IV
103D CONGRESS
2D SESSION
H. RES. 559
Concurring in the Senate amendment to H.R. 4217 with an amendment.
IN THE HOUSE OF REPRESENTATIVES
OCTOBER 3, 1994
Mr. DE LA GARZA submitted the following resolution; which was considered
under suspension of the rules and agreed to
RESOLUTION
Concurring in the Senate amendment to H.R. 4217 with
an amendment.
Resolved, That upon adoption of this resolution, the
House shall be considered to have taken from the Speak-
er’s table the bill (H.R. 4217) to reform the Federal crop
insurance program, and for other purposes, with the Sen-
ate amendment thereto, and to have concurred in the Sen-
ate amendment with an amendment as follows:
In lieu of the matter proposed to be inserted by the
Senate amendment, insert the following:
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Subtitle B—Farm and Foreign Agricultural Services
Sec. 225. Under Secretary of Agriculture for Farm and Foreign Agricultural
Services.
Sec. 226. Consolidated Farm Service Agency.
Sec. 227. State, county, and area committees.
Subtitle C—Rural Economic and Community Development
Sec. 231. Under Secretary of Agriculture for Rural Economic and Community
Development.
Sec. 232. Rural Utilities Service.
Sec. 233. Rural Housing and Community Development Service.
Sec. 234. Rural Business and Cooperative Development Service.
Sec. 235. Conforming amendments regarding Rural Electrification Administra-
tion.
Subtitle D—Food, Nutrition, and Consumer Services
Sec. 241. Under Secretary of Agriculture for Food, Nutrition, and Consumer
Services.
Subtitle E—Natural Resources and Environment
Sec. 245. Under Secretary of Agriculture for Natural Resources and Environ-
ment.
Sec. 246. Natural Resources Conservation Service.
Sec. 247. Reorganization of Forest Service.
Subtitle F—Research, Education, and Economics
Sec. 251. Under Secretary of Agriculture for Research, Education, and Eco-
nomics.
Sec. 252. Program staff.
Subtitle G—Food Safety
Sec. 261. Under Secretary of Agriculture for Food Safety.
Sec. 262. Conditions for implementation of alterations in the level of additives
allowed in animal diets.
Subtitle H—National Appeals Division
Sec. 271. Definitions.
Sec. 272. National Appeals Division and Director.
Sec. 273. Transfer of functions.
Sec. 274. Notice and opportunity for hearing.
Sec. 275. Informal hearings.
Sec. 276. Right of participants to Division hearing.
Sec. 277. Division hearings.
Sec. 278. Director review of determinations of hearing officers.
Sec. 279. Judicial review.
Sec. 280. Implementation of final determinations of Division.
Sec. 281. Conforming amendments relating to National Appeals Division.
Sec. 282. Expansion of issues covered by State mediation programs.
Sec. 283. Authorization of appropriations.
Subtitle I—Miscellaneous Reorganization Provisions
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Sec. 291. Successorship provisions relating to bargaining units and exclusive
representatives.
Sec. 292. Purchase of American-made equipment and products.
Sec. 293. Miscellaneous conforming amendments.
Sec. 294. Removal of obsolete administrative provisions.
Sec. 295. Proposed conforming amendments.
Sec. 296. Termination of authority.
TITLE III—MISCELLANEOUS
Sec. 301. Poultry labeling.
Sec. 302. First Amendment rights of employees of the United States Depart-
ment of Agriculture.
Sec. 303. Adjusted cost of thrifty food plan.
Sec. 304. Office of Risk Assessment and Cost-Benefit Analysis.
Sec. 305. Fair and equitable treatment of socially disadvantaged producers.
Sec. 306. Aviation inspections.
TITLE I—FEDERAL CROP
INSURANCE REFORM
SEC. 101. SHORT TITLE; REFERENCES.
(a) SHORT TITLE.—This title may be cited as the
‘‘Federal Crop Insurance Reform Act of 1994’’.
(b) REFERENCES TO FEDERAL CROP INSURANCE
ACT.—Except as otherwise expressly provided, whenever
in this title an amendment or repeal is expressed in terms
of an amendment to, or repeal of, a section or other provi-
sion, the reference shall be considered to be made to a
section or other provision of the Federal Crop Insurance
Act (7 U.S.C. 1501 et seq.).
SEC. 102. DEFINITIONS.
(a) IN GENERAL.—Section 502 (7 U.S.C. 1502) is
amended—
(1) by striking the section heading and ‘‘SEC.
502.’’ and inserting the following:
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‘‘SEC. 502. PURPOSE AND DEFINITIONS.
‘‘(a) PURPOSE.—’’; and
(2) by adding at the end the following new sub-
section:
‘‘(b) DEFINITIONS.—As used in this title:
‘‘(1) ADDITIONAL COVERAGE.—The term ‘addi-
tional coverage’ means a plan of crop insurance cov-
erage providing a level of coverage greater than the
level available under catastrophic risk protection.
‘‘(2) APPROVED
INSURANCE
PROVIDER.—The
term ‘approved insurance provider’ means a private
insurance provider that has been approved by the
Corporation to provide insurance coverage to produc-
ers participating in the Federal crop insurance pro-
gram established under this title.
‘‘(3) BOARD.—The term ‘Board’ means the
Board of Directors of the Corporation established
under section 505(a).
‘‘(4) CORPORATION.—The term ‘Corporation’
means the Federal Crop Insurance Corporation es-
tablished under section 503.
‘‘(5) DEPARTMENT.—The term ‘Department’
means the United States Department of Agriculture.
‘‘(6) LOSS RATIO.—The term ‘loss ratio’ means
the ratio of all sums paid by the Corporation as in-
demnities under any eligible crop insurance policy to
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that portion of the premium designated for antici-
pated losses and a reasonable reserve, other than
that portion of the premium designated for operat-
ing and administrative expenses.
‘‘(7) SECRETARY.—The term ‘Secretary’ means
the Secretary of Agriculture.
‘‘(8) TRANSITIONAL YIELD.—The term ‘transi-
tional yield’ means the maximum average production
per acre or equivalent measure that is assigned to
acreage for a crop year by the Corporation in ac-
cordance with the regulations of the Corporation
whenever the producer fails—
‘‘(A) to certify that acceptable documenta-
tion of production and acreage for the crop year
is in the possession of the producer; or
‘‘(B) to present the acceptable documenta-
tion on the demand of the Corporation or an in-
surance company reinsured by the Corpora-
tion.’’.
(b) CONFORMING AMENDMENTS.—
(1) The first sentence of section 503 (7 U.S.C.
1503) is amended by striking ‘‘(herein called the
Corporation)’’.
(2) Section 504 (7 U.S.C. 1504) is amended—
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(A) in subsection (a), by striking ‘‘Board
of Directors of the Corporation’’ and inserting
‘‘Board’’; and
(B) in subsection (d), by striking ‘‘Federal
Crop Insurance Corporation’’ and inserting
‘‘Corporation’’.
(3) The first sentence of section 505(a) (7
U.S.C. 1505(a)) is amended by striking ‘‘(herein-
after called the ‘Board’)’’.
(4) Except in section 502, the Act is amend-
ed—
(A) by striking ‘‘Board of Directors’’ each
place it appears and inserting ‘‘Board’’;
(B) by striking ‘‘Department of Agri-
culture’’ each place it appears and inserting
‘‘Department’’; and
(C) by striking ‘‘Secretary of Agriculture’’
each place it appears and inserting ‘‘Secretary’’.
SEC. 103. MEMBERS OF BOARD OF DIRECTORS OF COR-
PORATION.
The second sentence of section 505(a) (7 U.S.C.
1505(a)) is amended—
(1) by striking ‘‘or Assistant Secretary’’ the
first place it appears; and
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(2) by striking ‘‘the Under Secretary or Assist-
ant Secretary of Agriculture responsible for the farm
credit programs of the Department of Agriculture’’
and inserting ‘‘one additional Under Secretary of
Agriculture (as designated by the Secretary of Agri-
culture)’’.
SEC. 104. GENERAL POWERS.
Section 506 (7 U.S.C. 1506) is amended—
(1) by redesignating subsections (j) through (n)
as subsections (k) through (o), respectively;
(2) by inserting after subsection (i) the follow-
ing new subsection:
‘‘(j) SETTLING CLAIMS.—The Corporation shall have
the authority to make final and conclusive settlement and
adjustment of any claim by or against the Corporation or
a fiscal officer of the Corporation.’’;
(3) in subsection (l) (as so redesignated)—
(A) in the first sentence, by inserting ‘‘,
and issue regulations,’’ after ‘‘agreements’’; and
(B) in the second sentence, by striking
‘‘contracts or agreements’’ each place it appears
and inserting ‘‘contracts, agreements, or regula-
tions’’;
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(4) in subsection (n)(1) (as so redesignated), by
striking subparagraph (B) and inserting the follow-
ing new subparagraph:
‘‘(B) disqualify the person from purchasing
catastrophic 
risk 
protection 
or 
receiving
noninsured assistance for a period of not to ex-
ceed 2 years, or from receiving any other bene-
fit under this title for a period of not to exceed
10 years.’’;
(5) in subsection (o) (as so redesignated)—
(A) 
by 
redesignating 
paragraphs 
(1)
through (4) as subparagraphs (A) through (D)
and aligning the margins of each subparagraph
with the margins of subparagraph (A) of sub-
section (n)(1) (as redesignated by paragraph
(1));
(B) by striking ‘‘(o) ACTUARIAL SOUND-
NESS.—The Corporation’’ and inserting the fol-
lowing:
‘‘(o) ACTUARIAL SOUNDNESS.—
‘‘(1) PROJECTED LOSS RATIO AS OF OCTOBER
1, 1995.—The Corporation’’;
(C) in subparagraph (A) (as redesignated
by subparagraph (A)), by striking ‘‘from ob-
taining adequate Federal crop insurance, as de-
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termined by the Corporation’’ and inserting
‘‘(as defined by the Secretary) from obtaining
Federal crop insurance’’;
(D) in subparagraph (C) (as so redesig-
nated)—
(i) by inserting ‘‘, agents, and loss ad-
justers’’ after ‘‘participating producers’’;
and
(ii) by inserting ‘‘, agents, and loss
adjusters’’ after ‘‘identify insured produc-
ers’’; and
(E) by adding at the end the following new
paragraphs:
‘‘(2) PROJECTED LOSS RATIO AS OF OCTOBER
1, 1998.—The Corporation shall take such actions,
including the establishment of adequate premiums,
as are necessary to improve the actuarial soundness
of Federal multiperil crop insurance made available
under this title to achieve, on and after October 1,
1998, an overall projected loss ratio of not greater
than 1.075.
‘‘(3) 
NONSTANDARD
CLASSIFICATION
SYS-
TEM.—To the extent that the Corporation uses the
nonstandard classification system, the Corporation
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shall apply the system to all insured producers in a
fair and consistent manner.’’; and
(6) by adding at the end the following new sub-
sections:
‘‘(p) REGULATIONS.—The Secretary and the Cor-
poration are each authorized to issue such regulations as
are necessary to carry out this title.
‘‘(q) PROGRAM COMPLIANCE.—
‘‘(1) TIMELINESS.—The Corporation shall work
actively with approved insurance providers to ad-
dress program compliance and integrity issues as the
issues develop.
‘‘(2) NOTIFICATION
OF
COMPLIANCE
PROB-
LEMS.—The Corporation shall notify in writing any
approved insurance provider with whom the Cor-
poration has an agreement under this title of any
error, omission, or failure to follow Corporation reg-
ulations or procedures for which the approved insur-
ance provider may be responsible and which may re-
sult in a debt owed the Corporation. The notice shall
be given within 3 years of the end of the insurance
period during which the error, omission, or failure is
alleged to have occurred, except that this time limit
shall not apply with respect to errors, omissions, or
procedural violations that are willful or intentional.
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The failure to timely provide the notice required
under this subsection shall relieve the approved in-
surance provider from the debt owed the Corpora-
tion.
‘‘(r) PURCHASE
OF AMERICAN-MADE EQUIPMENT
AND PRODUCTS.—
‘‘(1) SENSE OF CONGRESS.—It is the sense of
Congress that, to the greatest extent practicable, all
equipment and products purchased by the Corpora-
tion using funds made available to the Corporation
should be American-made.
‘‘(2) NOTICE REQUIREMENT.—In providing fi-
nancial assistance to, or entering into any contract
with, any entity for the purchase of equipment and
products to carry out this title, the Corporation, to
the greatest extent practicable, shall provide to the
entity a notice describing the statement made in
paragraph (1).’’.
SEC. 105. PERSONNEL.
Section 507 (7 U.S.C. 1507) is amended—
(1) in subsection (a), by striking ‘‘, and county
crop insurance committeemen’’;
(2) in subsection (d), by striking ‘‘of this Act,’’
and all that follows through ‘‘agency’’; and
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(3) by adding at the end the following new sub-
section:
‘‘(g)(1) The Corporation shall establish a manage-
ment-level position to be known as the Specialty Crops Co-
ordinator.
‘‘(2) The Specialty Crops Coordinator shall have pri-
mary responsibility for addressing the needs of specialty
crop producers, and for providing information and advice,
in connection with the activities of the Corporation to im-
prove and expand the insurance program for specialty
crops. In carrying out this paragraph, the Specialty Crops
Coordinator shall act as the liaison of the Corporation
with representatives of specialty crop producers and assist
the Corporation with the knowledge, expertise, and famili-
arity of the producers with risk management and produc-
tion issues pertaining to specialty crops.
‘‘(3) The Specialty Crops Coordinator shall use infor-
mation collected from Corporation field office directors in
States in which specialty crops have a significant economic
effect and from other sources, including the extension
service and colleges and universities.’’.
SEC. 106. CROP INSURANCE.
Section 508 (7 U.S.C. 1508) is amended to read as
follows:
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‘‘SEC. 508. CROP INSURANCE.
‘‘(a) AUTHORITY TO OFFER INSURANCE.—
‘‘(1) IN GENERAL.—If sufficient actuarial data
are available (as determined by the Corporation), the
Corporation may insure, or provide reinsurance for
insurers of, producers of agricultural commodities
grown in the United States under 1 or more plans
of insurance determined by the Corporation to be
adapted to the agricultural commodity concerned. To
qualify for coverage under a plan of insurance, the
losses of the insured commodity must be due to
drought, flood, or other natural disaster (as deter-
mined by the Secretary).
‘‘(2) PERIOD.—Except in the cases of tobacco
and potatoes, insurance shall not extend beyond the
period during which the insured commodity is in the
field. As used in the preceding sentence, in the case
of an aquacultural species, the term ‘field’ means
the environment in which the commodity is pro-
duced.
‘‘(3) EXCLUSIONS.—Insurance provided under
this subsection shall not cover losses due to—
‘‘(A) the neglect or malfeasance of the pro-
ducer;
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‘‘(B) the failure of the producer to reseed
to the same crop in such areas and under such
circumstances as it is customary to reseed; or
‘‘(C) the failure of the producer to follow
good farming practices (as determined by the
Secretary).
‘‘(4) EXPANSION TO OTHER AREAS OR SINGLE
PRODUCERS.—
‘‘(A) AREA EXPANSION.—The Corporation
may offer plans of insurance or reinsurance for
production of agricultural commodities in the
Commonwealth of Puerto Rico, the Virgin Is-
lands, Guam, American Samoa, the Common-
wealth of the Northern Mariana Islands, the
Republic of the Marshall Islands, the Federated
States of Micronesia, and the Republic of Palau
in the same manner as provided in this section
for production of agricultural commodities in
the United States.
‘‘(B) PRODUCER EXPANSION.—In an area
in the United States or specified in subpara-
graph (A) where crop insurance is not available
for a particular agricultural commodity, the
Corporation may offer to enter into a written
agreement with an individual producer operat-
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ing in the area for insurance coverage under
this title if the producer has actuarially sound
data relating to the production by the producer
of the commodity and the data is acceptable to
the Corporation.
‘‘(5) DISSEMINATION OF CROP INSURANCE IN-
FORMATION.—The Corporation shall make available
to producers through local offices of the Depart-
ment—
‘‘(A) current and complete information on
all aspects of Federal crop insurance; and
‘‘(B) a listing of insurance agents and
companies offering to sell crop insurance in the
area of the producers.
‘‘(6) ADDITION
OF
NEW
AND
SPECIALTY
CROPS.—
‘‘(A) DATA COLLECTION.—Not later than
180 days after the date of enactment of this
paragraph, the Secretary shall issue guidelines
for publication in the Federal Register for data
collection to assist the Corporation in formulat-
ing crop insurance policies for new and spe-
cialty crops.
‘‘(B) ADDITION OF NEW CROPS.—Not later
than 1 year after the date of enactment of this
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paragraph, and annually thereafter, the Cor-
poration shall report to Congress on the
progress and expected timetable for expanding
crop insurance coverage under this title to new
and specialty crops.
‘‘(C) ADDITION OF DIRECT SALE PERISH-
ABLE CROPS.—Not later than 1 year after the
date of enactment of this paragraph, the Cor-
poration shall report to Congress on the fea-
sibility of offering a crop insurance program de-
signed to meet the needs of specialized produc-
ers of vegetables and other perishable crops who
market through direct marketing channels.
‘‘(b) CATASTROPHIC RISK PROTECTION.—
‘‘(1) IN GENERAL.—The Corporation shall offer
a catastrophic risk protection plan to indemnify pro-
ducers for crop loss due to loss of yield or prevented
planting, if provided by the Corporation, when the
producer is unable, because of drought, flood, or
other natural disaster (as determined by the Sec-
retary), to plant other crops for harvest on the acre-
age for the crop year.
‘‘(2) AMOUNT OF COVERAGE.—
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B)—
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‘‘(i) in the case of each of the 1995
through 1998 crop years, catastrophic risk
protection shall offer a producer coverage
for a 50 percent loss in yield, on an indi-
vidual yield or area yield basis, indemnified
at 60 percent of the expected market price,
or a comparable coverage (as determined
by the Corporation); and
‘‘(ii) in the case of each of the 1999
and subsequent crop years, catastrophic
risk protection shall offer a producer cov-
erage for a 50 percent loss in yield, on an
individual yield or area yield basis, indem-
nified at 55 percent of the expected market
price, or a comparable coverage (as deter-
mined by the Corporation).
‘‘(B) REDUCTION IN ACTUAL PAYMENT.—
The amount paid to a producer on a claim
under catastrophic risk protection may reflect a
reduction that is proportional to the out-of-
pocket expenses that are not incurred by the
producer as a result of not planting, growing,
or harvesting the crop for which the claim is
made, as determined by the Corporation.
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‘‘(3) YIELD AND LOSS BASIS.—A producer shall
have the option of basing the catastrophic coverage
of the producer on an individual yield and loss basis
or on an area yield and loss basis, if both options
are offered by the Corporation.
‘‘(4) SALE
OF
CATASTROPHIC
RISK
COV-
ERAGE.—
‘‘(A) IN GENERAL.—Catastrophic risk cov-
erage may be offered by—
‘‘(i) approved insurance providers, if
available in an area; and
‘‘(ii) at the option of the Secretary
that is based on considerations of need,
local offices of the Department.
‘‘(B) NEED.—For purposes of considering
need under subparagraph (A)(ii), the Secretary
may take into account the most efficient and
cost-effective use of resources, the availability of
personnel, fairness to local producers, the needs
and convenience of local producers, and the
availability of private insurance carriers.
‘‘(5) ADMINISTRATIVE FEE.—
‘‘(A) FEE
REQUIRED.—Producers shall
pay an administrative fee for catastrophic risk
protection. The administrative fee for each pro-
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ducer shall be $50 per crop per county, but not
to exceed $200 per producer per county up to
a maximum of $600 per producer for all coun-
ties in which a producer has insured crops. The
administrative fee shall be paid by the producer
at the time the producer applies for cata-
strophic risk protection.
‘‘(B) USE OF FEES.—
‘‘(i) FEES UP TO $100.—
‘‘(I) FEES COLLECTED BY USDA
OFFICES.—Not more than $100 of the
administrative fees paid by a producer
for catastrophic risk coverage that are
collected by an office of the Depart-
ment shall be credited to the appro-
priations account providing funds for
the payment of operating and admin-
istrative expenses incurred for the de-
livery of catastrophic risk protection
under this section. The fees shall be
collected in accordance with appro-
priation Acts and shall be available
until expended without fiscal year lim-
itation for the payment of the ex-
penses.
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‘‘(II) FEES COLLECTED BY AP-
PROVED
INSURANCE
PROVIDERS.—
Not more than $100 of the adminis-
trative fees paid by a producer for
catastrophic risk coverage that are
collected by an approved insurance
provider shall be retained by the pro-
vider as payment for operating and
administrative expenses incurred for
the delivery of catastrophic risk pro-
tection.
‘‘(ii) FEES IN EXCESS OF $100.—Not-
withstanding the authority granted to the
Secretary under the Federal Crop Insur-
ance Corporation account provisions of the
Agricultural, Rural Development, Food
and Drug Administration, and Related
Agencies Appropriations Act, 1995, all fees
collected under this subsection in excess of
$100 per producer per county shall be de-
posited in the crop insurance fund estab-
lished under section 516(c), to be available
for the programs and activities of the Cor-
poration.
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‘‘(C) WAIVER OF FEE.—The Corporation
shall waive the administrative fee for limited re-
source farmers, as defined by the Corporation.
‘‘(6) PARTICIPATION
REQUIREMENT.—A pro-
ducer may obtain catastrophic risk coverage for a
crop of the producer on land in the county only if
the producer obtains the coverage for the crop on all
insurable land of the producer in the county.
‘‘(7) ELIGIBILITY
FOR
DEPARTMENT
PRO-
GRAMS.—
‘‘(A) IN GENERAL.—To be eligible for any
price support or production adjustment pro-
gram, the conservation reserve program, or any
benefit described in section 371 of the Consoli-
dated Farm and Rural Development Act, the
producer must obtain at least the catastrophic
level of insurance for each crop of economic sig-
nificance grown on each farm in the county in
which the producer has an interest, if insurance
is available in the county for the crop.
‘‘(B) DEFINITION OF CROP OF ECONOMIC
SIGNIFICANCE.—As used in this paragraph, the
term ‘crop of economic significance’ means a
crop that has contributed, or is expected to con-
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tribute, 10 percent or more of the total ex-
pected value of all crops grown by the producer.
‘‘(8) LIMITATION DUE TO RISK.—The Corpora-
tion may limit catastrophic risk coverage in any
county or area, or on any farm, on the basis of the
insurance risk concerned.
‘‘(9) 
TRANSITIONAL
COVERAGE
FOR
1995
CROPS.—Effective only for a 1995 crop planted or
for which insurance attached prior to January 1,
1995, the Corporation shall allow producers of the
crops until not later than the end of the 180-day pe-
riod beginning on the date of enactment of the Fed-
eral Crop Insurance Reform Act of 1994 to obtain
catastrophic risk protection for the crop. On enact-
ment of such Act, a producer who made timely pur-
chases of a crop insurance policy before the date of
enactment of such Act, under the provisions of this
title then in effect, shall be eligible for the same ben-
efits to which a producer would be entitled under
comparable additional coverage under subsection (c).
‘‘(10) SIMPLIFICATION.—
‘‘(A) CATASTROPHIC
RISK
PROTECTION
PLANS.—In developing and carrying out the
policies and procedures for a catastrophic risk
protection plan under this title, the Corporation
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shall, to the maximum extent practicable, mini-
mize the paperwork required and the complexity
and costs of procedures governing applications
for, processing, and servicing of the plan for all
parties involved.
‘‘(B) OTHER PLANS.—To the extent that
the policies and procedures developed under
subparagraph (A) may be applied to other plans
of insurance offered under this title without
jeopardizing the actuarial soundness or integ-
rity of the crop insurance program, the Cor-
poration shall apply the policies and procedures
to the other plans of insurance within a reason-
able period of time (as determined by the Cor-
poration) after the effective date of this para-
graph.
‘‘(c) GENERAL COVERAGE LEVELS.—
‘‘(1) ADDITIONAL COVERAGE GENERALLY.—
‘‘(A) IN GENERAL.—The Corporation shall
offer to producers of agricultural commodities
grown in the United States plans of crop insur-
ance that provide additional coverage.
‘‘(B) PURCHASE.—To be eligible for addi-
tional coverage, a producer must apply to an
approved insurance provider for purchase of ad-
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ditional coverage if the coverage is available
from an approved insurance provider. If addi-
tional coverage is unavailable privately, the Cor-
poration may offer additional coverage plans of
insurance directly to producers.
‘‘(2) TRANSFER OF RELEVANT INFORMATION.—
If a producer has already applied for catastrophic
risk protection at the local office of the Department
and elects to purchase additional coverage, the rel-
evant information for the crop of the producer shall
be transferred to the approved insurance provider
servicing the additional coverage crop policy.
‘‘(3) YIELD AND LOSS BASIS.—A producer shall
have the option of purchasing additional coverage
based on an individual yield and loss basis or on an
area yield and loss basis, if both options are offered
by the Corporation.
‘‘(4) LEVEL OF COVERAGE.—The level of cov-
erage shall be dollar denominated and may be pur-
chased at any level not to exceed 85 percent of the
individual yield or 95 percent of the area yield (as
determined by the Corporation). Not later than the
beginning of the 1996 crop year, the Corporation
shall provide producers with information on cata-
strophic risk and additional coverage in terms of dol-
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lar coverage (within the allowable limits of coverage
provided in this paragraph).
‘‘(5) PRICE LEVEL.—The Corporation shall es-
tablish a price level for each commodity on which in-
surance is offered that—
‘‘(A) shall not be less than the projected
market price for the commodity (as determined
by the Corporation); or
‘‘(B) at the discretion of the Corporation,
may be based on the actual market price at the
time of harvest (as determined by the Corpora-
tion).
‘‘(6) PRICE ELECTIONS.—
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), insurance coverage shall be made
available to a producer on the basis of any price
election that equals or is less than the price
election established by the Corporation. The
coverage shall be quoted in terms of dollars per
acre.
‘‘(B) MINIMUM
PRICE
ELECTIONS.—The
Corporation may establish minimum price elec-
tions below which levels of insurance shall not
be offered.
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‘‘(C) WHEAT CLASSES AND MALTING BAR-
LEY.—The Corporation shall, as the Corpora-
tion determines practicable, offer producers dif-
ferent price elections for classes of wheat and
malting barley (including contract prices in the
case of malting barley), in addition to the
standard price election, that reflect different
market prices, as determined by the Corpora-
tion. The Corporation shall, as the Corporation
determines practicable, offer additional coverage
for each class determined under this subpara-
graph and charge a premium for each class that
is actuarially sound.
‘‘(7) FIRE AND HAIL COVERAGE.—For levels of
additional coverage equal to 65 percent or more of
the recorded or appraised average yield indemnified
at 100 percent of the expected market price, or an
equivalent coverage, a producer may elect to delete
from the additional coverage any coverage against
damage caused by fire and hail if the producer ob-
tains an equivalent or greater dollar amount of cov-
erage for damage caused by fire and hail from an
approved insurance provider. On written notice of
the election to the company issuing the policy pro-
viding additional coverage and submission of evi-
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dence of substitute coverage on the commodity in-
sured, the premium of the producer shall be reduced
by an amount determined by the Corporation to be
actuarially appropriate, taking into account the ac-
tuarial value of the remaining coverage provided by
the Corporation. In no event shall the producer be
given credit for an amount of premium determined
to be greater than the actuarial value of the protec-
tion against losses caused by fire and hail that is in-
cluded in the additional coverage for the crop.
‘‘(8) STATE
PREMIUM
SUBSIDIES.—The Cor-
poration may enter into an agreement with any
State or agency of a State under which the State or
agency may pay to the approved insurance provider
an additional premium subsidy to further reduce the
portion of the premium paid by producers in the
State.
‘‘(9) 
LIMITATIONS
ON
ADDITIONAL
COV-
ERAGE.—The Board may limit the availability of ad-
ditional coverage under this subsection in any county
or area, or on any farm, on the basis of the insur-
ance risk involved. The Board shall not offer addi-
tional coverage equal to less than 50 percent of the
recorded or appraised average yield indemnified at
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100 percent of the expected market price, or an
equivalent coverage.
‘‘(10) ADMINISTRATIVE FEE.—
‘‘(A) FEE
REQUIRED.—Except as other-
wise provided in this paragraph, if a producer
elects to purchase additional coverage for a crop
at a level that is less than 65 percent of the re-
corded or appraised average yield indemnified
at 100 percent of the expected market price, or
an equivalent coverage, the producer shall pay
an administrative fee for the additional cov-
erage. Subsection (b)(5) shall apply in deter-
mining the amount and use of the administra-
tive fee or in determining whether to waive the
administrative fee.
‘‘(B) EXCEPTION.—If a producer elects to
purchase additional coverage for a crop equal to
65 percent or more of the recorded or appraised
average yield indemnified at 100 percent of the
expected market price, or an equivalent cov-
erage, the producer shall not be subject to the
administrative fee required by this paragraph or
subsection (b)(5). If the producer has already
paid the administrative fee for a lower level of
coverage for the crop, the administrative fee
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shall be refunded to the producer unless the re-
fund would reduce to less than $200 the total
amount of the administrative fees paid by the
producer for 2 or more crops in the same coun-
ty for which a lower level of coverage is ob-
tained.
‘‘(C) ADDITIONAL
FEE.—If a producer
elects to purchase additional coverage for a crop
equal to or exceeding 65 percent of the recorded
or appraised average yield and 100 percent of
the expected market price or an equivalent cov-
erage, the producer shall pay an administrative
fee of $10 for the coverage. If a producer has
already paid an administrative fee for lesser
coverage for the crop, the fee for lesser cov-
erage shall be refunded to the producer unless
the producer has paid the maximum fee for
lesser coverage and refund of the fee will not
reduce the amount to be paid below the maxi-
mum amount.
‘‘(D) DEPOSIT OF FEES.—Notwithstanding
the authority granted to the Secretary under
the Federal Crop Insurance Corporation ac-
count provisions of the Agricultural, Rural De-
velopment, Food and Drug Administration, and
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Related Agencies Appropriations Act, 1995, ad-
ministrative fees collected under subparagraph
(B) in excess of $100 per producer per county
and under subparagraph (C) shall be deposited
in the insurance fund established under section
516(c) to be available for the programs and ac-
tivities of the Corporation.
‘‘(d) PREMIUMS.—
‘‘(1) PREMIUMS REQUIRED.—The Corporation
shall fix adequate premiums for all the plans of in-
surance of the Corporation at such rates as the
Board determines are actuarially sufficient to attain
an expected loss ratio of not greater than 1.1
through September 30, 1998, and not greater than
1.075 after October 1, 1998.
‘‘(2) 
PREMIUM
AMOUNTS.—The 
premium
amounts for catastrophic risk protection under sub-
section (b) and additional coverage under subsection
(c) shall be fixed as follows:
‘‘(A) In the case of catastrophic risk pro-
tection, the amount of the premium shall be
sufficient to cover anticipated losses and a rea-
sonable reserve.
‘‘(B) In the case of additional coverage
below 65 percent of the recorded or appraised
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average yield indemnified at 100 percent of the
expected market price, or an equivalent cov-
erage, but greater than 50 percent of the re-
corded or appraised average yield indemnified
at 100 percent of the expected market price, or
an equivalent coverage, the amount of the pre-
mium shall—
‘‘(i) be sufficient to cover anticipated
losses and a reasonable reserve; and
‘‘(ii) include an amount for operating
and administrative expenses, as determined
by the Corporation.
‘‘(C) In the case of additional coverage
equal to or greater than 65 percent of the re-
corded or appraised average yield indemnified
at 100 percent of the expected market price, or
an equivalent coverage, the amount of the pre-
mium shall—
‘‘(i) be sufficient to cover anticipated
losses and a reasonable reserve; and
‘‘(ii) include an amount for operating
and administrative expenses, as determined
by the Corporation, on an industry-wide
basis as a percentage of the amount of the
premium used to define loss ratio.
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‘‘(e) PAYMENT OF PORTION OF PREMIUM BY COR-
PORATION.—
‘‘(1) IN GENERAL.—For the purpose of encour-
aging the broadest possible participation of produc-
ers in the catastrophic risk protection provided
under subsection (b) and the additional coverage
provided under subsection (c), the Corporation shall
pay a part of the premium in the amounts provided
in accordance with this subsection.
‘‘(2) AMOUNT OF PAYMENT.—The amount of
the premium to be paid by the Corporation shall be
as follows:
‘‘(A) In the case of catastrophic risk pro-
tection, the amount shall be equivalent to the
premium established for catastrophic risk pro-
tection under subsection (d)(2)(A).
‘‘(B) In the case of coverage below 65 per-
cent of the recorded or appraised average yield
indemnified at 100 percent of the expected mar-
ket price, or an equivalent coverage, but greater
than 50 percent of the recorded or appraised
average yield indemnified at 100 percent of the
expected market price, or an equivalent cov-
erage, the amount shall be equivalent to the
amount of premium established for catastrophic
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risk protection coverage and the amount of op-
erating and administrative expenses established
under subsection (d)(2)(B).
‘‘(C) In the case of coverage equal to or
greater than 65 percent of the recorded or ap-
praised average yield indemnified at 100 per-
cent of the expected market price, or an equiva-
lent coverage, on an individual or area basis,
the amount shall be equivalent to an amount
equal to the premium established for 50 percent
loss in yield indemnified at 75 percent of the
expected market price and the amount of oper-
ating and administrative expenses established
under subsection (d)(2)(C).
‘‘(3) PREMIUM REDUCTION.—If an approved in-
surance provider determines that the provider may
provide insurance more efficiently than the expense
reimbursement amount established by the Corpora-
tion, the approved insurance provider may reduce,
subject to the approval of the Corporation, the pre-
mium charged the insured by an amount correspond-
ing to the efficiency. The approved insurance pro-
vider shall apply to the Corporation for authority to
reduce the premium before making such a reduction,
and the reduction shall be subject to the rules, limi-
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tations, and procedures established by the Corpora-
tion.
‘‘(4) INDIVIDUAL AND AREA CROP INSURANCE
COVERAGE.—The Corporation shall allow approved
insurance providers to offer a plan of insurance to
producers that combines both individual yield cov-
erage and area yield coverage at a premium rate de-
termined by the provider under the following condi-
tions:
‘‘(A) The individual yield coverage shall be
equal to or greater than catastrophic risk pro-
tection as described in subsection (b).
‘‘(B) The combined policy shall include
area yield coverage that is offered by the Cor-
poration or similar area coverage, as deter-
mined by the Corporation.
‘‘(C) The Corporation shall provide rein-
surance on the area yield portion of the com-
bined policy at the request of the provider, ex-
cept that the provider shall agree to pay to the
producer any portion of the area yield and loss
indemnity payment received from the Corpora-
tion or a commercial reinsurer that exceeds the
individual indemnity payment made by the pro-
vider to the producer.
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‘‘(D) The Corporation shall pay a part of
the premium equivalent to—
‘‘(i) the amount authorized under
paragraph (2) (except provisions regarding
operating and administrative expenses);
and
‘‘(ii) the amount of operating and ad-
ministrative expenses authorized by the
Corporation for the area yield coverage
portion of the combined policy.
‘‘(E) The provider shall provide all under-
writing services for the combined policy, includ-
ing the determination of individual yield cov-
erage premium rates, the terms and conditions
of the policy, and the acceptance and classifica-
tion of applicants into risk categories, subject to
subparagraph (F).
‘‘(F) The Corporation shall approve the
combined policy unless the Corporation deter-
mines that the policy is not actuarially sound or
that the interests of producers are not ade-
quately protected.
‘‘(f) ELIGIBILITY.—
‘‘(1) IN
GENERAL.—To participate in cata-
strophic risk protection coverage under this section,
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a producer shall submit an application at the local
office of the Department or to an approved insur-
ance provider.
‘‘(2) SALES
CLOSING
DATE.—For coverage
under this title, each producer shall purchase crop
insurance on or before the sales closing date for the
crop by providing the required information and exe-
cuting the required documents. Subject to the goal
of ensuring actuarial soundness for the crop insur-
ance program, the sales closing date shall be estab-
lished by the Corporation to maximize convenience
to producers in obtaining benefits under price and
production adjustment programs of the Department.
Beginning with the 1995 crop year, the Corporation
shall establish, for an insurance policy for each in-
surable crop that is planted in the spring, a sales
closing date that is 30 days earlier than the cor-
responding sales closing date that was established
for the 1994 crop year.
‘‘(3) RECORDS
AND
REPORTING.—To obtain
catastrophic risk protection under subsection (b) or
additional coverage under subsection (c), a producer
shall—
‘‘(A) provide, to the extent required by the
Corporation, records acceptable to the Corpora-
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tion of historical acreage and production of the
crops for which the insurance is sought or ac-
cept a yield determined by the Corporation; and
‘‘(B) report acreage planted and prevented
from planting by the designated acreage report-
ing date for the crop and location as established
by the Corporation.
‘‘(g) YIELD DETERMINATIONS.—
‘‘(1) IN GENERAL.—Subject to paragraph (2),
the Corporation shall establish crop insurance un-
derwriting rules that ensure that yield coverage, as
specified in this subsection, is provided to eligible
producers obtaining catastrophic risk protection
under subsection (b) or additional coverage under
subsection (c).
‘‘(2) YIELD COVERAGE PLANS.—
‘‘(A) ACTUAL
PRODUCTION
HISTORY.—
Subject to subparagraph (B), the yield for a
crop shall be based on the actual production
history for the crop, if the crop was produced
on the farm without penalty during each of the
4 crop years immediately preceding the crop
year for which actual production history is
being established, building up to a production
data base for each of the 10 consecutive crop
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years preceding the crop year for which actual
production history is being established.
‘‘(B) ASSIGNED
YIELD.—If the producer
does not provide satisfactory evidence of the
yield of a commodity under subparagraph (A),
the producer shall be assigned a yield that is
not less than 65 percent of the transitional
yield of the producer (adjusted to reflect actual
production reflected in the records acceptable to
the Corporation for continuous years), as speci-
fied in regulations issued by the Corporation
based on production history requirements.
‘‘(C) AREA YIELD.—The Corporation may
offer a crop insurance plan based on an area
yield that allows an insured producer to qualify
for an indemnity if a loss has occurred in an
area (as specified by the Corporation) in which
the farm of the producer is located. Under an
area yield plan, an insured producer shall be al-
lowed to select the level of area production at
which an indemnity will be paid consistent with
such terms and conditions as are established by
the Corporation.
‘‘(D) COMMODITY-BY-COMMODITY BASIS.—
A producer may choose between individual yield
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or area yield coverage or combined coverage (as
provided in subsection (e)(4)), if available, on a
commodity-by-commodity basis.
‘‘(3) TRANSITIONAL
YIELDS
FOR
PRODUCERS
OF FEED OR FORAGE.—
‘‘(A) IN GENERAL.—If a producer does not
provide satisfactory evidence of a yield under
paragraph (2)(A), the producer shall be as-
signed a yield that is at least 80 percent of the
transitional yield established by the Corporation
(adjusted to reflect the actual production his-
tory of the producer) if the Secretary deter-
mines that—
‘‘(i) the producer grows feed or forage
primarily for on-farm use in a livestock,
dairy, or poultry operation; and
‘‘(ii) over 50 percent of the net farm
income of the producer is derived from the
operation.
‘‘(B) YIELD CALCULATION.—The Corpora-
tion shall—
‘‘(i) for the first year of participation
of a producer, provide the assigned yield
under this paragraph to the producer of
feed or forage; and
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‘‘(ii) for the second year of participa-
tion of the producer, apply the actual pro-
duction history or assigned yield require-
ment, as provided in this subsection.
‘‘(C) TERMINATION OF AUTHORITY.—The
authority provided by this paragraph shall ter-
minate on the date that is 3 years after the ef-
fective date of this paragraph.
‘‘(h) SUBMISSION OF POLICIES AND MATERIALS TO
BOARD.—
‘‘(1) IN GENERAL.—In addition to any standard
forms or policies that the Board may require be
made available to producers under subsection (c), a
person may prepare for submission or propose to the
Board—
‘‘(A) other crop insurance policies and pro-
visions of policies; and
‘‘(B) rates of premiums for multiple peril
crop insurance pertaining to wheat, soybeans,
field corn, and any other crops determined by
the Secretary.
‘‘(2) SUBMISSION
OF
POLICIES.—A policy or
other material submitted to the Board under this
subsection may be prepared without regard to the
limitations contained in this title, including the re-
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quirements concerning the levels of coverage and
rates and the requirement that a price level for each
commodity insured must equal the expected market
price for the commodity as established by the Board.
In the case of such a policy, the payment by the
Corporation of a portion of the premium of the pol-
icy may not exceed the amount that would otherwise
be authorized under subsection (e).
‘‘(3) REVIEW AND APPROVAL BY THE BOARD.—
A policy or other material submitted to the Board
under this subsection shall be reviewed by the Board
and, if the Board finds that the interests of produc-
ers are adequately protected and that any premiums
charged to the producers are actuarially appropriate,
shall be approved by the Board for reinsurance and
for sale to producers as an additional choice at actu-
arially appropriate rates and under appropriate
terms and conditions. The Corporation may enter
into more than 1 reinsurance agreement with the ap-
proved insurance provider simultaneously to facili-
tate the offering of the new policies.
‘‘(4) GUIDELINES
FOR
SUBMISSION
AND
RE-
VIEW.—The Corporation shall issue regulations to
establish guidelines for the submission, and Board
review, of policies or other material submitted to the
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Board under this subsection. At a minimum, the
guidelines shall ensure the following:
‘‘(A) A proposal submitted to the Board
under this subsection shall be considered as
confidential commercial or financial information
for purposes of section 552(b)(4) of title 5,
United States Code, until approved by the
Board. A proposal disapproved by the Board
shall remain confidential commercial or finan-
cial information.
‘‘(B) The Board shall provide an applicant
with the opportunity to present the proposal to
the Board in person if the applicant so desires.
‘‘(C) The Board shall provide an applicant
with notification of intent to disapprove a pro-
posal not later than 30 days prior to making
the disapproval. An applicant that receives the
notification may modify the application of the
applicant. Any modification shall be considered
an original application for purposes of this
paragraph.
‘‘(D) Specific guidelines shall prescribe the
timing of submission of proposals under this
subsection and timely consideration by the
Board so that any approved proposal may be
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made available to all persons reinsured by the
Corporation in a manner permitting the persons
to participate, if the persons so desire, in offer-
ing such a proposal in the first crop year in
which the proposal is approved by the Board for
reinsurance, premium subsidy, or other support
offered by this title.
‘‘(5) REQUIRED
PUBLICATION.—Any policy,
provision of a policy, or rate approved under this
subsection shall be published as a notice in the Fed-
eral Register and made available to all persons con-
tracting with or reinsured by the Corporation under
the terms and conditions of the contract between the
Corporation and the person originally submitting the
policy or other material.
‘‘(6) PILOT COST OF PRODUCTION RISK PRO-
TECTION PLAN.—
‘‘(A) IN GENERAL.—The Corporation shall
offer, to the extent practicable, a cost of pro-
duction risk protection plan of insurance that
indemnifies producers (including new produc-
ers) for insurable losses as provided in this
paragraph.
‘‘(B) PILOT BASIS.—The cost of produc-
tion risk protection plan shall—
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‘‘(i) be established as a pilot project
for each of the 1996 and 1997 crop years;
and
‘‘(ii) be carried out in a number of
counties that is determined by the Cor-
poration to be adequate to provide a com-
prehensive evaluation of the feasibility, ef-
fectiveness, and demand among producers
for the plan.
‘‘(C) INSURABLE LOSS.—An insurable loss
shall be incurred by a producer if the gross in-
come of the producer (as determined by the
Corporation) is less than an amount determined
by the Corporation, as a result of a reduction
in yield or price resulting from an insured
cause.
‘‘(D) DEFINITION OF NEW PRODUCER.—
As used in this paragraph, the term ‘new pro-
ducer’ means a person that has not been ac-
tively engaged in farming for a share of the
production of the insured crop for more than 2
crop years, as determined by the Secretary.
‘‘(7) ADDITIONAL PREVENTED PLANTING POL-
ICY COVERAGE.—
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‘‘(A) IN
GENERAL.—Beginning with the
1995 crop year, the Corporation shall offer to
producers additional prevented planting cov-
erage that insures producers against losses in
accordance with this paragraph.
‘‘(B) APPROVED INSURANCE PROVIDERS.—
Additional prevented planting coverage shall be
offered by the Corporation through approved in-
surance providers.
‘‘(C) TIMING OF LOSS.—A crop loss shall
be covered by the additional prevented planting
coverage if—
‘‘(i) crop insurance policies were ob-
tained for—
‘‘(I) the crop year the loss was
experienced; and
‘‘(II) the crop year immediately
preceding the year of the prevented
planting loss; and
‘‘(ii) the cause of the loss occurred—
‘‘(I) after the sales closing date
for the crop in the crop year imme-
diately preceding the loss; and
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‘‘(II) before the sales closing date
for the crop in the year in which the
loss is experienced.
‘‘(8) PILOT PROGRAM OF ASSIGNED YIELDS FOR
NEW PRODUCERS.—
‘‘(A) PROGRAM REQUIRED.—For each of
the 1995 and 1996 crop years, the Corporation
shall carry out a pilot program to assign to eli-
gible new producers higher assigned yields than
would otherwise be assigned to the producers
under subsection (g). The Corporation shall in-
clude in the pilot program 30 counties that are
determined by the Corporation to be adequate
to provide a comprehensive evaluation of the
feasibility, effectiveness, and demand among
new producers for increased assigned yields.
‘‘(B) INCREASED
ASSIGNED
YIELDS.—In
the case of an eligible new producer participat-
ing in the pilot program, the Corporation shall
assign to the new producer a yield that is equal
to not less than 110 percent of the transitional
yield otherwise established by the Corporation.
‘‘(C) ELIGIBLE
NEW
PRODUCER.—The
Secretary shall establish a definition of new
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producer for purposes of determining eligibility
to participate in the pilot program.
‘‘(i) ADOPTION OF RATES AND COVERAGES.—The
Corporation shall adopt, as soon as practicable, rates and
coverages that will improve the actuarial soundness of the
insurance operations of the Corporation for those crops
that are determined to be insured at rates that are not
actuarially sound, except that no rate may be increased
by an amount of more than 20 percent over the com-
parable rate of the preceding crop year.
‘‘(j) CLAIMS FOR LOSSES.—
‘‘(1) IN GENERAL.—Under rules prescribed by
the Corporation, the Corporation may provide for
adjustment and payment of claims for losses. The
rules prescribed by the Corporation shall establish
standards to ensure that all claims for losses are ad-
justed, to the extent practicable, in a uniform and
timely manner.
‘‘(2) DENIAL OF CLAIMS.—
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), if a claim for indemnity is denied by
the Corporation or an approved provider, an ac-
tion on the claim may be brought against the
Corporation or Secretary only in the United
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States district court for the district in which
the insured farm is located.
‘‘(B) STATUTE OF LIMITATIONS.—A suit
on the claim may be brought not later than 1
year after the date on which final notice of de-
nial of the claim is provided to the claimant.
‘‘(3) INDEMNIFICATION.—The Corporation shall
provide approved insurance providers with indem-
nification, including costs and reasonable attorney
fees incurred by the approved insurance provider,
due to errors or omissions on the part of the Cor-
poration.
‘‘(k) REINSURANCE.—
‘‘(1) IN GENERAL.—Notwithstanding any other
provision of this title, the Corporation shall, to the
maximum extent practicable, provide reinsurance to
insurers approved by the Corporation that insure
producers of any agricultural commodity under 1 or
more plans acceptable to the Corporation.
‘‘(2) TERMS
AND
CONDITIONS.—The reinsur-
ance shall be provided on such terms and conditions
as the Board may determine to be consistent with
subsections (b) and (c) and sound reinsurance prin-
ciples.
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‘‘(3) SHARE OF RISK.—The reinsurance agree-
ments of the Corporation with the reinsured compa-
nies shall require the reinsured companies to bear a
sufficient share of any potential loss under the
agreement so as to ensure that the reinsured com-
pany will sell and service policies of insurance in a
sound and prudent manner, taking into consider-
ation the financial condition of the reinsured compa-
nies and the availability of private reinsurance.
‘‘(4) RATE.—The rate established by the Board
to reimburse approved insurance providers and
agents for the administrative and operating costs of
the providers and agents shall not exceed—
‘‘(A) for the 1997 reinsurance year, 29
percent of the premium used to define loss
ratio;
‘‘(B) for the 1998 reinsurance year, 28
percent of the premium used to define loss
ratio; and
‘‘(C) for the 1999 reinsurance year, 27.5
percent of the premium used to define loss
ratio.
‘‘(5) COST
AND
REGULATORY
REDUCTION.—
Consistent with section 118 of the Federal Crop In-
surance Reform Act of 1994, and consistent with
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maintenance of program integrity, prevention of
fraud and abuse, the need for program expansion,
and improvement of quality of service to customers,
the Board shall alter program procedures and ad-
ministrative requirements in order to reduce the ad-
ministrative and operating costs of approved insur-
ance providers and agents in an amount that cor-
responds to any reduction in the reimbursement rate
required under paragraph (4) during the 5-year pe-
riod beginning on the date of enactment of this
paragraph.
‘‘(6) AGENCY DISCRETION.—The determination
of whether the Corporation is achieving, or has
achieved, corresponding administrative cost savings
shall not be subject to administrative review, and is
wholly committed to agency discretion within the
meaning of section 701(a)(2) of title 5, United
States Code.
‘‘(7) PLAN.—The Corporation shall submit to
Congress a plan outlining the measures that will be
used to achieve the reduction required under para-
graph (5). If the Corporation can identify additional
cost reduction measures, the Corporation shall de-
scribe the measures in the plan.
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‘‘(l) OPTIONAL COVERAGES.—The Corporation may
offer specific risk protection programs, including protec-
tion against prevented planting, wildlife depredation, tree
damage and disease, and insect infestation, under such
terms and conditions as the Board may determine, except
that no program may be undertaken if insurance for the
specific risk involved is generally available from private
companies.
‘‘(m) RESEARCH.—
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), the Corporation may conduct research,
surveys, pilot programs, and investigations relating
to crop insurance and agriculture-related risks and
losses including insurance on losses involving re-
duced forage on rangeland caused by drought and by
insect infestation, livestock poisoning and disease,
destruction of bees due to the use of pesticides, and
other unique special risks related to fruits, nuts,
vegetables, aquacultural species, forest industry
needs (including appreciation), and other agricul-
tural products as determined by the Board.
‘‘(2) EXCEPTION.—No action may be under-
taken with respect to a risk under paragraph (1) if
insurance protection against the risk is generally
available from private companies.
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‘‘(3) EVALUATION.—After the completion of
any pilot program under this subsection, the Cor-
poration shall evaluate the pilot program and submit
to the Committee on Agriculture of the House of
Representatives and the Committee on Agriculture,
Nutrition, and Forestry of the Senate, a report of
the operations of the pilot program, including the
evaluation by the Corporation of the pilot program
and the recommendations of the Corporation with
respect to implementing the program on a national
basis.’’.
SEC. 107. CROP INSURANCE YIELD COVERAGE.
Section 508A (7 U.S.C. 1508a) is repealed.
SEC. 108. PREEMPTION.
Section 511 (7 U.S.C. 1511) is amended by adding
at the end the following sentence: ‘‘A contract of insurance
of the Corporation, and a contract of insurance reinsured
by the Corporation, shall be exempt from taxation imposed
by any State, municipality, or local taxing authority.’’.
SEC. 109. ADVISORY COMMITTEE.
The Act is amended by inserting after section 514
(7 U.S.C. 1514) the following new section:
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‘‘SEC. 515. ADVISORY COMMITTEE FOR FEDERAL CROP
INSURANCE.
‘‘(a) ESTABLISHMENT.—The Secretary may establish
within the Department an advisory committee to be known
as the ‘Advisory Committee for Federal Crop Insurance’.
‘‘(b) PRIMARY RESPONSIBILITY.—The primary re-
sponsibility of the Advisory Committee shall be to advise
the Secretary on the implementation of this title and on
other issues related to crop insurance, as determined by
the Manager of the Corporation.
‘‘(c) MEMBERSHIP.—The Advisory Committee shall
be composed of the Manager of the Corporation, the Sec-
retary (or a designee of the Secretary), and not fewer than
12 members representing organizations and agencies in-
volved in the provision of crop insurance under this title.
Not fewer than 3 of the members of the Advisory Commit-
tee shall be representatives of the specialty crops industry.
The organizations or agencies represented by members on
the Advisory Committee may include insurance companies,
insurance agents, farm producer organizations, experts on
agronomic practices, and banking and lending institutions.
‘‘(d) ADMINISTRATIVE PROVISIONS.—
‘‘(1) TERMS.—Members of the Advisory Com-
mittee (other than the Manager of the Corporation
and the Secretary) shall be appointed by the Sec-
retary for a term of up to 2 years from nominations
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made by the organizations and agencies specified in
subsection (c). The terms of the members (other
than the Manager of the Corporation and the Sec-
retary) shall be staggered.
‘‘(2) CHAIRPERSON.—The Advisory Committee
shall be chaired by the Manager of the Corporation.
‘‘(3) MEETINGS.—The Advisory Committee
shall meet at least annually. The meetings of the
Advisory Committee shall be publicly announced in
advance and shall be open to the public. Appropriate
records of the activities of the Advisory Committee
shall be kept and made available to the public on re-
quest.
‘‘(e) REPORTS.—Not later than June 30 of each year,
the Advisory Committee shall submit to the Secretary a
report specifying the conclusions and recommendations of
the Advisory Committee regarding—
‘‘(1) the progress toward implementation of this
title;
‘‘(2) the actuarial soundness of the Federal
crop insurance program;
‘‘(3) the rate of producer participation in both
catastrophic risk protection under section 508(b)
and additional coverage under section 508(c); and
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‘‘(4) the progress toward improved crop insur-
ance coverage for new and specialty crops.
‘‘(f) TERMINATION OF AUTHORITY.—The authority
provided by this section shall terminate on September 30,
1998.’’.
SEC. 110. FUNDING.
Section 516 (7 U.S.C. 1516) is amended to read as
follows:
‘‘SEC. 516. FUNDING.
‘‘(a) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(1) DISCRETIONARY
EXPENSES.—There are
authorized to be appropriated for each of fiscal years
1995 through 2001 such sums as are necessary to
cover—
‘‘(A) the salaries and expenses of the Cor-
poration; and
‘‘(B) the administrative and operating ex-
penses of the Corporation for the sales commis-
sions of agents.
‘‘(2) MANDATORY EXPENSES.—There are au-
thorized to be appropriated such sums as are nec-
essary to cover—
‘‘(A) in the case of each of the 1995
through 1997 reinsurance years, the adminis-
trative and operating expenses of the Corpora-
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tion for the sales commissions of agents, con-
sistent with subsection (b)(1);
‘‘(B) premium subsidies, including the ad-
ministrative and operating expenses of an ap-
proved insurance provider for the delivery of
policies with additional coverage; and
‘‘(C) payments for noninsured assistance
losses under section 519.
‘‘(b) PAYMENT OF EXPENSES.—
‘‘(1) ADMINISTRATIVE
AND
OPERATING
EX-
PENSES.—
‘‘(A) IN GENERAL.—Except as provided in
subparagraph (B), in the case of each of the
1995 through 1997 reinsurance years, the Cor-
poration is authorized to pay from the insur-
ance fund established under subsection (c), the
administrative and operating expenses of an ap-
proved insurance provider, including expenses
covered by subsection (a)(1)(B).
‘‘(B) SALES COMMISSIONS FOR 1997 REIN-
SURANCE YEAR.—In the case of the 1997 rein-
surance year, the amount of the payments from
the insurance fund established under subsection
(c) for the expenses of the Corporation for the
sales commissions of agents may not exceed 8.5
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percent of the total amount of premiums paid
for additional coverage for the 1997 reinsurance
year.
‘‘(2) OTHER
EXPENSES.—The Corporation is
authorized to pay from the insurance fund estab-
lished under subsection (c)—
‘‘(A) all other expenses of the Corporation
(other than expenses covered by subsection
(a)(1)), 
including 
all 
premium 
subsidies,
noninsured assistance benefits, and indemnities;
‘‘(B) subject to paragraph (1)(B), in the
case of each of the 1995 through 1997 reinsur-
ance years, all administrative and expense reim-
bursements due under a reinsurance agreement
with an approved insurance provider; and
‘‘(C) to the extent necessary, expenses in-
curred by the Corporation to carry out research
and development.
‘‘(c) INSURANCE FUND.—
‘‘(1) IN GENERAL.—There is established an in-
surance fund, for the deposit of premium income
and amounts made available under subsection (a)(2),
to be available without fiscal year limitation.
‘‘(2) 
COMMODITY
CREDIT
CORPORATION
FUNDS.—If at any time the amounts in the insur-
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ance fund are insufficient to enable the Corporation
to carry out subsection (b), to the extent the funds
of the Commodity Credit Corporation are avail-
able—
‘‘(A) the Corporation may request the Sec-
retary to use the funds of the Commodity Cred-
it Corporation to carry out subsection (b); and
‘‘(B) the Secretary may use the funds of
the Commodity Credit Corporation to carry out
subsection (b).’’.
SEC. 111. NONINSURED CROP DISASTER ASSISTANCE.
Section 519 (7 U.S.C. 1519) is amended to read as
follows:
‘‘SEC. 519. NONINSURED CROP DISASTER ASSISTANCE
PROGRAM.
‘‘(a) ESTABLISHMENT OF PROGRAM.—
‘‘(1) ESTABLISHMENT.—In the case of an eligi-
ble crop described in paragraph (2), the Corporation
shall establish a noninsured crop disaster assistance
program to provide coverage equivalent to the cata-
strophic risk protection otherwise available under
section 508(b).
‘‘(2) ELIGIBLE CROPS.—
‘‘(A) IN GENERAL.—As used in this sec-
tion, the term ‘eligible crop’ means each com-
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mercial crop or other agricultural commodity
(except livestock)—
‘‘(i) for which catastrophic risk pro-
tection under section 508(b) is not avail-
able; and
‘‘(ii) that is produced for food or
fiber.
‘‘(B) CROPS
SPECIFICALLY
INCLUDED.—
The term ‘eligible crop’ shall include floricul-
tural, ornamental nursery, and Christmas tree
crops, turfgrass sod, and industrial crops.
‘‘(3) CAUSE OF LOSS.—To qualify for assist-
ance under this section, the losses of the noninsured
commodity shall be due to drought, flood, or other
natural disaster, as determined by the Secretary.
‘‘(b) APPLICATION FOR NONINSURED CROP DISAS-
TER ASSISTANCE.—
‘‘(1) TIMELY APPLICATION.—To be eligible for
assistance under this section, a producer shall sub-
mit an application for noninsured crop disaster as-
sistance at a local office of the Department. The ap-
plication shall be in such form, contain such infor-
mation, and be submitted at such time as the Cor-
poration may require.
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‘‘(2) RECORDS.—A producer shall annually pro-
vide records, as required by the Corporation, of pre-
vious crop acreage, acreage yields, and production,
or the producer shall accept a yield under subsection
(e)(3) determined by the Corporation.
‘‘(3) ACREAGE
REPORTS.—A producer shall
provide reports on acreage planted or prevented
from being planted, as required by the Corporation,
by the designated acreage reporting date for the
crop and location as established by the Corporation.
‘‘(c) LOSS REQUIREMENTS.—
‘‘(1) REQUIRED AREA LOSS.—A producer of an
eligible crop shall not receive noninsured crop disas-
ter assistance unless the average yield for that crop,
or an equivalent measure in the event yield data are
not available, in an area falls below 65 percent of
the expected area yield, as established by the Cor-
poration.
‘‘(2) PREVENTED PLANTING.—Subject to para-
graph (1), the Corporation shall make a prevented
planting noninsured crop disaster assistance pay-
ment if the producer is prevented from planting
more than 35 percent of the acreage intended for
the eligible crop because of drought, flood, or other
natural disaster, as determined by the Secretary.
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‘‘(3) REDUCED YIELDS.—Subject to paragraph
(1), the Corporation shall make a reduced yield
noninsured crop disaster assistance payment to a
producer if the total quantity of the eligible crop
that the producer is able to harvest on any farm is,
because of drought, flood, or other natural disaster
as determined by the Secretary, less than 50 percent
of the expected individual yield for the crop, as de-
termined by the Corporation, factored for the inter-
est of the producer for the crop.
‘‘(d) PAYMENT.—The Corporation shall make avail-
able to a producer eligible for noninsured assistance under
this section a payment computed by multiplying—
‘‘(1) the quantity that is less than 50 percent
of the established yield for the crop; by
‘‘(2)(A) in the case of each of the 1995 through
1998 crop years, 60 percent of the average market
price for the crop (or any comparable coverage de-
termined by the Corporation); or
‘‘(B) in the case of each of the 1999 and subse-
quent crop years, 55 percent of the average market
price for the crop (or any comparable coverage de-
termined by the Corporation); by
‘‘(3) a payment rate for the type of crop (as de-
termined by the Corporation) that—
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‘‘(A) in the case of a crop that is produced
with a significant and variable harvesting ex-
pense, reflects the decreasing cost incurred in
the production cycle for the crop that is—
‘‘(i) harvested;
‘‘(ii) planted but not harvested; and
‘‘(iii) prevented from being planted
because of drought, flood, or other natural
disaster (as determined by the Secretary);
and
‘‘(B) in the case of a crop that is not pro-
duced with a significant and variable harvesting
expense, is determined by the Corporation.
‘‘(e) YIELD DETERMINATIONS.—
‘‘(1) ESTABLISHMENT.—The Corporation shall
establish farm yields for purposes of providing
noninsured crop disaster assistance under this sec-
tion.
‘‘(2) ACTUAL PRODUCTION HISTORY.—The Cor-
poration shall determine yield coverage using the ac-
tual production history of the producer over a period
of not less than the 4 previous consecutive crop
years and not more than 10 consecutive crop years.
Subject to paragraph (3), the yield for the year in
which noninsured crop disaster assistance is sought
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shall be equal to the average of the actual produc-
tion history of the producer during the period con-
sidered.
‘‘(3) ASSIGNMENT
OF
YIELD.—If a producer
does not submit adequate documentation of produc-
tion history to determine a crop yield under para-
graph (2), the Corporation shall assign to the pro-
ducer a yield equal to not less than 65 percent of
the transitional yield of the producer (adjusted to re-
flect actual production reflected in the records ac-
ceptable to the Corporation for continuous years), as
specified in regulations issued by the Corporation
based on production history requirements.
‘‘(4) PROHIBITION
ON
ASSIGNED
YIELDS
IN
CERTAIN COUNTIES.—
‘‘(A) IN GENERAL.—
‘‘(i) DOCUMENTATION.—If sufficient
data are available to demonstrate that the
acreage of a crop in a county for the crop
year has increased by more than 100 per-
cent over any year in the preceding 7 crop
years or, if data are not available, if the
acreage of the crop in the county has in-
creased significantly from the previous
crop years, a producer must provide such
•HRES 559 ATH
detailed documentation of production costs,
acres planted, and yield for the crop year
for which benefits are being claimed as is
required by the Corporation. If the Cor-
poration determines that the documenta-
tion provided is not sufficient, the Corpora-
tion may require documenting proof that
the crop, had the crop been harvested,
could have been marketed at a reasonable
price.
‘‘(ii) PROHIBITION.—Except as pro-
vided in subparagraph (B), a producer who
produces a crop on a farm located in a
county described in clause (i) may not ob-
tain an assigned yield.
‘‘(B) EXCEPTION.—A crop or a producer
shall not be subject to this subsection if—
‘‘(i) the planted acreage of the pro-
ducer for the crop has been inspected by a
third party acceptable to the Secretary; or
‘‘(ii)(I) the County Executive Director
and the State Executive Director rec-
ommend an exemption from the require-
ment to the Deputy Administrator for
State and County Operations of the Agri-
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cultural Stabilization and Conservation
Service; and
‘‘(II) the Deputy Administrator ap-
proves the recommendation.
‘‘(5) LIMITATION ON RECEIPT OF SUBSEQUENT
ASSIGNED YIELD.—A producer who receives an as-
signed yield for the current year of a natural disas-
ter because required production records were not
submitted to the local office of the Department shall
not be eligible for an assigned yield for the year of
the next natural disaster unless the required produc-
tion records of the previous 1 or more years (as ap-
plicable) are provided to the local office.
‘‘(6) YIELD
VARIATIONS
DUE
TO
DIFFERENT
FARMING PRACTICES.—The Corporation shall ensure
that noninsured crop disaster assistance accurately
reflects significant yield variations due to different
farming practices, such as between irrigated and
nonirrigated acreage.
‘‘(f) CONTRACT PAYMENTS.—A producer who has re-
ceived a guaranteed payment for production, as opposed
to delivery, of a crop pursuant to a contract shall have
the production of the producer adjusted upward by the
amount of the production equal to the amount of the con-
tract payment received.
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‘‘(g) 
PAYMENT
OF
LOSSES.—Payments 
for
noninsured crop disaster assistance losses under this sec-
tion shall be made from the insurance fund established
under section 516. The losses shall not be included in cal-
culating the premiums charged to producers for insurance
under section 508.
‘‘(h) EXCLUSIONS.—Noninsured crop disaster assist-
ance under this section shall not cover losses due to—
‘‘(A) the neglect or malfeasance of the pro-
ducer;
‘‘(B) the failure of the producer to reseed to the
same crop in those areas and under such cir-
cumstances where it is customary to reseed; or
‘‘(C) the failure of the producer to follow good
farming practices, as determined by the Corpora-
tion.’’.
SEC. 112. PAYMENT AND INCOME LIMITATIONS.
Section 519 (7 U.S.C. 1519) (as amended by section
111) is further amended by adding at the end the follow-
ing new subsection:
‘‘(h) PAYMENT AND INCOME LIMITATIONS.—
‘‘(1) DEFINITIONS.—As used in this subsection:
‘‘(A) PERSON.—The term ‘person’ has the
meaning provided the term in regulations issued
by the Secretary. The regulations shall conform,
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to the extent practicable, to the regulations de-
fining the term ‘person’ issued under section
1001 of the Food Security Act of 1985 (7
U.S.C. 1308).
‘‘(B) QUALIFYING GROSS REVENUES.—The
term ‘qualifying gross revenues’ means—
‘‘(i) if a majority of the gross revenue
of the person is received from farming,
ranching, and forestry operations, the
gross revenue from the farming, ranching,
and forestry operations of the person; and
‘‘(ii) if less than a majority of the
gross revenue of the person is received
from farming, ranching, and forestry oper-
ations, the gross revenue of the person
from all sources.
‘‘(2) PAYMENT LIMITATION.—The total amount
of payments that a person shall be entitled to receive
annually under this title may not exceed $100,000.
‘‘(3) LIMITATION ON MULTIPLE BENEFITS FOR
SAME LOSS.—If a producer who is eligible to receive
benefits under catastrophic risk protection under
section 508(b) or noninsured crop disaster assist-
ance under this section is also eligible to receive as-
sistance for the same loss under any other program
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administered by the Secretary, the producer shall be
required to elect whether to receive benefits under
this title or under the other program, but not both.
A producer who purchases additional coverage under
section 508(c) may also receive assistance for the
same loss under other programs administered by the
Secretary, except that the amount received for the
loss under the additional coverage together with the
amount received under the other programs may not
exceed the amount of the actual loss of the producer.
‘‘(4) INCOME LIMITATION.—A person who has
qualifying gross revenues in excess of the amount
specified in section 2266(a) of the Food, Agri-
culture, Conservation, and Trade Act of 1990 (7
U.S.C. 1421 note) (as in effect on November 28,
1990) during the taxable year (as determined by the
Secretary) shall not be eligible to receive any
noninsured assistance payment under this section.
‘‘(5) REGULATIONS.—The Secretary shall issue
regulations prescribing such rules as the Secretary
determines necessary to ensure a fair and equitable
application of section 1001 of the Food Security Act
of 1985 (7 U.S.C. 1308), the general payment limi-
tation regulations of the Secretary, and the limita-
tions established under this subsection.’’.
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SEC. 113. PRODUCER ELIGIBILITY.
Section 520 (7 U.S.C. 1520) is amended to read as
follows:
‘‘SEC. 520. PRODUCER ELIGIBILITY.
‘‘Except as otherwise provided in this title, a pro-
ducer shall not be denied insurance under this title if—
‘‘(1) for purposes of catastrophic risk protection
coverage, the producer is a ‘person’ (as defined by
the Secretary); and
‘‘(2) for purposes of any other plan of insur-
ance, the producer is 18 years of age and has a bona
fide insurable interest in a crop as an owner-opera-
tor, landlord, tenant, or sharecropper.’’.
SEC. 114. INELIGIBILITY FOR CATASTROPHIC RISK AND
NONINSURED ASSISTANCE PAYMENTS.
The Act (7 U.S.C. 1501 et seq.) is amended by add-
ing at the end the following new section:
‘‘SEC. 521. INELIGIBILITY FOR CATASTROPHIC RISK AND
NONINSURED ASSISTANCE PAYMENTS.
‘‘If the Secretary determines that a person has know-
ingly adopted a material scheme or device to obtain cata-
strophic risk, additional coverage, or noninsured assist-
ance benefits under this title to which the person is not
entitled, has evaded this title, or has acted with the pur-
poses of evading this title, the person shall be ineligible
to receive all benefits applicable to the crop year for which
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the scheme or device was adopted. The authority provided
by this section shall be in addition to, and shall not sup-
plant, the authority provided by section 506(n).’’.
SEC. 115. ELIMINATION OF GENDER REFERENCES.
(a) MANAGEMENT OF CORPORATION.—Section 505
(7 U.S.C. 1505) is amended—
(1) in subsection (a), by striking the third sen-
tence and inserting ‘‘The Board shall be appointed
by, and hold office at the pleasure of, the Secretary.
The Secretary shall not be a member of the Board.’’;
and
(2) in subsection (d)—
(A) by striking ‘‘upon him’’; and
(B) by striking ‘‘He shall be appointed
by,’’ and inserting ‘‘The manager shall be ap-
pointed by,’’.
(b) PERSONNEL.—Section 507 (7 U.S.C. 1507) is
amended—
(1) in subsection (a), by striking ‘‘as he may
determine: Provided, That’’ and inserting ‘‘as the
Secretary may determine appropriate. However,’’;
and
(2) in subsection (d), by striking ‘‘as he may re-
quest’’ and inserting ‘‘that the Secretary requests’’.
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(c) INDEMNITIES EXEMPT FROM LEVY.—Section
509 (7 U.S.C. 1509) is amended by striking ‘‘or his es-
tate’’ and inserting ‘‘or the estate of the insured’’.
SEC. 116. PREVENTED PLANTING.
(a) IN GENERAL.—Effective for the 1994 crop year,
a producer described in subsection (b) shall receive com-
pensation under the prevented planting coverage policy
provision described in subsection (b)(1) by—
(1) obtaining from the Secretary of Agriculture
the applicable amount that is payable under the con-
serving use program described in subsection (b)(4);
and
(2) obtaining from the Federal Crop Insurance
Corporation the amount that is equal to the dif-
ference between—
(A) the amount that is payable under the
conserving use program; and
(B) the amount that is payable under the
prevented planting coverage policy.
(b) ELIGIBLE PRODUCERS.—Subsection (a) shall
apply to a producer who—
(1) purchased a prevented planting policy for
the 1994 crop year from the Federal Crop Insurance
Corporation prior to the spring sales closing date for
the 1994 crop year;
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(2) is unable to plant a crop due to major,
widespread flooding in the Midwest, or excessive
ground moisture, that occurred prior to the spring
sales closing date for the 1994 crop year;
(3) had a reasonable expectation of planting a
crop on the prevented planting acreage for the 1994
crop year; and
(4) participates in a conserving use program es-
tablished for the 1994 crop of wheat, feed grains,
upland cotton, or rice established under section
107B(c)(1)(E), 105B(c)(1)(E), 103B(c)(1)(D), or
101B(c)(1)(D), respectively, of the Agricultural Act
of 
1949 
(7 
U.S.C. 
1445b–3a(c)(1)(E),
1444f(c)(1)(E), 
1444–2(c)(1)(D), 
or 
1441–
2(c)(1)(D)).
(c) OILSEED PREVENTED PLANTING PAYMENTS.—
(1) IN GENERAL.—Effective for the 1994 crop
year, a producer of a crop of oilseeds (as defined in
section 205(a) of the Agricultural Act of 1949 (7
U.S.C. 1446f(a))) shall receive a prevented planting
payment for the crop if the requirements of para-
graphs (1), (2), and (3) of subsection (b) are satis-
fied.
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(2) SOURCE OF PAYMENT.—The total amount
of payments required under this subsection shall be
made by the Federal Crop Insurance Corporation.
(d) PAYMENT.—A payment under this section may
not be made before October 1, 1994.
SEC. 117. REPORT ON IMPROVING DISSEMINATION OF
CROP INSURANCE INFORMATION.
Not later than 180 days after the date of enactment
of this Act and at the end of each of the 2 1-year periods
thereafter, the Federal Crop Insurance Corporation shall
submit a report to Congress containing a plan to imple-
ment a sound program for producer education regarding
the crop insurance program and for the dissemination of
crop insurance information to producers, as required by
section 508(a)(5) of the Federal Crop Insurance Act (as
amended by section 106).
SEC. 118. CROP INSURANCE PROVIDER EVALUATION.
(a) IN GENERAL.—The Comptroller General of the
United States and the Federal Crop Insurance Corpora-
tion (referred to in this section as the ‘‘Corporation’’) shall
jointly evaluate the financial arrangement between the
Corporation and approved insurance providers to deter-
mine the quality, costs, and efficiencies of providing the
benefits of multiple peril crop insurance to producers of
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agricultural commodities covered under the Federal Crop
Insurance Act (7 U.S.C. 1501 et seq.).
(b) COLLECTION
OF INFORMATION
AND PROPOS-
ALS.—The Corporation shall require private insurance
providers and agents to supply, and the private insurance
providers and agents shall supply, records and information
necessary to make the determinations and evaluations re-
quired under this section. The Corporation shall solicit
from the approved insurance providers and agents propos-
als for modifying or altering the requirements, regulations,
procedures, and processes related to implementing the
Federal Crop Insurance Act to reduce the operating and
administrative costs of the providers and agents.
(c) INITIAL REPORT.—Not later than 180 days after
receipt of information and cost-reduction proposals under
subsection (b), the Corporation shall evaluate the informa-
tion and proposals obtained and report the results of the
evaluation to the Committee on Agriculture of the House
of Representatives and the Committee on Agriculture, Nu-
trition, and Forestry of the Senate.
(d) FINAL REPORT.—Not later than 2 years after the
date of enactment of this Act, the Comptroller General
and the Corporation shall submit a final report that pro-
vides the evaluation required under subsection (a) to the
Committee on Agriculture of the House of Representatives
•HRES 559 ATH
and the Committee on Agriculture, Nutrition, and For-
estry of the Senate. In making the evaluation, the Comp-
troller General and the Corporation shall—
(1) consider the changes made by the Corpora-
tion in response to increased program participation
resulting from the enactment of this Act;
(2) include an evaluation and opinion of the ac-
curacy and reasonableness of—
(A) the average actual costs for approved
insurance providers to deliver multiple peril
crop insurance;
(B) the cost per policy of complying with
the requirements, regulations, procedures, and
processes of the Federal Crop Insurance Act;
(C) the cost differences for various pro-
vider firm sizes and any business delivered by
the Federal Government;
(D) the adequacy of the standard reim-
bursement for potential new providers; and
(E) the identification of any new costs re-
lated to the enactment of this Act not pre-
viously identified in the information reported by
the providers;
(3) compare delivery costs of multiple peril crop
insurance to other insurance coverages that the pro-
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vider may sell and determine the extent, if any, to
which any funds provided to carry out the Federal
Crop Insurance Act are being used to fund any
other business enterprise operated by the provider;
(4)(A) assess alternative methods for reimburs-
ing providers for reasonable and necessary expenses
associated with delivery of multiple peril crop insur-
ance;
(B) recommend changes under this paragraph
that reasonably demonstrate the need to achieve the
greatest operating efficiencies on the part of the pro-
vider and the Corporation has been recognized; and
(C) identify areas for improved operating effi-
ciencies, if any, in the requirements made by the
Corporation for compliance and program integrity;
(5) assess the potential for alternative forms of
reinsurance arrangements for providers of different
firm sizes, taking into consideration—
(A) the need to achieve a reasonable return
on the capital of the provider compared to other
lines of insurance;
(B) the relative risk borne by the provider
for the different lines of insurance;
(C) the availability and price of commercial
reinsurance; and
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(D) any additional costs that may be in-
curred by the Federal Government in carrying
out the Federal Crop Insurance Act; and
(6) include an analysis of the effect of the cur-
rent or proposed reinsurance arrangements on pro-
viders having different business levels.
(e) INFORMATION.—
(1) PRIVACY.—In conducting the evaluation re-
quired by this section, the Comptroller General and
the Corporation shall maintain the privacy of propri-
etary information.
(2) SUBPOENAS.—The Comptroller General
shall have the power to subpoena information rel-
evant to the evaluation required by this section from
any private insurance provider. The Comptroller
General shall allow the Corporation access to the in-
formation subpoenaed taking into consideration the
necessity of preserving the privacy of proprietary in-
formation.
SEC. 119. CONFORMING AMENDMENTS.
(a) PRICE SUPPORT PROGRAMS.—
(1) IN GENERAL.—Title IV of the Agricultural
Act of 1949 (7 U.S.C. 1421 et seq.) is amended by
adding at the end the following new section:
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‘‘SEC. 427. CROP INSURANCE REQUIREMENT.
‘‘As a condition of receiving any benefit (including
payments) under title I or II for each of the 1995 and
subsequent crops of tobacco, rice, extra long staple cotton,
upland cotton, feed grains, wheat, peanuts, oilseeds, and
sugar, a producer must obtain at least catastrophic risk
protection insurance coverage under section 508 of the
Federal Crop Insurance Act (7 U.S.C. 1508) for the crop
and crop year for which the benefit is sought, if the cov-
erage is offered by the Corporation.’’.
(2) RICE.—Section 101B(c) of such Act (7
U.S.C. 1441–2(c)) is amended—
(A) in paragraph (1), by striking subpara-
graph (F); and
(B) by striking paragraph (2) and insert-
ing the following new paragraph:
‘‘(2) CROP INSURANCE REQUIREMENT.—A pro-
ducer shall obtain catastrophic risk protection insur-
ance coverage in accordance with section 427.’’.
(3) UPLAND COTTON.—Section 103B(c) of such
Act (7 U.S.C. 1444–2(c)) is amended—
(A) in paragraph (1), by striking subpara-
graph (F); and
(B) by striking paragraph (2) and insert-
ing the following new paragraph:
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‘‘(2) CROP INSURANCE REQUIREMENT.—A pro-
ducer shall obtain catastrophic risk protection insur-
ance coverage in accordance with section 427.’’.
(4) FEED
GRAINS.—Section 105B(c) of such
Act (7 U.S.C. 1444f(c)) is amended—
(A) in paragraph (1), by striking subpara-
graph (G); and
(B) by striking paragraph (2) and insert-
ing the following new paragraph:
‘‘(2) CROP INSURANCE REQUIREMENT.—A pro-
ducer shall obtain catastrophic risk protection insur-
ance coverage in accordance with section 427.’’.
(5) WHEAT.—Section 107B(c) of such Act (7
U.S.C. 1445b–3a(c)) is amended—
(A) in paragraph (1), by striking subpara-
graph (G); and
(B) by striking paragraph (2) and insert-
ing the following new paragraph:
‘‘(2) CROP INSURANCE REQUIREMENT.—A pro-
ducer shall obtain catastrophic risk protection insur-
ance coverage in accordance with section 427.’’.
(6) DISASTER PAYMENTS.—Section 208 of such
Act (7 U.S.C. 1446i) is repealed.
(b) FARMERS HOME ADMINISTRATION PROGRAMS.—
The Consolidated Farm and Rural Development Act (7
•HRES 559 ATH
U.S.C. 1921 et seq.) is amended by adding at the end
the following new section:
‘‘SEC. 371. CROP INSURANCE REQUIREMENT.
‘‘(a) IN GENERAL.—As a condition of obtaining any
benefit (including a direct loan, loan guarantee, or pay-
ment) described in subsection (b), a borrower must obtain
at least catastrophic risk protection insurance coverage
under section 508 of the Federal Crop Insurance Act (7
U.S.C. 1508) for the crop and crop year for which the
benefit is sought, if the coverage is offered by the Corpora-
tion.
‘‘(b) APPLICABLE BENEFITS.—Subsection (a) shall
apply to—
‘‘(1) a farm ownership loan (FO) under section
303;
‘‘(2) an operating loan (OL) under section 312;
and
‘‘(3) an emergency loan (EM) under section
321.’’.
(c) DISASTER ASSISTANCE.—Subtitle B of title XXII
of the Food, Agriculture, Conservation, and Trade Act
of 1990 (7 U.S.C. 1421 note) is amended by striking
chapter 3.
(d) EMERGENCY APPROPRIATIONS.—
•HRES 559 ATH
(1) IN GENERAL.—Effective January 1, 1995,
section 251(b)(2)(D)(i) of the Balanced Budget and
Emergency Deficit Control Act of 1985 (2 U.S.C.
901(b)(2)(D)(i)) is amended by adding at the end
the following new sentence: ‘‘This subparagraph
shall not apply to appropriations to cover agricul-
tural crop disaster assistance.’’.
(2) EMERGENCY LEGISLATION.—Effective Jan-
uary 1, 1995, section 252(e) of such Act (2 U.S.C.
902(e)) is amended by adding at the end the follow-
ing new sentence: ‘‘This subsection shall not apply
to direct spending provisions to cover agricultural
crop disaster assistance.’’.
(e) FALSE STATEMENTS.—Section 1014 of title 18,
United States Code, is amended by inserting ‘‘or a com-
pany the Corporation reinsures’’ after ‘‘Federal Crop In-
surance Corporation’’.
(f) TECHNICAL AMENDMENTS.—
(1) The first sentence of section 506(d) (7
U.S.C. 1506(d)) is amended by striking ‘‘508(f)’’
and inserting ‘‘508(j)’’.
(2) The last sentence of section 507(c) (7
U.S.C. 1507(c)) is amended by striking ‘‘508(b)’’
and inserting ‘‘508(h)’’.
•HRES 559 ATH
(3) Section 518 (7 U.S.C. 1518) is amended by
striking ‘‘(k)’’ and inserting ‘‘(m)’’.
SEC. 120. EFFECTIVE DATE.
Except as otherwise provided in this title, this title
and the amendments made by this title shall become effec-
tive on the date of enactment of this Act and shall apply
to the provision of crop insurance under the Federal Crop
Insurance Act (7 U.S.C. 1501 et seq.) beginning with the
1995 crop year. With respect to the 1994 crop year, the
Federal Crop Insurance Act (as in effect on the day before
the date of enactment of this Act) shall continue to apply.
TITLE II—DEPARTMENT OF AG-
RICULTURE 
REORGANIZA-
TION
SEC. 201. SHORT TITLE.
(a) SHORT TITLE.—This title may be cited as the
‘‘Department of Agriculture Reorganization Act of 1994’’.
SEC. 202. PURPOSE.
The purpose of this title is to provide the Secretary
of Agriculture with the necessary authority to streamline
and reorganize the Department of Agriculture to achieve
greater efficiency, effectiveness, and economies in the or-
ganization and management of the programs and activities
carried out by the Department.
•HRES 559 ATH
SEC. 203. DEFINITIONS.
Except where the context requires otherwise, for pur-
poses of this title:
(1) DEPARTMENT.—The term ‘‘Department’’
means the Department of Agriculture.
(2) NATIONAL APPEALS DIVISION.—The term
‘‘National Appeals Division’’ means the National
Appeals Division of the Department established
under section 272.
(3) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of Agriculture.
(4) FUNCTION.—The term ‘‘function’’ means
an administrative, financial, or regulatory activity of
an agency, office, officer, or employee of the Depart-
ment.
Subtitle A—General
Reorganization Authorities
SEC. 211. TRANSFER OF DEPARTMENT FUNCTIONS TO SEC-
RETARY OF AGRICULTURE.
(a) TRANSFER OF FUNCTIONS.—Except as provided
in subsection (b), there are transferred to the Secretary
of Agriculture all functions of all agencies, offices, officers,
and employees of the Department that are not already
vested in the Secretary on the date of the enactment of
this Act.
•HRES 559 ATH
(b) EXCEPTIONS.—Subsection (a) shall not apply to
the following functions:
(1) Functions vested by subchapter II of chap-
ter 5 of title 5, United States Code, in administra-
tive law judges employed by the Department.
(2) Functions vested by the Inspector General
Act of 1978 (5 U.S.C. App.) in the Inspector Gen-
eral of the Department.
(3) Functions vested by chapter 9 of title 31,
United States Code, in the Chief Financial Officer
of the Department.
(4) Functions vested in the corporations of the
Department or the boards of directors and officers
of such corporations.
(5) Functions vested in the Alternative Agricul-
tural Research and Commercialization Board by the
Alternative Agricultural Research and Commer-
cialization Act of 1990 (7 U.S.C. 5901 et seq.).
SEC. 212. AUTHORITY OF SECRETARY TO DELEGATE
TRANSFERRED FUNCTIONS.
(a) DELEGATION OF AUTHORITY.—
(1) DELEGATION
AUTHORIZED.—Subject to
paragraph (2), the Secretary may delegate to any
agency, office, officer, or employee of the Depart-
ment the authority to perform any function trans-
•HRES 559 ATH
ferred to the Secretary under section 211(a) or any
other function vested in the Secretary as of the date
of the enactment of this Act. The authority provided
in the preceding sentence includes the authority to
establish, consolidate, alter, or discontinue any agen-
cy, office, or other administrative unit of the Depart-
ment.
(2) CONDITION ON AUTHORITY.—The delega-
tion authority provided by paragraph (1) shall be
subject to—
(A) sections 232, 251(d), 273, and 304
and subsections (a) and (b)(1) of section 261;
(B) sections 502 and 503 of the Agricul-
tural Trade Act of 1978 (7 U.S.C. 5692 and
5693); and
(C) section 8(b)(5) of the Soil Conserva-
tion and Domestic Allotment Act (16 U.S.C.
590h(b)(5)).
(b) COST-BENEFIT ANALYSIS REQUIRED FOR NAME
CHANGE.—
(1) ANALYSIS REQUIRED.—Except as provided
in paragraph (2), the Secretary shall conduct a cost-
benefit analysis before changing the name of any
agency, office, division, or other unit of the Depart-
ment to ensure that the benefits to be derived from
•HRES 559 ATH
changing the name of the agency, office, division, or
other unit outweigh the expense of executing the
name change.
(2) EXCEPTION.—Paragraph (1) shall not
apply with respect to any name change required or
authorized by this title.
(c) PUBLIC COMMENT ON PROPOSED REORGANIZA-
TION.—To the extent that the implementation of the au-
thority provided to the Secretary by this title to reorganize
the Department involves the creation of new agencies or
offices within the Department or the delegation of major
functions or major groups of functions to any agency or
office of the Department (or the officers or employees of
such agency or office), the Secretary shall, to the extent
considered practicable by the Secretary—
(1) give appropriate advance public notice of
the proposed reorganization action or delegation;
and
(2) afford appropriate opportunity for inter-
ested parties to comment on the proposed reorga-
nization action or delegation.
(d) INTERAGENCY TRANSFER OF RECORDS, PROP-
ERTY, PERSONNEL, AND FUNDS.—
(1) RELATED
TRANSFERS.—Subject to para-
graph (2), as part of the transfer or delegation of
•HRES 559 ATH
a function of the Department made or authorized by
this title, the Secretary may transfer within the De-
partment—
(A) any of the records, property, or per-
sonnel affected by the transfer or delegation of
the function; and
(B) unexpended balances (available or to
be made available for use in connection with the
transferred or delegated function) of appropria-
tions, allocations, or other funds of the Depart-
ment.
(2) APPLICABLE
LAW
RELATING
TO
FUNDS
TRANSFER.—Section 1531 of title 31, United States
Code, shall apply to any transfer of funds under
paragraph (1).
(e) EXHAUSTION OF ADMINISTRATIVE APPEALS.—
Notwithstanding any other provision of law, a person shall
exhaust all administrative appeal procedures established
by the Secretary or required by law before the person may
bring an action in a court of competent jurisdiction
against—
(1) the Secretary;
(2) the Department; or
(3) an agency, office, officer, or employee of the
Department.
•HRES 559 ATH
SEC. 213. REDUCTIONS IN NUMBER OF DEPARTMENT PER-
SONNEL.
(a) DEFINITIONS.—For purposes of this section:
(1) 
HEADQUARTERS
OFFICES.—The 
term
‘‘headquarters offices’’, with respect to agencies, of-
fices, or other administrative units of the Depart-
ment, means the offices, functions, and employee po-
sitions that are located or performed—
(A) in Washington, District of Columbia;
or
(B) in such other locations as are identi-
fied by the Secretary for purposes of this sec-
tion.
(2) FIELD STRUCTURE.—The term ‘‘field struc-
ture’’ means the offices, functions, and employee po-
sitions of all agencies, offices, or other administra-
tive units of the Department, other than the head-
quarters offices, except that the term does not in-
clude State, county, or area committees established
under section 8(b)(5) of the Soil Conservation and
Domestic Allotment Act (16 U.S.C. 590h(b)(5)).
The term includes the physical and geographic loca-
tions of such agencies, offices, or other administra-
tive units.
(b) NUMBER OF REDUCTIONS REQUIRED.—The Sec-
retary shall achieve Federal employee reductions of at
•HRES 559 ATH
least 7,500 staff years within the Department by the end
of fiscal year 1999. Reductions in the number of full-time
equivalent positions within the Department achieved
under section 5 of the Federal Workforce Restructuring
Act of 1994 (Public Law 103–226; 108 Stat. 115; 5
U.S.C. 3101 note) shall be counted toward the employee
reductions required under this section.
(c) EMPHASIS ON HEADQUARTERS OFFICES REDUC-
TIONS.—In achieving the employee reductions required by
subsection (b), the Secretary shall pursue a goal so that
the percentage of the total number of employee staff years
reduced in headquarters offices is at least twice the per-
centage of the total number of employee staff years re-
duced in the field structure.
(d) SCHEDULE.—The personnel reductions in head-
quarters offices and in the field structure should be accom-
plished concurrently in a manner determined by the Sec-
retary.
SEC. 214. CONSOLIDATION OF HEADQUARTERS OFFICES.
Subject to the availability of appropriated funds for
this purpose, the Secretary shall develop and carry out a
plan to consolidate offices located in Washington, District
of Columbia, of agencies, offices, and other administrative
units of the Department.
•HRES 559 ATH
SEC. 215. COMBINATION OF FIELD OFFICES.
(a) COMBINATION OF OFFICES REQUIRED.—Where
practicable and to the extent consistent with efficient, ef-
fective, and improved service, the Secretary shall combine
field offices of agencies within the Department to reduce
personnel and duplicative overhead expenses.
(b) JOINT USE OF RESOURCES AND OFFICES RE-
QUIRED.—When two or more agencies of the Department
share a common field office, the Secretary shall require
the agencies to jointly use office space, equipment, office
supplies, administrative personnel, and clerical personnel
associated with that field office.
SEC. 216. IMPROVEMENT OF INFORMATION SHARING.
Whenever the Secretary procures or uses computer
systems, as may be provided for in advance in appropria-
tions Acts, the Secretary shall do so in a manner that en-
hances efficiency, productivity, and client services and is
consistent with the goal of promoting computer informa-
tion sharing among agencies of the Department.
SEC. 217. REPORTS BY THE SECRETARY.
(a) IN GENERAL.—Subject to subsection (b), not-
withstanding any other provision of law, the Secretary
may, but shall not be required to, prepare and submit any
report solely to the Committee on Agriculture of the
House of Representatives and the Committee on Agri-
culture, Nutrition, and Forestry of the Senate.
•HRES 559 ATH
(b) LIMITATION.—For each fiscal year, the Secretary
may not prepare and submit more than 30 reports re-
ferred to in subsection (a).
(c) SELECTION OF REPORTS.—In consultation with
the Committee on Agriculture of the House of Representa-
tives and the Committee on Agriculture, Nutrition, and
Forestry of the Senate, the Secretary shall determine
which reports, if any, the Secretary will prepare and sub-
mit in accordance with subsection (b).
SEC. 218. ASSISTANT SECRETARIES OF AGRICULTURE.
(a) AUTHORIZATION.—The Secretary is authorized to
establish in the Department the positions of—
(1) Assistant Secretary of Agriculture for Con-
gressional Relations;
(2) Assistant Secretary of Agriculture for Ad-
ministration; and
(3) Assistant Secretary of Agriculture for Mar-
keting and Regulatory Programs.
(b) CONFIRMATION REQUIRED.—If the Secretary es-
tablishes any position of Assistant Secretary authorized
under subsection (a), the Assistant Secretary shall be ap-
pointed by the President, by and with the advice and con-
sent of the Senate.
(c) SUCCESSION.—Any official who is serving as As-
sistant Secretary of Agriculture for Administration or As-
•HRES 559 ATH
sistant Secretary of Agriculture for Congressional Rela-
tions on the date of the enactment of this Act and who
was appointed as such Assistant Secretary by the Presi-
dent, by and with the advice and consent of the Senate,
shall not be required to be reappointed under subsection
(b) to the successor position authorized under subsection
(a) if the Secretary establishes the position, and the offi-
cial occupies the new position, within 180 days after the
date of the enactment of this Act (or such later date set
by the Secretary if litigation delays rapid succession).
(d) EXECUTIVE SCHEDULE.—Section 5315 of title 5,
United States Code, is amended by striking ‘‘Assistant
Secretaries of Agriculture (7).’’ and inserting ‘‘Assistant
Secretaries of Agriculture (3).’’.
(e) REPEAL OF SUPERSEDED PROVISIONS REGARD-
ING ASSISTANT SECRETARIES.—The following provisions
of law are repealed:
(1) Section 2 of Reorganization Plan No. 2 of
1953 (5 U.S.C. App; 7 U.S.C. 2201 note).
(2) Section 2 of the Act entitled ‘‘An Act to en-
large the powers and duties of the Department of
Agriculture and to create an Executive Department
to be known as the Department of Agriculture.’’, ap-
proved February 9, 1889 (7 U.S.C. 2212).
•HRES 559 ATH
(3) The first paragraph designated ‘‘OFFICE OF
THE SECRETARY:’’ under the heading ‘‘DEPART-
MENT OF AGRICULTURE’’ of the Act entitled
‘‘An Act making appropriations for the Department
of Agriculture for the fiscal year ending June thirti-
eth, nineteen hundred and seven.’’, approved June
30, 1906 (34 Stat. 670; 7 U.S.C. 2212).
(4) Section 604(a) of the Rural Development
Act of 1972 (7 U.S.C. 2212a).
(5) Section 2 of Public Law 94–561 (7 U.S.C.
2212b).
(6) Section 8(a) of Public Law 97–325 (7
U.S.C. 2212c).
(7) Section 1413(d) of the National Agricul-
tural Research, Extension, and Teaching Policy Act
of 1977 (7 U.S.C. 3128(d)).
SEC. 219. PAY INCREASES PROHIBITED.
The compensation of any officer or employee of the
Department on the date of the enactment of this Act shall
not be increased as a result of the enactment of this title.
•HRES 559 ATH
Subtitle B—Farm and Foreign
Agricultural Services
SEC. 225. UNDER SECRETARY OF AGRICULTURE FOR FARM
AND FOREIGN AGRICULTURAL SERVICES.
(a) AUTHORIZATION.—The Secretary is authorized to
establish in the Department the position of Under Sec-
retary of Agriculture for Farm and Foreign Agricultural
Services.
(b) CONFIRMATION REQUIRED.—If the Secretary es-
tablishes the position of Under Secretary of Agriculture
for Farm and Foreign Agricultural Services authorized
under subsection (a), the Under Secretary shall be ap-
pointed by the President, by and with the advice and con-
sent of the Senate.
(c) FUNCTIONS OF UNDER SECRETARY.—
(1) PRINCIPAL
FUNCTIONS.—Upon establish-
ment, the Secretary shall delegate to the Under Sec-
retary of Agriculture for Farm and Foreign Agricul-
tural Services those functions under the jurisdiction
of the Department that are related to farm and for-
eign agricultural services.
(2) ADDITIONAL FUNCTIONS.—The Under Sec-
retary of Agriculture for Farm and Foreign Agricul-
tural Services shall perform such other functions as
•HRES 559 ATH
may be required by law or prescribed by the Sec-
retary.
(d) SUCCESSION.—Any official who is serving as
Under Secretary of Agriculture for International Affairs
and Commodity Programs on the date of the enactment
of this Act and who was appointed by the President, by
and with the advice and consent of the Senate, shall not
be required to be reappointed under subsection (b) to the
successor position authorized under subsection (a) if the
Secretary establishes the position, and the official occupies
the new position, within 180 days after the date of the
enactment of this Act (or such later date set by the Sec-
retary if litigation delays rapid succession).
(e) CONFORMING AMENDMENTS.—
(1) EXISTING POSITION.—Section 501 of the
Agricultural Trade Act of 1978 (7 U.S.C. 5691), re-
lating to the Under Secretary of Agriculture for
International Affairs and Commodity Programs, is
repealed.
(2) EXECUTIVE SCHEDULE.—Section 5314 of
title 5, United States Code, is amended by striking
‘‘Under Secretary of Agriculture for International
Affairs and Commodity Programs.’’ and inserting
‘‘Under Secretary of Agriculture for Farm and For-
eign Agricultural Services.’’.
•HRES 559 ATH
SEC. 226. CONSOLIDATED FARM SERVICE AGENCY.
(a) ESTABLISHMENT.—The Secretary is authorized
to establish and maintain in the Department a Consoli-
dated Farm Service Agency.
(b) FUNCTIONS OF CONSOLIDATED FARM SERVICE
AGENCY.—If the Secretary establishes the Consolidated
Farm Service Agency under subsection (a), the Secretary
is authorized to assign to the Agency jurisdiction over the
following functions:
(1) Agricultural price and income support pro-
grams, production adjustment programs, and related
programs.
(2) General supervision of the Federal Crop In-
surance Corporation.
(3) Agricultural credit programs assigned be-
fore the date of the enactment of this Act by law to
the Farmers Home Administration (including farm
ownership and operating, emergency, and disaster
loan programs) and other lending programs for agri-
cultural producers and others engaged in the pro-
duction of agricultural commodities.
(4) Subchapter B of chapter 1 of subtitle D of
title XII of the Food Security Act of 1985 (16
U.S.C. 3831–3836) and the agricultural conserva-
tion program under the Soil Conservation and Do-
mestic Allotment Act (16 U.S.C. 590g et seq.).
•HRES 559 ATH
(5) Such other functions as the Secretary con-
siders appropriate, except for those programs as-
signed by the Secretary to the Natural Resources
Conservation Service or another agency of the De-
partment under section 246(b).
(c) SPECIAL CONCURRENCE REQUIREMENTS
FOR
CERTAIN FUNCTIONS.—In carrying out the programs
specified in subsection (b)(4), the Secretary shall—
(1) acting on the recommendations of the Con-
solidated Farm Service Agency, with the concurrence
of the Natural Resources Conservation Service, issue
regulations to carry out such programs;
(2) ensure that the Consolidated Farm Service
Agency, in establishing policies, priorities, and
guidelines for such programs, does so with the con-
currence of the Natural Resources Conservation
Service at national, State, and local levels;
(3) ensure that, in reaching such concurrence
at the local level, the Natural Resources Conserva-
tion Service works in cooperation with Soil and
Water Conservation Districts or similar organiza-
tions established under State law;
(4) ensure that officials of county and area
committees established under section 8(b)(5) of the
Soil Conservation and Domestic Allotment Act (16
•HRES 559 ATH
U.S.C. 590h(b)(5)) meet annually with officials of
such Districts or similar organizations to consider
local conservation priorities and guidelines; and
(5) take steps to ensure that the concurrence
process does not interfere with the effective delivery
of such programs.
(d) JURISDICTION OVER CONSERVATION PROGRAM
APPEALS.—
(1) IN GENERAL.—Until such time as an ad-
verse decision described in this paragraph is referred
to the National Appeals Division for consideration,
the Consolidated Farm Service Agency shall have
initial jurisdiction over any administrative appeal re-
sulting from an adverse decision made under title
XII of the Food Security Act of 1985 (16 U.S.C.
3801 et seq.), including an adverse decision involv-
ing technical determinations made by the Natural
Resources Conservation Service.
(2) TREATMENT
OF
TECHNICAL
DETERMINA-
TION.—With respect to administrative appeals in-
volving a technical determination made by the Natu-
ral Resources Conservation Service, the Consolidated
Farm Service Agency, by rule with the concurrence
of the Natural Resources Conservation Service, shall
establish procedures for obtaining review by the Nat-
100
•HRES 559 ATH
ural Resources Conservation Service of the technical
determinations involved. Such rules shall ensure that
technical criteria established by the Natural Re-
sources Conservation Service shall be used by the
Consolidated Farm Service Agency as the basis for
any decisions regarding technical determinations. If
no review is requested, the technical determination
of the Natural Resources Conservation Service shall
be the technical basis for any decision rendered by
a county or area committee established under section
8(b)(5) of the Soil Conservation and Domestic Allot-
ment Act (16 U.S.C. 590h(b)(5)). If the committee
requests a review by the Natural Resources Con-
servation Service of a wetlands determination of the
Service, the Consolidated Farm Service Agency shall
consult with other Federal agencies whenever re-
quired by law or under a memorandum of agreement
in existence on the date of the enactment of this
Act.
(3) REINSTATEMENT
OF
PROGRAM
BENE-
FITS.—Rules issued to carry out this subsection
shall provide for the prompt reinstatement of bene-
fits to a producer who is determined in an adminis-
trative appeal to meet the requirements of title XII
101
•HRES 559 ATH
of the Food Security Act of 1985 applicable to the
producer.
(e) USE OF FEDERAL AND NON-FEDERAL EMPLOY-
EES.—
(1) USE AUTHORIZED.—In the implementation
of programs and activities assigned to the Consoli-
dated Farm Service Agency, the Secretary may use
interchangeably in local offices of the Agency both
Federal employees of the Department and non-Fed-
eral employees of county and area committees estab-
lished under section 8(b)(5) of the Soil Conservation
and 
Domestic 
Allotment 
Act 
(16 
U.S.C.
590h(b)(5)).
(2) EXCEPTION.—Notwithstanding paragraph
(1), no personnel action (as defined in section
2302(a)(2)(A) of title 5, United States Code) may
be taken with respect to a Federal employee unless
such action is taken by another Federal employee.
(f) COLLOCATION.—To the maximum extent prac-
ticable, the Secretary shall collocate county offices of the
Consolidated Farm Service Agency with county offices of
the Natural Resources Conservation Service in order to—
(1) maximize savings from shared equipment,
office space, and administrative support;
102
•HRES 559 ATH
(2) simplify paperwork and regulatory require-
ments;
(3) provide improved services to agricultural
producers and landowners affected by programs ad-
ministered by the Agency and the Service; and
(4) achieve computer compatibility between the
Agency and the Service to maximize efficiency and
savings.
(g) SAVINGS PROVISION.—For purposes of sub-
sections (c) through (f) of this section:
(1) A reference to the ‘‘Consolidated Farm
Service Agency’’ includes any other office, agency, or
administrative unit of the Department assigned the
functions authorized for the Consolidated Farm
Service Agency under this section.
(2) A reference to the ‘‘Natural Resources Con-
servation Service’’ includes any other office, agency,
or administrative unit of the Department assigned
the functions authorized for the Natural Resources
Conservation Service under section 246(b).
(h) CONFORMING AMENDMENT.—Section 331(a) of
the Consolidated Farm and Rural Development Act (7
U.S.C. 1981(a)) is amended by striking ‘‘assets to the
Farmers Home Administration’’ and all that follows
through the period at the end of the subsection and insert-
103
•HRES 559 ATH
ing ‘‘assets to such officers or agencies of the Department
of Agriculture as the Secretary considers appropriate.’’.
SEC. 227. STATE, COUNTY, AND AREA COMMITTEES.
(a) COMMITTEES UNDER THE SOIL CONSERVATION
AND DOMESTIC ALLOTMENT ACT.—Section 8(b) of the
Soil Conservation and Domestic Allotment Act (16 U.S.C.
590h(b)) is amended—
(1) by inserting ‘‘(1)’’ after ‘‘(b)’’;
(2) by designating the second through eighth
undesignated paragraphs as paragraphs (2) through
(8), respectively; and
(3) by striking paragraph (5) (as so designated)
and inserting the following new paragraph:
‘‘(5) STATE, COUNTY, AND AREA COMMITTEES.—
‘‘(A) APPOINTMENT OF STATE COMMITTEES.—
The Secretary shall appoint in each State a State
committee composed of not fewer than 3 nor more
than 5 members who are fairly representative of the
farmers in the State. The members of a State com-
mittee shall serve at the pleasure of the Secretary
for such term as the Secretary may establish.
‘‘(B) ESTABLISHMENT OF COUNTY, AREA, OR
LOCAL COMMITTEES.—(i) In each county or area in
which activities are carried out under this section,
104
•HRES 559 ATH
the Secretary shall establish a county or area com-
mittee.
‘‘(ii) Any such committee shall consist of not
fewer than 3 nor more than 5 members who are
fairly representative of the agricultural producers in
the county or area and who shall be elected by the
agricultural producers in such county or area under
such procedures as the Secretary may prescribe.
‘‘(iii) The Secretary may designate local admin-
istrative areas within the county or larger area cov-
ered by a committee established under clause (i).
Only agricultural producers within a local adminis-
trative area who participate or cooperate in pro-
grams administered within their area shall be eligi-
ble for nomination and election to the local commit-
tee for that area, under such regulations as the Sec-
retary may prescribe.
‘‘(iv) The Secretary shall solicit and accept
nominations from organizations representing the in-
terests of socially disadvantaged groups (as defined
in section 355(e)(1) of the Consolidated Farm and
Rural Development Act (7 U.S.C. 2003(e)(1)).
‘‘(v) Members of each county, area, or local
committee shall serve for terms not to exceed 3
years.
105
•HRES 559 ATH
‘‘(C) TERMINATION OR COMBINATION OF COM-
MITTEES.—The Secretary may not terminate a
county or area committee or combine or consolidate
two or more county or area committees unless—
‘‘(i) the Secretary first notifies the commit-
tee or committees involved of the proposed ac-
tion; and
‘‘(ii) the State committee of the State in
which the affected counties are located approves
of such action in a vote taken after the end of
the 60-day period beginning on the date the no-
tification is received.
‘‘(D) USE
OF
COMMITTEES.—The Secretary
shall use the services of such committees in carrying
out programs under this section and the agricultural
credit programs under the Consolidated Farm and
Rural Development Act (7 U.S.C. 1921 et seq.) and
in considering administrative appeals as provided by
section 226(d) of the Department of Agriculture Re-
organization Act of 1994. The Secretary may use
the services of such committees in carrying out pro-
grams under other authorities administered by the
Secretary .
‘‘(E) REGULATIONS.—The Secretary shall issue
such regulations as the Secretary considers nec-
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essary relating to the selection and exercise of the
functions of the respective committees, and to the
administration through such committees of the pro-
grams described in subparagraph (D). Pursuant to
such regulations, each county and area committee
shall select an executive director for the area or
county. Such selection shall be made in the same
manner as provided for the selection of the county
executive director under section 7.21(b)(2) of title 7,
Code of Federal Regulations, as in effect on January
1, 1994. Regulations governing payments or grants
under this subsection shall be as simple and direct
as possible, and, whenever practicable, they shall be
classified on the following two bases:
‘‘(i) Soil-depleting practices.
‘‘(ii) Soil-building practices.
‘‘(F) MANDATORY DUTIES OF SECRETARY.—In
carrying out this section, the Secretary shall—
‘‘(i) insofar as practicable, protect the in-
terests of tenants and sharecroppers;
‘‘(ii) accord such encouragement to pro-
ducer-owned and producer-controlled coopera-
tive associations as will be in harmony with the
policy toward cooperative associations set forth
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in Federal laws and as will tend to promote ef-
ficient methods of marketing and distribution;
‘‘(iii) in every practicable manner, protect
the interests of small producers; and
‘‘(iv) in every practical way, encourage and
provide for soil-conserving and soil-rebuilding
practices.
‘‘(G) DISCRETIONARY
AUTHORITIES
OF
SEC-
RETARY.—In carrying out this section, the Secretary
may use other approved agencies.
‘‘(H) LIMITATIONS.—In carrying out this sec-
tion, the Secretary shall not have the authority to
acquire any land or any right or interest in land.’’.
(b) ELIMINATION
OF
FMHA COUNTY
COMMIT-
TEES.—The Consolidated Farm and Rural Development
Act (7 U.S.C. 1921 et seq.) is amended—
(1) by striking section 332 (7 U.S.C. 1982);
and
(2) in section 333 (7 U.S.C. 1983)—
(A) by striking paragraph (2); and
(B) redesignating paragraphs (3), (4), and
(5) as paragraphs (2), (3), and (4), respec-
tively.
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Subtitle C—Rural Economic and
Community Development
SEC. 231. UNDER SECRETARY OF AGRICULTURE FOR
RURAL ECONOMIC AND COMMUNITY DEVEL-
OPMENT.
(a) AUTHORIZATION.—The Secretary is authorized to
establish in the Department the position of Under Sec-
retary of Agriculture for Rural Economic and Community
Development.
(b) CONFIRMATION REQUIRED.—If the Secretary es-
tablishes the position of Under Secretary of Agriculture
for Rural Economic and Community Development author-
ized under subsection (a), the Under Secretary shall be
appointed by the President, by and with the advice and
consent of the Senate.
(c) FUNCTIONS OF UNDER SECRETARY.—
(1) PRINCIPAL
FUNCTIONS.—Upon establish-
ment, the Secretary shall delegate to the Under Sec-
retary of Agriculture for Rural Economic and Com-
munity Development those functions under the juris-
diction of the Department that are related to rural
economic and community development.
(2) ADDITIONAL FUNCTIONS.—The Under Sec-
retary of Agriculture for Rural Economic and Com-
munity Development shall perform such other func-
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tions as may be required by law or prescribed by the
Secretary.
(d) SUCCESSION.—Any official who is serving as
Under Secretary of Agriculture for Small Community and
Rural Development on the date of the enactment of this
Act and who was appointed by the President, by and with
the advice and consent of the Senate, shall not be required
to be reappointed under subsection (b) to the successor
position authorized under subsection (a) if the Secretary
establishes the position, and the official occupies the new
position, within 180 days after the date of the enactment
of this Act (or such later date set by the Secretary if litiga-
tion delays rapid succession).
(e) LOAN APPROVAL AUTHORITY.—Approval author-
ity for loans and loan guarantees in connection with the
electric and telephone loan and loan guarantee programs
authorized by the Rural Electrification Act of 1936 (7
U.S.C. 901 et seq.) shall not be transferred to, or condi-
tioned on review of, a State director or other employee
whose primary duty is not the review and approval of such
loans or the provision of assistance to such borrowers.
(f) CONFORMING AMENDMENTS.—
(1) EXISTING
POSITION.—Section 3 of the
Rural Development Policy Act of 1980 (7 U.S.C.
2211b) is amended by striking subsection (a).
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(2) EXECUTIVE SCHEDULE.—Section 5314 of
title 5, United States Code, is amended by striking
‘‘Under Secretary of Agriculture for Small Commu-
nity and Rural Development.’’ and inserting ‘‘Under
Secretary of Agriculture for Rural Economic and
Community Development.’’.
(3) REPEAL OF RURAL DEVELOPMENT ADMIN-
ISTRATION.—Section 364 of the Consolidated Farm
and Rural Development Act (7 U.S.C. 2006f) is re-
pealed.
SEC. 232. RURAL UTILITIES SERVICE.
(a) ESTABLISHMENT
REQUIRED.—The Secretary
shall establish and maintain within the Department the
Rural Utilities Service and assign to the Service such
functions as the Secretary considers appropriate.
(b) ADMINISTRATOR.—
(1) APPOINTMENT.—The Rural Utilities Service
shall be headed by an Administrator who shall be
appointed by the President, by and with the advice
and consent of the Senate.
(2) SUCCESSION.—Any official who is serving
as Administrator of the Rural Electrification Admin-
istration on the date of the enactment of this Act
and who was appointed by the President, by and
with the advice and consent of the Senate—
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(A) may be considered to be serving in the
successor position established under paragraph
(1); and
(B) shall not be required to be reappointed
to that position by reason of the enactment of
this Act.
(3) EXECUTIVE SCHEDULE.—Section 5315 of
title 5, United States Code, is amended by adding
at the end the following:
‘‘Administrator, Rural Utilities Service, Depart-
ment of Agriculture.’’.
(c) FUNCTIONS.—The Secretary shall carry out
through the Rural Utilities Service the following functions
that are under the jurisdiction of the Department:
(1) Electric and telephone loan programs and
water and waste facility activities authorized by law,
including—
(A) the Rural Electrification Act of 1936
(7 U.S.C. 901 et seq.); and
(B) section 2322 of the Food, Agriculture,
Conservation, and Trade Act of 1990 (7 U.S.C.
1926–1); and
(2) Water and waste facility programs and ac-
tivities authorized by law, including—
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•HRES 559 ATH
(A) sections 306, 306A, 306B, and 306C,
the provisions of sections 309 and 309A relat-
ing to assets, terms, and conditions of water
and sewer programs, section 310B(b)(2), and
the amendment made by section 342 of the
Consolidated Farm and Rural Development Act
(7 U.S.C. 1926, 1926a, 1926b, 1926c, 1929,
1929a, 1932(b)(2), and 1013a); and
(B) section 2324 of the Food, Agriculture,
Conservation, and Trade Act of 1990 (7 U.S.C.
1926 note).
SEC. 233. RURAL HOUSING AND COMMUNITY DEVELOP-
MENT SERVICE.
(a) ESTABLISHMENT AUTHORIZED.—Notwithstand-
ing any other provision of law, the Secretary is authorized
to establish and maintain within the Department the
Rural Housing and Community Development Service and
to assign to the Service such functions as the Secretary
considers appropriate.
(b) FUNCTIONS.—If the Secretary establishes the
Rural Housing and Community Development Service
under subsection (a), the Secretary is authorized to assign
to the Service jurisdiction over the following:
(1) Programs and activities under title V of the
Housing Act of 1949 (42 U.S.C. 1471 et seq.).
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(2) Programs and activities authorized under
section 310B(i) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1932(i)) and related
provisions of law.
(3) Programs and activities that relate to rural
community lending programs, including programs
authorized by sections 365 through 369 of the Con-
solidated Farm and Rural Development Act (7
U.S.C. 2008–2008d).
SEC. 234. RURAL BUSINESS AND COOPERATIVE DEVELOP-
MENT SERVICE.
(a) ESTABLISHMENT AUTHORIZED.—Notwithstand-
ing any other provision of law, the Secretary is authorized
to establish and maintain within the Department the
Rural Business and Cooperative Development Service and
to assign to the Service such functions as the Secretary
considers appropriate.
(b) FUNCTIONS.—If the Secretary establishes the
Rural Business and Cooperative Development Service
under subsection (a), the Secretary is authorized to assign
to the Service jurisdiction over the following:
(1) Section 313 and title V of the Rural Elec-
trification Act of 1936 (7 U.S.C. 940c and 950aa et
seq.).
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(2) subtitle G of title XVI of the Food, Agri-
culture, Conservation, and Trade Act of 1990 (7
U.S.C. 5901 et seq.).
(3) Sections 306(a)(1) and 310B of the Con-
solidated Farm and Rural Development Act (7
U.S.C. 1926(a)(1) and 1932).
(4) Section 1323 of the Food Security Act of
1985 (Public Law 99–198; 7 U.S.C. 1932 note).
(5) The Act of July 2, 1926 (44 Stat. 802,
chapter 725; 7 U.S.C. 451 et seq.).
SEC. 235. CONFORMING AMENDMENTS REGARDING RURAL
ELECTRIFICATION ADMINISTRATION.
(a) AMENDMENTS TO RURAL ELECTRIFICATION ACT
OF 1936.—The Rural Electrification Act of 1936 (7
U.S.C. 901 et seq.) is amended—
(1) by striking the first section (7 U.S.C. 901)
and inserting the following:
‘‘SECTION 1. SHORT TITLE.
‘‘This Act may be cited as the ‘Rural Electrification
Act of 1936’.’’;
(2) in section 2(a) (7 U.S.C. 902(a)), by strik-
ing ‘‘Administrator’’ and inserting ‘‘Secretary of Ag-
riculture’’;
(3) in section 3(a) (7 U.S.C. 903(a))—
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(A) by striking ‘‘Administrator, upon the
request and approval of the Secretary of Agri-
culture,’’ and inserting ‘‘Secretary’’; and
(B) by striking ‘‘Administrator appointed
pursuant to the provisions of this Act or from
the Administrator of the Rural Electrification
Administration established by Executive Order
Numbered 7037’’ and inserting ‘‘Secretary’’;
(4) in section 8 (7 U.S.C. 908)—
(A) by striking ‘‘Administrator authorized
to be appointed by this Act’’ and inserting
‘‘Secretary’’; and
(B) by striking ‘‘Rural Electrification Ad-
ministration created by this Act’’ and inserting
‘‘Secretary’’;
(5) by striking section 11A (7 U.S.C. 911a);
(6) in section 13 (7 U.S.C. 913), by inserting
before the period at the end the following: ‘‘; and the
term ‘Secretary’ shall be deemed to mean the Sec-
retary of Agriculture’’;
(7) in sections 206(b)(2), 306A(b), 311, and
405(b)(1)(A) (7 U.S.C. 927(b)(2), 936a(b), 940a,
and 945(b)(1)(A)), by striking ‘‘Rural Electrification
Administration’’ each place it appears and inserting
‘‘Secretary’’;
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(8) in sections 305(c)(2)(C)(ii)(II) and 306E(d)
(7 U.S.C. 935(c)(2)(C)(ii)(II) and 936e(d)), by
striking ‘‘ADMINISTRATOR’’ and inserting ‘‘SEC-
RETARY’’;
(9) in section 403(b) (7 U.S.C. 943(b)), by
striking ‘‘Rural Electrification Administration or of
any other agency of the Department of Agriculture,’’
and inserting ‘‘Secretary,’’;
(10) in section 404 (7 U.S.C. 944), by striking
‘‘the Administrator of the Rural Electrification Ad-
ministration’’ and inserting ‘‘the Secretary shall des-
ignate an official of the Department of Agriculture
who’’;
(11) in sections 406(c) and 410 (7 U.S.C.
946(c) and 950), by striking ‘‘Administrator of the
Rural Electrification Administration’’ each place it
appears and inserting ‘‘Secretary’’;
(12) in the heading of section 501 (7 U.S.C.
950aa), by striking ‘‘OF REA ADMINISTRATOR’’;
and
(13) except as otherwise provided in this sub-
section, by striking ‘‘Administrator’’ each place it
appears in such Act and inserting ‘‘Secretary’’.
(b) MISCELLANEOUS AMENDMENTS.—(1) Section
236(a) of the Disaster Relief Act of 1970 (7 U.S.C. 912a)
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(1) acting on the recommendations of the Natu-
ral Resources Conservation Service, with the concur-
rence of the Consolidated Farm Service Agency,
issue regulations to carry out such programs;
(2) ensure that the Natural Resources Con-
servation Service, in establishing policies, priorities,
and guidelines for each such program, does so with
the concurrence of the Consolidated Farm Service
Agency at national, State, and local levels;
(3) ensure that, in reaching such concurrence
at the local level, the Natural Resources Conserva-
tion Service works in cooperation with Soil and
Water Conservation Districts or similar organiza-
tions established under State law;
(4) ensure that officials of county and area
committees established under section 8(b)(5) of the
Soil Conservation and Domestic Allotment Act (16
U.S.C. 590h(b)(5)) meet annually with officials of
such Districts or similar organizations to consider
local conservation priorities and guidelines; and
(5) take steps to ensure that the concurrence
process does not interfere with the effective delivery
of such programs.
(d) 
USE
OF
FEDERAL
AND
NON-FEDERAL
EMPLOYEES.—