Title: Agriculture Risk Coverage Improvement and Innovation Act of 2018
Policy area: Agriculture and Food

Summary:
Agriculture Risk Coverage Improvement and Innovation Act of 2018
This bill reauthorizes and modifies Department of Agriculture commodity programs, including the Agriculture Risk Coverage Program and the Price Loss Coverage Program. The bill modifies payment calculations, coverage levels, and other requirements of the Agriculture Risk Coverage Program.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 2749 Introduced in Senate (IS)]

<DOC>






115th CONGRESS
  2d Session
                                S. 2749

 To provide for the reform and continuation of agricultural commodity 
programs of the Department of Agriculture through fiscal year 2023, and 
                          for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 25, 2018

 Mr. Brown (for himself and Mr. Thune) introduced the following bill; 
  which was read twice and referred to the Committee on Agriculture, 
                        Nutrition, and Forestry

_______________________________________________________________________

                                 A BILL


 
 To provide for the reform and continuation of agricultural commodity 
programs of the Department of Agriculture through fiscal year 2023, and 
                          for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Agriculture Risk Coverage 
Improvement and Innovation Act of 2018''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Actual crop revenue.--The term ``actual crop revenue'', 
        with respect to a covered commodity for a crop year, means the 
        amount determined by the Secretary under section 8(b).
            (2) Agriculture risk coverage.--The term ``agriculture risk 
        coverage'' means coverage provided under section 8.
            (3) Agriculture risk coverage guarantee.--The term 
        ``agriculture risk coverage guarantee'', with respect to a 
        covered commodity for a crop year, means the amount determined 
        by the Secretary under section 8(c).
            (4) Base acres.--The term ``base acres'', with respect to a 
        covered commodity on a farm, means the number of acres in 
        effect under section 1111 of the Agricultural Act of 2014 (7 
        U.S.C. 9011), as in effect on September 30, 2018, subject to 
        any reallocation, adjustment, or reduction under section 3.
            (5) Covered commodity.--The term ``covered commodity'' 
        means wheat, oats, and barley (including wheat, oats, and 
        barley used for haying and grazing), corn, grain sorghum, seed 
        cotton, long grain rice, medium grain rice, pulse crops, 
        soybeans, other oilseeds, and peanuts.
            (6) Effective price.--The term ``effective price'', with 
        respect to a covered commodity for a crop year, means the price 
        calculated by the Secretary under section 7(b) to determine 
        whether price loss coverage payments are required to be 
        provided for that crop year.
            (7) Individual coverage.--The term ``individual coverage'' 
        means agriculture risk coverage selected under section 6(b)(2) 
        to be obtained at the farm level.
            (8) Medium grain rice.--The term ``medium grain rice'' 
        includes short grain rice and temperate japonica rice.
            (9) Other oilseed.--The term ``other oilseed'' means a crop 
        of sunflower seed, rapeseed, canola, safflower, flaxseed, 
        mustard seed, crambe, sesame seed, or any oilseed designated by 
        the Secretary.
            (10) Payment acres.--The term ``payment acres'', with 
        respect to the provision of price loss coverage payments and 
        agriculture risk coverage payments, means the number of acres 
        determined for a farm under section 5.
            (11) Payment yield.--The term ``payment yield'', for a farm 
        for a covered commodity, means, as applicable--
                    (A) the yield used to make payments pursuant to 
                section 1104 or 1304 of the Food, Conservation, and 
                Energy Act of 2008 (7 U.S.C. 8714, 8754), as in effect 
                on September 30, 2018;
                    (B) the yield established under section 4; or
                    (C) with respect to seed cotton, the yield 
                established under section 1113(e) of the Agricultural 
                Act of 2014 (7 U.S.C. 9013(e)), as in effect on 
                September 30, 2018.
            (12) Price loss coverage.--The term ``price loss coverage'' 
        means coverage provided under section 7.
            (13) Producer.--
                    (A) In general.--The term ``producer'' means an 
                owner, operator, landlord, tenant, or sharecropper that 
                shares in the risk of producing a crop and is entitled 
                to share in the crop available for marketing from the 
                farm, or would have shared had the crop been produced.
                    (B) Hybrid seed.--In determining whether a grower 
                of hybrid seed is a producer, the Secretary shall--
                            (i) not take into consideration the 
                        existence of a hybrid seed contract; and
                            (ii) ensure that program requirements do 
                        not adversely affect the ability of the grower 
                        to receive a payment under this Act.
            (14) Pulse crop.--The term ``pulse crop'' means dry peas, 
        lentils, small chickpeas, and large chickpeas.
            (15) Reference price.--The term ``reference price'', with 
        respect to a covered commodity for a crop year, means the 
        lesser of--
                    (A) the national average market price received by 
                producers during the 12-month marketing year for the 
                most recent 10 crop years for the covered commodity; 
                and
                    (B)(i) for wheat, $5.50 per bushel;
                    (ii) for corn, $3.70 per bushel;
                    (iii) for grain sorghum, $3.95 per bushel;
                    (iv) for barley, $4.95 per bushel;
                    (v) for oats, $2.40 per bushel;
                    (vi) for seed cotton, $0.367 per pound;
                    (vii) for long grain rice, $14.00 per 
                hundredweight;
                    (viii) for medium grain rice, $14.00 per 
                hundredweight;
                    (ix) for soybeans, $8.40 per bushel;
                    (x) for other oilseeds, $20.15 per hundredweight;
                    (xi) for peanuts, $535.00 per ton;
                    (xii) for dry peas, $11.00 per hundredweight;
                    (xiii) for lentils, $19.97 per hundredweight;
                    (xiv) for small chickpeas, $19.04 per 
                hundredweight; or
                    (xv) for large chickpeas, $21.54 per hundredweight.
            (16) Secretary.--The term ``Secretary'' means the Secretary 
        of Agriculture.
            (17) State.--The term ``State'' means--
                    (A) a State;
                    (B) the District of Columbia;
                    (C) the Commonwealth of Puerto Rico; and
                    (D) any other territory or possession of the United 
                States.
            (18) Temperate japonica rice.--The term ``temperate 
        japonica rice'' means rice that is grown in high altitudes or 
        temperate regions of high latitudes with cooler climate 
        conditions, in the Western United States, as determined by the 
        Secretary, for the purpose of--
                    (A) the reallocation of base acres under section 3;
                    (B) the establishment of a reference price (as 
                required under section 7(g)) and an effective price 
                pursuant to section 7; and
                    (C) the determination of the actual crop revenue 
                and agriculture risk coverage guarantee pursuant to 
                section 8.
            (19) Transitional yield.--The term ``transitional yield'' 
        has the meaning given the term in section 502(b) of the Federal 
        Crop Insurance Act (7 U.S.C. 1502(b)).
            (20) United states.--The term ``United States'', when used 
        in a geographical sense, means all of the States.

SEC. 3. BASE ACRES.

    (a) Adjustment of Base Acres.--
            (1) In general.--The Secretary shall provide for an 
        adjustment, as appropriate, in the base acres for covered 
        commodities for a farm whenever any of the following 
        circumstances occur:
                    (A) A conservation reserve contract entered into 
                under section 1231 of the Food Security Act of 1985 (16 
                U.S.C. 3831) with respect to the farm expires or is 
                voluntarily terminated.
                    (B) Cropland is released from coverage under a 
                conservation reserve contract by the Secretary.
                    (C) The producer has eligible oilseed acreage as 
                the result of the Secretary designating additional 
                oilseeds, which shall be determined in the same manner 
                as eligible oilseed acreage under section 1101(a)(1)(D) 
                of the Food, Conservation, and Energy Act of 2008 (7 
                U.S.C. 8711(a)(1)(D)).
            (2) Special conservation reserve acreage payment rules.--
        For the crop year in which a base-acres adjustment under 
        subparagraph (A) or (B) of paragraph (1) is first made, the 
        owner of the farm shall elect to receive price loss coverage or 
        agriculture risk coverage with respect to the acreage added to 
        the farm under this subsection or a prorated payment under the 
        conservation reserve contract, but not both.
            (3) Beginning farmers of covered commodities.--
                    (A) Definition of beginning farmer of covered 
                commodities.--In this paragraph, the term ``beginning 
                farmer of covered commodities'' means a beginning 
                farmer (as determined by the Secretary) of one or more 
                covered commodities that has not planted or been 
                prevented from planting a covered commodity on any farm 
                for any crop year before the 2002 crop year.
                    (B) Opportunity to increase base acres.--The 
                Secretary shall provide a 1-time opportunity for a 
                beginning farmer of covered commodities to increase 
                base acres on a farm in accordance with subparagraph 
                (C) if--
                            (i) the beginning farmer of covered 
                        commodities is an operator on the farm and 
                        provides a significant contribution of active 
                        personal labor;
                            (ii) as determined by the Secretary, the 
                        beginning farmer of covered commodities has, or 
                        has an option to obtain, a significant 
                        ownership share of the farm or a business 
                        producing commodities on the farm;
                            (iii) the beginning farmer of covered 
                        commodities has not planted or been prevented 
                        from planting a covered commodity on the farm 
                        for any crop year before the 2007 crop year; 
                        and
                            (iv) the average number of acres planted on 
                        the farm to covered commodities during the 2013 
                        through 2017 crop years is greater than the 
                        number of base acres on the farm.
                    (C) Base increase for beginning farmers of covered 
                commodities.--
                            (i) In general.--Subject to clause (ii), 
                        the number of base acres added to a farm under 
                        subparagraph (B) shall be equal to the 
                        difference between--
                                    (I) the 5-year average of--
                                            (aa) the acreage planted on 
                                        the farm to all covered 
                                        commodities for harvest, 
                                        grazing, haying, silage, or 
                                        other similar purposes for the 
                                        2013 through 2017 crop years, 
                                        according to records submitted 
                                        to the Farm Service Agency; and
                                            (bb) any acreage on the 
                                        farm that the beginning farmer 
                                        of covered commodities was 
                                        prevented from planting during 
                                        the 2013 through 2017 crop 
                                        years to a covered commodity 
                                        because of drought, flood, or 
                                        other natural disaster, or 
                                        other condition beyond the 
                                        control of the beginning farmer 
                                        of covered commodities, 
                                        according to records submitted 
                                        to the Farm Service Agency and 
                                        as determined by the Secretary; 
                                        and
                                    (II) the number of base acres for 
                                covered commodities on the farm.
                            (ii) Limitation.--The Secretary shall 
                        adjust the number of base acres added to a farm 
                        under clause (i) to prevent the cumulative 
                        increase in the number of base acres under this 
                        paragraph from exceeding 5,000,000 base acres 
                        for all beginning farmers of covered 
                        commodities.
                            (iii) Distribution.--Base acres added to a 
                        farm under clause (i) shall be added to the 
                        base acreage of each covered commodity on the 
                        farm in the proportion that--
                                    (I) the acreage planted to the 
                                covered commodity on the farm; bears to
                                    (II) the acreage planted to all 
                                covered commodities on the farm.
                    (D) Reduction of base increase.--If a beginning 
                farmer of covered commodities on a farm for which base 
                acres have been increased under subparagraph (B) no 
                longer owns or operates the farm for any of the 2019 
                through 2023 crop years, the base acres on the farm 
                shall be reduced by the number of base acres added to 
                the farm under that subparagraph in the same proportion 
                among covered commodities on the farm described in 
                subparagraph (C)(iii).
    (b) Prevention of Excess Base Acres.--
            (1) Required reduction.--If the sum of the base acres for a 
        farm and the acreage described in paragraph (2) exceeds the 
        actual cropland acreage of the farm, the Secretary shall reduce 
        the base acres for one or more covered commodities for the farm 
        so that the sum of the base acres and the acreage described in 
        paragraph (2) does not exceed the actual cropland acreage of 
        the farm.
            (2) Other acreage.--For purposes of paragraph (1), the 
        Secretary shall include the following:
                    (A) Any acreage on the farm enrolled in--
                            (i) the conservation reserve program 
                        established under subchapter B of chapter 1 of 
                        subtitle D of title XII of the Food Security 
                        Act of 1985 (16 U.S.C. 3831 et seq.); or
                            (ii) the agricultural conservation easement 
                        program established under subtitle H of title 
                        XII of the Food Security Act of 1985 (16 U.S.C. 
                        3865 et seq.).
                    (B) Any other acreage on the farm enrolled in a 
                Federal conservation program for which payments are 
                made in exchange for not producing an agricultural 
                commodity on the acreage.
                    (C) If the Secretary designates additional 
                oilseeds, any eligible oilseed acreage, which shall be 
                determined in the same manner as eligible oilseed 
                acreage under subsection (a)(1)(C).
            (3) Selection of acres.--The Secretary shall give the owner 
        of the farm the opportunity to select the base acres for a 
        covered commodity for the farm against which the reduction 
        required by paragraph (1) will be made.
            (4) Exception for double-cropped acreage.--In applying 
        paragraph (1), the Secretary shall make an exception in the 
        case of double cropping, as determined by the Secretary.
    (c) Reduction in Base Acres.--
            (1) Reduction at option of owner.--
                    (A) In general.--The owner of a farm may reduce, at 
                any time, the base acres for any covered commodity for 
                the farm.
                    (B) Effect of reduction.--A reduction under 
                subparagraph (A) shall be permanent and made in a 
                manner prescribed by the Secretary.
            (2) Required action by secretary.--
                    (A) In general.--The Secretary shall 
                proportionately reduce base acres on a farm for land 
                that has been subdivided and developed for multiple 
                residential units or other nonfarming uses if the size 
                of the tracts and the density of the subdivision is 
                such that the land is unlikely to return to the 
                previous agricultural use, unless the producers on the 
                farm demonstrate that the land--
                            (i) remains devoted to commercial 
                        agricultural production; or
                            (ii) is likely to be returned to the 
                        previous agricultural use.
                    (B) Requirement.--The Secretary shall establish 
                procedures to identify land described in subparagraph 
                (A).

SEC. 4. PAYMENT YIELDS.

    (a) Establishment and Purpose.--For the purpose of making price 
loss coverage payments under section 7, the Secretary shall provide for 
the establishment of a yield for each farm for any designated oilseed 
for which a payment yield was not established under section 1102 of the 
Food, Conservation, and Energy Act of 2008 (7 U.S.C. 8712) in 
accordance with this section.
    (b) Payment Yields for Designated Oilseeds.--
            (1) Determination of average yield.--In the case of 
        designated oilseeds, the Secretary shall determine the average 
        yield per planted acre for the designated oilseed on a farm for 
        the 1998 through 2001 crop years, excluding any crop year in 
        which the acreage planted to the designated oilseed was zero.
            (2) Adjustment for payment yield.--
                    (A) In general.--The payment yield for a farm for a 
                designated oilseed shall be equal to the product of the 
                following:
                            (i) The average yield for the designated 
                        oilseed determined under paragraph (1).
                            (ii) The ratio resulting from dividing the 
                        national average yield for the designated 
                        oilseed for the 1981 through 1985 crops by the 
                        national average yield for the designated 
                        oilseed for the 1998 through 2001 crops.
                    (B) No national average yield information 
                available.--To the extent that national average yield 
                information for a designated oilseed is not available, 
                the Secretary shall use such information as the 
                Secretary determines to be fair and equitable to 
                establish a national average yield under this section.
            (3) Use of county average yield.--If the yield per planted 
        acre for a crop of a designated oilseed for a farm for any of 
        the 1998 through 2001 crop years was less than 75 percent of 
        the county yield for that designated oilseed, the Secretary 
        shall assign a yield for that crop year equal to 75 percent of 
        the county yield for the purpose of determining the average 
        under paragraph (1).
    (c) Effect of Lack of Payment Yield.--
            (1) Establishment by secretary.--In the case of a covered 
        commodity on a farm for which base acres have been established, 
        if no payment yield is otherwise established for the covered 
        commodity on the farm, the Secretary shall establish an 
        appropriate payment yield for the covered commodity on the farm 
        under paragraph (2).
            (2) Use of similarly situated farms.--
                    (A) In general.--To establish an appropriate 
                payment yield for a covered commodity on a farm as 
                required by paragraph (1), the Secretary shall take 
                into consideration the farm program payment yields 
                applicable to that covered commodity for similarly 
                situated farms.
                    (B) Use of farm program payment yields in appeal.--
                The use of farm program payment yields described in 
                subparagraph (A) in an appeal, by the Secretary or by 
                the producer, shall not be subject to any other 
                provision of law.

SEC. 5. PAYMENT ACRES.

    (a) Determination of Payment Acres.--
            (1) In general.--For the purpose of price loss coverage and 
        agriculture risk coverage when county coverage has been 
        selected under section 6(b)(1), subject to subsection (d), the 
        payment acres for each covered commodity on a farm shall be 
        equal to 85 percent of the base acres for the covered commodity 
        on the farm (not including any base acres excluded under 
        subsection (e)).
            (2) Effect of individual coverage.--In the case of 
        agriculture risk coverage when individual coverage has been 
        selected under section 6(b)(2), but subject to subsection (e), 
        the payment acres for a farm shall be equal to 65 percent of 
        the base acres for all of the covered commodities on the farm.
    (b) Exclusion.--The quantity of payment acres determined under 
subsection (a) may not include any crop subsequently planted during the 
same crop year on the same land for which the first crop is eligible 
for price loss coverage payments or agriculture risk coverage payments, 
unless the crop was approved for double cropping in the county, as 
determined by the Secretary.
    (c) Effect of Minimal Payment Acres.--
            (1) Prohibition on payments.--Notwithstanding any other 
        provision of this Act, a producer on a farm may not receive 
        price loss coverage payments or agriculture risk coverage 
        payments if the sum of the base acres on the farm is 10 acres 
        or less, as determined by the Secretary.
            (2) Exceptions.--Paragraph (1) does not apply to a producer 
        that is--
                    (A) a socially disadvantaged farmer or rancher (as 
                defined in section 355(e) of the Consolidated Farm and 
                Rural Development Act (7 U.S.C. 2003(e))); or
                    (B) a limited resource farmer or rancher, as 
                defined by the Secretary.
    (d) Effect of Planting Fruits and Vegetables.--
            (1) Reduction required.--In the manner provided in this 
        subsection, payment acres on a farm shall be reduced in any 
        crop year in which fruits, vegetables (other than mung beans 
        and pulse crops), or wild rice have been planted on base acres 
        on a farm.
            (2) Quantity of reduction.--
                    (A) Price loss coverage and county coverage.--In 
                the case of price loss coverage payments and 
                agricultural risk coverage payments using county 
                coverage, the reduction under paragraph (1) shall be 
                the amount equal to the base acres planted to crops 
                referred to in that paragraph in excess of 15 percent 
                of base acres.
                    (B) Individual coverage.--In the case of 
                agricultural risk coverage payments using individual 
                coverage, the reduction under paragraph (1) shall be 
                the amount equal to the base acres planted to crops 
                referred to in that paragraph in excess of 35 percent 
                of base acres.
            (3) Reduction exceptions.--No reduction to payment acres 
        shall be made under this subsection if--
                    (A) cover crops or crops referred to in paragraph 
                (1) are grown solely for conservation purposes and not 
                harvested for use or sale, as determined by the 
                Secretary; or
                    (B) in any region in which there is a history of 
                double-cropping covered commodities with crops referred 
                to in paragraph (1) and those crops were so double-
                cropped on the base acres, as determined by the 
                Secretary.
    (e) Exclusion of Unused Acres.--
            (1) In general.--Effective beginning with the 2019 crop 
        year, subject to paragraphs (2) and (3), if the producers on a 
        farm did not plant and were not prevented from planting a 
        covered commodity on base acres during each of the 2009 through 
        2016 crop years, the Secretary shall exclude those base acres 
        from payment acres on the farm.
            (2) Treatment of planting fruits and vegetables and acres 
        enrolled in conservation reserve.--Base acres subject to a 
        reduction under subsection (d) or that were enrolled in the 
        conservation reserve program established under subchapter B of 
        chapter 1 of subtitle D of title XII of the Food Security Act 
        of 1985 (16 U.S.C. 3831 et seq.) for not fewer than 5 crop 
        years of the 2009 through 2016 crop years shall be considered 
        planted to a covered commodity for purposes of paragraph (1).
            (3) Exceptions.--Paragraph (1) shall not apply to--
                    (A) a socially disadvantaged farmer or rancher (as 
                defined in section 355(e) of the Consolidated Farm and 
                Rural Development Act (7 U.S.C. 2003(e))); or
                    (B) a limited resource farmer or rancher, as 
                defined by the Secretary.

SEC. 6. PRODUCER ELECTION.

    (a) Election Required.--For the 2019 through 2023 crop years, all 
of the producers on a farm shall make a 1-time, irrevocable election to 
obtain--
            (1) price loss coverage under section 7 for all covered 
        commodities on the farm; or
            (2) agriculture risk coverage under section 8 for all 
        covered commodities on the farm.
    (b) Coverage Options.--In the election under subsection (a), the 
producers on a farm that elect under paragraph (2) of that subsection 
to obtain agriculture risk coverage under section 8 shall unanimously 
select whether to receive agriculture risk coverage payments based on--
            (1) county coverage applicable on a covered commodity-by-
        covered-commodity basis; or
            (2) individual coverage applicable to all of the covered 
        commodities on the farm.
    (c) Effect of Failure To Make Unanimous Election.--If all the 
producers on a farm fail to make a unanimous election under subsection 
(a) for the 2019 crop year--
            (1) the Secretary shall not make any payments with respect 
        to the farm for the 2019 crop year under section 7 or 8; and
            (2) the producers on the farm shall be deemed to have 
        elected for the 2020 through 2023 crop years the coverage 
        described in paragraph (1) or (2) of subsection (a) in which 
        the majority of base acres on the farm were enrolled during the 
        period of crop years 2014 through 2018.
    (d) Effect of Selection of County Coverage.--If all the producers 
on a farm select county coverage for a covered commodity under 
subsection (b)(1), the Secretary may not make price loss coverage 
payments under section 7 to the producers on the farm with respect to 
that covered commodity.
    (e) Effect of Selection of Individual Coverage.--If all the 
producers on a farm select individual coverage under subsection (b)(2), 
in addition to the selection and election under this section applying 
to each producer on the farm, the Secretary shall consider, for 
purposes of making the calculations required by subsections (b)(2) and 
(c)(3) of section 8, the share of the producer in all farms in the same 
State--
            (1) in which the producer has an interest; and
            (2) for which individual coverage has been selected.
    (f) Prohibition on Reconstitution.--The Secretary shall ensure that 
producers on a farm do not reconstitute the farm to void or change an 
election or selection made under this section.

SEC. 7. PRICE LOSS COVERAGE.

    (a) Price Loss Coverage Payments.--If all of the producers on a 
farm make the election under section 6(a) to obtain price loss 
coverage, or are deemed to have made that election under section 
6(c)(2), the Secretary shall make price loss coverage payments to 
producers on the farm on a covered commodity-by-covered-commodity basis 
if the Secretary determines that, for any of the 2019 through 2023 crop 
years--
            (1) the effective price for the covered commodity for the 
        crop year; is less than
            (2) the reference price for the covered commodity for the 
        crop year.
    (b) Effective Price.--
            (1) In general.--Except as provided in paragraph (2), the 
        effective price for a covered commodity for a crop year shall 
        be the higher of--
                    (A) the national average market price received by 
                producers during the 12-month marketing year for the 
                covered commodity, as determined by the Secretary; or
                    (B) the national average loan rate for a marketing 
                assistance loan for the covered commodity in effect for 
                that crop year under subtitle B of title I of the 
                Agricultural Act of 2014 (7 U.S.C. 9031 et seq.).
            (2) Seed cotton.--
                    (A) In general.--The effective price for seed 
                cotton for a crop year shall be equal to the marketing 
                year average price for seed cotton, as calculated under 
                subparagraph (B).
                    (B) Calculation.--The marketing year average price 
                for seed cotton for a crop year shall be equal to the 
                quotient obtained by dividing--
                            (i) the sum obtained by adding--
                                    (I) the product obtained by 
                                multiplying--
                                            (aa) the upland cotton lint 
                                        marketing year average price; 
                                        and
                                            (bb) the total United 
                                        States upland cotton lint 
                                        production, measured in pounds; 
                                        and
                                    (II) the product obtained by 
                                multiplying--
                                            (aa) the cottonseed 
                                        marketing year average price; 
                                        and
                                            (bb) the total United 
                                        States cottonseed production, 
                                        measured in pounds; by
                            (ii) the sum obtained by adding--
                                    (I) the total United States upland 
                                cotton lint production, measured in 
                                pounds; and
                                    (II) the total United States 
                                cottonseed production, measured in 
                                pounds.
    (c) Payment Rate.--The payment rate shall be equal to the 
difference between--
            (1) the reference price for the covered commodity; and
            (2) the effective price determined under subsection (b) for 
        the covered commodity.
    (d) Payment Amount.--If price loss coverage payments are required 
to be provided under this section for any of the 2019 through 2023 crop 
years for a covered commodity, the amount of the price loss coverage 
payment to be paid to the producers on a farm for the crop year shall 
be equal to the product obtained by multiplying--
            (1) the payment rate for the covered commodity under 
        subsection (c);
            (2) the payment yield for the covered commodity; and
            (3) the payment acres for the covered commodity.
    (e) Time for Payments.--If the Secretary determines under this 
section that price loss coverage payments are required to be provided 
for the covered commodity, the payments shall be made beginning October 
1, or as soon as practicable thereafter, after the end of the 
applicable marketing year for the covered commodity.
    (f) Effective Price for Barley.--In determining the effective price 
for barley under subsection (b), the Secretary shall use the all-barley 
price.
    (g) Reference Price for Temperate Japonica Rice.--The Secretary 
shall provide a reference price with respect to temperate japonica rice 
in an amount equal to 115 percent of the amount established in clauses 
(vii) and (viii) of section 2(14)(B) in order to reflect price 
premiums.

SEC. 8. AGRICULTURE RISK COVERAGE.

    (a) Agriculture Risk Coverage Payments.--If all of the producers on 
a farm make the election under section 6(a) to obtain agriculture risk 
coverage, the Secretary shall make agriculture risk coverage payments 
to producers on the farm if the Secretary determines that, for any of 
the 2019 through 2023 crop years--
            (1) the actual crop revenue determined under subsection (b) 
        for the crop year; is less than
            (2) the agriculture risk coverage guarantee determined 
        under subsection (c) for the crop year.
    (b) Actual Crop Revenue.--
            (1) County coverage.--In the case of county coverage, the 
        amount of the actual crop revenue for a county for a crop year 
        of a covered commodity shall be equal to the product obtained 
        by multiplying--
                    (A) the actual average county yield per planted 
                acre for the covered commodity, as determined by the 
                Secretary (including any adjustments under paragraph 
                (3)); and
                    (B) the higher of--
                            (i) the national average market price 
                        received by producers during the 12-month 
                        marketing year for the covered commodity, as 
                        determined by the Secretary; and
                            (ii) the national average loan rate for a 
                        marketing assistance loan for the covered 
                        commodity in effect for that crop year under 
                        subtitle B of title I of the Agricultural Act 
                        of 2014 (7 U.S.C. 9031 et seq.).
            (2) Individual coverage.--In the case of individual 
        coverage, the amount of the actual crop revenue for a producer 
        on a farm for a crop year shall be based on the share of the 
        producer in all covered commodities planted on all farms for 
        which individual coverage has been selected and in which the 
        producer has an interest, to be determined by the Secretary as 
        follows:
                    (A) For each covered commodity, the product 
                obtained by multiplying--
                            (i) the total production of the covered 
                        commodity on those farms, as determined by the 
                        Secretary; and
                            (ii) the higher of--
                                    (I) the national average market 
                                price received by producers during the 
                                12-month marketing year, as determined 
                                by the Secretary; or
                                    (II) the national average loan rate 
                                for a marketing assistance loan for the 
                                covered commodity in effect for that 
                                crop year under subtitle B of title I 
                                of the Agricultural Act of 2014 (7 
                                U.S.C. 9031 et seq.).
                    (B) The sum of the amounts determined under 
                subparagraph (A) for all covered commodities on those 
                farms.
                    (C) The quotient obtained by dividing the amount 
                determined under subparagraph (B) by the total planted 
                acres of all covered commodities on those farms.
            (3) County yield disparities.--
                    (A) In general.--The Secretary may adjust county 
                yields under paragraph (1)(A) to reduce disparities 
                between neighboring and nearby counties with similar 
                soils and climate that are not attributable to a 
                localized weather event.
                    (B) Aggregate estimated payment.--The Secretary 
                shall ensure that all adjustments made under this 
                paragraph are balanced so the aggregate amount of 
                payments made under this section as a result of the 
                adjustments for a crop year do not increase.
                    (C) Options.--
                            (i) In general.--If the Secretary makes 
                        adjustments under this paragraph, the Secretary 
                        shall make the adjustments in accordance with 
                        clause (ii) or (iii).
                            (ii) Variations within a state.--
                                    (I) In general.--Subject to 
                                subparagraph (B), the Secretary shall 
                                allow State committees of the Farm 
                                Service Agency to review and recommend 
                                adjustments to the initial yield 
                                estimates before the adjustments become 
                                final to reduce unexplained variation 
                                between neighboring or nearby counties 
                                with similar soils and climate.
                                    (II) Review and approval.--The 
                                Secretary shall review and approve or 
                                reject adjustments recommended under 
                                subclause (I) before the adjustments 
                                become final.
                            (iii) Variations along state boundaries.--
                                    (I) In general.--Subject to 
                                subparagraph (B), the Secretary shall 
                                allow State committees of the Farm 
                                Service Agency or the national office 
                                of the Farm Service Agency, in 
                                consultation with affected State 
                                committees, to review and recommend 
                                adjustments to the initial yield 
                                estimates before the adjustments become 
                                final to reduce unexplained variation 
                                between counties in neighboring States.
                                    (II) Review and approval.--The 
                                Secretary shall review and approve or 
                                reject adjustments recommended under 
                                subclause (I) before the adjustments 
                                become final.
            (4) Quality adjustment factor for wheat.--
                    (A) In general.--The Secretary shall adjust county 
                yields for wheat under paragraph (1)(A) to account for 
                weather-related quality factors, such as protein, 
                falling numbers, or vomitoxin, based on--
                            (i) the average quality adjustment discount 
                        factor determined by the Secretary for policies 
                        or plans of insurance under the Federal Crop 
                        Insurance Act (7 U.S.C. 1501 et seq.) for--
                                    (I) the applicable crop year; and
                                    (II) that county or the applicable 
                                region; or
                            (ii) a comparable adjustment, as determined 
                        by the Secretary, if the factor described in 
                        clause (i) is not available.
                    (B) Limitation.--A yield may not be adjusted by 
                greater than 50 percent under subparagraph (A).
                    (C) Use.--The Secretary shall not use a yield 
                adjustment under this paragraph for purposes of 
                subsection (c).
    (c) Agriculture Risk Coverage Guarantee.--
            (1) In general.--The agriculture risk coverage guarantee 
        for a crop year for a covered commodity shall equal 90 percent 
        of the benchmark revenue described in paragraph (2) or (3), as 
        applicable.
            (2) Benchmark revenue for county coverage.--In the case of 
        county coverage, the benchmark revenue referred to in paragraph 
        (1) shall be the product obtained by multiplying--
                    (A) subject to paragraphs (4) and (5), the average 
                historical county yield as determined by the Secretary 
                for the most recent 5 crop years, excluding each of the 
                crop years with the highest and lowest yields; and
                    (B) subject to paragraph (6), the national average 
                market price received by producers during the 12-month 
                marketing year for the most recent 3 crop years.
            (3) Benchmark revenue for individual coverage.--In the case 
        of individual coverage, the benchmark revenue for a producer on 
        a farm for a crop year shall be based on the share of the 
        producer in all covered commodities planted on all farms for 
        which individual coverage has been selected and in which the 
        producer has an interest, to be determined by the Secretary as 
        follows:
                    (A) For each covered commodity for each of the most 
                recent 5 crop years, the product obtained by 
                multiplying--
                            (i) subject to paragraphs (4) and (5), the 
                        yield per planted acre for the covered 
                        commodity on those farms, as determined by the 
                        Secretary; by
                            (ii) subject to paragraph (6), the national 
                        average market price received by producers 
                        during the 12-month marketing year.
                    (B) For each covered commodity, the average of the 
                revenues determined under subparagraph (A) for the most 
                recent 5 crop years, excluding each of the crop years 
                with the highest and lowest revenues.
                    (C) For each of the 2019 through 2023 crop years, 
                the sum of the amounts determined under subparagraph 
                (B) for all covered commodities on those farms, but 
                adjusted to reflect the ratio that--
                            (i) the total number of acres planted on 
                        those farms to a covered commodity; bears to
                            (ii) the total acres of all covered 
                        commodities planted on those farms.
            (4) Yield conditions.--If the yield per planted acre for 
        the covered commodity or historical county yield per planted 
        acre for the covered commodity for any of the 5 most recent 
        crop years, as determined by the Secretary, is less than 80 
        percent of the transitional yield, as determined by the 
        Secretary, the amounts used for any of those years in paragraph 
        (2)(A) or (3)(A)(i), as applicable, shall be 80 percent of the 
        transitional yield.
            (5) Trend-adjusted yield.--
                    (A) In general.--The Secretary shall adjust the 
                yield determined under paragraph (2)(A) or (3)(A)(i), 
                as applicable, using the same Trend-Adjusted Yield 
                factor that is used under the endorsement under the 
                Federal Crop Insurance Act (7 U.S.C. 1501 et seq.) for 
                that crop and county.
                    (B) Not available for crop or county.--If a factor 
                described in subparagraph (A) is not available for a 
                crop or county, the Secretary shall calculate and use a 
                State or national Trend-Adjusted Yield factor for the 
                crop, as determined by the Secretary.
            (6) Floor price.--In the case of county coverage, if the 
        national average market price received by producers during the 
        12-month marketing year for any of the 3 most recent crop years 
        is lower than the national average market price received by 
        producers during the 12-month marketing year for the most 
        recent 10 crop years for the covered commodity, the Secretary 
        shall use the national average market price received by 
        producers during the 12-month marketing year for the most 
        recent 10 crop years for the amount in paragraph (2)(B).
            (7) Reference price.--In the case of individual coverage, 
        if the national average market price received by producers 
        during the 12-month marketing year for any of the 5 most recent 
        crop years is lower than the reference price for the covered 
        commodity, the Secretary shall use the reference price for any 
        of those years for the amount in paragraph (3)(A)(i).
    (d) Payment Rate.--The payment rate for a covered commodity, in the 
case of county coverage, or a farm, in the case of individual coverage, 
shall be equal to the lesser of--
            (1) the amount that--
                    (A) the agriculture risk coverage guarantee for the 
                crop year applicable under subsection (c); exceeds
                    (B) the actual crop revenue for the crop year 
                applicable under subsection (b); and
            (2) 10 percent of the benchmark revenue for the crop year 
        applicable under subsection (c).
    (e) Payment Amount.--If agriculture risk coverage payments are 
required to be paid for any of the 2019 through 2023 crop years, the 
amount of the agriculture risk coverage payment for the crop year shall 
be determined by multiplying--
            (1) the payment rate determined under subsection (d); and
            (2) the payment acres determined under section 5.
    (f) Time for Payments.--If the Secretary determines that 
agriculture risk coverage payments are required to be provided for the 
covered commodity, payments shall be made beginning October 1, or as 
soon as practicable thereafter, after the end of the applicable 
marketing year for the covered commodity.
    (g) Administrative Units.--
            (1) In general.--For purposes of agriculture risk coverage 
        payments in the case of county coverage, a county may be 
        divided into not greater than 3 administrative units in 
        accordance with this subsection.
            (2) Eligible counties.--A county that may be divided into 
        administrative units under this subsection is a county that--
                    (A) is larger than 1,500 square miles; and
                    (B) contains more than 10,000 base acres.
            (3) Elections.--Before making any agriculture risk coverage 
        payments for the 2019 crop year, the Farm Service Agency State 
        committee, in consultation with the Farm Service Agency county 
        or area committee of a county described in paragraph (2), may 
        make a 1-time election to divide the county into administrative 
        units under this subsection.
            (4) Administration.--For purposes of providing agriculture 
        risk coverage payments in the case of county coverage, the 
        Secretary shall consider an administrative unit elected under 
        paragraph (3) to be a county for the 2019 through 2023 crop 
        years.
    (h) Additional Duties of the Secretary.--In providing agriculture 
risk coverage, the Secretary shall--
            (1) to the maximum extent practicable, use all available 
        information and analysis, including data mining, to check for 
        anomalies in the determination of agriculture risk coverage 
        payments;
            (2) to the maximum extent practicable, calculate a separate 
        actual crop revenue and agriculture risk coverage guarantee for 
        irrigated and nonirrigated covered commodities;
            (3) in the case of county coverage, assign an actual or 
        benchmark county yield for each planted acre for the crop year 
        for the covered commodity on the basis of the yield history of 
        representative farms in the State, region, or crop reporting 
        district, as determined by the Secretary, if--
                    (A) the Secretary cannot establish the actual or 
                benchmark county yield for each planted acre for a crop 
                year for a covered commodity in the county in 
                accordance with subsection (b)(1) or (c)(2); or
                    (B) the yield determined under subsection (b)(1) or 
                (c)(2) is an unrepresentative average yield for the 
                county, as determined by the Secretary;
            (4) in the case of individual coverage, assign an average 
        yield for a farm on the basis of the yield history of 
        representative farms in the State, region, or crop reporting 
        district, as determined by the Secretary, if the Secretary 
        determines that the farm has planted acreage in a quantity that 
        is insufficient to calculate a representative average yield for 
        the farm;
            (5) prioritize the use of yields from sources that provide 
        the greatest geographic coverage of county-level data from the 
        same source; and
            (6)(A) use the yield, benchmark revenue and payment rate 
        based on the county of the physical location of the farm; and
            (B) in the case of a farm that crosses county boundaries--
                    (i) split the base acres on a pro rata basis based 
                on the relative quantity of cropland in each county; 
                and
                    (ii) calculate any payments on that same pro rata 
                basis.

SEC. 9. PRODUCER AGREEMENTS.

    (a) Compliance With Certain Requirements.--
            (1) Requirements.--Before the producers on a farm may 
        receive payments under this Act with respect to the farm, the 
        producers shall agree, during the crop year for which the 
        payments are made and in exchange for the payments--
                    (A) to comply with applicable conservation 
                requirements under subtitle B of title XII of the Food 
                Security Act of 1985 (16 U.S.C. 3811 et seq.);
                    (B) to comply with applicable wetland protection 
                requirements under subtitle C of title XII of that Act 
                (16 U.S.C. 3821 et seq.);
                    (C) to effectively control noxious weeds and 
                otherwise maintain the land in accordance with sound 
                agricultural practices, as determined by the Secretary; 
                and
                    (D) to use the land on the farm, in a quantity 
                equal to the attributable base acres for the farm and 
                any base acres for an agricultural or conserving use, 
                and not for a nonagricultural commercial, industrial, 
                or residential use, as determined by the Secretary.
            (2) Compliance.--The Secretary may issue such rules as the 
        Secretary considers necessary to ensure producer compliance 
        with the requirements of paragraph (1).
            (3) Modification.--At the request of the transferee or 
        owner, the Secretary may modify the requirements of this 
        subsection if the modifications are consistent with the 
        objectives of this subsection, as determined by the Secretary.
    (b) Transfer or Change of Interest in Farm.--
            (1) Termination.--
                    (A) In general.--Except as provided in paragraph 
                (2), a transfer of (or change in) the interest of the 
                producers on a farm for which payments under this Act 
                are provided shall result in the termination of the 
                payments, unless the transferee or owner of the acreage 
                agrees to assume all obligations under subsection (a).
                    (B) Effective date.--The termination shall take 
                effect on the date determined by the Secretary.
            (2) Exception.--If a producer entitled to a payment under 
        this Act dies, becomes incompetent, or is otherwise unable to 
        receive the payment, the Secretary shall make the payment in 
        accordance with rules issued by the Secretary.
    (c) Production Reports.--As an additional condition on receiving 
agriculture risk coverage payments for individual coverage, the 
Secretary shall require a producer on a farm to submit to the Secretary 
annual production reports with respect to all covered commodities 
produced on all farms in the same State--
            (1) in which the producer has an interest; and
            (2) for which individual coverage has been selected.
    (d) Effect of Inaccurate Reports.--No penalty with respect to 
benefits under this Act shall be assessed against a producer on a farm 
for an inaccurate acreage or production report unless the Secretary 
determines that the producer on the farm knowingly and willfully 
falsified the acreage or production report.
    (e) Tenants and Sharecroppers.--In carrying out this Act, the 
Secretary shall provide adequate safeguards to protect the interests of 
tenants and sharecroppers.
    (f) Sharing of Payments.--The Secretary shall provide for the 
sharing of payments made under this Act among the producers on a farm 
on a fair and equitable basis.
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