Title: Butcher Block Act
Policy area: Agriculture and Food

Summary:
Butcher Block Act
This bill authorizes the Department of Agriculture to make (or guarantee) loans and award grants for establishing, expanding, and otherwise supporting livestock and meat processing and related activities.

[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4140 Introduced in House (IH)]

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117th CONGRESS
  1st Session
                                H. R. 4140

   To make improvements with respect to the pricing of cattle in the 
                 United States, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 24, 2021

  Mr. Johnson of South Dakota (for himself, Ms. Spanberger, Mr. Mann, 
 Mrs. Hartzler, Mr. Baird, Mr. Cuellar, Mrs. Fischbach, Mr. Feenstra, 
and Mr. Lucas) introduced the following bill; which was referred to the 
                        Committee on Agriculture

_______________________________________________________________________

                                 A BILL


 
   To make improvements with respect to the pricing of cattle in the 
                 United States, 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 ``Butcher Block Act''.

SEC. 2. ASSISTANCE FOR NEW AND EXPANDED LIVESTOCK OR MEAT PROCESSORS.

    (a) In General.--The Secretary of Agriculture (in this section 
referred to as the ``Secretary'') may make or guarantee a loan for the 
purpose of--
            (1) facilitating economic opportunity for livestock and 
        meat producers seeking further processing capacity and 
        diversification of processor ownership to increase 
        competitiveness in the livestock and meat industry;
            (2) increasing value-added opportunities for livestock and 
        meat production through investment in processing capacity;
            (3) improving, developing, or financing livestock and meat 
        processing activity and employment including through the 
        financing of working capital; or
            (4) promoting the interstate trade and local sales of 
        processed meat by financing improvements to meet relevant 
        Federal, State, and local regulatory standards.
    (b) Eligibility; General Limitations.--
            (1) Eligible recipient.--An entity shall be eligible for a 
        loan or guarantee under this section if the entity is--
                    (A) a public, private, or cooperative organization 
                organized on a for-profit or nonprofit basis;
                    (B) an Indian tribe on a Federal or State 
                reservation, or any other federally recognized Indian 
                tribal group; or
                    (C) an individual.
            (2) Facility location.--
                    (A) In general.--Except as provided in subparagraph 
                (B), a facility constructed with proceeds from a loan 
                made or guaranteed under this section shall be in a 
                rural area.
                    (B) Exception.--A facility constructed with 
                proceeds from a loan made or guaranteed under this 
                section may be in a non-rural area if--
                            (i) the primary use of the loan involved is 
                        for the facility, and the facility will provide 
                        value-added processing for agricultural 
                        producers that are located within 300 miles of 
                        the facility;
                            (ii) the applicant demonstrates to the 
                        Secretary that the primary benefit of making 
                        the loan or guarantee will be to provide 
                        employment for residents of a rural area;
                            (iii) the loan involved will be used to 
                        increase the competitiveness of meat, poultry, 
                        or seafood processing in a region; and
                            (iv) the principal amount of the loan 
                        involved does not exceed $50,000,000.
                    (C) Rural area defined.--In this paragraph, the 
                term ``rural area'' has the meaning given the term in 
                section 343(a)(13) of the Consolidated Farm and Rural 
                Development Act (7 U.S.C. 1991(a)(13)).
            (3) Limitations.--
                    (A) Limitation on amount of loan involved.--A loan 
                of more than $50,000,000 may not be made or guaranteed 
                under this section.
                    (B) Limitation on eligibility.--A loan may not be 
                made or guaranteed under this section to an entity that 
                is owned in partnership or in whole by--
                            (i) a foreign entity; or
                            (ii) an entity that currently processes 
                        over 5 percent of the daily harvest of any 
                        species.
    (c) Special Rules Applicable With Respect to Cooperatives.--
            (1) Limitation on amount of loan involved.--
                    (A) In general.--Notwithstanding subsection (b)(3), 
                a loan of not more than $100,000,000 may be made or 
                guaranteed for a cooperative organization under this 
                section.
                    (B) Conditions applicable if loan involved is for 
                more than $50,000,000.--A loan of more than $50,000,000 
                may not be made or guaranteed for a cooperative 
                organization under this section unless the loan is used 
                to carry out a project that--
                            (i) provides for the value-added processing 
                        of agricultural commodities; or
                            (ii) significantly increases 
                        competitiveness or increases capacity where 
                        insufficient capacity exists for livestock 
                        harvest or meat processing, as determined by 
                        the Secretary.
            (2) Intangible assets.--
                    (A) In general.--In determining whether a 
                cooperative organization is eligible for a loan or 
                guarantee under this section, the Secretary may 
                consider the market value of a properly appraised brand 
                name, patent, or trademark of the cooperative.
                    (B) Accounts receivable.--In the sole discretion of 
                the Secretary, if the Secretary determines that the 
                action would not create or otherwise contribute to an 
                unreasonable risk of default or loss to the Federal 
                Government, the Secretary may take accounts receivable 
                as security for the obligations entered into in 
                connection with a loan made or guaranteed under this 
                section, and a borrower may use accounts receivable as 
                collateral to secure such a loan.
            (3) Purchase of cooperative stock.--
                    (A) In general.--The Secretary may make or 
                guarantee a loan in accordance with this section to an 
                individual farmer or rancher for the purpose of 
                purchasing capital stock of a farmer or rancher 
                cooperative established for the purpose of processing 
                an agricultural commodity.
                    (B) Processing contracts during initial period.--A 
                cooperative described in subparagraph (A) with respect 
                to which a farmer or rancher receives a guarantee to 
                purchase stock under subparagraph (A) may contract for 
                services to process agricultural commodities or 
                otherwise process value-added agricultural products, 
                during the 5-year period beginning on the date the 
                cooperative commences operations, in order to provide 
                adequate time for the planning and construction of the 
                processing facility of the cooperative.
                    (C) Financial information.--A farmer or rancher 
                from whom the Secretary requires financial information 
                as a condition of making or guaranteeing a loan under 
                subparagraph (A) shall provide the information in the 
                manner generally required by commercial agricultural 
                lenders in the geographical area in which the farmer or 
                rancher is located.
    (d) Conditions Applicable With Respect to Using Loan Involved for 
Refinancing.--A borrower may use 25 percent of a loan made or 
guaranteed under this section to refinance a loan made for a purpose 
described in subsection (a) if--
            (1) the borrower is current and performing with respect to 
        the loan to be refinanced;
            (2) the borrower has not defaulted on any payment required 
        to be made with respect to the loan to be refinanced;
            (3) none of the collateral for the loan to be refinanced 
        has been converted; and
            (4) there is adequate security or full collateral for the 
        loan to be refinanced.
    (e) Loan Appraisal.--The Secretary may require that any appraisal 
made in connection with a loan made or guaranteed under this section be 
conducted by a specialized appraiser that uses standards that are 
similar to standards used for similar purposes in the private sector, 
as determined by the Secretary.
    (f) Preference.--In making or guaranteeing a loan under this 
section, the Secretary shall give a preference to applicants that have 
experience in meat processing and can quickly scale-up to increase 
overall processing capacity in the region involved.
    (g) Limitations on Authorization of Appropriations.--There is 
authorized to be appropriated to carry out this section $100,000,000 
for each of fiscal years 2022 through 2024.

SEC. 3. NEW AND EXPANDING LIVESTOCK OR MEAT PROCESSING GRANTS.

    (a) In General.--The Secretary of Agriculture may make grants to--
            (1) expand, diversify, and increase competition in 
        livestock or meat processing activities;
            (2) improve compliance with livestock and meat processing 
        statutes (including the regulations issued thereunder), such as 
        the Federal Meat Inspection Act (21 U.S.C. 661) and the Poultry 
        Products Inspection Act (21 U.S.C. 454);
            (3) provide relief from financial barriers to entry into 
        the livestock and meat processing industry; and
            (4) update, expand, or otherwise improve existing 
        facilities.
    (b) Eligible Grantees.--An entity shall be eligible for a grant 
under this section if the entity is--
            (1) a governmental entity;
            (2) a public, private, or cooperative organization 
        organized on a for-profit or nonprofit basis; or
            (3) an Indian tribe on a Federal or State reservation or 
        any other federally recognized Indian tribal group.
    (c) Use of Funds.--An entity to which a grant is made under this 
section may use the grant funds for a livestock or meat producing 
business opportunity, or a new or expanded processing project, that--
            (1) identifies and analyzes business opportunities, 
        including feasibility studies as required for creditworthiness;
            (2) identifies, trains, and provides technical assistance 
        to existing or prospective rural entrepreneurs and managers or 
        processing facilities;
            (3) provides technical assistance to gain compliance with 
        Federal, State, or local regulations;
            (4) conducts regional, community, and local economic 
        development planning and coordination, and leadership 
        development; or
            (5) establishes a center for training, technology, and 
        trade that will provide training to livestock or meat 
        processing employees.
    (d) Preference.--In awarding grants under this section, the 
Secretary shall give a preference to applicants that have experience in 
meat processing and can quickly scale-up to increase overall processing 
capacity in the region involved.
    (e) Limitations on Authorization of Appropriations.--There is 
authorized to be appropriated to carry out this section $20,000,000 for 
each of fiscal years 2022 through 2024.
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