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gether with interest thereon as determined by
the Secretary; or
‘‘(B) to accept an adjustment in the
amount of future payments otherwise required
under the contract.
‘‘(j) MARKET TRANSITION CONTRACTS.—Notwith-
standing any other provision of law, no order issued for
any fiscal year under section 252 of the Balanced Budget
and Emergency Deficit Control Act of 1985 (2 U.S.C.
902) shall affect any payment under any market transi-
tion contract.’’.
(b) CONTINUED OPERATION OF EXISTING PROGRAM
THROUGH 1995.—
(1) PRICE SUPPORT OPERATIONS.—Until De-
cember 31, 1995, the Secretary of Agriculture shall
continue to use section 204 of the Agricultural Act
of 1949 (7 U.S.C. 1446e), as in effect on the day
before the date of the enactment of this Act, to sup-
port the price of milk produced in the 48 contiguous
States.
(2) PRICE REDUCTION.—Subsection (h) of such
section, relating to a reduction in the price received
by milk producers for all milk produced in the 48
contiguous States and marketed for commercial use,
shall continue to apply with respect to milk mar-
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keted through December 31, 1995. In the case of
milk producers that did not increase milk market-
ings in 1995 when compared to 1994 milk market-
ings, the Secretary of Agriculture shall make re-
funds available in 1996 to such milk producers in
the manner provided in paragraph (3) of such sub-
section.
(c) CONFORMING REPEAL OF GENERAL AUTHORITY
TO PROVIDE PRICE SUPPORT FOR MILK.—
(1) DESIGNATED
NONBASIC
AGRICULTURAL
COMMODITY.—Section 201(a) of the Agricultural
Act of 1949 (7 U.S.C. 1446(a)) is amended by strik-
ing ‘‘milk,’’.
(2) OTHER NONBASIC AGRICULTURAL COMMOD-
ITIES.—Section 301 of the Agricultural Act of 1949
(7 U.S.C. 1447) is amended by inserting ‘‘(other
than milk)’’ after ‘‘title II’’.
SEC. 1202. RECOURSE LOANS FOR COMMERCIAL PROC-
ESSORS OF DAIRY PRODUCTS.
The Agricultural Act of 1949 is amended by striking
section 424 (7 U.S.C. 1433c), as added by section 1003
of the Food Security Act of 1985 and effective for 1986
through 1990 crops, and inserting the following new sec-
tion:
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‘‘SEC. 424. RECOURSE LOANS FOR COMMERCIAL PROC-
ESSORS OF DAIRY PRODUCTS.
‘‘(a) RECOURSE LOANS AVAILABLE.—On and after
January 1, 1996, the Secretary may make recourse loans
available to commercial processors of eligible dairy prod-
ucts to assist such processors to manage inventories of eli-
gible dairy products to assure a greater degree of price
stability for the dairy industry during the year. Recourse
loans may be made available under such reasonable terms
and conditions as the Secretary may prescribe.
‘‘(b) AMOUNT OF LOAN.—The Secretary shall estab-
lish the amount of a loan for eligible dairy products, which
shall reflect 90 percent of the reference price for that
product. The rate of interest charged participants in this
program shall not be less than the rate of interest charged
the Commodity Credit Corporation by the United States
Treasury.
‘‘(c) PERIOD
OF LOANS.—A recourse loan made
under this section may not extend beyond the end of the
fiscal year during which the loan is made, except that the
Secretary may extend the loan for an additional period
not to exceed the end of the next fiscal year.
‘‘(d) DEFINITIONS.—For purposes of this section:
‘‘(1) The term ‘eligible dairy products’ means
cheddar cheese, butter, and nonfat dry milk.
‘‘(2) The term ‘reference price’ means—
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‘‘(A) for cheddar cheese, the average Na-
tional Cheese Exchange price for 40 pound
blocks of cheddar cheese for the previous three
months;
‘‘(B) for butter the average Chicago Mer-
cantile Exchange price for butter for the pre-
vious three months; and
‘‘(C) for nonfat dry milk, the Western
States price for nonfat dry milk for the pre-
vious three months.’’.
CHAPTER 2—DAIRY EXPORT PROGRAMS
SEC. 1211. DAIRY EXPORT INCENTIVE PROGRAM.
(a) IN GENERAL.—Section 153(c) of the Food Secu-
rity Act of 1985 (15 U.S.C. 713a–14(c)) is amended—
(1) by striking ‘‘and’’ at the end of paragraph
(1);
(2) by striking the period at the end of para-
graph (2) and inserting ‘‘; and’’; and
(3) by adding at the end the following new
paragraphs:
‘‘(3) the maximum volume of dairy product ex-
ports allowable consistent with the obligations of the
United States as a member of the World Trade Or-
ganization are exported under the program each
year (minus the volume sold under section 1163 of
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the Food Security Act of 1985 (7 U.S.C. 1731 note)
during that year), except to the extent that the ex-
port of such a volume under the program would, in
the judgment of the Secretary, exceed the limitations
on the value set forth in subsection (f); and
‘‘(4) payments may be made under the program
for exports to any destination in the world for the
purpose of market development, except a destination
in a country with respect to which shipments from
the United States are otherwise restricted by law.’’.
(b) SOLE DISCRETION.—Section 153(b) of the Food
Security Act of 1985 (15 U.S.C. 713a–14(b)) is amended
by inserting ‘‘sole’’ before ‘‘discretion’’.
(c) MARKET DEVELOPMENT.—Section 153(e)(1) of
the Food Security Act of 1985 (15 U.S.C. 713a–14(e)(1))
is amended—
(1) by striking ‘‘and’’ and inserting ‘‘the’’; and
(2) by inserting before the period the following:
‘‘, and any additional amount that may be required
to assist in the development of world markets for
United States dairy products’’.
(d) MAXIMUM ALLOWABLE AMOUNTS.—Section 153
of the Food Security Act of 1985 (15 U.S.C. 713a–14)
is amended by adding at the end the following:
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‘‘(f) REQUIRED FUNDING.—The Commodity Credit
Corporation shall in each year use money and commodities
for the program under this section in the maximum
amount consistent with the obligations of the United
States as a member of the World Trade Organization,
minus the amount expended under section 1163 of the
Food Security Act of 1985 (7 U.S.C. 1731 note) during
that year. However, the Commodity Credit Corporation
may not exceed the limitations specified in subsection
(c)(3) on the volume of allowable dairy product exports.’’.
(e) CONFORMING AMENDMENT.—Section 153(a) of
the Food Security Act of 1985 (15 U.S.C. 713a–14(a))
is amended by striking ‘‘2001’’ and inserting ‘‘2002’’.
SEC. 1212. AUTHORITY TO ASSIST IN ESTABLISHMENT AND
MAINTENANCE OF EXPORT TRADING COM-
PANY.
The Secretary of Agriculture shall, consistent with
the obligations of the United States as a member of the
World Trade Organization, provide such advice and assist-
ance to the United States dairy industry as may be nec-
essary to enable that industry to establish and maintain
an export trading company under the Export Trading
Company Act of 1982 (15 U.S.C. 4001 et seq.) for the
purpose of facilitating the international market develop-
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ment for and exportation of dairy products produced in
the United States.
SEC. 1213. STANDBY AUTHORITY TO INDICATE ENTITY
BEST SUITED TO PROVIDE INTERNATIONAL
MARKET DEVELOPMENT AND EXPORT SERV-
ICES.
(a) INDICATION OF ENTITY BEST SUITED TO ASSIST
INTERNATIONAL MARKET DEVELOPMENT FOR AND EX-
PORT OF UNITED STATES DAIRY PRODUCTS.—If—
(1) the United States dairy industry has not es-
tablished an export trading company under the Ex-
port Trading Company Act of 1982 (15 U.S.C. 4001
et seq.) for the purpose of facilitating the inter-
national market development for and exportation of
dairy products produced in the United States on or
before June 30, 1996; or
(2) the quantity of exports of United States
dairy products during the 12-month period preced-
ing July 1, 1997 does not exceed the quantity of ex-
ports of United States dairy products during the 12-
month period preceding July 1, 1996 by 1.5 billion
pounds (milk equivalent, total solids basis);
the Secretary of Agriculture is directed to indicate which
entity autonomous of the Government of the United States
is best suited to facilitate the international market devel-
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opment for and exportation of United States dairy prod-
ucts.
(b) FUNDING OF EXPORT ACTIVITIES.—The Sec-
retary shall assist the entity in identifying sources of fund-
ing for the activities specified in subsection (a) from with-
in the dairy industry and elsewhere.
(c) APPLICATION OF SECTION.—This section shall
apply only during the period beginning on July 1, 1997
and ending on September 30, 2000.
SEC. 1214. STUDY AND REPORT REGARDING POTENTIAL IM-
PACT OF URUGUAY ROUND ON PRICES, IN-
COME AND GOVERNMENT PURCHASES.
(a) STUDY.—The Secretary of Agriculture shall con-
duct a study, on a variety by variety of cheese basis, to
determine the potential impact on milk prices in the Unit-
ed States, dairy producer income, and Federal dairy pro-
gram costs, of the allocation of additional cheese granted
access to the United States as a result of the obligations
of the United States as a member of the World Trade
Organization.
(b) REPORT.—Not later than September 30, 1996,
the Secretary shall report to the Committees on Agri-
culture of the Senate and the House of Representatives
the results of the study conducted under this section.
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(c) RULE OF CONSTRUCTION.—Any limitation im-
posed by Act of Congress on the conduct or completion
of studies or reports to Congress shall not apply to the
study and report required under this section unless such
limitation explicitly references this section in doing so.
CHAPTER 3—DAIRY PROMOTION
PROGRAMS
SEC. 1221. RESEARCH AND PROMOTION ACTIVITIES UNDER
FLUID MILK PROMOTION ACT OF 1990.
(a) EXTENSION OF ORDER.—Section 1999O of the
Fluid Milk Promotion Act of 1990 (subtitle H of title XIX
of Public Law 101–624; 7 U.S.C. 6414(a)) is amended—
(1) by striking subsection (a); and
(2) by redesignating subsections (b) and (c) as
subsections (a) and (b), respectively.
(b) DEFINITION OF RESEARCH.—Paragraph (6) of
section 1999C of such Act (7 U.S.C. 6402) is amended
to read as follows:
‘‘(6) RESEARCH.—The term ‘research’ means—
‘‘(A) market research to support and in-
crease the effectiveness of industry advertising,
promotion, and educational activities; and
‘‘(B) other research to expand sales of
fluid milk products, including research regard-
ing the development of new products, new prod-
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uct characteristics, and improved technology in
the production, manufacturing, or processing of
milk and the products of milk.’’.
(c) CONFORMING AMENDMENTS REGARDING MAR-
KETING ORDERS.—Section 1999J(b) of such Act (7
U.S.C. 6409(b)) is amended—
(1) by striking paragraph (1);
(2) in paragraph (2), by striking ‘‘(2) other-
wise’’ and inserting ‘‘(1)’’; and
(3) by redesignating paragraph (3) as para-
graph (2).
(d) CLARIFICATION
OF
REFERENDUM
REQUIRE-
MENTS.—
(1) SUSPENSION OR TERMINATION.—Subsection
(b) of section 1999O of such Act (7 U.S.C. 6414),
as redesignated by subsection (a)(2), is amended—
(A) in paragraph (1), by striking ‘‘all proc-
essors’’ and inserting ‘‘all fluid milk proc-
essors’’; and
(B) in paragraph (2)(B), by striking ‘‘all
processors’’ and inserting ‘‘all fluid milk proc-
essors voting in the referendum’’.
(2) 
CONFORMING
AMENDMENT.—Section
1999N(b)(2) of such Act (7 U.S.C. 6413(b)(2)) is
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amended by striking ‘‘all processors’’ and inserting
‘‘all fluid milk processors voting in the referendum’’.
SEC. 1222. EXPANSION OF DAIRY PROMOTION PROGRAM TO
COVER DAIRY PRODUCTS IMPORTED INTO
THE UNITED STATES.
(a) DECLARATION OF POLICY.—Section 110(b) of
the Dairy Production Stabilization Act of 1983 (7 U.S.C.
4501(b)) is amended by inserting after ‘‘commercial use’’
the following: ‘‘and dairy products imported into the Unit-
ed States’’.
(b) DEFINITIONS.—
(1) MILK.—Subsection (d) of section 111 of
such Act (7 U.S.C. 4502) is amended by inserting
before the period at the end the following: ‘‘or cow’s
milk imported into the United States in the form of
dairy products intended for consumption in the
United States’’.
(2) DAIRY PRODUCTS.—Subsection (e) of such
section is amended by inserting before the semicolon
the following: ‘‘and casein (except casein imported
under 
sections 
3501.90.20 
(casein 
glue) 
and
3501.90.50 (other) of the Harmonized Tariff Sched-
ule)’’.
(3) RESEARCH.—Subsection (j) of such section
is amended by inserting before the semicolon the fol-
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lowing: ‘‘or to reduce the costs associated with proc-
essing or marketing those products’’.
(4) UNITED STATES.—Subsection (l) of such
section is amended to read as follows:
‘‘(l) the term ‘United States’ means the several
States and the District of Columbia;’’.
(5) IMPORTERS AND EXPORTERS.—Such section
is further amended—
(A) in subsection (k), by striking ‘‘and’’ at
the end of such subsection; and
(B) by adding at the end the following new
subsections:
‘‘(m) the term ‘importer’ means the first person
to take title to dairy products imported into the
United States for domestic consumption; and
‘‘(n) the term ‘exporter’ means any person who
exports dairy products from the United States.’’.
(c) MEMBERSHIP
OF BOARD.—Section 113(b) of
such Act (7 U.S.C. 4504(b)) is amended—
(1) in the first sentence, by striking ‘‘thirty-six
members’’ and inserting ‘‘38 members, including one
representative of importers and one representative of
exporters to be appointed by the Secretary’’;
(2) in the second sentence, by striking ‘‘Mem-
bers’’ and inserting ‘‘The remaining members’’; and
876
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fuel held by any person exclusively for any use for
which a credit or refund of the entire tax imposed
by section 4091 of such Code (other than the rate
imposed by section 4091(b)(2) of such Code) is al-
lowable for aviation fuel so used.
(5) EXCEPTION
FOR
CERTAIN
AMOUNTS
OF
FUEL.—
(A) IN
GENERAL.—No tax shall be im-
posed by paragraph (1) on aviation fuel held on
October 1, 1997, by any person if the aggregate
amount of commercial aviation fuel held by
such person on such date does not exceed 2,000
gallons. The preceding sentence shall apply only
if such person submits to the Secretary (at the
time and in the manner required by the Sec-
retary) such information as the Secretary shall
require for purposes of this paragraph.
(B) EXEMPT FUEL.—For purposes of sub-
paragraph (A), there shall not be taken into ac-
count fuel held by any person which is exempt
from the tax imposed by paragraph (1) by rea-
son of paragraph (4).
(C) CONTROLLED GROUPS.—For purposes
of this paragraph—
(i) CORPORATIONS.—