 
funds made available for a year to carry out the pro-
gram. 
‘‘(2) ADDITIONAL FUNDING.—Of the funds re-
maining after grants are made under paragraph (1), 
the Secretary shall allocate additional funds to each 
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State that is operating a school lunch program 
under section 4 based on the proportion that— 
‘‘(A) the population of the State; bears to 
‘‘(B) the population of the United States. 
‘‘(d) SELECTION OF SCHOOLS.— 
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2) of this subsection and section 4304(a)(2) 
of the Food, Conservation, and Energy Act of 2008, 
each year, in selecting schools to participate in the 
program, each State shall— 
‘‘(A) ensure that each school chosen to 
participate in the program is a school— 
‘‘(i) in which not less than 50 percent 
of the students are eligible for free or re-
duced price meals under this Act; and 
‘‘(ii) that submits an application in 
accordance with subparagraph (D); 
‘‘(B) to the maximum extent practicable, 
give the highest priority to schools with the 
highest proportion of children who are eligible 
for free or reduced price meals under this Act; 
‘‘(C) ensure that each school selected is an 
elementary school (as defined in section 9101 of 
the Elementary and Secondary Education Act 
of 1965 (20 U.S.C. 7801)); 
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‘‘(D) solicit applications from interested 
schools that include— 
‘‘(i) information pertaining to the per-
centage of students enrolled in the school 
submitting the application who are eligible 
for free or reduced price school lunches 
under this Act; 
‘‘(ii) a certification of support for par-
ticipation in the program signed by the 
school food manager, the school principal, 
and the district superintendent (or equiva-
lent positions, as determined by the 
school); 
‘‘(iii) a plan for implementation of the 
program, including efforts to integrate ac-
tivities carried out under this section with 
other efforts to promote sound health and 
nutrition, reduce overweight and obesity, 
or promote physical activity; and 
‘‘(iv) such other information as may 
be requested by the Secretary; and 
‘‘(E) encourage applicants to submit a 
plan for implementation of the program that in-
cludes a partnership with 1 or more entities 
that will provide non-Federal resources (includ-
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ing entities representing the fruit and vegetable 
industry). 
‘‘(2) EXCEPTION.—Clause (i) of paragraph 
(1)(A) shall not apply to a State if all schools that 
meet the requirements of that clause have been se-
lected and the State does not have a sufficient num-
ber of additional schools that meet the requirement 
of that clause. 
‘‘(3) OUTREACH TO LOW-INCOME SCHOOLS.— 
‘‘(A) IN GENERAL.—Prior to making deci-
sions regarding school participation in the pro-
gram, a State agency shall inform the schools 
within the State with the highest proportion of 
free and reduced price meal eligibility, including 
Native American schools, of the eligibility of the 
schools for the program with respect to priority 
granted to schools with the highest proportion 
of free and reduced price eligibility under para-
graph (1)(B). 
‘‘(B) REQUIREMENT.—In providing infor-
mation to schools in accordance with subpara-
graph (A), a State agency shall inform the 
schools that would likely be chosen to partici-
pate in the program under paragraph (1)(B). 
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‘‘(e) NOTICE OF AVAILABILITY.—If selected to par-
ticipate in the program, a school shall widely publicize 
within the school the availability of free fresh fruits and 
vegetables under the program. 
‘‘(f) PER-STUDENT GRANT.—The per-student grant 
provided to a school under this section shall be— 
‘‘(1) determined by a State agency; and 
‘‘(2) not less than $50, nor more than $75. 
‘‘(g) LIMITATION.—To the maximum extent prac-
ticable, each State agency shall ensure that in making the 
fruits and vegetables provided under this section available 
to students, schools offer the fruits and vegetables sepa-
rately from meals otherwise provided at the school under 
this Act or the Child Nutrition Act of 1966 (42 U.S.C. 
1771 et seq.). 
‘‘(h) EVALUATION AND REPORTS.— 
‘‘(1) IN GENERAL.—The Secretary shall con-
duct an evaluation of the program, including a de-
termination as to whether children experienced, as a 
result of participating in the program— 
‘‘(A) increased consumption of fruits and 
vegetables; 
‘‘(B) other dietary changes, such as de-
creased consumption of less nutritious foods; 
and 
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‘‘(C) such other outcomes as are consid-
ered appropriate by the Secretary. 
‘‘(2) REPORT.—Not later than September 30, 
2011, the Secretary shall submit to the Committee 
on Education and Labor of the House of Represent-
atives and the Committee on Agriculture, Nutrition, 
and Forestry of the Senate a report that describes 
the results of the evaluation under paragraph (1). 
‘‘(i) FUNDING.— 
‘‘(1) IN
GENERAL.—Out of the funds made 
available under subsection (b)(2)(A) of section 
14222 of the Food, Conservation, and Energy Act of 
2008, the Secretary shall use the following amounts 
to carry out this section: 
‘‘(A) On October 1, 2008, $40,000,000. 
‘‘(B) On July 1, 2009, $65,000,000. 
‘‘(C) On July 1, 2010, $101,000,000. 
‘‘(D) On July 1, 2011, $150,000,000. 
‘‘(E) On July 1, 2012, and each July 1 
thereafter, the amount made available for the 
preceding fiscal year, as adjusted to reflect 
changes for the 12-month period ending the 
preceding April 30 in the Consumer Price Index 
for All Urban Consumers published by the Bu-
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reau of Labor Statistics of the Department of 
Labor, for items other than food. 
‘‘(2) MAINTENANCE OF EXISTING FUNDING.— 
In allocating funding made available under para-
graph (1) among the States in accordance with sub-
section (c), the Secretary shall ensure that each 
State that received funding under section 18(f) on 
the day before the date of enactment of the Food, 
Conservation, and Energy Act of 2008 shall con-
tinue to receive sufficient funding under this section 
to maintain the caseload level of the State under 
that section as in effect on that date. 
‘‘(3) EVALUATION
FUNDING.—On October 1, 
2008, out of any funds made available under sub-
section (b)(2)(A) of section 14222 of the Food, Con-
servation, and Energy Act of 2008, the Secretary 
shall use to carry out the evaluation required under 
subsection (h), $3,000,000, to remain available for 
obligation until September 30, 2010. 
‘‘(4) RECEIPT
AND
ACCEPTANCE.—The Sec-
retary shall be entitled to receive, shall accept, and 
shall use to carry out this section any funds trans-
ferred for that purpose, without further appropria-
tion. 
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‘‘(5) AUTHORIZATION OF APPROPRIATIONS.—In 
addition to any other amounts made available to 
carry out this section, there are authorized to be ap-
propriated such sums as are necessary to expand the 
program established under this section. 
‘‘(6) ADMINISTRATIVE COSTS.— 
‘‘(A) IN GENERAL.—Of funds made avail-
able to carry out this section for a fiscal year, 
the Secretary may use not more than $500,000 
for the administrative costs of carrying out the 
program. 
‘‘(B) RESERVATION OF FUNDS.—The Sec-
retary shall allow each State to reserve such 
funding as the Secretary determines to be nec-
essary to administer the program in the State 
(with adjustments for the size of the State and 
the grant amount), but not to exceed the 
amount required to pay the costs of 1 full-time 
coordinator for the program in the State. 
‘‘(7) REALLOCATION.— 
‘‘(A) AMONG STATES.—The Secretary may 
reallocate any amounts made available to carry 
out this section that are not obligated or ex-
pended by a date determined by the Secretary. 
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‘‘(B) WITHIN STATES.—A State that re-
ceives a grant under this section may reallocate 
any amounts made available under the grant 
that are not obligated or expended by a date de-
termined by the Secretary.’’. 
(2) TRANSITION OF EXISTING SCHOOLS.— 
(A) EXISTING SECONDARY SCHOOLS.—Sec-
tion 19(d)(1)(C) of the Richard B. Russell Na-
tional School Lunch Act (as amended by para-
graph (1)) may be waived by a State until July 
1, 2010, for each secondary school in the State 
that has been awarded funding under section 
18(f) of that Act (42 U.S.C. 1769(f)) for the 
school year beginning July 1, 2008. 
(B) SCHOOL
YEAR
BEGINNING
JULY
1, 
2008.—To facilitate transition from the program 
authorized under section 18(f) of the Richard 
B. Russell National School Lunch Act (42 
U.S.C. 1769(f)) (as in effect on the day before 
the date of enactment of this Act) to the pro-
gram established under section 19 of that Act 
(as amended by paragraph (1))— 
(i) for the school year beginning July 
1, 2008, the Secretary may permit any 
school selected for participation under sec-
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tion 18(f) of that Act (42 U.S.C. 1769(f)) 
for that school year to continue to partici-
pate under section 19 of that Act until the 
end of that school year; and 
(ii) funds made available under that 
Act for fiscal year 2009 may be used to 
support the participation of any schools se-
lected to participate in the program au-
thorized under section 18(f) of that Act 
(42 U.S.C. 1769(f)) (as in effect on the 
day before the date of enactment of this 
Act). 
(b) CONFORMING AMENDMENTS.—Section 18 of the 
Richard B. Russell National School Lunch Act (42 U.S.C. 
1769) is amended— 
(1) by striking subsection (f); and 
(2) by redesignating subsections (g) through (j) 
as subsections (f) through (i), respectively. 
SEC. 4305. WHOLE GRAIN PRODUCTS. 
(a) PURPOSE.—The purpose of this section is to en-
courage greater awareness and interest in the number and 
variety of whole grain products available to schoolchildren, 
as recommended by the 2005 Dietary Guidelines for 
Americans. 
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(b) DEFINITION OF ELIGIBLE WHOLE GRAINS AND 
WHOLE GRAIN PRODUCTS.—In this section, the terms 
‘‘whole grains’’ and ‘‘whole grain products’’ have the 
meaning given the terms by the Food and Nutrition Serv-
ice in the HealthierUS School Challenge. 
(c) PURCHASE
OF WHOLE GRAINS
AND WHOLE 
GRAIN PRODUCTS.—In addition to the commodities deliv-
ered under section 6 of the Richard B. Russell National 
School Lunch Act (42 U.S.C. 1755), the Secretary shall 
purchase whole grains and whole grain products for use 
in— 
(1) the school lunch program established under 
the Richard B. Russell National School Lunch Act 
(42 U.S.C. 1751 et seq.); and 
(2) the school breakfast program established by 
section 4 of the Child Nutrition Act of 1966 (42 
U.S.C. 1773). 
(d) EVALUATION.—Not later than September 30, 
2011, the Secretary shall conduct an evaluation of the ac-
tivities conducted under subsection (c) that includes— 
(1) an evaluation of whether children partici-
pating in the school lunch and breakfast programs 
increased their consumption of whole grains; 
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(2) an evaluation of which whole grains and 
whole grain products are most acceptable for use in 
the school lunch and breakfast programs; 
(3) any recommendations of the Secretary re-
garding the integration of whole grain products in 
the school lunch and breakfast programs; and 
(4) an evaluation of any other outcomes deter-
mined to be appropriate by the Secretary. 
(e) REPORT.—As soon as practicable after the com-
pletion of the evaluation under subsection (d), the Sec-
retary shall submit to the Committee on Agriculture, Nu-
trition, and Forestry of the Senate and the Committee on 
Education and Labor of the House of Representative a 
report describing the results of the evaluation. 
SEC. 4306. BUY AMERICAN REQUIREMENTS. 
(a) FINDINGS.—The Congress finds the following: 
(1) Federal law requires that commodities and 
products purchased with Federal funds be, to the ex-
tent practicable, of domestic origin. 
(2) Federal Buy American statutory require-
ments seek to ensure that purchases made with Fed-
eral funds benefit domestic producers. 
(3) The Richard B. Russell National School 
Lunch Act (42 U.S.C. 1751 et seq.) requires the use 
of domestic food products for all meals served under 
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the program, including food products purchased with 
local funds. 
(b) BUY AMERICAN STATUTORY REQUIREMENTS.— 
The Department of Agriculture should undertake training, 
guidance, and enforcement of the various current Buy 
American statutory requirements and regulations, includ-
ing those of the Richard B. Russell National School Lunch 
Act (42 U.S.C. 1751 et seq.). 
SEC. 4307. SURVEY OF FOODS PURCHASED BY SCHOOL 
FOOD AUTHORITIES. 
(a) IN GENERAL.—For fiscal year 2009, the Sec-
retary shall carry out a nationally representative survey 
of the foods purchased during the most recent school year 
for which data is available by school authorities partici-
pating in the school lunch program established under the 
Richard B. Russell National School Lunch Act (42 U.S.C. 
1751 et seq.). 
(b) REPORT.— 
(1) IN GENERAL.—On completion of the survey, 
the Secretary shall submit to the Committees on Ag-
riculture and Education and Labor of the House of 
Representatives and the Committee on Agriculture, 
Nutrition, and Forestry of the Senate a report that 
describes the results of the survey. 
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(2) INTERIM REQUIREMENT.—If the initial re-
port required under paragraph (1) is not submitted 
to the Committees referred to in that paragraph by 
June 30, 2009, the Secretary shall submit to the 
Committees an interim report that describes the rel-
evant survey data, or a sample of such data, avail-
able to the Secretary as of that date. 
(c) FUNDING.—Of the funds of the Commodity Cred-
it Corporation, the Secretary shall use to carry out this 
section not more than $3,000,000. 
Subtitle D—Miscellaneous 
SEC. 4401. BILL EMERSON NATIONAL HUNGER FELLOWS 
AND MICKEY LELAND INTERNATIONAL HUN-
GER FELLOWS. 
Section 4404 of the Farm Security and Rural Invest-
ment Act of 2002 (2 U.S.C. 1161) is amended to read 
as follows: 
‘‘SEC. 4404. BILL EMERSON NATIONAL HUNGER FELLOWS 
AND MICKEY LELAND INTERNATIONAL HUN-
GER FELLOWS. 
‘‘(a) SHORT TITLE.—This section may be cited as the 
‘Bill Emerson National Hunger Fellows and Mickey Le-
land International Hunger Fellows Program Act of 2008’. 
‘‘(b) DEFINITIONS.—In this subsection: 
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‘‘(1) DIRECTOR.—The term ‘Director’ means 
the head of the Congressional Hunger Center. 
‘‘(2) FELLOW.—The term ‘fellow’ means— 
‘‘(A) a Bill Emerson Hunger Fellow; or 
‘‘(B) Mickey Leland Hunger Fellow. 
‘‘(3) FELLOWSHIP PROGRAMS.—The term ‘Fel-
lowship Programs’ means the Bill Emerson National 
Hunger Fellowship Program and the Mickey Leland 
International Hunger Fellowship Program estab-
lished under subsection (c)(1). 
‘‘(c) FELLOWSHIP PROGRAMS.— 
‘‘(1) IN
GENERAL.—There is established the 
Bill Emerson National Hunger Fellowship Program 
and the Mickey Leland International Hunger Fel-
lowship Program. 
‘‘(2) PURPOSES.— 
‘‘(A) IN GENERAL.—The purposes of the 
Fellowship Programs are— 
‘‘(i) to encourage future leaders of the 
United States— 
‘‘(I) to pursue careers in humani-
tarian and public service; 
‘‘(II) to recognize the needs of 
low-income people and hungry people; 
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‘‘(III) to provide assistance to 
people in need; and 
‘‘(IV) to seek public policy solu-
tions to the challenges of hunger and 
poverty; 
‘‘(ii) to provide training and develop-
ment 
opportunities 
for 
such 
leaders 
through placement in programs operated 
by appropriate organizations or entities; 
and 
‘‘(iii) to increase awareness of the im-
portance of public service. 
‘‘(B) BILL
EMERSON
HUNGER
FELLOW-
SHIP PROGRAM.—The purpose of the Bill Emer-
son Hunger Fellowship Program is to address 
hunger and poverty in the United States. 
‘‘(C) MICKEY LELAND HUNGER FELLOW-
SHIP
PROGRAM.—The purpose of the Mickey 
Leland Hunger Fellowship Program is to ad-
dress international hunger and other humani-
tarian needs. 
‘‘(3) ADMINISTRATION.— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), the Secretary shall offer to provide 
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a grant to the Congressional Hunger Center to 
administer the Fellowship Programs. 
‘‘(B) TERMS OF GRANT.—The terms of the 
grant provided under subparagraph (A), includ-
ing the length of the grant and provisions for 
the alteration or termination of the grant, shall 
be determined by the Secretary in accordance 
with this section. 
‘‘(d) FELLOWSHIPS.— 
‘‘(1) IN GENERAL.—The Director shall make 
available Bill Emerson Hunger Fellowships and 
Mickey Leland Hunger Fellowships in accordance 
with this subsection. 
‘‘(2) CURRICULUM.— 
‘‘(A) IN GENERAL.—The Fellowship Pro-
grams shall provide experience and training to 
develop the skills necessary to train fellows to 
carry out the purposes described in subsection 
(c)(2), including— 
‘‘(i) training in direct service pro-
grams for the hungry and other anti-hun-
ger programs in conjunction with commu-
nity-based organizations through a pro-
gram of field placement; and 
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‘‘(ii) providing experience in policy de-
velopment through placement in a govern-
mental entity or nongovernmental, non-
profit, or private sector organization. 
‘‘(B) WORK PLAN.—To carry out subpara-
graph (A) and assist in the evaluation of the 
fellowships under paragraph (6), the Director 
shall, for each fellow, approve a work plan that 
identifies the target objectives for the fellow in 
the fellowship, including specific duties and re-
sponsibilities relating to those objectives. 
‘‘(3) PERIOD OF FELLOWSHIP.— 
‘‘(A) BILL EMERSON HUNGER FELLOW.— 
A Bill Emerson Hunger Fellowship awarded 
under this section shall be for not more than 15 
months. 
‘‘(B) MICKEY
LELAND
HUNGER
FEL-
LOW.—A Mickey Leland Hunger Fellowship 
awarded under this section shall be for not 
more than 2 years. 
‘‘(4) SELECTION OF FELLOWS.— 
‘‘(A) IN GENERAL.—Fellowships shall be 
awarded pursuant to a nationwide competition 
established by the Director. 
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‘‘(B) QUALIFICATIONS.—A successful pro-
gram applicant shall be an individual who has 
demonstrated— 
‘‘(i) an intent to pursue a career in 
humanitarian services and outstanding po-
tential for such a career; 
‘‘(ii) leadership potential or actual 
leadership experience; 
‘‘(iii) diverse life experience; 
‘‘(iv) proficient writing and speaking 
skills; 
‘‘(v) an ability to live in poor or di-
verse communities; and 
‘‘(vi) such other attributes as are con-
sidered to be appropriate by the Director. 
‘‘(5) AMOUNT OF AWARD.— 
‘‘(A) IN
GENERAL.—A fellow shall re-
ceive— 
‘‘(i) a living allowance during the term 
of the Fellowship; and 
‘‘(ii) subject to subparagraph (B), an 
end-of-service award. 
‘‘(B) REQUIREMENT
FOR
SUCCESSFUL 
COMPLETION
OF
FELLOWSHIP.—Each fellow 
shall be entitled to receive an end-of-service 
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award at an appropriate rate for each month of 
satisfactory service completed, as determined by 
the Director. 
‘‘(C) TERMS
OF
FELLOWSHIP.—A fellow 
shall not be considered an employee of— 
‘‘(i) the Department of Agriculture; 
‘‘(ii) the Congressional Hunger Cen-
ter; or 
‘‘(iii) a host agency in the field or pol-
icy placement of the fellow. 
‘‘(D) 
RECOGNITION
OF
FELLOWSHIP 
AWARD.— 
‘‘(i) EMERSON
FELLOW.—An indi-
vidual awarded a fellowship from the Bill 
Emerson Hunger Fellowship shall be 
known as an ‘Emerson Fellow’. 
‘‘(ii) LELAND
FELLOW.—An indi-
vidual awarded a fellowship from the Mick-
ey Leland Hunger Fellowship shall be 
known as a ‘Leland Fellow’. 
‘‘(6) EVALUATIONS AND AUDITS.—Under terms 
stipulated in the contract entered into under sub-
section (c)(3), the Director shall— 
‘‘(A) conduct periodic evaluations of the 
Fellowship Programs; and 
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‘‘(B) arrange for annual independent fi-
nancial audits of expenditures under the Fel-
lowship Programs. 
‘‘(e) AUTHORITY.— 
‘‘(1) IN GENERAL.—Subject to paragraph (2), 
in carrying out this section, the Director may solicit, 
accept, use, and dispose of gifts, bequests, or devises 
of services or property, both real and personal, for 
the purpose of facilitating the work of the Fellow-
ship Programs. 
‘‘(2) LIMITATION.—Gifts, bequests, or devises 
of money and proceeds from sales of other property 
received as gifts, bequests, or devises shall be used 
exclusively for the purposes of the Fellowship Pro-
grams. 
‘‘(f) REPORT.—The Director shall annually submit to 
the Secretary of Agriculture, the Committee on Agri-
culture of the House of Representatives, and the Com-
mittee on Agriculture, Nutrition, and Forestry of the Sen-
ate a report that— 
‘‘(1) describes the activities and expenditures of 
the Fellowship Programs during the preceding fiscal 
year, including expenditures made from funds made 
available under subsection (g); and 
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‘‘(2) includes the results of evaluations and au-
dits required by subsection (d). 
‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There 
are authorized to be appropriated to the Secretary such 
sums as are necessary to carry out this section, to remain 
available until expended.’’. 
SEC. 4402. ASSISTANCE FOR COMMUNITY FOOD PROJECTS. 
Section 25 of the Food and Nutrition Act of 2008 
(7 U.S.C. 2034) is amended— 
(1) by striking subsection (a) and inserting the 
following: 
‘‘(a) DEFINITIONS.—In this section: 
‘‘(1) COMMUNITY FOOD PROJECT.—In this sec-
tion, the term ‘community food project’ means a 
community-based project that— 
‘‘(A) requires a 1-time contribution of Fed-
eral assistance to become self-sustaining; and 
‘‘(B) is designed— 
‘‘(i)(I) to meet the food needs of low- 
income individuals; 
‘‘(II) to increase the self-reliance of 
communities in providing for the food 
needs of the communities; and 
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‘‘(III) to promote comprehensive re-
sponses to local food, farm, and nutrition 
issues; or 
‘‘(ii) to meet specific State, local, or 
neighborhood food and agricultural needs, 
including needs relating to— 
‘‘(I) infrastructure improvement 
and development; 
‘‘(II) planning for long-term solu-
tions; or 
‘‘(III) the creation of innovative 
marketing activities that mutually 
benefit agricultural producers and 
low-income consumers. 
‘‘(2) CENTER.—The term ‘Center’ means the 
healthy urban food enterprise development center es-
tablished under subsection (h). 
‘‘(3) UNDERSERVED
COMMUNITY.—The term 
‘underserved community’ means a community (in-
cluding an urban or rural community or an Indian 
tribe) that, as determined by the Secretary, has— 
‘‘(A) limited access to affordable, healthy 
foods, including fresh fruits and vegetables; 
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‘‘(B) a high incidence of a diet-related dis-
ease (including obesity) as compared to the na-
tional average; 
‘‘(C) a high rate of hunger or food insecu-
rity; or 
‘‘(D) severe or persistent poverty.’’; 
(2) by redesignating subsection (h) as sub-
section (i); and 
(3) by inserting after subsection (g) the fol-
lowing: 
‘‘(h) HEALTHY URBAN FOOD ENTERPRISE DEVEL-
OPMENT CENTER.— 
‘‘(1) DEFINITION
OF
ELIGIBLE
ENTITY.—In 
this subsection, the term ‘eligible entity’ means— 
‘‘(A) a nonprofit organization; 
‘‘(B) a cooperative; 
‘‘(C) a commercial entity; 
‘‘(D) an agricultural producer; 
‘‘(E) an academic institution; 
‘‘(F) an individual; and 
‘‘(G) such other entities as the Secretary 
may designate. 
‘‘(2) ESTABLISHMENT.—The Secretary shall 
offer to provide a grant to a nonprofit organization 
to establish and support a healthy urban food enter-
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prise development center to carry out the purpose 
described in paragraph (3). 
‘‘(3) PURPOSE.—The purpose of the Center is 
to increase access to healthy affordable foods, in-
cluding locally produced agricultural products, to un-
derserved communities. 
‘‘(4) ACTIVITIES.— 
‘‘(A) TECHNICAL ASSISTANCE AND INFOR-
MATION.—The Center shall collect, develop, and 
provide technical assistance and information to 
small and medium-sized agricultural producers, 
food wholesalers and retailers, schools, and 
other individuals and entities regarding best 
practices and the availability of assistance for 
aggregating, storing, processing, and marketing 
locally produced agricultural products and in-
creasing the availability of such products in un-
derserved communities. 
‘‘(B) AUTHORITY
TO
SUBGRANT.—The 
Center may provide subgrants to eligible enti-
ties— 
‘‘(i) to carry out feasibility studies to 
establish businesses for the purpose de-
scribed in paragraph (3); and 
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‘‘(ii) to establish and otherwise assist 
enterprises that process, distribute, aggre-
gate, store, and market healthy affordable 
foods. 
‘‘(5) PRIORITY.—In providing technical assist-
ance and grants under paragraph (4), the Center 
shall give priority to applications that include 
projects— 
‘‘(A) to benefit underserved communities; 
and 
‘‘(B) to develop market opportunities for 
small and mid-sized farm and ranch operations. 
‘‘(6) REPORT.—For each fiscal year for which 
the nonprofit organization described in paragraph 
(2) receives funds, the organization shall submit to 
the Secretary a report describing the activities car-
ried out in the preceding fiscal year, including— 
‘‘(A) a description of technical assistance 
provided by the Center; 
‘‘(B) the total number and a description of 
the subgrants provided under paragraph (4)(B); 
‘‘(C) a complete listing of cases in which 
the activities of the Center have resulted in in-
creased access to healthy, affordable foods, such 
as fresh fruit and vegetables, particularly for 
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school-aged children and individuals in low-in-
come communities; and 
‘‘(D) a determination of whether the activi-
ties identified in subparagraph (C) are sus-
tained during the years following the initial pro-
vision of technical assistance and subgrants 
under this section. 
‘‘(7) COMPETITIVE AWARD PROCESS.—The Sec-
retary shall use a competitive process to award 
funds to establish the Center. 
‘‘(8) LIMITATION
ON
ADMINISTRATIVE
EX-
PENSES.—Not more than 10 percent of the total 
amount allocated for this subsection in a given fiscal 
year may be used for administrative expenses. 
‘‘(9) FUNDING.— 
‘‘(A) IN GENERAL.—Out of any funds in 
the Treasury not otherwise appropriated, the 
Secretary of the Treasury shall transfer to the 
Secretary 
to 
carry 
out 
this 
subsection 
$1,000,000 for each of fiscal years 2009 
through 2011. 
‘‘(B) ADDITIONAL FUNDING.—There is au-
thorized to be appropriated $2,000,000 to carry 
out this subsection for fiscal year 2012.’’. 
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SEC. 4403. JOINT NUTRITION MONITORING AND RELATED 
RESEARCH ACTIVITIES. 
The Secretary and the Secretary of Health and 
Human Services shall continue to provide jointly for na-
tional nutrition monitoring and related research activities 
carried out as of the date of enactment of this Act— 
(1) to collect continuous dietary, health, phys-
ical activity, and diet and health knowledge data on 
a nationally representative sample; 
(2) to periodically collect data on special at-risk 
populations, as identified by the Secretaries; 
(3) to distribute information on health, nutri-
tion, the environment, and physical activity to the 
public in a timely fashion; 
(4) to analyze new data that becomes available; 
(5) to continuously update food composition ta-
bles; and 
(6) to research and develop data collection 
methods and standards. 
SEC. 4404. SECTION 32 FUNDS FOR PURCHASE OF FRUITS, 
VEGETABLES, AND NUTS TO SUPPORT DO-
MESTIC NUTRITION ASSISTANCE PROGRAMS. 
(a) FUNDING
FOR ADDITIONAL PURCHASES
OF 
FRUITS, VEGETABLES, AND NUTS.—In addition to the 
purchases of fruits, vegetables, and nuts required by sec-
tion 10603 of the Farm Security and Rural Investment 
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Act of 2002 (7 U.S.C. 612c–4), the Secretary of Agri-
culture shall purchase fruits, vegetables, and nuts for the 
purpose of providing nutritious foods for use in domestic 
nutrition assistance programs, using, of the funds made 
available under section 32 of the Act of August 24, 1935 
(7 U.S.C. 612c), the following amounts: 
(1) $190,000,000 for fiscal year 2008. 
(2) $193,000,000 for fiscal year 2009. 
(3) $199,000,000 for fiscal year 2010. 
(4) $203,000,000 for fiscal year 2011. 
(5) $206,000,000 for fiscal year 2012 and each 
fiscal year thereafter. 
(b) FORM OF PURCHASES.—Fruits, vegetables, and 
nuts may be purchased under this section in the form of 
frozen, canned, dried, or fresh fruits, vegetables, and nuts. 
(c) PURCHASE OF FRESH FRUITS AND VEGETABLES 
FOR DISTRIBUTION TO SCHOOLS AND SERVICE INSTITU-
TIONS.—Section 10603 of the Farm Security and Rural 
Investment Act of 2002 (7 U.S.C. 612c–4) is amended 
by striking subsection (b) and inserting the following: 
‘‘(b) PURCHASE OF FRESH FRUITS AND VEGETA-
BLES FOR DISTRIBUTION TO SCHOOLS AND SERVICE IN-
STITUTIONS.—The Secretary of Agriculture shall purchase 
fresh fruits and vegetables for distribution to schools and 
service institutions in accordance with section 6(a) of the 
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Richard B. Russell National School Lunch Act (42 U.S.C. 
1755(a)) using, of the amount specified in subsection (a), 
not less than $50,000,000 for each of fiscal years 2008 
through 2012.’’. 
SEC. 4405. HUNGER-FREE COMMUNITIES. 
(a) DEFINITIONS.—In this section: 
(1) ELIGIBLE ENTITY.—The term ‘‘eligible enti-
ty’’ means a public food program service provider or 
nonprofit organization, including an emergency feed-
ing organization, that has collaborated, or will col-
laborate, with 1 or more local partner organizations 
to achieve at least 1 hunger-free communities goal. 
(2) EMERGENCY
FEEDING
ORGANIZATION.— 
The term ‘‘emergency feeding organization’’ has the 
meaning given the term in section 201A of the 
Emergency Food Assistance Act of 1983 (7 U.S.C. 
7501). 
(3) HUNGER-FREE COMMUNITIES GOAL.—The 
term ‘‘hunger-free communities goal’’ means any of 
the 14 goals described in the H. Con. Res. 302 
(102nd Congress). 
(b) HUNGER-FREE COMMUNITIES COLLABORATIVE 
GRANTS.— 
(1) PROGRAM.— 
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(A) IN GENERAL.—The Secretary shall use 
not more than 50 percent of any funds made 
available under subsection (e) to make grants to 
eligible entities to pay the Federal share of the 
costs of an activity described in paragraph (2). 
(B) FEDERAL SHARE.—The Federal share 
of the cost of carrying out an activity under 
this subsection shall not exceed 80 percent. 
(C) NON-FEDERAL SHARE.— 
(i) CALCULATION.—The non-Federal 
share of the cost of an activity under this 
subsection may be provided in cash or fair-
ly evaluated in-kind contributions, includ-
ing facilities, equipment, or services. 
(ii) SOURCES.—Any entity may pro-
vide the non-Federal share of the cost of 
an activity under this subsection through a 
State government, a local government, or a 
private source. 
(2) USE OF FUNDS.—An eligible entity in a 
community shall use a grant received under this sub-
section for any fiscal year for hunger relief activities, 
including— 
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(A) meeting the immediate needs of people 
who experience hunger in the community served 
by the eligible entity by— 
(i) distributing food; 
(ii) providing community outreach to 
assist in participation in federally assisted 
nutrition programs, including— 
(I) the school breakfast program 
established by section 4 of the Child 
Nutrition Act of 1966 (42 U.S.C. 
1773); 
(II) the school lunch program es-
tablished under the Richard B. Rus-
sell National School Lunch Act (42 
U.S.C. 1751 et seq.); 
(III) the summer food service 
program 
for 
children 
established 
under section 13 of that Act; and 
(IV) other Federal programs that 
provide food for children in child care 
facilities and homeless and older indi-
viduals; or 
(iii) improving access to food as part 
of a comprehensive service; and 
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(B) developing new resources and strate-
gies to help reduce hunger in the community 
and prevent hunger in the future by— 
(i) developing creative food resources, 
such as community gardens, buying clubs, 
food cooperatives, community-owned and 
operated grocery stores, and farmers’ mar-
kets; 
(ii) coordinating food services with 
park and recreation programs and other 
community-based outlets to reduce barriers 
to access; or 
(iii) creating nutrition education pro-
grams for at-risk populations to enhance 
food-purchasing and food-preparation skills 
and to heighten awareness of the connec-
tion between diet and health. 
(c) HUNGER-FREE COMMUNITIES INFRASTRUCTURE 
GRANTS.— 
(1) PROGRAM AUTHORIZED.— 
(A) IN GENERAL.—The Secretary shall use 
not more than 50 percent of any funds made 
available for a fiscal year under subsection (e) 
to make grants to eligible entities to pay the 
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Federal share of the costs of an activity de-
scribed in paragraph (2). 
(B) FEDERAL SHARE.—The Federal share 
of the cost of carrying out an activity under 
this subsection shall not exceed 80 percent. 
(2) APPLICATION.— 
(A) IN
GENERAL.—To receive a grant 
under this subsection, an eligible entity shall 
submit an application at such time, in such 
form, and containing such information as the 
Secretary may prescribe. 
(B) CONTENTS.—Each application sub-
mitted under subparagraph (A) shall— 
(i) identify any activity described in 
paragraph (3) that the grant will be used 
to fund; and 
(ii) describe the means by which an 
activity identified under clause (i) will re-
duce hunger in the community of the eligi-
ble entity. 
(C) PRIORITY.—In making grants under 
this subsection, the Secretary shall give priority 
to eligible entities that demonstrate 2 or more 
of the following: 
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(i) The eligible entity serves a commu-
nity in which the rates of food insecurity, 
hunger, poverty, or unemployment are de-
monstrably higher than national average 
rates. 
(ii) The eligible entity serves a com-
munity that has successfully carried out 
long-term efforts to reduce hunger in the 
community. 
(iii) The eligible entity serves a com-
munity that provides public support for the 
efforts of the eligible entity. 
(iv) The eligible entity is committed to 
achieving more than 1 hunger-free commu-
nities goal. 
(3) USE OF FUNDS.—An eligible entity shall 
use a grant received under this subsection to con-
struct, expand, or repair a facility or equipment to 
support hunger relief efforts in the community. 
(d) REPORT.—If funds are made available under sub-
section (e) to carry out this section, not later than Sep-
tember 30, 2012, the Secretary shall submit to Congress 
a report that describes— 
(1) each grant made under this section, includ-
ing— 
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(A) a description of any activity funded; 
and 
(B) the degree of success of each activity 
funded in achieving hunger free-communities 
goals; and 
(2) the degree of success of all activities funded 
under this section in achieving domestic hunger 
goals. 
(e) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated such sums as are nec-
essary to carry out this section for each of fiscal years 
2008 through 2012. 
SEC. 4406. REAUTHORIZATION OF FEDERAL FOOD ASSIST-
ANCE PROGRAMS. 
(a) SUPPLEMENTAL NUTRITION ASSISTANCE PRO-
GRAM.— 
(1) AUTHORIZATION
OF
APPROPRIATIONS.— 
Section 18(a)(1) of the Food and Nutrition Act of 
2008 (7 U.S.C. 2027(a)(1)) is amended in the first 
sentence by striking ‘‘for each of the fiscal years 
2003 through 2007’’ and inserting ‘‘for each of fis-
cal years 2008 through 2012’’. 
(2) GRANTS
FOR
SIMPLE
APPLICATION
AND 
ELIGIBILITY
DETERMINATION
SYSTEMS
AND
IM-
PROVED ACCESS TO BENEFITS.—Section 11(t)(1) of 
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the Food and Nutrition Act of 2008 (7 U.S.C. 
2020(t)(1)) is amended by striking ‘‘For each of fis-
cal years 2003 through 2007’’ and inserting ‘‘Sub-
ject to the availability of appropriations under sec-
tion 18(a), for each fiscal year’’. 
(3) FUNDING OF EMPLOYMENT AND TRAINING 
PROGRAMS.—Section 16(h)(1) of the Food and Nu-
trition Act of 2008 (7 U.S.C. 2025(h)(1)) is amend-
ed— 
(A) in subparagraph (A), by striking ‘‘the 
amount of—’’ and all that follows through the 
end of the subparagraph and inserting ‘‘, 
$90,000,000 for each fiscal year.’’; and 
(B) in subparagraph (E)(i), by striking 
‘‘for each of fiscal years 2002 through 2007’’ 
and inserting ‘‘for each fiscal year’’. 
(4) REDUCTIONS IN PAYMENTS FOR ADMINIS-
TRATIVE COSTS.—Section 16(k)(3) of the Food and 
Nutrition Act of 2008 (7 U.S.C. 2025(k)(3)) is 
amended— 
(A) in the first sentence of subparagraph 
(A), by striking ‘‘effective for each of fiscal 
years 1999 through 2007,’’; and 
(B) in subparagraph (B)(ii), by striking 
‘‘through fiscal year 2007’’. 
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(ii) in paragraph (2)(B), by striking 
the subparagraph designation and heading 
and all that follows through ‘‘2007’’ and 
inserting the following: 
‘‘(B) SUBSEQUENT
FISCAL
YEARS.—For 
each of fiscal years 2004 through 2012’’; and 
(B) in subsection (d)(2), by striking ‘‘each 
of the fiscal years 1991 through 2007’’ and in-
serting ‘‘each of fiscal years 2008 through 
2012’’. 
(4) DISTRIBUTION OF SURPLUS COMMODITIES 
TO
SPECIAL
NUTRITION
PROJECTS.—Section 
1114(a)(2)(A) of the Agriculture and Food Act of 
1981 (7 U.S.C. 1431e(2)(A)) is amended in the first 
sentence by striking ‘‘Effective through September 
30, 2007’’ and inserting ‘‘For each of fiscal years 
2008 through 2012’’. 
(c) FARM SECURITY AND RURAL INVESTMENT.— 
(1) SENIORS
FARMERS’ MARKET
NUTRITION 
PROGRAM.—Section 4402 of the Farm Security and 
Rural Investment Act of 2002 (7 U.S.C. 3007) is 
amended by striking by striking subsection (a) and 
inserting the following: 
‘‘(a) FUNDING.—Of the funds of the Commodity 
Credit Corporation, the Secretary of Agriculture shall use 
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to carry out and expand the seniors farmers’ market nutri-
tion program $20,600,000 for each of fiscal years 2008 
through 2012.’’. 
(2) NUTRITION INFORMATION AND AWARENESS 
PILOT PROGRAM.—Section 4403(f) of the Farm Se-
curity and Rural Investment Act of 2002 (7 U.S.C. 
3171 note; Public Law 107–171) is amended by 
striking ‘‘2007’’ and inserting ‘‘2012’’. 
SEC. 4407. EFFECTIVE AND IMPLEMENTATION DATES. 
Except as otherwise provided in this title, this title 
and the amendments made by this title take effect on Oc-
tober 1, 2008. 
TITLE V—CREDIT 
Subtitle A—Farm Ownership Loans 
SEC. 5001. DIRECT LOANS. 
Section 302 of the Consolidated Farm and Rural De-
velopment Act (7 U.S.C. 1922) is amended— 
(1) by striking the section designation and 
heading and all that follows through ‘‘(a) The Sec-
retary is authorized to’’ and inserting the following: 
‘‘SEC. 302. PERSONS ELIGIBLE FOR REAL ESTATE LOANS. 
‘‘(a) IN GENERAL.—The Secretary may’’; and 
(2) in subsection (a)(2), by inserting ‘‘, taking 
into consideration all farming experience of the ap-
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plicant, without regard to any lapse between farming 
experiences’’ after ‘‘farming operations’’. 
SEC. 5002. CONSERVATION LOAN AND LOAN GUARANTEE 
PROGRAM. 
Section 304 of the Consolidated Farm and Rural De-
velopment Act (7 U.S.C. 1924) is amended to read as fol-
lows: 
‘‘SEC. 304. CONSERVATION LOAN AND LOAN GUARANTEE 
PROGRAM. 
‘‘(a) IN GENERAL.—The Secretary may make or 
guarantee qualified conservation loans to eligible bor-
rowers under this section. 
‘‘(b) DEFINITIONS.—In this section: 
‘‘(1) QUALIFIED
CONSERVATION
LOAN.—The 
term ‘qualified conservation loan’ means a loan, the 
proceeds of which are used to cover the costs to the 
borrower of carrying out a qualified conservation 
project. 
‘‘(2) QUALIFIED
CONSERVATION
PROJECT.— 
The term ‘qualified conservation project’ means con-
servation measures that address provisions of a con-
servation plan of the eligible borrower. 
‘‘(3) CONSERVATION
PLAN.—The term ‘con-
servation plan’ means a plan, approved by the Sec-
retary, that, for a farming or ranching operation, 
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identifies the conservation activities that will be ad-
dressed with loan funds provided under this section, 
including— 
‘‘(A) the installation of conservation struc-
tures to address soil, water, and related re-
sources; 
‘‘(B) the establishment of forest cover for 
sustained yield timber management, erosion 
control, or shelter belt purposes; 
‘‘(C) the installation of water conservation 
measures; 
‘‘(D) the installation of waste management 
systems; 
‘‘(E) the establishment or improvement of 
permanent pasture; 
‘‘(F) compliance with section 1212 of the 
Food Security Act of 1985; and 
‘‘(G) other purposes consistent with the 
plan, including the adoption of any other 
emerging or existing conservation practices, 
techniques, or technologies approved by the Sec-
retary. 
‘‘(c) ELIGIBILITY.— 
‘‘(1) IN GENERAL.—The Secretary may make 
or guarantee loans to farmers or ranchers in the 
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United States, farm cooperatives, private domestic 
corporations, partnerships, joint operations, trusts, 
or limited liability companies that are controlled by 
farmers or ranchers and engaged primarily and di-
rectly in agricultural production in the United 
States. 
‘‘(2) REQUIREMENTS.—To be eligible for a loan 
under this section, applicants shall meet the require-
ments in paragraphs (1) and (2) of section 302(a). 
‘‘(d) PRIORITY.—In making or guaranteeing loans 
under this section, the Secretary shall give priority to— 
‘‘(1) qualified beginning farmers or ranchers 
and socially disadvantaged farmers or ranchers; 
‘‘(2) owners or tenants who use the loans to 
convert to sustainable or organic agricultural pro-
duction systems; and 
‘‘(3) producers who use the loans to build con-
servation structures or establish conservation prac-
tices to comply with section 1212 of the Food Secu-
rity Act of 1985. 
‘‘(e) LIMITATIONS APPLICABLE TO LOAN GUARAN-
TEES.—The portion of a loan that the Secretary may 
guarantee under this section shall be 75 percent of the 
principal amount of the loan. 
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‘‘(f) ADMINISTRATIVE PROVISIONS.—The Secretary 
shall ensure, to the maximum extent practicable, that 
loans made or guaranteed under this section are distrib-
uted across diverse geographic regions. 
‘‘(g) CREDIT ELIGIBILITY.—The provisions of para-
graphs (1) and (3) of section 333 shall not apply to loans 
made or guaranteed under this section. 
‘‘(h) AUTHORIZATION
OF APPROPRIATIONS.—For 
each of fiscal years 2008 through 2012, there are author-
ized to be appropriated to the Secretary such funds as are 
necessary to carry out this section.’’. 
SEC. 5003. LIMITATIONS ON AMOUNT OF FARM OWNERSHIP 
LOANS. 
Section 305(a)(2) of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1925(a)(2)) is amended 
by striking ‘‘$200,000’’ and inserting ‘‘$300,000’’. 
SEC. 5004. DOWN PAYMENT LOAN PROGRAM. 
Section 310E of the Consolidated Farm and Rural 
Development Act (7 U.S.C. 1935) is amended— 
(1) in subsection (a)(1), by striking ‘‘and 
ranchers’’ and inserting ‘‘or ranchers and socially 
disadvantaged farmers or ranchers’’; 
(2) in subsection (b)— 
(A) by striking paragraph (1) and insert-
ing the following; 
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value of the farm or ranch that is the subject of the 
contract land sale is greater than $500,000. 
‘‘(d) PERIOD OF GUARANTEE.—The period during 
which a loan guarantee under this section is in effect shall 
be the 10-year period beginning with the date the guar-
antee is provided. 
‘‘(e) GUARANTEE PLAN.— 
‘‘(1) SELECTION OF PLAN.—A private seller of 
a farm or ranch who makes a loan that is guaran-
teed by the Secretary under subsection (a) may se-
lect— 
‘‘(A) a prompt payment guarantee plan, 
which shall cover— 
‘‘(i) 3 amortized annual installments; 
or 
‘‘(ii) an amount equal to 3 annual in-
stallments (including an amount equal to 
the total cost of any tax and insurance in-
curred during the period covered by the 
annual installments); or 
‘‘(B) a standard guarantee plan, which 
shall cover an amount equal to 90 percent of 
the outstanding principal of the loan. 
‘‘(2) ELIGIBLITY FOR STANDARD GUARANTEE 
PLAN.—In order for a private seller to be eligible for 
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a standard guarantee plan referred to in paragraph 
(1)(B), the private seller shall— 
‘‘(A) secure a commercial lending institu-
tion or similar entity, as determined by the Sec-
retary, to serve as an escrow agent; or 
‘‘(B) in cooperation with the farmer or 
rancher, use an appropriate alternate arrange-
ment, as determined by the Secretary. 
‘‘(f) TRANSITION FROM PILOT PROGRAM.— 
‘‘(1) IN GENERAL.—The Secretary may phase- 
in the implementation of the changes to the Begin-
ning Farmer and Rancher and Socially Disadvan-
taged Farmer or Rancher Contract Land Sales Pro-
gram provided for in this section. 
‘‘(2) LIMITATION.—All changes to the Begin-
ning Farmer and Rancher and Socially Disadvan-
taged Farmer or Rancher Contract Land Sales Pro-
gram must be implemented for the 2011 Fiscal 
Year.’’. 
Subtitle B—Operating Loans 
SEC. 5101. FARMING EXPERIENCE AS ELIGIBILITY RE-
QUIREMENT. 
Section 311 of the Consolidated Farm and Rural De-
velopment Act (7 U.S.C. 1941) is amended— 
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(1) by striking the section designation and all 
that follows through ‘‘(a) The Secretary is author-
ized to’’ and inserting the following: 
‘‘SEC. 311. PERSONS ELIGIBLE FOR LOANS. 
‘‘(a) IN GENERAL.—The Secretary may’’; 
(2) in subsection (a)(2), by inserting ‘‘, taking 
into consideration all farming experience of the ap-
plicant, without regard to any lapse between farming 
experiences’’ after ‘‘farming operations’’. 
SEC. 5102. LIMITATIONS ON AMOUNT OF OPERATING 
LOANS. 
Section 313(a)(1) of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1943(a)(1)) is amended 
by striking ‘‘$200,000’’ and inserting ‘‘$300,000’’. 
SEC. 5103. SUSPENSION OF LIMITATION ON PERIOD FOR 
WHICH 
BORROWERS 
ARE 
ELIGIBLE 
FOR 
GUARANTEED ASSISTANCE. 
Section 5102 of the Farm Security And Rural Invest-
ment Act of 2002 (7 U.S.C. 1949 note; Public Law 107– 
171) is amended by striking ‘‘September 30, 2007’’ and 
inserting ‘‘December 31, 2010’’. 
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Subtitle C—Emergency Loans 
SEC. 5201. ELIGIBILITY OF EQUINE FARMERS AND RANCH-
ERS FOR EMERGENCY LOANS. 
Section 321(a) of the Consolidated Farm and Rural 
Development Act (7 U.S.C. 1961(a)) is amended— 
(1) in paragraph (1), by striking ‘‘farmers, 
ranchers’’ and inserting ‘‘farmers or ranchers (in-
cluding equine farmers or ranchers)’’; and 
(2) in paragraph (2)(A), by striking ‘‘farming, 
ranching,’’ and inserting ‘‘farming or ranching (in-
cluding equine farming or ranching)’’. 
Subtitle D—Administrative 
Provisions 
SEC. 5301. BEGINNING FARMER AND RANCHER INDIVIDUAL 
DEVELOPMENT ACCOUNTS PILOT PROGRAM. 
Subtitle D of the Consolidated Farm and Rural De-
velopment Act (7 U.S.C. 1981–2008r) is amended by in-
serting after section 333A the following: 
‘‘SEC. 333B. BEGINNING FARMER AND RANCHER INDI-
VIDUAL DEVELOPMENT ACCOUNTS PILOT 
PROGRAM. 
‘‘(a) DEFINITIONS.—In this section: 
‘‘(1) DEMONSTRATION
PROGRAM.—The term 
‘demonstration program’ means a demonstration 
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program carried out by a qualified entity under the 
pilot program established in subsection (b)(1). 
‘‘(2) ELIGIBLE PARTICIPANT.—The term ‘eligi-
ble participant’ means a qualified beginning farmer 
or rancher that— 
‘‘(A) lacks significant financial resources 
or assets; and 
‘‘(B) has an income that is less than— 
‘‘(i) 80 percent of the median income 
of the State in which the farmer or ranch-
er resides; or 
‘‘(ii) 200 percent of the most recent 
annual Federal Poverty Income Guidelines 
published by the Department of Health 
and Human Services for the State. 
‘‘(3) INDIVIDUAL
DEVELOPMENT
ACCOUNT.— 
The term ‘individual development account’ means a 
savings account described in subsection (b)(4)(A). 
‘‘(4) QUALIFIED ENTITY.— 
‘‘(A) IN
GENERAL.—The term ‘qualified 
entity’ means— 
‘‘(i) 1 or more organizations— 
‘‘(I) 
described 
in 
section 
501(c)(3) of the Internal Revenue 
Code of 1986; and 
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‘‘(II) exempt from taxation under 
section 501(a) of such Code; or 
‘‘(ii) a State, local, or tribal govern-
ment submitting an application jointly with 
an organization described in clause (i). 
‘‘(B) NO
PROHIBITION
ON
COLLABORA-
TION.—An organization described in subpara-
graph (A)(i) may collaborate with a financial 
institution or for-profit community development 
corporation to carry out the purposes of this 
section. 
‘‘(b) PILOT PROGRAM.— 
‘‘(1) IN GENERAL.—The Secretary shall estab-
lish a pilot program to be known as the ‘New Farm-
er Individual Development Accounts Pilot Program’ 
under which the Secretary shall work through quali-
fied entities to establish demonstration programs— 
‘‘(A) of at least 5 years in duration; and 
‘‘(B) in at least 15 States. 
‘‘(2) COORDINATION.—The Secretary shall op-
erate the pilot program through, and in coordination 
with the farm loan programs of, the Farm Service 
Agency. 
‘‘(3) RESERVE FUNDS.— 
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subparagraph (A) may be used by the qualified 
entity as additional matching funds for, or to 
administer, the demonstration program. 
‘‘(E) GUIDANCE.—The Secretary shall 
issue guidance regarding the investment re-
quirements of reserve funds established under 
this paragraph. 
‘‘(F) REVERSION.—On the date on which 
all funds remaining in any individual develop-
ment account established by a qualified entity 
have reverted under paragraph (5)(B)(ii) to the 
reserve fund established by the qualified entity, 
there shall revert to the Treasury of the United 
States a percentage of the amount (if any) in 
the reserve fund equal to— 
‘‘(i) the amount of Federal funds de-
posited in the reserve fund under subpara-
graph (B) that were not used for adminis-
trative expenses; divided by 
‘‘(ii) the total amount of funds depos-
ited in the reserve fund. 
‘‘(4) INDIVIDUAL DEVELOPMENT ACCOUNTS.— 
‘‘(A) IN GENERAL.—A qualified entity re-
ceiving a grant under this section shall establish 
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and administer individual development accounts 
for eligible participants. 
‘‘(B) CONTRACT REQUIREMENTS.—To be 
eligible to receive funds under this section from 
a qualified entity, an eligible participant shall 
enter into a contract with only 1 qualified enti-
ty under which— 
‘‘(i) the eligible participant agrees— 
‘‘(I) to deposit a certain amount 
of funds of the eligible participant in 
a personal savings account, as pre-
scribed by the contractual agreement 
between the eligible participant and 
the qualified entity; 
‘‘(II) to use the funds described 
in subclause (I) only for 1 or more eli-
gible expenditures described in para-
graph (5)(A); and 
‘‘(III) to complete financial train-
ing; and 
‘‘(ii) the qualified entity agrees— 
‘‘(I) to deposit, not later than 1 
month after an amount is deposited 
pursuant to clause (i)(I), at least a 
100-percent, and up to a 200-percent, 
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match of that amount into the indi-
vidual development account estab-
lished for the eligible participant; and 
‘‘(II) with uses of funds proposed 
by the eligible participant. 
‘‘(C) LIMITATION.— 
‘‘(i) IN GENERAL.—A qualified entity 
administering a demonstration program 
under this section may provide not more 
than $6,000 for each fiscal year in match-
ing funds to the individual development ac-
count established by the qualified entity 
for an eligible participant. 
‘‘(ii) TREATMENT
OF
AMOUNT.—An 
amount provided under clause (i) shall not 
be considered to be a gift or loan for mort-
gage purposes. 
‘‘(5) ELIGIBLE EXPENDITURES.— 
‘‘(A) IN
GENERAL.—An eligible expendi-
ture described in this subparagraph is an ex-
penditure— 
‘‘(i) to purchase farmland or make a 
down payment on an accepted purchase 
offer for farmland; 
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‘‘(ii) to make mortgage payments on 
farmland purchased pursuant to clause (i), 
for up to 180 days after the date of the 
purchase; 
‘‘(iii) to purchase breeding stock, fruit 
or nut trees, or trees to harvest for timber; 
and 
‘‘(iv) for other similar expenditures, 
as determined by the Secretary. 
‘‘(B) TIMING.— 
‘‘(i) IN GENERAL.—An eligible partici-
pant may make an eligible expenditure at 
any time during the 2-year period begin-
ning on the date on which the last match-
ing funds are provided under paragraph 
(4)(B)(ii)(I) to the individual development 
account established for the eligible partici-
pant. 
‘‘(ii) UNEXPENDED
FUNDS.—At the 
end of the period described in clause (i), 
any funds remaining in an individual devel-
opment account established for an eligible 
participant shall revert to the reserve fund 
of the demonstration program under which 
the account was established. 
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‘‘(c) APPLICATIONS.— 
‘‘(1) IN
GENERAL.—A qualified entity that 
seeks to carry out a demonstration program under 
this section may submit to the Secretary an applica-
tion at such time, in such form, and containing such 
information as the Secretary may prescribe. 
‘‘(2) CRITERIA.—In considering whether to ap-
prove an application to carry out a demonstration 
program under this section, the Secretary shall as-
sess— 
‘‘(A) the degree to which the demonstra-
tion program described in the application is 
likely to aid eligible participants in successfully 
pursuing new farming opportunities; 
‘‘(B) the experience and ability of the 
qualified entity to responsibly administer the 
demonstration program; 
‘‘(C) the experience and ability of the 
qualified entity in recruiting, educating, and as-
sisting eligible participants to increase economic 
independence and pursue or advance farming 
opportunities; 
‘‘(D) the aggregate amount of direct funds 
from non-Federal public sector and private 
sources that are formally committed to the 
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demonstration program as matching contribu-
tions; 
‘‘(E) the adequacy of the plan of the quali-
fied entity to provide information relevant to an 
evaluation of the demonstration program; and 
‘‘(F) such other factors as the Secretary 
considers to be appropriate. 
‘‘(3) PREFERENCES.—In considering an appli-
cation to conduct a demonstration program under 
this section, the Secretary shall give preference to an 
application from a qualified entity that dem-
onstrates— 
‘‘(A) a track record of serving clients tar-
geted by the program, including, as appro-
priate, socially disadvantaged farmers or ranch-
ers (as defined in section 355(e)(2)); and 
‘‘(B) expertise in dealing with financial 
management aspects of farming. 
‘‘(4) APPROVAL.—Not later than 1 year after 
the date of enactment of this section, in accordance 
with this section, the Secretary shall, on a competi-
tive basis, approve such applications to conduct dem-
onstration programs as the Secretary considers ap-
propriate. 
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‘‘(5) TERM OF AUTHORITY.—If the Secretary 
approves an application to carry out a demonstration 
program, the Secretary shall authorize the applicant 
to carry out the project for a period of 5 years, plus 
an additional 2 years to make eligible expenditures 
in accordance with subsection (b)(5)(B). 
‘‘(d) GRANT AUTHORITY.— 
‘‘(1) IN GENERAL.—The Secretary shall make a 
grant to a qualified entity authorized to carry out a 
demonstration program under this section. 
‘‘(2) MAXIMUM AMOUNT OF GRANTS.—The ag-
gregate amount of grant funds provided to a dem-
onstration program carried out under this section 
shall not exceed $250,000. 
‘‘(3) TIMING OF GRANT PAYMENTS.—The Sec-
retary shall pay the amounts awarded under a grant 
made under this section— 
‘‘(A) on the awarding of the grant; or 
‘‘(B) pursuant to such payment plan as 
the qualified entity may specify. 
‘‘(e) REPORTS.— 
‘‘(1) ANNUAL PROGRESS REPORTS.— 
‘‘(A) IN
GENERAL.—Not later than 60 
days after the end of the calendar year in which 
the Secretary authorizes a qualified entity to 
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carry out a demonstration program under this 
section, and annually thereafter until the con-
clusion of the demonstration program, the 
qualified entity shall prepare an annual report 
that includes, for the period covered by the re-
port— 
‘‘(i) an evaluation of the progress of 
the demonstration program; 
‘‘(ii) information about the dem-
onstration program, including the eligible 
participants and the individual develop-
ment accounts that have been established; 
and 
‘‘(iii) such other information as the 
Secretary may require. 
‘‘(B) SUBMISSION OF REPORTS.—A quali-
fied entity shall submit each report required 
under subparagraph (A) to the Secretary. 
‘‘(2) REPORTS BY THE SECRETARY.—Not later 
than 1 year after the date on which all demonstra-
tion programs under this section are concluded, the 
Secretary shall submit to Congress a final report 
that describes the results and findings of all reports 
and evaluations carried out under this section. 
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‘‘(f) ANNUAL REVIEW.—The Secretary may conduct 
an annual review of the financial records of a qualified 
entity— 
‘‘(1) to assess the financial soundness of the 
qualified entity; and 
‘‘(2) to determine the use of grant funds made 
available to the qualified entity under this section. 
‘‘(g) REGULATIONS.—In carrying out this section, 
the Secretary may promulgate regulations to ensure that 
the program includes provisions for— 
‘‘(1) the termination of demonstration pro-
grams; 
‘‘(2) control of the reserve funds in the case of 
such a termination; 
‘‘(3) transfer of demonstration programs to 
other qualified entities; and 
‘‘(4) remissions from a reserve fund to the Sec-
retary in a case in which a demonstration program 
is terminated without transfer to a new qualified en-
tity. 
‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There 
is authorized to be appropriated to carry out this section 
$5,000,000 for each of fiscal years 2008 through 2012.’’. 
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SEC. 5302. INVENTORY SALES PREFERENCES; LOAN FUND 
SET-ASIDES. 
(a) INVENTORY
SALES
PREFERENCES.—Section 
335(c) of the Consolidated Farm and Rural Development 
Act (7 U.S.C. 1985(c)) is amended— 
(1) in paragraph (1)— 
(A) in subparagraph (B)— 
(i) in the subparagraph heading, by 
inserting ‘‘; 
SOCIALLY
DISADVANTAGED 
FARMER OR RANCHER’’ after ‘‘OR RANCH-
ER’’; 
(ii) in clause (i), by inserting ‘‘ or a 
socially disadvantaged farmer or rancher’’ 
after ‘‘or rancher’’; 
(iii) in clause (ii), by inserting ‘‘or so-
cially disadvantaged farmer or rancher’’ 
after ‘‘or rancher’’; 
(iv) in clause (iii), by inserting ‘‘or a 
socially disadvantaged farmer or rancher’’ 
after ‘‘or rancher’’; and 
(v) in clause (iv), by striking ‘‘and 
ranchers’’ and inserting ‘‘or ranchers and 
socially disadvantaged farmers or ranch-
ers’’; and 
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(B) in subparagraph (C), by inserting ‘‘or 
a socially disadvantaged farmer or rancher’’ 
after ‘‘or rancher’’; 
(2) in paragraph (5)(B)— 
(A) in clause (i)— 
(i) in the clause heading, by inserting 
‘‘; SOCIALLY DISADVANTAGED FARMER OR 
RANCHER’’ after ‘‘OR RANCHER’’; 
(ii) by inserting ‘‘or a socially dis-
advantaged farmer or rancher’’ after ‘‘a 
beginning farmer or rancher’’; and 
(iii) by inserting ‘‘or the socially dis-
advantaged farmer or rancher’’ after ‘‘the 
beginning farmer or rancher’’; and 
(B) in clause (ii)— 
(i) in the matter preceding subclause 
(I), by inserting ‘‘or a socially disadvan-
taged farmer or rancher’’ after ‘‘or ranch-
er’’; and 
(ii) in subclause (II), by inserting ‘‘or 
the socially disadvantaged farmer or ranch-
er’’ after ‘‘or rancher’’; and 
(3) in paragraph (6)— 
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(A) in subparagraph (A), by inserting ‘‘or 
a socially disadvantaged farmer or rancher’’ 
after ‘‘or rancher’’; and 
(B) in subparagraph (C)— 
(i) in clause (i)(I), by striking ‘‘and 
ranchers’’ and inserting ‘‘or ranchers and 
socially disadvantaged farmers or ranch-
ers’’; and 
(ii) in clause (ii), by inserting ‘‘or so-
cially disadvantaged farmers or ranchers’’ 
after ‘‘or ranchers’’. 
(b) LOAN FUND SET-ASIDES.—Section 346(b)(2) of 
such Act (7 U.S.C. 1994(b)(2)) is amended— 
(1) in subparagraph (A)— 
(A) in clause (i)— 
(i) in subclause (I), by striking ‘‘70 
percent’’ and inserting ‘‘an amount that is 
not less than 75 percent of the total 
amount’’; and 
(ii) in subclause (II)— 
(I) in the subclause heading, by 
inserting ‘‘; JOINT
FINANCING
AR-
RANGEMENTS’’ 
after 
‘‘PAYMENT 
LOANS’’; 
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(II) by striking ‘‘60 percent’’ and 
inserting ‘‘an amount not less than 2⁄3 
of the amount’’; and 
(III) by inserting ‘‘and joint fi-
nancing arrangements under section 
307(a)(3)(D)’’ after ‘‘section 310E’’; 
and 
(B) in clause (ii)(III), by striking ‘‘2003 
through 2007, 35 percent’’ and inserting ‘‘2008 
through 2012, an amount that is not less than 
50 percent of the total amount’’; and 
(2) in subparagraph (B)(i), by striking ‘‘25 per-
cent’’ and inserting ‘‘an amount that is not less than 
40 percent of the total amount’’. 
SEC. 5303. LOAN AUTHORIZATION LEVELS. 
Section 346(b)(1) of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1994(b)(1)) is amend-
ed— 
(1) in the matter preceding subparagraph (A), 
by striking ‘‘$3,796,000,000 for each of fiscal years 
2003 through 2007’’ and inserting ‘‘$4,226,000,000 
for each of fiscal years 2008 through 2012’’; and 
(2) in subparagraph (A)— 
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(A) in the matter preceding clause (i), by 
striking 
‘‘$770,000,000’’ 
and 
inserting 
‘‘$1,200,000,000’’; 
(B) 
in 
clause 
(i), 
by 
striking 
‘‘$205,000,000’’ and inserting ‘‘$350,000,000’’; 
and 
(C) 
in 
clause 
(ii), 
by 
striking 
‘‘$565,000,000’’ and inserting ‘‘$850,000,000’’. 
SEC. 5304. TRANSITION TO PRIVATE COMMERCIAL OR 
OTHER SOURCES OF CREDIT. 
Subtitle D of the Consolidated Farm and Rural De-
velopment Act (7 U.S.C. 1981–2008r) is amended by in-
serting after section 344 the following: 
‘‘SEC. 345. TRANSITION TO PRIVATE COMMERCIAL OR 
OTHER SOURCES OF CREDIT. 
‘‘(a) IN GENERAL.—In making or insuring a farm 
loan under subtitle A or B, the Secretary shall establish 
a plan and promulgate regulations (including performance 
criteria) that promote the goal of transitioning borrowers 
to private commercial credit and other sources of credit 
in the shortest period of time practicable. 
‘‘(b) COORDINATION.—In carrying out this section, 
the Secretary shall integrate and coordinate the transition 
policy described in subsection (a) with— 
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‘‘(1) the borrower training program established 
by section 359; 
‘‘(2) the loan assessment process established by 
section 360; 
‘‘(3) the supervised credit requirement estab-
lished by section 361; 
‘‘(4) the market placement program established 
by section 362; and 
‘‘(5) other appropriate programs and authori-
ties, as determined by the Secretary.’’. 
SEC. 5305. EXTENSION OF THE RIGHT OF FIRST REFUSAL 
TO REACQUIRE HOMESTEAD PROPERTY TO 
IMMEDIATE 
FAMILY 
MEMBERS 
OF 
BOR-
ROWER-OWNER. 
Section 352(c)(4)(B) of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 2000(c)(4)(B)) is 
amended— 
(1) in the 1st sentence, by striking ‘‘, the bor-
rower-owner’’ inserting ‘‘of a borrower-owner who is 
a socially disadvantaged farmer or rancher (as de-
fined in section 355(e)(2)), the borrower-owner or a 
member of the immediate family of the borrower- 
owner’’; and 
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(2) in the 2nd sentence, by inserting ‘‘or imme-
diate family member, as the case may be,’’ before 
‘‘from’’. 
SEC. 5306. RURAL DEVELOPMENT AND FARM LOAN PRO-
GRAM ACTIVITIES. 
Subtitle D of the Consolidated Farm and Rural De-
velopment Act (7 U.S.C. 1981–2008r) is amended by in-
serting after section 364 the following: 
‘‘SEC. 365. RURAL DEVELOPMENT AND FARM LOAN PRO-
GRAM ACTIVITIES. 
‘‘The Secretary may not complete a study of, or enter 
into a contract with a private party to carry out, without 
specific authorization in a subsequent Act of Congress, a 
competitive sourcing activity of the Secretary, including 
support personnel of the Department of Agriculture, relat-
ing to rural development or farm loan programs.’’. 
Subtitle E—Farm Credit 
SEC. 5401. FARM CREDIT SYSTEM INSURANCE CORPORA-
TION. 
(a) IN GENERAL.—Section 1.12(b) of the Farm 
Credit Act of 1971 (12 U.S.C. 2020(b)) is amended— 
(1) in the first sentence, by striking ‘‘Each 
Farm’’ and inserting the following; 
‘‘(1) IN GENERAL.—Each Farm’’; and 
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(2) by striking the second sentence and insert-
ing the following: 
‘‘(2) COMPUTATION.—The assessment on any 
association or other financing institution described 
in paragraph (1) for any period shall be computed 
in an equitable manner, as determined by the Cor-
poration.’’. 
(b) RULES AND REGULATIONS.—Section 5.58(10) of 
such Act (12 U.S.C. 2277a-7(10)) is amended by inserting 
‘‘and section 1.12(b)’’ after ‘‘part’’. 
SEC. 5402. TECHNICAL CORRECTION. 
Section 3.3(b) of the Farm Credit Act of 1971 (12 
U.S.C. 2124(b)) is amended in the first sentence by strik-
ing ‘‘per’’ and inserting ‘‘par’’. 
SEC. 5403. BANK FOR COOPERATIVES VOTING STOCK. 
(a) IN GENERAL.—Section 3.3(c) of the Farm Credit 
Act of 1971 (12 U.S.C. 2124(c)) is amended by striking 
‘‘and (ii)’’ and inserting ‘‘(ii) other categories of persons 
and entities described in sections 3.7 and 3.8 eligible to 
borrow from the bank, as determined by the bank’s board 
of directors; and (iii)’’. 
(b) 
CONFORMING
AMENDMENTS.—Section 
4.3A(c)(1)(D) of such Act (12 U.S.C. 2154a(c)(1)(D)) is 
amended by redesignating clauses (ii) and (iii) as clauses 
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(iii) and (iv), respectively, and inserting after clause (i) 
the following: 
‘‘(ii) persons and entities eligible to 
borrow from the banks for cooperatives, as 
described in section 3.3(c)(ii);’’. 
SEC. 5404. PREMIUMS. 
(a) AMOUNT IN FUND NOT EXCEEDING SECURE 
BASE AMOUNT.—Section 5.55(a) of the Farm Credit Act 
of 1971 (12 U.S.C. 2277a-4(a)) is amended— 
(1) in paragraph (1)— 
(A) in the matter preceding subparagraph 
(A)— 
(i) by striking ‘‘paragraph (2)’’ and 
inserting ‘‘paragraph (3)’’; and 
(ii) by striking ‘‘annual’’ ; and 
(B) by striking subparagraphs (A) through 
(D) and inserting the following: 
‘‘(A) the average outstanding insured obli-
gations issued by the bank for the calendar 
year, after deducting from the obligations the 
percentages of the guaranteed portions of loans 
and investments described in paragraph (2), 
multiplied by 0.0020; and 
‘‘(B) the product obtained by multi-
plying— 
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‘‘(i) the sum of— 
‘‘(I) the average principal out-
standing for the calendar year on 
loans made by the bank that are in 
nonaccrual status; and 
‘‘(II) the average amount out-
standing for the calendar year of 
other-than-temporarily impaired in-
vestments made by the bank; by 
‘‘(ii) 0.0010.’’; 
(2) by striking paragraph (4); 
(3) by redesignating paragraphs (2) and (3) as 
paragraphs (3) and (4), respectively; 
(4) by inserting after paragraph (1) the fol-
lowing: 
‘‘(2) 
DEDUCTIONS
FROM
AVERAGE
OUT-
STANDING
INSURED
OBLIGATIONS.—The average 
outstanding insured obligations issued by the bank 
for the calendar year referred to in paragraph (1)(A) 
shall be reduced by deducting from the obligations 
the sum of (as determined by the Corporation)— 
‘‘(A) 90 percent of each of— 
‘‘(i) the average principal outstanding 
for the calendar year on the guaranteed 
portions of Federal government-guaranteed 
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loans made by the bank that are in accrual 
status; and 
‘‘(ii) the average amount outstanding 
for the calendar year of the guaranteed 
portions of Federal government-guaranteed 
investments made by the bank that are not 
permanently impaired; and 
‘‘(B) 80 percent of each of— 
‘‘(i) the average principal outstanding 
for the calendar year on the guaranteed 
portions of State government-guaranteed 
loans made by the bank that are in accrual 
status; and 
‘‘(ii) the average amount outstanding 
for the calendar year of the guaranteed 
portions of State government-guaranteed 
investments made by the bank that are not 
permanently impaired.’’; 
(5) in paragraph (3) (as so redesignated by 
paragraph (3) of this subsection), by striking ‘‘an-
nual’’; and 
(6) in paragraph (4) (as so redesignated by 
paragraph (3) of this subsection)— 
(A) in the paragraph heading, by inserting 
‘‘OR INVESTMENTS’’ after ‘‘LOANS’’ ; and 
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(B) in the matter preceding subparagraph 
(A), by striking ‘‘As used’’ and all that follows 
through ‘‘guaranteed—’’ and inserting ‘‘In this 
section, 
the 
term 
‘government-guaranteed’, 
when applied to a loan or an investment, means 
a loan, credit, or investment, or portion of a 
loan, credit, or investment, that is guaran-
teed—’’. 
(b) AMOUNT IN FUND EXCEEDING SECURE BASE 
AMOUNT.—Section 5.55(b) of such Act (12 U.S.C. 2277a- 
4(b)) is amended by striking ‘‘annual’’. 
(c) SECURE BASE AMOUNT.—Section 5.55(c) of such 
Act (12 U.S.C. 2277a-4(c)) is amended— 
(1) by striking ‘‘For purposes’’ and inserting 
the following: 
‘‘(1) IN GENERAL.—For purposes’’; 
(2) by striking ‘‘(adjusted downward’’ and all 
that follows through ‘‘by the Corporation)’’ and in-
serting ‘‘(as adjusted under paragraph (2))’’; and 
(3) by adding at the end the following: 
‘‘(2) 
ADJUSTMENT.—The 
aggregate 
out-
standing insured obligations of all insured System 
banks under paragraph (1) shall be adjusted down-
ward to exclude an amount equal to the sum of (as 
determined by the corporation)— 
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‘‘(A) 90 percent of each of— 
‘‘(i) the guaranteed portions of prin-
cipal outstanding on Federal government- 
guaranteed loans in accrual status made 
by the banks; and 
‘‘(ii) the guaranteed portions of the 
amount of Federal government-guaranteed 
investments made by the banks that are 
not permanently impaired; and 
‘‘(B) 80 percent of each of— 
‘‘(i) the guaranteed portions of prin-
cipal outstanding on State government- 
guaranteed loans in accrual status made 
by the banks; and 
‘‘(ii) the guaranteed portions of the 
amount of State government-guaranteed 
investments made by the banks that are 
not permanently impaired.’’. 
(d) DETERMINATION
OF LOAN
AND INVESTMENT 
AMOUNTS.—Section 5.55(d) of such Act (12 U.S.C. 
2277a-4(d)) is amended— 
(1) in the subsection heading, by striking 
‘‘PRINCIPAL OUTSTANDING’’ and inserting ‘‘LOAN 
AND INVESTMENT AMOUNTS’’; 
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704 
(2) in the matter preceding paragraph (1), by 
striking ‘‘For the purpose’’ and all that follows 
through ‘‘made—’’ and inserting ‘‘For the purpose 
of subsections (a) and (c), the principal outstanding 
on all loans made by an insured System bank, and 
the amount outstanding on all investments made by 
an insured System bank, shall be determined based 
on—’’; 
(3) in each of paragraphs (1), (2), and (3), by 
inserting ‘‘all loans or investments made’’ before 
‘‘by’’ the first place it appears; and 
(4) in each of paragraphs (1) and (2), by in-
serting ‘‘or investments’’ after ‘‘that is able to make 
such loans’’ each place it appears. 
(e) ALLOCATION TO SYSTEM INSTITUTIONS OF EX-
CESS RESERVES.—Section 5.55(e) of such Act (12 U.S.C. 
2277a-4(e)) is amended— 
(1) in paragraph (3), by striking ‘‘the average 
secure base amount for the calendar year (as cal-
culated on an average daily balance basis)’’ and in-
serting ‘‘the secure base amount’’; 
(2) in paragraph (4), by striking subparagraph 
(B) and inserting the following: 
‘‘(B) there shall be credited to the allo-
cated insurance reserves account of each in-
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705 
sured system bank an amount that bears the 
same ratio to the total amount (less any 
amount credited under subparagraph (A)) as— 
‘‘(i) the average principal outstanding 
for the calendar year on insured obliga-
tions issued by the bank (after deducting 
from the principal the percentages of the 
guaranteed portions of loans and invest-
ments described in subsection (a)(2)); 
bears to 
‘‘(ii) the average principal outstanding 
for the calendar year on insured obliga-
tions issued by all insured System banks 
(after deducting from the principal the 
percentages of the guaranteed portions of 
loans and investments described in sub-
section (a)(2)).’’; and 
(3) in paragraph (6)— 
(A) in subparagraph (A)— 
(i) in the matter preceding clause (i), 
by striking ‘‘beginning more’’ and all that 
follows through ‘‘January 1, 2005’’; 
(ii) by striking clause (i) and inserting 
the following: 
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706 
‘‘(i) subject to subparagraph (D), pay 
to each insured System bank, in a manner 
determined by the Corporation, an amount 
equal to the balance in the Allocated Insur-
ance Reserves Account of the System 
bank; and’’; and 
(iii) in clause (ii)— 
(I) by striking ‘‘subparagraphs 
(C), (E), and (F)’’ and inserting 
‘‘subparagraphs (C) and (E)’’; and 
(II) by striking ‘‘, of the lesser 
of—’’ and all that follows through the 
end of subclause (II) and inserting 
‘‘at the time of the termination of the 
Financial Assistance Corporation, of 
the balance in the Allocated Insurance 
Reserves Account established under 
paragraph (1)(B).’’; 
(B) in subparagraph (C)— 
(i) in clause (i), by striking ‘‘(in addi-
tion to the amounts described in subpara-
graph (F)(ii))’’; and 
(ii) by striking clause (ii) and insert-
ing the following: 
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‘‘(ii) TERMINATION
OF
ACCOUNT.— 
On disbursement of an amount equal to 
$56,000,000, the Corporation shall— 
‘‘(I) close the account established 
under paragraph (1)(B); and 
‘‘(II) transfer any remaining 
funds in the Account to the remaining 
Allocated 
Insurance 
Reserves 
Ac-
counts in accordance with paragraph 
(4)(B) for the calendar year in which 
the transfer occurs.’’; and 
(C) by striking subparagraph (F). 
SEC. 5405. CERTIFICATION OF PREMIUMS. 
(a) FILING CERTIFIED STATEMENT.—Section 5.56 
of the Farm Credit Act of 1971 (12 U.S.C. 2277a–5) is 
amended by striking subsection (a) and inserting the fol-
lowing: 
‘‘(a) FILING CERTIFIED STATEMENT.—On a date to 
be determined in the sole discretion of the Board of Direc-
tors of the Corporation, each insured System bank that 
became insured before the beginning of the period for 
which premiums are being assessed (referred to in this 
section as the ‘period’) shall file with the Corporation a 
certified statement showing— 
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‘‘(1) the average outstanding insured obliga-
tions for the period issued by the bank; 
‘‘(2)(A) the average principal outstanding for 
the period on the guaranteed portion of Federal gov-
ernment-guaranteed loans that are in accrual status; 
and 
‘‘(B) the average amount outstanding for the 
period of Federal government-guaranteed invest-
ments that are not permanently impaired (as defined 
in section 5.55(a)(4)); 
‘‘(3)(A) the average principal outstanding for 
the period on State government-guaranteed loans 
that are in accrual status; and 
‘‘(B) the average amount outstanding for the 
period of State government-guaranteed investments 
that are not permanently impaired (as defined in 
section 5.55(a)(4)); 
‘‘(4)(A) the average principal outstanding for 
the period on loans that are in nonaccrual status; 
and 
‘‘(B) the average amount outstanding for the 
period of other-than-temporarily impaired invest-
ments; and 
‘‘(5) the amount of the premium due the Cor-
poration from the bank for the period.’’. 
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709 
(b) PREMIUM PAYMENTS.—Section 5.56 of such Act 
(12 U.S.C. 2277a–5) is amended by striking subsection 
(c) and inserting the following: 
‘‘(c) PREMIUM PAYMENTS.— 
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), each insured System bank shall pay to 
the Corporation the premium payments required 
under subsection (a), not more frequently than once 
in each calendar quarter, in such manner and at 
such 1 or more times as the Board of Directors shall 
prescribe. 
‘‘(2) PREMIUM AMOUNT.—The amount of the 
premium shall be established not later than 60 days 
after filing the certified statement specifying the 
amount of the premium.’’. 
(c) SUBSEQUENT
PREMIUM
PAYMENTS.—Section 
5.56 of such Act (12 U.S.C. 2277a–5) is amended— 
(1) by striking subsection (d); and 
(2) by redesignating subsection (e) as sub-
section (d). 
SEC. 5406. RURAL UTILITY LOANS. 
(a) DEFINITION
OF
QUALIFIED
LOAN.—Section 
8.0(9) of the Farm Credit Act of 1971 (12 U.S.C. 
2279aa(9)) is amended— 
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710 
(1) in subparagraph (A)(iii), by striking ‘‘or’’ at 
the end; 
(2) in subparagraph (B)(ii), by striking the pe-
riod at the end and inserting ‘‘; or’’; and 
(3) by adding at the end the following: 
‘‘(C) that is a loan, or an interest in a 
loan, for an electric or telephone facility by a 
cooperative lender to a borrower that has re-
ceived, or is eligible to receive, a loan under the 
Rural Electrification Act of 1936 (7 U.S.C. 901 
et seq.).’’. 
(b) GUARANTEE
OF QUALIFIED LOANS.—Section 
8.6(a)(1) of such Act (12 U.S.C. 2279aa–6(a)(1)) is 
amended by inserting ‘‘applicable’’ before ‘‘standards’’ 
each place it appears in subparagraphs (A) and (B)(i). 
(c) STANDARDS
FOR QUALIFIED LOANS.—Section 
8.8 of such Act (12 U.S.C. 2279aa–8) is amended— 
(1) in subsection (a)— 
(A) by striking the first sentence and in-
serting the following: 
‘‘(1) IN GENERAL.—The Corporation shall es-
tablish underwriting, security appraisal, and repay-
ment standards for qualified loans taking into ac-
count the nature, risk profile, and other differences 
between different categories of qualified loans. 
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711 
‘‘(2) SUPERVISION, EXAMINATION, AND REPORT 
OF CONDITION.—The standards shall be subject to 
the authorities of the Farm Credit Administration 
under section 8.11.’’; and 
(B) in the last sentence, by striking ‘‘In 
establishing’’ and inserting the following: 
‘‘(3) MORTGAGE LOANS.—In establishing’’; 
(2) in subsection (b)— 
(A) in the matter preceding paragraph (1), 
by inserting ‘‘with respect to loans secured by 
agricultural real estate’’ after ‘‘subsection (a)’’; 
and 
(B) in paragraph (5)— 
(i) by striking ‘‘borrower’’ the first 
place it appears and inserting ‘‘farmer or 
rancher’’; and 
(ii) by striking ‘‘site’’ and inserting 
‘‘farm or ranch’’; 
(3) in subsection (c)(1), by inserting ‘‘secured 
by agricultural real estate’’ after ‘‘A loan’’; 
(4) by striking subsection (d); and 
(5) by redesignating subsection (e) as sub-
section (d). 
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(d) 
RISK-BASED
CAPITAL
LEVELS.—Section 
8.32(a)(1) of such Act (12 U.S.C. 2279bb–1(a)(1)) is 
amended— 
(1) by striking ‘‘With respect’’ and inserting 
the following: 
‘‘(A) IN GENERAL.—With respect’’; and 
(2) by adding at the end the following: 
‘‘(B) RURAL
UTILITY
LOANS.—With re-
spect to securities representing an interest in, 
or obligation backed by, a pool of qualified 
loans described in section 8.0(9)(C) owned or 
guaranteed by the Corporation, losses occur at 
a rate of default and severity reasonably related 
to risks in electric and telephone facility loans 
(as applicable), as determined by the Direc-
tor.’’. 
SEC. 5407. EQUALIZATION OF LOAN-MAKING POWERS OF 
CERTAIN DISTRICT ASSOCIATIONS. 
(a) IN GENERAL.—The Farm Credit Act of 1971 is 
amended by inserting after section 7.6 (12 U.S.C. 2279b) 
the following: 
‘‘SEC. 7.7. EQUALIZATION OF LOAN-MAKING POWERS OF 
CERTAIN DISTRICT ASSOCIATIONS. 
‘‘(a) EQUALIZATION OF LOAN-MAKING POWERS.— 
‘‘(1) IN GENERAL.— 
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713 
‘‘(A) FEDERAL
LAND
BANK
ASSOCIA-
TIONS.—Subject to paragraph (2), any associa-
tion that owns a Federal land bank association 
authorized as of January 1, 2007, to make 
long-term loans under title I in its chartered 
territory within the geographic area described 
in subsection (b) may make short- and inter-
mediate-term loans and otherwise operate as a 
production credit association under title II 
within that same chartered territory. 
‘‘(B) 
PRODUCTION
CREDIT
ASSOCIA-
TIONS.—Subject to paragraph (2), any associa-
tion that under its charter has title I lending 
authority and that owns a production credit as-
sociation authorized as of January 1, 2007, to 
make short- and intermediate-term loans under 
title II in the geographic area described in sub-
section (b) may make long-term loans and oth-
erwise operate, directly or through a subsidiary 
association, as a Federal land bank association 
or Federal land credit association under title I 
in the geographic area. 
‘‘(C) 
FARM
CREDIT
BANK.—Notwith-
standing section 5.17(a), the Farm Credit Bank 
with which any association had a written fi-
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714 
nancing agreement as of January 1, 2007, may 
make loans and extend other comparable finan-
cial assistance with respect to, and may pur-
chase, any loans made under the new authority 
provided under subparagraph (A) or (B) by an 
association exercising such authority. 
‘‘(2) REQUIRED
APPROVALS.—An association 
may exercise the additional authority provided for in 
paragraph (1) only after the exercise of the author-
ity is approved by— 
‘‘(A) the board of directors of the associa-
tion; and 
‘‘(B) a majority of the voting stockholders 
of the association (or, if the association is a 
subsidiary of another association, the voting 
stockholders of the parent association) voting, 
in person or by proxy, at a duly authorized 
meeting of stockholders in accordance with the 
process described in section 7.11. 
‘‘(b) APPLICABILITY.—This section applies only to 
associations the chartered territory of which was within 
the geographic area served by the Federal intermediate 
credit bank immediately prior to its merger with a Farm 
Credit Bank under section 410(e)(1) of the Agricultural 
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715 
Credit Act of 1987 (12 U.S.C. 2011 note; Public Law 
100–233).’’. 
(b) CHARTER AMENDMENTS.—Section 5.17(a) of the 
Farm Credit Act of 1971 (12 U.S.C. 2252(a)) is amended 
by adding at the end the following: 
‘‘(15)(A) Approve amendments to the charters 
of institutions of the Farm Credit System to imple-
ment the equalization of loan-making powers of a 
Farm Credit System association under section 7.7. 
‘‘(B) Amendments described in subparagraph 
(A) to the charters of an association and the related 
Farm Credit Bank shall be approved by the Farm 
Credit Administration, subject to any conditions of 
approval imposed, by not later than 30 days after 
the date on which the Farm Credit Administration 
receives all approvals required by section 7.7(a)(2).’’. 
(c) CONFORMING AMENDMENTS.— 
(1) Section 5.17(a)(2) of the Farm Credit Act 
of 1971 (12 U.S.C. 2252(a)(2)) is amended— 
(A) by striking ‘‘(2)(A)’’ and inserting 
‘‘(2)’’; and 
(B) by striking subparagraphs (B) and 
(C). 
(2) SECTION 410 OF THE 1987 ACT.—Section 
410(e)(1)(A)(iii) of the Agricultural Credit Act of 
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716 
1987 (12 U.S.C. 2011 note; Public Law 100–233) 
is amended by inserting ‘‘(except section 7.7 of that 
Act)’’ after ‘‘(12 U.S.C. 2001 et seq.)’’. 
(3) SECTION 401 OF THE 1992 ACT.—Section 
401(b) of the Farm Credit Banks and Associations 
Safety and Soundness Act of 1992 (12 U.S.C. 2011 
note; Public Law 102–552) is amended— 
(A) by inserting ‘‘(except section 7.7 of the 
Farm Credit Act of 1971)’’ after ‘‘provision of 
law’’; and 
(B) by striking ‘‘, subject to such limita-
tions’’ and all that follows through the end of 
the paragraph and inserting a period. 
(d) EFFECTIVE DATE.—The amendments made by 
this section take effect on January 1, 2010. 
Subtitle F—Miscellaneous 
SEC. 
5501. 
LOANS 
TO 
PURCHASERS 
OF 
HIGHLY 
FRACTIONED LAND. 
The first section of Public Law 91–229 (25 U.S.C. 
488) is amended— 
(1) by striking ‘‘That the Secretary’’ and in-
serting the following: 
‘‘SECTION 
1. 
LOANS 
TO 
PURCHASERS 
OF 
HIGHLY 
FRACTIONED LAND. 
‘‘(a) IN GENERAL.—The Secretary’’; and 
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729 
(2) Section 310B(g) of the Consolidated Farm 
and Rural Development Act (7 U.S.C. 1932(g)) is 
amended by striking ‘‘subsection (a)(1)’’ each place 
it appears in paragraphs (1), (6)(A)(iii), and (8)(C) 
and inserting ‘‘subsection (a)(2)(A)’’. 
(3) Section 333A(g)(1)(B) of the Consolidated 
Farm and Rural Development Act (7 U.S.C. 
1983a(g)(1)(B)) is amended by striking ‘‘section 
310B(a)(1)’’ and inserting ‘‘section 310B(a)(2)(A)’’. 
(4) Section 381E(d)(3)(B) of the Consolidated 
Farm and Rural Development Act (7 U.S.C. 
2009d(d)(3)(B)) is amended by striking ‘‘section 
310B(a)(1)’’ and inserting ‘‘section 310B(a)(2)(A)’’. 
SEC. 6013. RURAL COOPERATIVE DEVELOPMENT GRANTS. 
(a) ELIGIBILITY.—Section 310B(e)(5) of the Consoli-
dated Farm and Rural Development Act (7 U.S.C. 
1932(e)(5)) is amended— 
(1) in subparagraph (A), by striking ‘‘admin-
istering a nationally coordinated, regionally or State- 
wide operated project’’ and inserting ‘‘carrying out 
activities to promote and assist the development of 
cooperatively and mutually owned businesses’’; 
(2) in subparagraph (B), by inserting ‘‘to pro-
mote and assist the development of cooperatively 
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